Your Directors have the pleasure of presenting the 31st Annual Report andthe Audited Accounts of the Company for the Financial Year ended June 30 2015.
| || ||(Figures in Rs Crores) |
| ||2014-15 ||2013-14 |
|Sales including Excise ||1981 ||1762 |
|Net Sales (less excise duty) ||1971 ||1746 |
|Profit before tax ||246 ||81 |
|Profit after tax ||158 ||51 |
|Proposed Dividend plus tax thereon ||59 ||57 |
|Transfer to General Reserve ||16 ||5 |
|Balance carried forward ||341 ||278 |
The Directors are pleased to recommend a dividend of Rs 15 per Equity Share of Rs 10each for the Financial Year ended June 30 2015.
Your Company delivered another year of robust performance in the Financial Year2014-15. Sales for the Financial Year increased by 13% to Rs 1971 crores driven byCompany's focus on brand fundamentals and strength of product portfolio.
The financial results of the Company include a one-time facilitation income benefit ofabout Rs 63 crores before tax related to the discontinuation of distribution of Duracellbatteries. Profit after Tax (PAT) for the Financial Year stood atRs 158 crores versus Rs51 crores last year behind continued focus on productivity operational excellence andcost optimization. Excluding the one-time Duracell distribution discontinuationfacilitation income PAT for the Financial Year increased to Rs 116 crores versus Rs 51crores last year.
Your Company will look to utilize the improved earnings and cash flow to considerinvestments for sustaining the growth of the Company over the mid to long term.
Your Company's shave care portfolio had a strong year registering double digit growthcombined with high market share growth across blades and razors and personal carecategory. This was driven by strong performance across all product tiers throughirresistible product and commercial innovations.
On Gillette the biggest systems franchise your Companycompleted the first ever global restage with a completely new look design across all threevariants viz. Sensitive and Turbo with a bold new promise of'Closer Shave with Zero Redness Guaranteed'.
Gillette Guard the entry level system specially designed for low-income groupconsumers registered its strongest year on value volume and share growth since itslaunch in 2010 behind strong awareness activation and go-to-market plans.
Our premium line of systems (March and Fusion) again delivereddouble digit growth behind strong razor placement go-to-market and innovative marketingcampaigns - Shave India and cricket activations through the Financial Year.
As an ode to Indian cricket fans your Company launched its 'The Best A Fan Can Get'video saluting all cricket lovers who showcase their passion and relentless supporttowards cricket and cricketers. The video featured brand ambassador Rahul Dravid salutingthe spirit of the Indian cricket fans who have made cricket what it is today. The videowas adjudged as the 'Most watched campaign on You Tube India for Q1 2015'. This wascoupled with the launch of its limited edition India razors with the word 'INDIA' engravedon the handle.
Our female personal care portfolio comprising Gillette Venus Venus Oceana Disposablesalong with Satin Care Gel delivered high double digit growth behind strong awareness andinstore execution and successful digital women empowerment campaigns like 'Use Your And'across You Tube Bloggers and Social Media.
Gillette Double Edge blades continued to register double digit value growth primarilyled by its 7-o' clock and Wilkinson Sword brands.
In the personal care segment comprising of pre-shave and post-shave products the newlylaunched Gillette Shaving Cream demonstrated strong share and volume growth behind strongbase brand building plans thus strengthening our overall share within the Cream Segmentwhile we continued its leadership in the Gel and Foam segment as well.
Thus your Company continued to grow across the portfolio through the Financial Year.
Oral-B manual brushes continue to grow in key mid & premium/super premium tier withdisproportionate growth in super premium tier. Initiatives focused on establishingsuperiority of Pro-Health & Sensitive helped Oral-B grow in the super premium tiersegment. Oral-B has led innovation this year within the sensitive category by launchingthe new sensitive whitening variant helping Oral-B disproportionately grow withinsensitive tier. Oral-B 123 continues to drive the premium tier by providing superiorpropositions to the consumers. Strong plans to drive deeper distribution further helpedstrengthen Oral-B's position in the entry/mid/premium tier segment. Multiple initiativeswere undertaken to expand Oral-B distribution which resulted in the brand being availableto more consumers across India.
Oral-B which is the World's No. 1 dentist recommended toothbrush brand (Based onsurveys of a representative worldwide sample of dentists carried out for P&G)continued its partnership with dentists across India to promote oral health awareness viathe free dental checkup program. The campaign helped in improving the lives of consumersby educating them on oral hygiene and by offering them a free dental checkup close totheir residence simply on the purchase of an Oral-B toothbrush and toothpaste.
