To the Members of
GUJARAT FLUOROCHEMICALS LIMITED
Your Directors take pleasure in presenting to you their ThirtiethAnnual Report for the Financial Year ended on 31st March 2017.
1. FINANCIAL RESULTS
Following are the working results for the Financial Year 2016-17:
|Particulars ||Consolidated || ||Standalone || |
| ||Rs. in Lakh || ||Rs. in Lakh || |
| ||2016-17 ||2015-16 ||2016-17 ||2015-16 |
|I Revenue from Operations ||639295 ||711058 ||153206 ||143522 |
|II Other income ||11983 ||10258 ||7112 ||5886 |
|III Total Revenue Income (I+II) ||651278 ||721316 ||160318 ||149408 |
|IV Less : Total Expenses ||586880 ||635146 ||141606 ||135193 |
|V Share of Profit / (loss) of joint ventures ||(175) ||(444) ||- ||- |
|and associates || || || || |
|VI Profit before exceptional items and tax ||64223 ||85726 ||18712 ||14214 |
|(III-IV+V) || || || || |
|VII Exceptional items ||(20082) ||(496) ||528 || |
|VIII Profit before tax (VI+VII) ||44141 ||85230 ||19240 ||14214 |
|IX Total Tax expense ||22690 ||24297 ||4612 ||4674 |
|X Profit/(Loss) for the period (X+XIII) ||21451 ||60933 ||14629 ||9540 |
|XI Other comprehensive income ||(2638) ||(575) ||147 ||(116) |
|XII Total other comprehensive income ||18813 ||60358 ||14776 ||9424 |
|Attributable to || || || || |
|- Owners of the Company ||6215 ||39367 ||- ||- |
|- Non-controlling interests ||12598 ||20991 ||- ||- |
|Opening balance in Retained Earnings ||100652 ||75980 ||(1923) ||3785 |
|Amount available for appropriation ||111758 ||115908 ||12618 ||13333 |
|Dividend-Interim-F.Y.2015-16 ||- ||3845 ||- ||3845 |
|Dividend-Final-F.Y.2015-16 ||- ||- ||- ||- |
|Dividend-Final-F.Y.2014-15 ||- ||3845 ||- ||3845 |
|Tax on Dividend ||- ||1566 ||- ||1566 |
|Transferred to General Reserves ||3000 ||6000 ||3000 ||6000 |
|Transferred to Other Reserves ||(1136) ||- ||- ||- |
|Closing balance in Retained Earnings ||107622 ||100652 ||9618 ||(1923) |
Detailed analysis of the Financial and Operational Performance of theCompany has been given in the Management Discussion and Analysis Report forming part ofthis Annual Report.
2. CONSOLIDATED FINANCIAL STATEMENTS
As per Regulation 33 of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafter referredto as "Listing Regulations") and applicable provisions of the Companies Act2013 read with the Rules issued thereunder the Consolidated Financial Statements of theCompany for the Financial Year 2016-17 have been prepared in compliance with applicableAccounting Standards and on the basis of audited financial statements of the Company itssubsidiaries and associate companies as approved by the respective Board of Directors.
The Consolidated Financial Statements together with the Auditors'Report form part of this Annual Report. The Audited Standalone and Consolidated FinancialStatements for the Financial Year 2016-17 shall be laid before the Annual General Meetingfor approval of the Members of the Company.
Your Directors have proposed Dividend of Rs. 3.50 per share (350%). Thetotal dividend pay-out (including dividend distribution tax on dividend pay-out) for theFinancial Year 2016-17 will be Rs. 4627 lakh.
In accordance with Regulation 43A of the Listing Regulations theCompany has formulated a Dividend Distribution Policy' and details of the samehave been uploaded on the Company's website www.g_.co.in.
4. TRANSFER TO RESERVES
During the year under review the Company has transferred Rs. 3000 lakhto General Reserves.
5. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Your Directors recommend re-appointment of following Directors:
Re-appointment of Shri Deepak Asher (DIN: 00035371) who retires byrotation and being eligible offers himself for re-appointment.
Re-appointment of Shri Vivek Jain (DIN: 00029968) as Managing Directorof the Company for a further period of five years with effect from 01stJanuary 2018 and Shri Anand Bhusari (DIN: 07167198) and Shri Dinesh Kumar Sachdeva (DIN:00050740) as Whole-time Director of the Company for a further period of one year witheffect from 28th April 2017 and 29th November 2017 respectively.
Necessary Resolutions in respect of Directors seeking re-appointmentand their brief resume pursuant to Clause 36 of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 (Listing Regulations)are provided in the Notice of the Annual General Meeting forming part of this AnnualReport.
During the year under review Shri Chandra Prakash Jain (DIN: 00011964)was appointed as Independent Director of the Company with effect from 11thAugust 2016.
During the year there is no change in the Key Managerial Personnel ofthe Company and Shri Vivek Jain Managing Director Shri Manoj Agrawal Chief FinancialOfficer and Shri Bhavin Desai Company Secretary continue as Key Managerial Personnel ofthe Company.
6. NOMINATION AND REMUNERATION POLICY
The Nomination and Remuneration Policy of the Company is annexed tothis report as Annexure A.
7. DECLARATION OF INDEPENDENCE
The Company has received declarations from all the IndependentDirectors confirming that they meet the criteria of independence as prescribed under theprovisions of Section 149 (6) the Companies Act 2013 read with the Schedules and Rulesissued thereunder as well as Regulation 16 of Listing Regulations (including any statutorymodification(s) or re-enactment(s) thereof for the time being in force).
8. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
Details of Familiarisation Programme for Independent Directors is givenin the Corporate Governance Report.
9. PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act 2013 read with theRules issued thereunder Regulation 17 (10) of the Listing Regulations and the circularissued by SEBI dated 5th January 2017 with respect to Guidance Note on BoardEvaluation the evaluation of the annual performance of the Directors/Board/Committees wascarried out for the Financial Year 2016-17.
The details of the evaluation process are set out in the CorporateGovernance Report which forms a part of this report.
10. MEETINGS OF THE BOARD
During the year under review the Board met five times and details ofBoard Meetings held are given in the Corporate Governance Report. The intervening gapbetween the two Meetings was within the time limit prescribed under Section 173 of theCompanies Act 2013 and Regulation 17 of the Listing Regulations.
11. DIRECTOR'S RESPONSIBILITY STATEMENT AS PER SUB-SECTION (5) OFSECTION 134 OF THE COMPANIES ACT 2013
To the best of their knowledge and belief and according to theinformation and explanations obtained by your Directors they make the followingstatements in terms of Section 134(3) (c) of the Companies Act 2013:
i. in the preparation of the annual accounts for the financial year ended 31stMarch 2017 the applicable Accounting Standards and Schedule III of the Companies Act2013 have been followed and there are no material departures from the same;
ii. the Directors had selected such Accounting Policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the Financial Year and ofthe Profit of the Company for that period;
iii. the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv. the Directors had prepared the Annual Accounts on a going concern basis;
v. the Directors had laid down Internal Financial Controls to be followed by theCompany and that such Internal Financial Controls were adequate and were operatingeffectively and
vi. the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
12. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN ANDSECURITIES PROVIDED
Particulars of loans given investments made guarantees given andsecurities provided along with the purpose for which the loan or guarantee or security isproposed to be utilized by the recipient are provided in the Standalone FinancialStatement of the Company. Please refer to Notes no. 20 21 24 46 49 9(a) to (c) and 10to the Standalone Financial Statements of the Company.
13. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Companyduring the year under review with Related Parties are approved by the Audit Committeeand/or Board as per the provisions of Section 188 of the Companies Act 2013 read withthe Rule 15 of the Companies (Meetings of Board and its Powers) Rules 2014 and Regulation23 of the Listing Regulations. During the year under review the Company had not enteredinto any contract / arrangement / transaction with Related Parties which could beconsidered material in accordance with the Policy of the Company on materiality of RelatedParty Transactions.
