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Gravita India Ltd.

BSE: 533282 Sector: Metals & Mining
NSE: GRAVITA ISIN Code: INE024L01027
BSE LIVE 15:53 | 15 Dec 151.55 1.30
(0.87%)
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NSE 15:55 | 15 Dec 151.60 0.85
(0.56%)
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OPEN 150.05
PREVIOUS CLOSE 150.25
VOLUME 24869
52-Week high 171.90
52-Week low 38.70
P/E 42.33
Mkt Cap.(Rs cr) 1,041
Buy Price 151.55
Buy Qty 1012.00
Sell Price 0.00
Sell Qty 0.00
OPEN 150.05
CLOSE 150.25
VOLUME 24869
52-Week high 171.90
52-Week low 38.70
P/E 42.33
Mkt Cap.(Rs cr) 1,041
Buy Price 151.55
Buy Qty 1012.00
Sell Price 0.00
Sell Qty 0.00

Gravita India Ltd. (GRAVITA) - Director Report

Company director report

To

The Members of

Gravita India Limited

We are delighted to present on behalf of Board of Directors of the Company the 25thAnnual Report of the Company along with Audited Financial Statements (Consolidated &Standalone) for the year ended 31st March 2017.

Consolidated Financial Performance
( H in Lacs)
Particulars 2016-17 2015-16
Total Revenue 65567.94 43119.58
Total Expenditure 60026.40 41516.62
Profit Before Interest Depreciation and Tax (EBIDTA) 5541.54 1602.96
Add: Other Income 94.65 420.48
Less: Interest 857.73 756.86
Less: Depreciation 658.00 670.91
Profit from Ordinary Activities Before Tax 4120.46 595.67
Less: Provisions for Taxation Including Deferred Tax 824.94 47.60
Profit After Tax (PAT) 3295.52 548.07
Share in Profit of Associates (0.81) 0.22
Less: Minority Share in Profit & Loss 264.95 111.26
Profit Available for Appropriation 3029.76 437.03
Appropriation:
Depreciation on transition to Schedule II of the Companies Act 2013 on tangible fixed assets - -
Proposed for Dividend 410.81 136.83
Corporate Tax on Dividend 83.63 32.44
Balance Carried to Balance Sheet 2535.32 267.76

1. Performance at a Glance

India has emerged as the fastest growing major economy in the world as per the CentralStatistics Organisation (CSO) and International Monetary Fund (IMF). The Government ofIndia has forecasted that the Indian economy will grow by 7.1 per cent in F.Y. 2016-17. Asper the Economic Survey 2016-17 the Indian economy should grow between 6.75 and 7.5 percent in F.Y. 2017-18. The improvement in India's economic fundamentals has accelerated inthe year 2016 with the combined impact of strong government reforms Reserve Bank ofIndia's (RBI) inflation focus supported by benign global commodity prices. India'sconsumer confidence index stood at 136 in the fourth quarter of 2016 topping the globallist of countries on the same parameter as a result of strong consumer sentimentaccording to market research agency.

Infrastructure spending Strong Automotive Sales globally coupled with hike in LMEPrices boosted the demand of Lead in F.Y. 2016-17. Infrastructure and automobileindustries are the main demand drivers for Lead in India. During the year the operationalefficiency of the company increased and the year 2016-17 resulted in an exceptional yearwhere the revenues and profitability of the company increased significantly and companyreported a life time high Turnover and Profit. The highlights of the strong performance ofthe company are as under:

Consolidated Results:

Consolidated Total Revenue stood at Rs.655.68 crores

Operating Profit before Interest Depreciation and Tax stood at Rs.55.42 crores infinancial year 2016-17 as compared to Rs.16.03 crores in previous year.

Net Profit after Tax and Minority Interest during the year stood at Rs.30.30 crores.

Earnings Per Share of the Company stood at Rs.4.43 per share having face value of Rs.2each.

Cash Profit during the year stood at Rs.42.07 crores.

Standalone Results:

Total Revenue stood at Rs.533.99 crores as compared to Rs.353.84 crores in the previousyear.

Operating Profit before Interest Depreciation and Tax stood at Rs.38.32 crores infinancial year 2016-17 as compared to Rs.8.86 crores in previous year.

Net Profit after Tax during the year is reported at Rs.22.65 crores as compared to lastyear's PAT of Rs.3.27 crores.

Earnings Per Share of the Company stood at Rs.3.31 per share having face value of Rs.2each.

Cash Profit during the year stood at Rs.28.53 crores.

2. Dividend

The Board of Directors of your Company has recommended payment of final dividend @ 30%(H0.60 per equity share) amounting to Rs.410.81 Lacs. The dividend will be paid to memberswhose names appear in the Register of Members as at the close of business hours ofWednesday 2nd August 2017 and in respect of shares held in dematerialisedform it will be paid to members whose names are furnished by National SecuritiesDepository Limited and Central Depository Services (India) Limited as beneficial ownersas on that date. Further Company has not transferred any amount to General Reserve.