Oral B continued to drive toothpaste growth in its learning markets focusing onstrengthening equity and distribution in the premium toothpaste segment.
For the Financial Year 2014-15 Duracell achieved robust sales growth behind continuingto successfully shift consumers using Zinc carbon cells to Duracell which has helpedimprove earnings.
Your Company has been acting as an authorised distributor of 'Duracell' batteriespursuant to an arrangement entered into with Procter & Gamble International OperationsS. A. Pursuant to The Procter & Gamble Company's plan to exit the 'Duracell' businessProcter & Gamble International Operations S. A. decided to terminate the distributorarrangement entered into with the. Company. As a result of the termination the Companywill no longer be acting as the distributor of 'Duracell' batteries effective 29thJanuary 2016.
SHIFTING OF REGISTERED OFFICE OF THE COMPANY
During the Financial Year the registered office of the Company has been shifted fromBhiwadi Rajasthan to Mumbai Maharashtra.
CORPORATE SOCIAL RESPONSIBILITY
The only way to build a sustainable business is to improve lives At P&Gsustainability means making every day better for people through how we innovate and how weact. As one of the world's largest consumer products company we have both aresponsibility and an opportunity to do the right thing and create change. P&G'ssustainability objective is to create long-term value for our consumers and shareholdersby growing our brands and operations responsibly to conserve resources and improve life inthe communities we impact across the world. This strategy has inspired an enduring CSRstrategy supported by two pillars - P&G Shiksha and Timely Disaster Relief. WhileP&G Shiksha provides children from underprivileged backgrounds with an access to aholistic education P&Gs disaster relief activities aim to rehabilitate andempower the victims of natural disasters by providing them with daily essentialcommodities and safe drinking water.
P&G's signature corporate sustainability program P&G Shiksha has till datebuilt and supported over 450 (+120 since last year) schools across the country that willimpact the lives of over 800 000 (+200 000 since last year) children in partnershipwith a number of NGOs like - Round Table India Pratham Education Foundation amongstothers. These partners serve as specialists lending their expertise to particular aspectsof the education system. The NGO Round Table India for example is dedicated towardsconstructing educational infrastructure and supporting schools across India. The Prathamhas special expertise in remedial learning to help bring children up to speed with thelearning levels in their curriculum.
Since its commencement in 2005 P&G Shiksha has also empowered consumers tocontribute towards the education of underprivileged children by making conscious brandchoices which has enabled P&G to share a part of the sales towards this movement.P&G Shiksha has till date made a cumulative donation of overRs 40 crores towardsbuilding new schools providing critical infrastructural amenities at existing schools orreviving non-operational government schools.
In partnership with Pratham we work to improve learning levels of children
P&G continued to impact the communities around its plants in a holistic mannerthroughout the Financial Year. At about 20 km from the Bhiwadi Plant in association withIBTADA a local NGO
P&G Shiksha continues its association with a local school to promote the educationof girl children in Gwalda village. The students are provided holistic support in the formof uniforms library meals infrastructure recreational activities & study tours.
For the second consecutive year the initiative received a prestigious recognition withthe Bhamashah award by the Rajasthan Government for outstanding contribution in promotingeducation and creating a transformational change in the lives of young girl children.
In line with P&G Shiksha's commitment towards improving the quality of educationthis year. P&G also entered into partnership with Pratham Education Foundation one ofthe leading NGOs in India in the educational space to foray into remedial learning therebyincreasing our focus on learning outcomes via improving learning effectiveness. P&GShiksha is partnering with Pratham's Read India initiative that aims to bridge theexisting gap between current and existing learning levels on scale. The methodologycombines reading speaking practical application and writing in a variety of ways toenhance learning.
P&G continued its efforts to provide timely aid and relief to families affected bynatural disasters. P&G sent out relief aid to over 5 000 families affected by theJ&K floods comprising of P&G products.
P&G's conscious commitment towards the pursuit of sustainable development hasempowered us to truly make a substantial impact on the lives of the communities around uswhile simultaneously providing them with superior product propositions. This unequivocalprinciple has fueled our Corporate Social Responsibility strategy aimed at improving livesand also lends inspiration to our efforts on environmental sustainability and economicaccountability. At P&G Corporate Social Responsibility has and will remain animportant component of our ability to improve consumers' lives and to create value for ourShareholders.