3. Performance of Subsidiaries/ Associate Companies and Firms

a. Gravita Mozambique LDA Mozambique: Gravita Mozambique LDA is a step downsubsidiary of Gravita India Limited and is engaged in the business of Manufacture ofRemelted Lead & PP Chips. During the year under review this subsidiary has produced2844 MT of Re-melted Lead Ingots and achieved a turnover of Rs.41.85 crores againstRs.34.77 crores in last year and reported a Net profit of Rs.5.98 crores during the year.

b. Gravita Senegal SAU Senegal: Gravita Senegal SAU is a step down subsidiaryof Gravita India Limited. The subsidiary is engaged in recycling of Lead Acid batteryScrap for producing Re-melted Lead Ingots PP Chips etc. During the year under review thisplant produced 3576 MT of Re-melted Lead Ingots and achieved a turnover of H 45.31 crorescoupled with Net profit of Rs.4.06 crores.

c. Navam Lanka Ltd Srilanka: Navam Lanka Limited is a step down subsidiary ofGravita India Limited operating in Sri Lanka for more than a decade. It is the largestproducer of Lead Ingots and PP Chips in Sri Lanka. This subsidiary is engaged in Recyclingof Lead Acid Battery Scrap PP Chips & Refining & Alloying of Lead Ingots toproduce 99.97% Pure Lead and

Specific Alloys. During the year under review this subsidiary produced 3006 MT ofRefined Lead Ingots and achieved a Total turnover of Rs.40.34 crores coupled with NetProfit after Tax of Rs.5.52 crores.

d. Gravita Ghana Limited Ghana: Gravita Ghana Limited is a wholly-ownedsubsidiary of the Company. The subsidiary is engaged in recycling of Lead Acid BatteryScrap for producing Remelted Lead Ingots PP Chips etc. During the year under review thisplant produced 1823 MT of Re-melted Lead Ingots and delivered revenue of Rs.40.18 croresand incurred a Net loss of Rs.1.55 crores.

e. Gravita Nicaragua S.A. Nicaragua: Gravita Nicaragua S.A. is a step downsubsidiary of the Company. This subsidiary is engaged in recycling of Pet waste andproduced 2525 MT of Pet. During the year under review subsidiary achieved turnover ofRs.17.49 crores coupled with net loss of Rs.0.31 crores.

f. Gravita USA Inc.: Gravita USA Inc. is a step down subsidiary of the Company.This subsidiary is engaged in trading of Scrap related to Non-ferrous Metals PET etc.During the year under review subsidiary achieved turnover of Rs.0.33 crores coupled withnet loss of Rs.0.83 crores.

g. Gravita Netherlands B.V. Netherlands: Gravita Netherlands B.V. is a stepdown subsidiary of Gravita India Limited. During the year under review this subsidiaryachieved revenue of Rs.3.04 crores and net profit of Rs.2.45 crores.

h. Gravita Global Pte. Ltd Singapore: Gravita Global Pte. Ltd is a wholly ownedsubsidiary of the Company and is based at Singapore which is engaged in the tradingbusiness. During the year under review the Company has been able to achieve a turnover ofRs.0.23 crores resulting in a Net Loss of Rs.0.07 crores.

i. Gravita Ventures Limited Tanzania: Gravita Ventures Limited is a step downsubsidiary of the Company. This subsidiary is engaged in trading of scrap. During the yearunder review subsidiary achieved turnover of Rs.1.87 crores coupled with net loss ofRs.0.42 crores.

j. Gravita Infotech Limited (formerly known as Gravita Exim Limited) India: GravitaInfotech Limited is a wholly-owned subsidiary of the Company. Since inception thissubsidiary was engaged in the business of providing comprehensive turnkey solution forcost effective Battery Recycling Process & plant with environment friendly technologybut from F.Y. 2013-14 the company has ventured in the business of IT Segment for providingfacilities related to IT Software and IT Solutions Web Designing etc. In this currentfinancial year company generated revenue of Rs.0.55 crores resulting in Net Loss ofRs.0.58 crores.

k. M/s Gravita Metal Inc India: Gravita India Limited along with its whollyowned subsidiary Gravita Infotech Limited (formerly known as Gravita Exim Limited) holds100% share in this partnership firm. This firm is engaged in Manufacturing of Pure Leadand all kind of Specific Lead Alloys. During the year under review the unit produced 5121MT of Refined Lead and Alloys achieved a turnover of Rs.74.57 crores coupled with NetProfit of Rs.5.99 crores. This firm enjoys fiscal benefits of J&K region.

l. M/s Gravita Metals India: Gravita India Limited along with its wholly ownedsubsidiary Gravita Infotech Limited (formerly known as Gravita Exim Limited) holds 100%share in this partnership firm. This firm is engaged in manufacturing of Pure Lead and allkind of Lead Alloys like Antimonial Lead Alloy Calcium Selenium Copper Tin ArsenicLead Alloy etc. During the year under review the operations of Gravita Metals remained atvery low level due to some excise duty issues. The firm incurred a net loss of Rs.0.23crores.

m. Gravita Infotech: Gravita India Limited together with its subsidiary holds100% share in this firm. This firm is engaged in business of Information Technology.During the year under review the firm incurred a loss of Rs.0.38 crores.

n. Recycling Infotech LLP: Gravita India Limited together with its subsidiaryholds 100% stake in this LLP. Recycling Infotech LLP is engaged in business related toE-Marketing Database Collection etc The LLP achieved revenue of 1.22 Lacs with net profitof Rs.0.67 Lacs.

o. Other Subsidiaries The Company has some other Subsidiaries/Step Subsidiaries/LLP which are under process of implementation of projects/ commercial production. Thedetails of the same are given below:

Noble Build Estate Private Limited

Gravita Jamaica Limited

Recyclers Ghana Limited

Gravita Mali SA

Gravita Mauritania SARL

Gravita Cameroon Limited

Recyclers Gravita Costa Rica SA

4. Disclosures under Companies Act 2013

a) Extract of Annual Return: The detail forming part of extract of annual returnis enclosed as Annexure-1.

b) Material Subsidiaries: In accordance with SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Company has formulated a policy fordetermining material subsidiaries. The policy has been uploaded on the website of theCompany at http://www.gravitaindia.com/wp-content/uploads/pdf/material-subsidiaries-policy.pdf.

c) Number of Board Meetings: During the year under review the Board of Directorsof the company met 9 (nine) times. The details of the Board Meetings and the attendance ofthe Directors are provided in Corporate Governance Report. The intervening gap between themeetings was within the period prescribed under the Companies Act 2013.

d) Committees of the Board: Details of all the Committees including AuditCommittee of Board of Directors along with their terms of reference composition andmeetings held during the year is provided in the Corporate Governance Report and formsintegral part of this report.

e) Directors' Responsibility Statement

Pursuant to Section 134 of the Companies Act 2013 the Directors hereby confirm that:

(i) In the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed along with proper explanations relating to material departures if any;

(ii) They have selected such Accounting Policies and applied them consistently and madejudgment and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as at 31st March 2017 and of the profitand loss of the company for that period;

(iii) To the best of their knowledge and information they have taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of Companies Act 2013 for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities;

(iv) They have prepared the Annual Accounts on a Going Concern basis;

(v) They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively; and

(vi) There is a proper system to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.

f) Independent Directors: The Company has received declarations from allIndependent Directors of the Company confirming that they meet with the criteria ofindependence as prescribed under Section 149 of the Companies Act 2013 and Regulation 16(1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. TheIndependent Directors have also confirmed that they have complied with the Company's codeof conduct.

g) Vigil Mechanism: The Company is having an established and effective mechanismcalled the Vigil Mechanism. The mechanism under the Whistle Blower Policy of the companyhas been appropriately communicated within the organisation. The purpose of this Policy isto provide a framework to promote responsible whistle blowing by employees. It protectsemployees wishing to raise a concern about serious irregularities unethical behavioractual or suspected fraud within the Company.

h) Familiarisation Programme for Independent Directors: The Company hasFamiliarisation Program for Independent Directors to familiarise them with regard to theirroles rights responsibilities in the Company along with industry business operationsbusiness model code of conduct and policies of the Company etc. The FamiliarisationProgram has been disclosed on the website of the Company. The company's policy onfamiliarisation programme is available on following web link: http://www.gravitaindia.com/wp-content/uploads/pdf/familarization-programme.pdf

i) The Company conducts an introductory familiarisation programme when a newIndependent Director joins the Board of the Company. New Independent Directors areprovided with copy of latest Annual Report the Company's Code of Conduct the Company'sCode of Conduct for Prevention of Insider Trading to let them have an insight of theCompany's present status and their regulatory requirements. The induction comprises adetailed overview of the business verticals of the Company and meetings with businessheads / senior leadership team and with the Managing Director of the Company. The policyon familiarisation programmes for Independent Directors is posted on the website of theCompany and can be accessed on the website of the Company at http://www.gravitaindia.com/wp-content/uploads/pdf/familarization-programme.pdf.

j) Remuneration Policy: The Company follows a policy on remuneration ofDirectors and Senior Management Employees. The policy is approved by the Nomination &Remuneration Committee and the Board. More detail on the same is given in the CorporateGovernance Report which forms part of Annual Report 2016-17.

k) Board Evaluation: Pursuant to the provisions of the Companies Act 2013 andRegulation 17(10) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Board carried out annual evaluation of its own performance performance of itsCommittees and evaluation of individual Directors including Independent Directors. TheIndependent Directors carried out an annual performance evaluation of non-independentDirectors the Board as a Whole and Chairperson of the Company. Nomination &Remuneration Committee of the Board of Director evaluated the performance of everyDirector. The performance is evaluated on the basis of number of Board and Committeemeetings attended by individual Director participation of director in the affairs of thecompany duties performed by each Director targets achieved by company during the year.The Board further discusses the areas where the performance is not up to the desiredlevel.

l) Internal Financial Controls: The Company has in place adequate internalfinancial controls with reference to financial statements. During the year such controlswere tested and no reportable material weakness in the design or operation were observed.

m) Related Party Transactions: All related party transactions that were enteredinto during the financial year were on an arm's length basis and were in the ordinarycourse of business. The company has not entered into any contract arrangement andtransaction with related parties which could be considered material in accordance with thepolicy of the company on Related Party Transactions. Details with respect to transactionswith related parties entered into by the company during the year under review aredisclosed in the accompanying financial results. There are no materially significantrelated party transactions made by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons which may have a potential conflict with theinterest of the Company at large.

Prior omnibus approval of the Audit Committee is obtained for the transactions whichare of a foreseen and repetitive nature. The transactions entered into pursuant to theomnibus approval so granted are audited and a statement giving details of all relatedparty transactions is placed on a quarterly basis. The policy on Related PartyTransactions as approved by the Board is available on the Company's website.

n) Corporate Social Responsibility (CSR): The Corporate Social ResponsibilityCommittee (CSR Committee) has formulated and recommended to the Board a Corporate SocialResponsibility Policy (CSR Policy) indicating the activities to be undertaken by theCompany which has been approved by the Board. The details about Committee composition andterms of reference of Committee are given in Corporate Governance Report and formsintegral part of this report. A CSR Report on activities undertaken by the company andamount spent on them is attached as Annexure-2.

o) Risk Management: The Company has developed a very comprehensive riskmanagement policy under which all key risks and mitigation plans are compiled into a RiskMatrix. The same is reviewed quarterly by senior management and periodically also by theBoard of Directors. The Risk Matrix contains the Company's assessment of impact andprobability of each significant risk and mitigation steps taken or planned. For a detailedrisk management policy please refer the website link http://www.gravitaindia.com/wp-content/uploads/pdf/risk-management-policy.pdf.

p) Material Changes and Commitments Affecting Financial Position of the Companywhich have occurred between the end of the financial year of the company to which thefinancial statements relate and the date of the report: No material changes andcommitments have occurred after the closure of the Financial Year till the date of thisReport which affect the financial position of the Company.