Your Company has constituted a Corporate Social Responsibility Committee. Thecomposition and terms of reference of the Corporate Social Responsibility Committee areprovided in the Corporate Governance Report annexed to this report.
Annual report on CSR activities as required under the Companies (Corporate SocialResponsibility Policy) Rules 2014 has been appended as Annexure I to this Report.
ENVIRONMENTAL SUSTAINABILITY AND CONSERVATION OF ENERGY
Environmental sustainability is embedded in our Purpose Values Principles and ourbusiness. In order to improve lives now and for generations to come we ensure that ourproducts packaging and operations are safe for employees consumers and the environment.Your Company ensures this with a focus on technologies processes and improvements thatmatter for the environment.
Your Company's head office at Mumbai reduced its annual energy consumption by over 39.2% over the last 11 years saving over 2214 gigajoules of energy. The Company's Bhiwadiand Baddi plants are zero discharge sites which means that there is no manufacturingdischarge into the environment. During the Financial Year our Bhiwadi plant has reducedenergy consumption by more than 10% per unit of production. Your Company did an innovationproject at Bhiwadi where we replaced our boiler with heat pump technology through whichwe avoided use of diesel to produce hot water through boiler. We now use efficient heatpumps to generate hot water which is helping us to save 120 KL of diesel every year. TheBhiwadi plant investedRs 128 lakhs for the heat pump system andRs 192 lakhs for energysaving equipments such as efficient compressor chiller LED lights etc.
Our Baddi plant took energy conservation steps like LED lights installation which willhelp in 45% electrical energy savings across the plant. The Baddi plant has investedRs 454lakhs in LED lights installation andRs 96 000 in renewable energy certificates.
At P&G sustainability inspires and guides everything we do. Moreover we ensureenvironmental friendly practices at our sites. These include reduction in powerconsumption optimal water consumption and eliminating excess use of paper.
i. Efforts made towards technology absorption;
Continued implementation of quality control/quality assurance procedures of productsand processes were successfully adapted on commercial scale to utilize local raw materialsand machinery; technical services for reliability quality cost savings and technologytransfer from overseas.
ii. Benefits derived like product improvement cost reduction product development orimport substitution;
All the above efforts resulted in improving process efficiencies consistent quality ofour products introduction of new products and import substitution and successfulabsorption of technology.
iii. Imported technology (Imported during the last three years reckoned from thebeginning of the Financial Year):
No technology has been imported during the last three Financial Years.
iv. The Company has not incurred any expenditure incurred on Research and Developmentduring the Financial Year.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars of foreign exchange earned/ utilized during the Financial Year aregiven in Note No. 30 & 31 respectively forming part of the Financial Statements.
RELATED PARTY TRANSACTIONS
Your Company has formulated a policy on related party transactions which is alsoavailable on Company's website at http: //www. pg. com/en_IN/invest/gillette/corporate_governance/ policy. shtml. This policy deals with thereview and approval of related party transactions. All related party transactions areplaced before the Audit Committee for review and approval. Prior omnibus approval isobtained for related party transactions which are of repetitive nature and entered in theordinary course of business and at arm's length. All related party transactions aresubjected to independent review by external chartered accountancy firm to confirmcompliance with the requirements under the Companies Act 2013 and the Listing Agreement.
All related party transactions entered during the Financial Year were in ordinarycourse of the business and on arm's length basis. No material related party transactionswere entered during the Financial Year by your Company. Accordingly the disclosure ofrelated party transactions as required under Section 134(3) (h) of the Companies Act 2013in Form AOC 2 is not applicable to your Company.