5. Corporate Governance

Corporate Governance is a continuous process at Gravita India Limited. It is aboutcommitment to values and ethical business conduct. Systems policies and frameworks areregularly upgraded to effectively meet the challenges of rapid growth in a dynamicexternal business environment.

Being a Listed Corporate entity our Company is committed to sound corporate practicesbased on conscience openness fairness professionalism and accountability paving the wayin building con dence among all its stakeholders for achieving sustainable long termgrowth and pro tability.

A detailed Corporate Governance Report and a certificate from M/s P. Pincha &Associates Practicing Company Secretaries Jaipur certifying compliance with conditionsof Corporate Governance as required under SEBI (LODR) Regulations 2015 are attached andforms an integral part of this report. Further a certificate of CEO/CFO inter aliaconfirming the correctness of the Financial Statements compliance with Company's Code ofConduct adequacy of the Internal Control measures and reporting of matters to the AuditCommittee is also attached and forms integral part of this report.

6. Statutory Auditor

At the Annual General Meeting of the Company held on 02nd August 2014 M/sDeloitte Haskins & Sells Chartered Accountants were appointed as Statutory Auditorsof the Company to hold office till the conclusion of the 27th Annual GeneralMeeting. In terms of the first proviso to Section 139 of the Companies Act 2013 theappointment of the auditors shall be placed for ratification at every Annual GeneralMeeting. Accordingly based on recommendation of Audit Committee and Board of Directorsthe appointment of M/s Deloitte Haskins & Sells Chartered Accountants as StatutoryAuditors of the Company is placed for ratification by the shareholders. In this regardthe Company has received a certificate from the auditors to the effect that if theirappointment for the current year be rectified by shareholders it would be in accordancewith the provisions of Section 141 of the Companies Act 2013.

Further there are no qualifications or adverse remarks in the Auditors' Report whichrequire any clarification/explanation. The Notes on financial statements areself-explanatory and needs no further explanation.

7. Cost Auditor

The Board of Directors of the Company on recommendation of Audit Committee hasappointed M/s K.G. Goyal & Associates Cost Accountants having firm registration no.000024 as Cost Auditors for conducting the audit of Cost Records maintained by the companyfor the Financial Year 2016-17. The Cost Audit Report for the F.Y. 2015-16 was filed withRegistrar of Companies (Central Government) on 26th September 2016 while thedue date for filing of Cost Audit Report for F.Y. 2015-16 was 30th September2016. There are no qualifications or adverse remarks in the Cost Audit Report whichrequire any clarification/explanation.

8. Particulars of Loans given Investments made Guarantees given and Securitiesprovided [Reference Section 134 and 186(4)]

Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilised by the recipient are provided herein below:

Name of Person / Body Corporate Nature (Loan / Guarantee/ Security / Acquisition) Particulars of Loan given / Investment made or Guarantee made Purpose for which the loan or guarantee or security is proposed to be utilised by the recipient
1. M/s Gravita Metal Inc Corporate Guarantee For securing Credit Limits amounting to Rs.9.00 Crores granted to M/s Gravita Metal Inc. For Business Purposes of the firm

9. Secretarial Auditor and Secretarial Audit Report

The Board has appointed M/s P. Pincha & Associates Company Secretaries inWhole-time Practice to carry out Secretarial Audit of the Company under the provisions ofSection 204 of the Companies Act 2013. The report does not contain any qualificationreservation or adverse remark except on compliance related to Section 135 of CompaniesAct 2013. The Secretarial Audit Report is annexed with this report as Annexure-3.

10. Insider Trading Prevention Code

Pursuant to the SEBI Insider Trading Code the company has formulated a comprehensivepolicy for prohibition of Insider Trading in equity shares of Gravita India Limited topreserve the con dentiality and to prevent misuse of unpublished price sensitiveinformation. The Company Secretary has been designated as the Compliance Officer. It hasalso been posted on the website of the Company www.gravitaindia.com.

11. Energy Conservation

A detailed statement on Particulars of Conservation of Energy Technology Absorptionand Foreign Exchange Earnings and Outgo as required under Section 134 of the CompaniesAct 2013 read with Companies (Accounts) Rules 2014 forms part of this Report asAnnexure-4.

12. Particulars of Employees and related disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the top ten employees and ofemployees drawing remuneration in excess of the limits set out in the said rules areprovided as Annexure-5. Further the disclosures pertaining to remuneration and otherdetails as required under Section 197(12) of the Act read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are provided in theAnnual Report as Annexure-6.

13. Appointment/Resignation of KMP's

During the under review Mr. Nitin Gupta was appointed as a new Company Secretary &Compliance Officer w.e.f. 21st May 2016 in place of Mrs. Leena Jain who hasresigned from the post of Company Secretary & Compliance Officer of the Company w.e.f.20th May2016.

Further Mr. Rajat Agrawal Managing Director shall be liable for retiring by rotationat the ensuing Annual General Meeting and being eligible offer himself for re-appointmentand none of the Director is disqualified under Section 164 of the Companies Act 2013 andrules made thereunder for the reporting period.

14. Consolidated Financial Statements and Cash Flow Statement

The Consolidated Financial Statements of the Company are prepared as required in termsof Accounting Standards (AS-21) issued by Institute of Chartered Accountants of India andforms part of the Annual Report.

15. Subsidiaries and Associates

The Company has prepared Consolidated Financial Statements in accordance with Section129 (3) of the Companies Act 2013 which forms part of the Annual Report. Further thereport on the performance and financial position of each of the subsidiary associate andjoint venture and salient features of the financial statements in the prescribed FormAOC-1 is annexed to this report as Annexure -7.