LOANS GIVEN DURING THE FINANCIAL YEAR 2014-15
Details of loans given by your Company under Section 186 of the Companies Act 2013during the Financial Year 2014-15 are as follows:
|Name of Borrowing Company ||Relation ||Amount (Rs In Crores) ||Particulars of Loan ||Purpose for which the loans are proposed to be utilized |
|Prior to October 1 2014 || || || || |
|Gillette Diversified Operations Private Ltd. ||Fellow Subsidiary ||57.80 ||Interest rate of 12% ||General business purpose |
|Procter & Gamble Home Products Pvt Ltd ||Fellow Subsidiary ||123.51 ||Interest rate of 12% ||General business purpose |
|Post October 1 2014 || || || || |
|Gillette Diversified Operations Pvt Ltd ||Fellow Subsidiary ||84.00 ||Interest rate of 9. 33% ||General business purpose |
|Procter & Gamble Home Products Pvt Ltd ||Fellow Subsidiary ||30.00 ||Interest rate of 9. 33% ||General business purpose |
|Wella India Haircosmetics Private Ltd ||Fellow Subsidiary || |
|Interest rate of 9. 33% ||General business purpose |
|Gillette Products Private Limited ||Fellow Subsidiary ||17.00 ||Interest rate of 9. 33% ||General business purpose |
Your Company has not accepted any Public Deposits under Chapter V of Companies Act2013 during the Financial Year.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
In line with P&G's Worldwide Business Conduct Manual your Company treats all itsemployees and business partners with dignity and respect. Your Company is committed toprovide a harassment-free environment in which all have an opportunity to contribute attheir highest potential. As a part of our commitment to providing a safe work environmentwe never engage in or tolerate any form of harassment.
As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 ('Act') and Rules made thereunder your Company hasconstituted Internal Complaints Committees (ICC). During the Financial Year no complaintswith allegations of sexual harassment were filed with the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Sections 134 (3) (c) of the Companies Act 2013 withrespect to the Directors' Responsibilities Statement it is hereby confirmed:
i. that in the preparation of the Annual Accounts for the Financial Year ended June 302015 the applicable accounting standards had been followed along with proper explanationrelating to material departures;
ii. that the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of theFinancial Year and of the profit or loss of the Company for the Financial Year underreview;
iii. that the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv. that the Directors had prepared the accounts for the Financial Year ended June 302015 on a "going concern" basis;
v. that the Directors had laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and were operating effectively;and
vi. that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
A separate report on Corporate Governance along with the Auditors' Certificate on itscompliance is annexed to this report.
MANAGEMENT & PERSONNEL
The strong growth over the past few years demonstrates the core strengths of ouremployees to stay reality-based and proactively influence the course of business. In adiverse organization & competitive environment the efforts of our organizationstrong capability plans and HR innovation accelerated our growth. Our productivitycontinues to be best-in-class with major progress in Leadership and Talent Development.
The statement of Disclosure of Remuneration under Section 197 of Companies Act 2013and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is appended as Annexure III to the Report.
The information as per Rule 5 (2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 forms part of this Report. As per the provisions offirst proviso to Section 136 (1) of the Act the Report and Financial Statements are beingsent to the Members of the Company excluding the statement of particulars of employeesunder Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014. Any Member interested in obtaining a copy of the said statement may write tothe Company Secretary at the Registered Office of the Company.
During the Financial Year Mr. Pramod Agarwal ceased to be a Director effective fromMarch 31 2015. Subsequently he was appointed as an Additional Director of the Companywith effect from May 8 2015 and holds office upto the date of the ensuing 31stAnnual General Meeting of the Company. Notices under Section 160 of the Companies Act2013 has been received from him proposing his candidature as Director of the Companyliable to retire by rotation.
Mr. Shantanu Khosla ceased to be the Managing Director and Director of the Companyeffective from June 30 2015. The Board of Directors place on record its appreciation forhis long service and contribution to the Company.
Mr. Al Rajwani was appointed as an Additional Director and Managing Director of theCompany effective August 29 2015 subject to the approval of the Shareholders and theCentral Government if applicable. Notice under Section 160 of the Companies Act 2013 hasbeen received from him proposing his candidature as Managing Director of the Company.
Mr. Narendra P. Sarda has been appointed as an Additional Director and IndependentDirector of the Company for a period of five years with effect from August 29 2015subject to approval of the Shareholders of the Company at the ensuing 31stAnnual General Meeting of the Company. Notices under Section 160 of the Companies Act2013 has been received from him proposing his candidature as Director of the Companyliable to retire by rotation. He has also provided certificate of independence to yourCompany stating that he meets the criteria of independence as mentioned under Section 149(6) of the Companies Act 2013 and clause 49 of the Listing Agreement.
Ms. Sonali Dhawan Director retires by rotation and being eligible offers herselffor re-appointment.
The Independent Directors of your Company have given certificate of independence toyour Company stating that they meet the criteria of independence as mentioned underSection 149 (6) of the Companies Act 2013 and clause 49 of the Listing Agreement.
The details of training and familiarization programmes and Annual Board Evaluationprocess for Directors have been provided under the Corporate Governance Report.
The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of CorporateGovernance Report of this Annual Report.
The brief resumes of Directors proposed to be appointed/reappointed at the ensuing 31stAnnual General Meeting and the details of the Directorships held by them in othercompanies are given in the "Corporate Governance" section of the Annual Report.
Appropriate resolutions for the appointment/ re-appointment of the aforesaid Directorsare being moved at the ensuing 31st Annual General Meeting which the Boardrecommends for your approval.
M/s. Deloitte Haskins & Sells LLP were appointed as Statutory Auditors of yourCompany at the previous 30th Annual General Meeting held on September 29 2014for a term of three consecutive years. As per the provisions of Section 139 of theCompanies Act 2013 the appointment of Auditors is required to be ratified by Members atevery Annual General Meeting. Resolution for the said ratification is being moved at theensuing 31st Annual General Meeting.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation or adverse remark given bythe Auditors in their Report.
The Company was not required to conduct Cost Audit for the Financial Year 2014-15 dueto amendment in Cost Audit Rules.
The Board of Directors has appointed M/s. Ashwin Solanki & Associates CostAccountants as Cost Auditors for the Financial Year 2015-16. -
Secretarial Audit was carried out by M/s. Dholakia & Associates LLP CompanySecretaries for the Financial Year 2014-15. There were no qualifications reservation oradverse remarks given by Secretarial Auditors of the Company. The Secretarial Audit reportis annexed to this report.
EXTRACT OF ANNUAL RETURN
The extract of annual return in Form MGT 9 as required under Section 92(3) and Rule 12of the Companies (Management and Administration) Rules 2014 is appended as an AnnexureII to this Report.
During the Financial Year your Company has adopted policies on related partytransactions corporate social responsibility and vigil mechanism which are available onthe website of the Company at http: //www. pg. com/en_IN/invest/gillette/corporate_governance/policy. shtml
The details of all the policies adopted by the Company are provided in the CorporateGovernance Report annexed to this Report.
The Directors wish to thank the retailers wholesalers distributors suppliers ofgoods & services clearing and forwarding agents and all other business associates andacknowledge their efficiency and continued support in promoting such healthy growth in theCompany's business.
We are grateful to The Procter & Gamble Company USA and its subsidiaries for theirinvaluable support in terms of access to the latest information/knowledge in the field ofresearch & development for products ingredients and technologies; timely inputs toexceptional marketing strategies; and the goodwill of its world-renowned trademarks andsuperior brands. We are proud to acknowledge this unstinted association that has vastlybenefited the Company.
|On behalf of the Board of Directors ||Sd/- |
|Place: Mumbai ||B. S. Mehta |
|Date: August 29 2015 ||Chairman |
Annual Report on Corporate Social Responsibility [Pursuant to Companies (CorporateSocial Responsibility Policy) Rules 2014]
1. Brief outline of the Company's CSR policy
Doing the right thing is the foundation of Procter & Gamble's Purpose Values andPrinciples. It is naturally woven into the way we work every day - paying competitivewages working consistently with our retailers and suppliers preventing conflicts ofinterest ensuring consumer privacy and maintaining financial stewardship. This approachto business is at the heart of all we do at P&G. Doing the right thing also includesinvesting in the communities in which we live work and serve. At its core P&G'sSocial Responsibility efforts aim to improve lives:
Companies Act 2013 ("Act") highlights the importance of Corporate SocialResponsibility ("CSR") as a strategic tool for sustainable growth of the peoplethe communities we operate in and the Company as a whole. In line with the globalprinciples followed by the Procter & Gamble group and the terms of Act the policy onCorporate Social Responsibility is broadly framed taking into account the following:
1. We beiieve it's essential to run our business responsibly and our operatingpractices reflect this commitment.
2. P&G is focused on making every day better for people and the planet through ourinnovations. and our actions;
i) Environment by-conservation of resources using renewable resources generatingworth from waste;
ii) Social by-providing the comforts of home improving health and hygiene of peoplesocial and cultural development imparting education training and social awareness.