In accordance with Section 136 of the Companies Act 2013 the Audited FinancialStatements including the Consolidated Financial Statements and related information of theCompany are available on our website www.gravitaindia.com.

16. Disclosures pursuant to Regulation 14 of the SEBI (Share Based Employee Benefits)Regulations 2014 read with SEBI circular dated 16th June 2015 on ESOPdisclosures for the financial year ended 31st March 2017.

Particulars Employee Stock Option Plan 2011
1 Date of shareholders' approval 27th July 2011
2 Total number of options approved under Employee Stock Option Plan 2011 3405000 Stock Options of Rs. 2/- each (681000 Stock Options of Rs. 10/- each)
3 Vesting requirements The Compensation Committee of the Board of Directors of the Company administers and monitors the Employees' Stock Option Scheme of the Company in accordance with the prescribed SEBI Guidelines'. The Options would vest not earlier than one year from the Grant Date in accordance with SEBI Guidelines and not later than such vesting period as may be determined by Compensation Committee.
4 Exercise price or pricing formula The Exercise Price of Options would be determined by the Compensation Committee provided that the Exercise Price shall not be less than the face value of the equity shares of the Company on the date of grant of Options.
5 Maximum term of options granted The Options granted to a Grantee shall be capable of being exercised within a period of not exceeding six years from the date of Grant of the respective Options or such other period as may be determined by the Compensation Committee from time to time.
6 Source of shares (primary secondary or combination) Primary
7 Variation in terms of options Subject to applicable law the Compensation Committee will at its absolute discretion have the right to modify/amend the Employee Stock Option Plan 2011 in such manner and at such time or times as it may deem fit subject however that any such modification/amendment shall not be detrimental to the interest of the Grantees/ Employees and approval wherever required for such modification/ amendment is obtained from the shareholders of the Company in terms of the SEBI Guidelines. During the year no amendment/ modification/ variation has been introduced in terms of options granted by the Company
8 Method used to account for ESOS - Intrinsic or fair value The employee compensation cost has been calculated using the intrinsic value method of accounting for Options issued under the Company's Employee Stock Option Schemes. The employee compensation cost as per the intrinsic value method for the financial year 2016-17 is Rs. 59.18 Lacs.
9 Weighted-average exercise prices and weighted- average fair values of options shall be disclosed separately for options whose exercise price either equals or exceeds or is less than the market price of the stock Weighted-average Exercise price granted during April 2015 to March 2016: Rs. 2/-
Weighted-average Exercise price granted during April 2016 to March 2017: Rs. 2/-
Weighted-average fair value of options outstanding as on 31st March 2016: Rs. 42.63
Weighted-average fair value of options outstanding as on 31st March 2017 : Rs. 34.95

 

Particulars Employee Stock Option Plan 2011
10 Where the company opts for expensing of the options using the intrinsic value of the options the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognised if it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the company shall also be disclosed. Rs. (14.74) Lacs
The effect on the profits and earnings per share had the fair value method been adopted is presented below:
(Rs. In Lacs)
Profit after Tax as reported 2265.26
Add: Intrinsic Value Compensation Cost 59.18
Less: Fair Value Compensation Cost (Binomial Pricing Model) 44.44
Adjusted Profit 2280.00
Earnings Per Share Basic (Rs.) Diluted (Rs.)
As reported 3.31 3.28
As adjusted 3.33 3.30

 

11 A description of the method and significant assumptions used during the year to estimate the fair value of options including the following information: The fair value of options granted under Employee Stock Option Plan 2011 is estimated using the Black Scholes Option Pricing Model after applying the following key assumptions:
a) The weighted-average values of share price exercise price expected volatility expected option life expected dividends the risk-free interest rate and any other inputs to the model; Risk-free interest rate : 6.90%
Expected life (in years): 1.76
Expected volatility: 73.94%
b) The method used and the assumptions made to incorporate the effects of expected early exercise; Expected dividend yield: N.A.
c) How expected volatility was determined including an explanation of the extent to which expected volatility was based on historical volatility; and The expected volatility has been calculated using the daily stock returns on NSE based on expected life options of each vest.
d) Whether and how any other features of the option grant were incorporated into the measurement of fair value such as a market condition The expected life of share option is based on historical data and current expectation and not necessarily indicative of exercise pattern that may occur.
12 Diluted EPS on issue of shares pursuant to all the schemes covered under the regulations shall be disclosed in accordance with ‘Accounting Standard 20 - Earnings Per Share' issued by ICAI or any other relevant accounting standards as prescribed from time to time Rs. 3.28 per share
13 Relevant disclosures in terms of the ‘Guidance note on accounting for employee share-based payments' issued by ICAI or any other relevant accounting standards as prescribed from time to time Option Movement during the year: All relevant disclosures have been made in the financial statements.

 