The Corporate Social Responsibility activities to be undertaken by the Companyinclude but are not limited to the following:
a. Social and Cultural development by:
Imparting education training (vocational and skill based) and creating socialawareness;
Awareness programs on girl education;
Empowerment of women for education/ health & self-employment;
Empowerment of differentially abled children and their self-development;
Skill development and generation of employment by locally driven initiatives;
Promoting preventive health care and sanitation by providing health and hygieneproducts;
Making available safe drinking water;
Promoting sports and cultural activities;
Creating awareness and development of infrastructure for sports and culturalactivities;
Measures for the benefit of armed forces veterans war widows and theirdependents; and
Relief and support to victims of natural calamities in any part of the Country.
b. Ensuring Environmental Sustainability by:
Conservation of resources by design and manufacture of products that maximizethe conservation of resources;
Utilization of renewable energy and renewable or recycled materials; and
Generating worth from waste;
c. Any other objectives as mentioned under Section 135 of Companies Act 2013 and/orrelevant Rules and Schedules.
The Corporate Social Responsibility Policy is available on the website of the Companyat http: //www. pg. com/en_IN/invest/pghh/ corporate_governance/policies. shtml.
The composition of the CSR Committee:
|Mr. A. K. Gupta ||Chairman |
|Mr. Shantanu Khosla* ||Member |
|Ms. Sonali Dhawan** ||Member |
|Mr. Al Rajwani*** ||Member |
* Mr. S. Khosla resigned as Director and Managing Director of the Company w. e. f. June30 2015 and consequently ceased to be Member of the Corporate Social ResponsibilityCommittee w. e. f. June 30 2015;
** In absence of Mr. A. K. Gupta Ms. S. Dhawan was appointed as the Chairperson of theCSR Committee meeting held on August 29 2015;.
*** Mr. Al Rajwani was inducted as a Member of the Corporate Social ResponsibilityCommittee w. e. f. August 29 2015.
2. Average net profit of the Company for last three Financial Years -Rs 112. 51 Crores
3. Prescribed CSR expenditure (2% of amount as in item 3) -Rs 2. 25 Crores
4. Details of CSR spent during Financial Year:
a) Total amount to be spent for the Financial Year -Rs 2. 26 Crores
b) Amount unspent if any - Not applicable
c) Manner in which the amount spent during the Financial Year as detailed below: -
|Sr.No. ||CSR project or activity identified ||Sector in which the Project is covered ||Projects or programs(a) Local area or other(b) Specify State & district where projects/ programs wereundertaken ||Amount outlay (budget)project or program-wise(Rs in Crores) || |
Amount spent on the projects or programs
|Cumulative expenditure upto the reporting period ||Amount spent:Direct or through implementing agency * |
| || || || || ||Total ||Direct expenditure ||Overheads || || |
|1 ||P&G Shiksha: Pratham's Read India Program ||Education: Remedial Learning ||Maharashtra Rajasthan and Chhattisgarh ||1.00 ||1.00 ||93% ||7% ||1.00 ||Implementing agency: Pratham Education Foundation |
|2 ||P&G Shiksha: Build & Support Schools through Round Table India Trust ||Education: Infrastructure Interventions ||Pan-India ||0.95 ||0.95 ||100% ||Nil ||0.95 ||Implementing agency: Round Table India Trust |
|3 ||P&G Shiksha: Supporting communities around our plants ||Education: Interventions in a Girls School near Bhiwadi Plant ||Bhiwadi (Rajasthan) ||0.31 ||0.31 ||95% ||5% ||0.31 ||Implementing agency: IBTADA |
5. In case the Company has failed to spend 2% of the average net profit of the lastthree Financial Years or any part thereof the Company shall provide the reasons for notspending the amount in its Board Report: Not applicable.
6. The CSR committee confirms that the implementation and monitoring of CSR activitiesis in compliance with CSR objectives and policy of the Company.
|Sd/- ||Sd/- |
|Al Rajwani ||Sonali Dhawan |
|Managing Director ||Chairperson of meeting of the CSR Committee held on August 29 2015 |
Statement of Disclosure of Remuneration under Section 197 of Companies Act 2013 andRule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014
i. Ratio of remuneration of each Director to the median remuneration of the employeesof the Company for the Financial Year;
|Name of Director ||Designation ||Commission (Rs in lakhs) ||Sitting Fees (Rs in lakhs) ||Total (Rs in lakhs) ||Ratio |
|Mr. S. Khosla ||MD ||- ||- ||249.51* ||45.7 |
|Mr. B. S. Mehta ||ID ||11.00 ||2.60 ||13.60 ||2.50 |
|Mr. C. R. Dua ||ID ||11.00 ||2.60 ||13.60 ||2.50 |
|Mr. G. Das ||ID ||11.00 ||2.90 ||13.90 ||2.55 |
|Mr. A. K. Gupta ||ID ||11.00 ||3.80 ||14.80 ||2.71 |
|Mr. P. Agarwal ||NED ||- || ||0 ||0 |
|Ms. S. Dhawan ||NED ||- ||- ||0 ||0 |
* Employee benefits expense under Note 21 to the Financial Statements includes expensesin respect of Managerial personnel ofRs 250 lakhs (Previous Year: t 123 lakhs) crosscharged from Procter & Gamble Hygiene and Health Care Limited in terms of commonservice agreement.