Sr. No. Particulars 1st Grant (Effective date being 1st October 2011) 2nd Grant (Effective date being 5th July 2012) 3rd Grant (Effective date being 1st July 2013) 4th Grant (Effective date being 1st April 2015)
a) Options granted 400380 31000 368500 500000
b) The pricing formula Rs. 2/- per share Rs. 2/- per share Rs. 2/- per share Rs. 2/- per share
c) Options outstanding at the beginning of the year 940 11000 259675 452500
d) New options issued during the year Nil Nil Nil Nil
e) Options vested during the year 940 11000 42225 45250
f) Options exercised during the year 940 11000 42225 45250
g) The total number of shares arising as a result of exercise of option 940 11000 42225 45250
h) Options lapsed during the year Nil Nil 23200 21600
i) Variation of terms of options Nil Nil Nil Nil
j) Money realised by exercise of options Rs. 1880 Rs. 22000 Rs. 84450 Rs. 90500
k) Total number of options outstanding at the end of the year Nil Nil 194250* 385650**
l) Employee wise details of options granted to Senior Managerial Personnel:
Naveen Prakash Sharma 22500 35000 45000
Sandeep Choudhary 15000 20000 22500
Kishan Gopal Gupta 17500 17500 18000
Sunil Kansal 17500 17500 18000
Kamal Singh 17500 17500 30000
V S Tanwar 25000 20000 20000
Yogesh Malhotra 22500 26000 32500
Sanjay Singh Baid 20000 20000
Vijay Pareek 20000 35000
m) Any other employee who receives a grant in any one year of option amounting to 5% or more of option granted during the year Nil Nil Nil Nil
n) Identified employees who were granted option during any one year equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant Nil Nil Nil Nil
o) The price of the underlying share in market at the time of option grant Rs. 76.95 Rs. 176.20 Rs. 21.45 Rs. 36.30

* This is total number of live options of Third Grant. Further 91250 options have beenexercised till end of F.Y. 2016-17 ** This is total number of live options of FourthGrant. Further 45250 options have been exercised till end of F.Y. 2016-17. Further thedetails as aforesaid is available on the website of the company www.gravitaindia.com

17. Listing of Equity Shares

The equity shares of the Company are listed on the BSE Ltd (BSE) and National StockExchange of India Limited (NSE) and the listing fees for the Financial Year 2017-18 havebeen duly paid.

18. Management Discussion and Analysis Report

Management Discussion and Analysis Report for the year under review as stipulated underSEBI (LODR) Regulations 2015 is presented in a separate section forming part of thisAnnual Report.

19. Deposits

The Company has not accepted any Deposits from public shareholders or employees duringthe reporting period.

20. Share Capital

The Company has made allotment of 99415 Equity Shares of Rs.2/- each to the Employeesof the Company and its subsidiaries upon exercise of an equal number of stock optionsgranted to them pursuant to the Stock Option Scheme of the Company. Consequently theissued subscribed and paid-up equity share capital of the Company has increased from68368099 equity shares of Rs.2/- each as at March 31 2016 to 68467514 equity sharesof Rs.2/- each as at March 31 2017.

21. Policy on Prevention Prohibition and Redressal of Sexual Harassment at Workplace

The Company has adopted a Policy on Prevention Prohibition and Redressal of SexualHarassment at the Workplace in line with the provisions of the "Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013" and the Rulesthere under. Company has formed an "Internal Complaints Committee" forprevention and redressal of sexual harassment at workplace. The

Committee is having requisite members and is chaired by a senior woman member of theorganisation. Further the Company has not received any complaint of sexual harassmentduring the financial year 2016-17.

22. Miscellaneous

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

Details relating to deposits covered under Chapter V of the Act.

Issue of equity shares with differential rights as to dividend voting or otherwise.

Issue of shares (including sweat equity shares) to employees of the Company under anyscheme save and except ESOP's referred to in this Report.

No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.

Details relating to provisions of section 134 (3) (ca)

23. Acknowledgement

The Directors wish to place on record their appreciation for the co-operation andsupport received from the Banks Government Authorities Customers Suppliers BSE NSECDSL NSDL Business Associates Shareholders Auditors Financial Institutions and otherindividuals / bodies for their continued co-operation and support.

The Directors also acknowledge the hard work dedication and commitment of theemployees. Their enthusiasm and unstinting efforts have enabled the Company to emergestronger than ever enabling it to maintain its position as one of the leading players inthe recycling industry in India and around the world.

For and on behalf of the Board
Sd/- Sd/-
(Rajat Agrawal) (Dr. Mahavir Prasad Agarwal)
Date: 24th June 2017 Managing Director Whole-time Director
Place: Jaipur DIN: 00855284 DIN: 00188179

Annexure-4

PARTICULARS OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGOAS REQUIREDUNDER SECTION 134 OF THE COMPANIES ACT 2013 READ WITHCOMPANIES (ACCOUNTS) RULES 2014

I. Conservation of Energy:

a) Steps taken or impact on conservation of energy:

The company has made an design improvement in its existing Battery Crushing and HydroSeparation System due to which 25%-30% of the raw material is directly feeded to refiningsection which was earlier feeded first to smelting section and then to refining section.The new process has helped the company to increase its productivity coupled with reductionin time and energy. Apart from this the company has also upgraded its Pollution ControlEquipment which decreased the effect of hazardous gases and pollutants and helped thecompany to continue its operations in an Eco Friendly Recycling manner.

b) Steps taken by the company for utilising alternate sources of energy:

The Company is making efforts to utilise alternate sources and is looking atalternative of oxyfuel combustion system for its smelting section.

c) Capital Investment on Energy conservation equipments:

The Company has made an investment of approx Rs.2.00 crore in redesigning its BatteryCrushing and Hydro Separating System

II. Technology Absorption

a) Efforts made towards Technology Absorption: During the year under review theCompany has taken technology consultancy from HERAS Chemicals Spain for installing RedLead Plant and made an expenditure of approx 2 crores towards its consultancy design andfabrication.

b) Benefits derived towards improvement in technology of machines and equipment: Theabove Red Lead plant will help the Company in manufacturing more value added products.

c) Technology Imported: Nil

III. Foreign Exchanges Earnings & outgo

( H in Lacs)
Particulars For the year ended March 31 2017 For the year ended March 31 2016
Expenditure in Foreign Currency
Import value on CIF Basis - -
Raw material and consumables 27778.56 13109.72
Capital Goods - -
Finance Costs 198.58 134.26
Others 111.93 58.11
Total 28089.07 13302.09
Earnings in Foreign Currency
Export of Goods calculated on FOB basis 36831.93 21533.41
Interest Income - 13.30
Other Income - -
Total 36831.93 21546.71

Annexure-5

STATEMENT SHOWING THE NAMES AND OTHER PARTICULARS OF THE TOP TEN EMPLOYEES AND OFEMPLOYEES DRAWING REMUNERATION IN ExCESS OF THE LIMITS IN TERMS OF THE PROVISIONS OFSECTION 197(12) OF THE ACT READ WITH RULES 5(2) AND 5(3) OF THE COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014:

Name Mr. Rajat Agrawal
Age 50 Years
Designation Managing Director
Remuneration H960080/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Mechanical)
Experience (in Years) 25 Years
Date of Commencement of Employment 04.08.1992
Particulars of Previous Employment Started career with Gravita only
% of Equity Shares Held 47.73%
Relation with Director Dr. Mahavir Prasad Agarwal (WTD) is Father of Mr. Rajat Agrawal
Name Dr. Mahavir Prasad Agarwal
Age 83 Years
Designation Whole-time Director
Remuneration H640111/- Per Month
Nature of Employment Regular Employment
Qualification M.B.B.S. and M.D. in General Medicine
Experience (in Years) 59 Years
Date of Commencement of Employment 04.08.1992
Particulars of Previous Employment Department of Medical & Health Govt. of Rajasthan
% of Equity Shares Held 0.00%
Relation with Director Mr. Rajat Agrawal (MD) is son of Dr. Mahavir Prasad Agarwal
Name Mr. Naveen Prakash Sharma
Age 48 Years
Designation President & CEO
Remuneration H469253/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Metallurgy) and MBA
Experience (in Years) 25 Years
Date of Commencement of Employment 01.11.2006
Particulars of Previous Employment Assistant General Manager- Sales in Finolex Cables Limited
% of Equity Shares Held 0.03%
Relation with Director None
Name Mr. Vijendra Singh Tanwar
Age 49 Years
Designation Director-NBD
Remuneration Rs. 395158/- Per Month
Nature of Employment Regular Employment
Qualification Graduate
Experience (in Years) 26 Years
Date of Commencement of Employment 20.12.2009
Particulars of Previous Employment Started career with Gravita only
% of Equity Shares Held 0.17%
Relation with Director None
Name Mr. Vijay Pareekh
Age 48 Years
Designation Vice President- Sales & Marketing
Remuneration H 470584/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Metallurgy) and MBA
Experience (in Years) 25 Years
Date of Commencement of Employment 29.09.2012
Particulars of Previous Employment Assistant Vice President –Marketing Aditya Birla Insulators
% of Equity Shares Held 0.01%
Relation with Director None
Name Mr. Yogesh Malhotra
Age 49 Years
Designation Vice President-Operations
Remuneration H 467908/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Mechanical) and MBA
Experience (in Years) 24 Years
Date of Commencement of Employment 15.11.2011
Particulars of Previous Employment General Manager-Projects Euro Chemicals
% of Equity Shares Held 0.05%
Relation with Director None
Name Mr. Sanjay Singh Baid
Age 48 Years
Designation Vice President-Procurement Domestic
Remuneration H 427164/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Metallurgy)
Experience (in Years) 24 Years
Date of Commencement of Employment 05.09.2012
Particulars of Previous Employment Assistant General Manager-JSW Steel Limited
% of Equity Shares Held 0.01%
Relation with Director None
Name Mr. Sandeep Choudhary
Age 48 Years
Designation Vice President-Procurement Import
Remuneration H436295/- Per Month
Nature of Employment Regular Employment
Qualification B.E. (Civil)
Experience (in Years) 24 Years
Date of Commencement of Employment 23.11.2009
Particulars of Previous Employment General Manager Business Development-Omaxe Limited
% of Equity Shares Held 0.02%
Relation with Director None
Name Mr. Sandip Grover
Age 56 Years
Designation SVP & SBU Head New Businesses & HR
Remuneration H415347/- Per Month
Nature of Employment Regular Employment
Qualification B.A. PGDPM and MBA
Experience (in Years) 30 Years
Date of Commencement of Employment 18.07.2016
Particulars of Previous Employment Self Employed
% of Equity Shares Held 0.00%
Relation with Director None
Name Mr. Sunil Kansal
Age 44 Years
Designation Chief Financial Officer
Remuneration H327870/- Per Month
Nature of Employment Regular Employment
Qualification Chartered Accountant and M.Com
Experience (in Years) 23 Years
Date of Commencement of Employment 06.02.2008
Particulars of Previous Employment General Manager-Accounts Jaipur Rugs Company Private Limited
% of Equity Shares Held 0.03%
Relation with Director None

Annexure-6

DISCLOSURES OF REMUNERATION TO DIRECTORS & KMP [PURSUANT TO SECTION 197(12)] i.The Ratio of the remuneration of each Director to the median remuneration of employees ofthe Company for the year ended 31st March 2017 are:-

S. No Name of Director/CFO/ CEO/ Company Secretary Designation Ratio of remuneration to median remuneration of the Employee of the Company Percentage increase in the remuneration for the Financial Year 2016-17
1 Dr. Mahavir Prasad Agarwal Chairman & Whole time Director 42.62:1 23.81%
2 Mr. Rajat Agrawal Managing Director 72.13:1 12.82%
3 Mr. Nitin Gupta Company Secretary N.A. 17.84%
4 Mr. Naveen Prakash Sharma Chief Executive Officer N.A. 43.32%
5 Mr. Sunil Kansal Chief Financial Officer N.A. 52.70%

* Median remuneration of the Employees of the Company assumed to be Rs.1.22 Lacs.

ii. Percentage increase in the median remuneration of employees in the financial year2016-17 is Negligible.

iii. Number of Permanent Employees on the payroll as on 31st March 2017 ofthe Company are 738 (Seven Hundred Thirty Eight only).

iv. Average Percentile increase in the Salaries of the Employees other than ManagerialPersonnel is 10% and increase in salary of Managerial Personnel during last financial yearis disclosed in point no.(i).

v. It is hereby affirmed that the remuneration paid during the year is as per theRemuneration Policy of the Company.