ii. The % increase in remuneration of each director. Chief Financial Officer ChiefExecutive Officer Company Secretary or Manager if any in the Financial Year
|Designation ||Name of Employee ||% increase in remuneration |
|Managing Director ||Mr. Shantanu Khosla ||38. 50% |
|Company Secretary ||Ms. Jessica Rastogi ||25. 00% |
|Chief Financial Officer ||Mr: Karthik Natarajan ||Not Applicable(Not employed with the Company in F. Y. 2013-14) - |
iii. The % increase in the median remuneration of employees in the Financial Year - 25%
iv. The number of permanent employees on the rolls of Company - 654
v. Explanation on the relationship between average increase in remuneration and Companyperformance:
The Company performance in the Financial Year was strong in terms of sales and profitgrowth. Overall compensation trends were consistent with the Company growth. Ourcompensation philosophy for all employees aims to provide opportunities for competitivecompensation. The key principles of compensation at P&G are (i) Pay for Performance
(ii) Pay Competitively and
(iii) Design programs to support business strategies. We set our salaries in line withthe pay practices of the finest global regional and local companies with whom P&Gcompetes for market share and people. We review our salary ranges each year to ensurecompetitiveness. During the Financial Year similar approach was followed to establish thecompensation increases to the employees.
vi. Comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company-
Our fundamental and overriding objective is to create value for our shareholders atleadership levels on a consistent long-term basis. To accomplish this goal the guidelineson executive compensation programs provide the following guiding principles: (i) EmphasizePay for Performance (ii) Pay Competitively (iii) Focus on Long-Term Success. This was dulyreviewed by the Nomination and Remuneration committee of the Company to ensurecompetitiveness. During the Financial Year the Company's Net sales grew by 13% and ProfitBefore Tax grew by 204%. Overall compensation trends are consistent with the Companygrowth.
vii. a) Variations in the market capitalisation of the Company: The marketcapitalisation of the Company as at the closing date of the current Financial Year andprevious Financial Year has increased by 114%.
b) Price Earnings Ratio of the Company was 94 on June 30 2015 and was 135 as at June30 2014.
c) Price earnings ratio as at the closing date of the current Financial Year andprevious Financial Year and percentage increase over decrease in the market quotations ofthe shares of the Company in comparison to the rate at which the Company came out - Theclosing share price of the Company at BSE Limited on June 30 2015 beingRs 4565. 40 perequity share ofRs 10 each has grown 38 times since the last offer for sale by the Companywas made in the year 1992.
viii. Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last Financial Year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration
The average percentage increase made in the salaries of employees other than themanagerial personnel in the Financial Year was 10. 5% whereas the increase in managerialremuneration was 11%. The average increase every year is an outcome of Company's marketcompetitiveness as against peer group companies.
ix. The key parameters for any variable component of remuneration
Variable compensation is paid to all employees above the level of senior manager. Theoverall variable compensation will depend upon individual targets business unit resultsand Company performance.
x. Ratio of the remuneration of the highest paid Director to that of the employees whoare not Directors but receive remuneration in excess of the highest paid Director duringthe Financial Year
xi. I affirm that the remuneration is as per the remuneration policy of the Company.
SECRETARIAL AUDIT REPORT
FORM NO. MR-3 FOR THE FINANCIAL YEAR ENDED 30 JUNE 2015
[Pursuant to section 204(1) of the Companies Act 2013 and Rule No. 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 with modifications asdeemed necessary without changing the substance of format given in MR-3]
Gillette India Limited
P&G Plaza Cardinal Gracias Road Chakala Andheri East Mumbai - 400 099
We have conducted the Secretarial Audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Gillette India Limited (CINL28931MH1984PLC267130) (hereinafter called the "Company"). Secretarial Audit wasconducted in a manner that provided us a reasonable basis for evaluating the corporateconducts/statutory compliances and expressing our opinion thereon.