Form AOC-I

(Pursuant to first proviso to sub-Section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014) Statement containing salient features of the financialstatement of Subsidiaries/Associate Companies/Joint Ventures

Part "A" : Subsidiaries

Details in their Respective Local currencies

Details in INR (H in Lakhs)
S. No Name of Subsidiary Reporting period for the subsidiary Reporting currency Exchange rate as on 31.03.2017 Share capital Reserves & surplus Total assets Total Liabilities Investments Turnover Profit before taxation Provision for taxation Profit after taxation Proposed Dividend % of shareholding
1 Gravita Infotech Limited 31st March 2017 INR 1.000 20.00 300.12 473.87 153.75 27.57 54.91 (54.81) 2.89 (57.71) - 100%
2 Gravita Netherlands BV 31st March USD 64.839 14.63 2481.89 3153.54 657.03 1955.78 303.67 244.81 - 244.81 - 100%
2017
3 Gravita Global Pte Ltd 31st March 2017 USD 64.839 728.60 238.38 1380.75 413.76 786.23 23.12 (6.90) 0.09 (6.99) - 100%
4 Gravita Infotech 31st March 2017 INR 1.000 16.73 - 16.77 0.03 - 0.08 (6.78) 31.24 (38.03) - 100%
5 Noble Buildstate Private Limited 31st March 2017 INR 1.000 2.00 (74.94) 216.78 289.72 - - (23.71) - (23.71) - 100%
6 Gravita Ghana Limited 31st March 2017 GHC 15.018 123.66 858.77 1892.06 909.63 - 4017.68 (154.58) - (154.58) - 100%
7 Gravita Senegal SAU 31st December 2016 CFA 0.106 223.93 560.59 1118.12 333.60 - 4530.64 456.83 51.23 405.60 - 100%
8 Gravita Mozambique LDA 31st March 2017 MZN 0.955 128.35 1201.63 1662.10 332.12 - 4184.59 598.43 - 598.43 - 100%
9 Navam Lanka Limited 31st March 2017 LKR 0.427 409.63 581.28 1103.82 112.91 - 4034.13 624.37 72.39 551.98 - 52%
10 Gravita Nicaragua SA 31st March 2017 NIO 2.185 356.14 (166.38) 1234.64 1044.88 - 1792.56 (31.13) - (31.13) - 100%
11 Gravita Metals 31st March 2017 INR 1.000 1232.99 - 1237.29 4.30 - 0.25 (22.60) - (22.60) - 100%
12 Gravita Metal Inc 31st March 2017 INR 1.000 998.65 - 1957.66 959.01 - 7499.01 751.52 152.35 599.17 - 100%
13 Gravita Jamaica Limited 31st March 2017 USD 64.839 0.05 - 417.62 417.57 - - - - - - 100%
14 Gravita USA Inc 31st March 2017 USD 64.839 60.99 (83.31) 73.68 96.01 - 33.38 (83.31) - (83.31) - 100%
15 Recycling Infotech LLP 31st March 2017 INR 1.000 2.00 (1.78) 0.45 0.23 - 1.22 0.95 0.28 0.67 - 100%
16 Gravita Ventures Limted 31st March 2017 USD 64.839 6.27 (42.31) 101.55 137.59 - 186.89 (42.31) - (42.31) - 100%
17 Recyclers Gravita Costa Rica SA 31st March 2017 CRC 0.116 77.11 - 87.61 10.50 - - - - - - 100%
18 Gravita Mali SA 31st March 2017 CFA 0.106 - - 116.33 116.33 - - - - - - 100%
19 Gravita Mauritania SARL 31st March 2017 MRO 0.180 1.87 - 130.95 129.08 - - - - - - 100%
20 Gravita Cameroon Limited 31st March 2017 CFA 0.106 1.08 - 3.39 2.31 - - - - - - 100%
TOTAL 4404.67 5853.93 16378.95 6120.36 2769.57 26662.15 2250.77 310.47 1940.30 -

 

1. Financial Information has been extracted from the standalone audited financial statement for the year ended 31st March 2017 and have been translated at exchange rates prevailing on March 31 2017.
2. Turnover includes other income and other operating revenues
3 The following Subsidiries of the company are yet to commence their operations
a)- Noble Buidestate Private Limited
b)- Gravita Jamaica Limited
c)- Gravita Mali SA
d)- Gravita Cameroon Limited
e)- Gravita Mauritania SARL
f)- Recyclers Gravita Costa Rica SA
Part "B" : Associates
Statement pursuant to Section 129(3) of the Companies Act 2013 related to Associate Companies and Joint Ventures (H in Lakhs)

 

Name of the Associate Latest Balance Sheet Date

Share of Associate held by the company on the year end

Description of how there is significant influence Reason why the associate is not consolidated Net Worth attributable to Sharholding as per latest audited Balance Sheet

Profit / (loss) for the year

No of Shares Held Amount of Investment Extend of Holding Considered in consolidation Not considered in consolidation
1 Pearl Landcon Private Limited 31st March 2017 5000 0.50 25% Equity Holding more than 20 % but less than 50% Not Applicable 14.10 (0.81) (0.99)