A. In expressing our opinion it must be noted that -
i. Maintenance of secretarial record is the responsibility of the management of theCompany.
Our responsibility is to express an opinion on these secretarial records based on ouraudit.
ii. We have followed the audit practices and processes as were appropriate to obtainreasonable assurances about the correctness of the contents of the secretarial records.The verification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis of our opinion.
iii. We have not verified the correctness and appropriateness of the financialstatements of the Company.
iv. Wherever required we have discussed with the management of the Company andobtained the management representation pertaining to compliance of laws rules andregulations happening of events etc.
v. The compliance with the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of the management.
Our examination was limited to the verification of procedures on test basis.
vi. The Secretarial Audit report is neither an assurance as to the future viability ofthe Company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the Company.
B. Based on our verification of the Company's books papers minute books forms andreturns filed and other records maintained by the Company and also the informationprovided by the Company its officers. agents and authorized representatives during theconduct of Secretarial Audit we hereby report that in our opinion the Company hasduring the audit period covering the Financial Year ended on 30th June 2015complied with the statutory provisions listed hereunder and also that the Company hasproper Board - process (duly evolved) and compliance - mechanism in place to the extentin the manner and subject to the reporting made hereinafter:
C. We have examined the books papers minute books forms and returns filed and otherrecords maintained by the Company for the Financial Year ended on 30th June2015 according to the provisions of:
I. The Companies Act 2013 (the Act) and the rules made thereunder;
II. The Securities Contracts (Regulation) Act 1956 ('SCRA') and the rules madethereunder;
III. The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;
IV. The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 ('SEBI Act'):
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992; and
(c) The Securities and Exchange Board of India (Registrar to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client.
The Company has not accepted or received or made any additional Foreign DirectInvestment Overseas Direct Investment and External Commercial Borrowings during the auditperiod and hence provisions of Foreign Exchange Management Act 1999 and the rules andregulations made thereunder applicable to such Investment and Borrowings is not applicableto the Company.
The Company has not undertaken any of the activities during the audit period asenvisaged in the following Regulations and Guidelines prescribed under the SEBI Act andhence are not relevant for the purpose of audit: -
(a) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998;
(b) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008;
(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;
(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999/Securities and Exchange Board of India(Share Based Employee Benefits) Regulations 2014 (effective 28th October2014); and
(e) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009.
V. The following Acts and Rules made thereunder pertaining to Company's business areapplicable to the Company:
(a) Drugs and Cosmetics Act 1940;
(b) The Legal Metrology Act 2009; and
(c) The Legal Metrology (Packaged Commodities) Rules 2011.
VI. Compliance with the applicable clauses of the Equity Listing Agreement entered intoby the Company with BSE Limited and National Stock Exchange of India Limited.
During the period under review the Company has complied with the provisions of the ActRules Regulations Guidelines etc. mentioned above.
D. We further report that -
I. The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the period under review werecarried out in compliance with the provisions of the Companies Act 2013.
II. Adequate notice is given to all Directors to schedule the Board Meetings agendaand detailed notes on agenda were sent well in advance and a system exists for seekingand obtaining further information and clarifications on the agenda items before themeeting and for meaningful participation at the meeting.
III. The agenda items are well deliberated before passing the same and theviews/observations made by the Directors are recorded in the minutes.
E. We further report that there are adequate systems and process in the Companycommensurate with its size and operations to monitor and ensure compliance with applicablelaws rules regulations and guidelines.
F. We further report that during the audit period the Members of the Company has passeda Special Resolution by way of Postal Ballot on 16th March 2015 allowing theCompany to shift its Registered Office from the State of Rajasthan to the State ofMaharashtra and consequent change in the Clause II of the Memorandum of Association of theCompany.
G. We further report that during the audit period none of the following events havetaken place:
I. Public/Rights/Preferential Issue of Shares/ Debentures/Sweat equity etc.
II. Redemption /buy-back of securities
III. Major decisions taken by the members in pursuance to Section 180 of the CompaniesAct 2013.
IV. Merger/Amalgamation/Reconstruction etc.
V. Foreign Technical Collaborations.
|For DHOLAKIA & ASSOCIATES LLP ||(Company Secretaries) |
| ||Sd/- |
| ||CS Bhumitra V. Dholakia |
|Place: Mumbai ||Designated Partner |
|Date: 29th August 2015 ||FCS - 977 CP No. 507 |