The Policy on materiality of Related Party Transactions and dealingwith Related Party Transactions as approved by the Board may be accessed on theCompany's website at the link: http://www.g_.co.in/pdf/GFL%20-%20Related%20Party%20Transaction%20Policy.pdf.
All transactions entered with Related Parties for the year under reviewwere on arm's length basis and hence disclosure in form no. AOC -2 is not requiredto be annexed to this report.
The Company has not accepted any deposits covered under Chapter V ofthe Act.
15. SUBSIDIARY COMPANIES INCLUDING JOINT VENTURE AND ASSOCIATECOMPANIES
A separate statement containing the salient features of financialstatements of all Subsidiaries Associates and Joint Ventures of the Company forms a partof consolidated financial statements in compliance with Section 129 and other applicableprovisions if any of the Companies Act 2013. In accordance with Section 136 of theCompanies Act 2013 the financial statements of the subsidiary and associate companiesare available for inspection by the members at the Registered Office of the Company duringbusiness hours on all days except Saturdays Sundays and public holidays upto the date ofthe Annual General Meeting (AGM'). Any member desirous of obtaining a copy ofthe said financial statements may write to the Company Secretary at the Registered Officeof the Company. The financial statements including the consolidated financial statementsfinancial statements of subsidiaries and all other documents required to be attached tothis report have been uploaded on the website of the Company www.g_.co.in. The Company hasformulated a policy for determining material subsidiaries. The policy may be accessed onthe website of the Company www.g_.co.in.
The Report on the performance and financial position of each of theSubsidiaries Associates and Joint Venture Companies of the Company is annexed to thisreport in Form no. AOC-1 pursuant to first proviso to sub-section (3) of Section 129 ofthe Companies Act 2013 and Rule 5 of Companies (Accounts) Rules 2014 is annexed to thisreport as Annexure B.
During the year under review the Company has entered into an agreementfor sale of its stake in its Joint Venture Company Xuancheng Hengyuan Chemical TechnologyCompany Limited (XHCT) China with Heng Wei Holding Limited and hence XHCT has ceased tobe a joint venture company with effect from 07th September 2016. Further InoxRenewables Limited ("IRL") a wholly-owned subsidiary of the Company and InoxRenewables (Jaisalmer) Limited ("IRJL") a wholly-owned subsidiary of IRL haveon 07th March 2017 signed certain agreements with Leap Green Energy PrivateLimited ("Leap Green") and certain subsidiaries of Leap Green to sellsubstantially all of the wind energy-based power projects of IRL and IRJL to thesesubsidiaries of Leap Green in each case on a slump sale basis ("Transaction").This Transaction is expected to complete over the next few months subject to satisfactionof certain conditions precedent including obtaining necessary approvals and consents ofregulatory and governmental authorities as well as project lenders.
16. INTERNAL FINANCIAL CONTROLS
The Company has adequate internal controls commensurate with its sizeand nature of its business. The Board has reviewed internal financial controls of theCompany and the Audit Committee monitors the same in consultation with Internal Auditorsof the Company.
17. INDEPENDENT AUDITORS' REPORT
There are no reservations qualifications or adverse remarks in theIndependent Auditors' Report.
The notes forming part of the accounts are self-explanatory and do notcall for any further clarifications under Section 134 (3) (f) of the Companies Act 2013.
18. INDEPENDENT AUDITORS
Members at their 28th Annual General Meeting held on 29thSeptember 2015 had appointed M/s Patankar & Associates Chartered Accountants Puneas Independent Auditors of the Company from the conclusion of 28thAnnual General Meeting until conclusion of 30th Annual General Meeting.
M/s. Patankar & Associates Chartered Accountants have been theAuditors of the Company since the inception of the Company and their tenure as theAuditors of the Company will expire with the conclusion of this ensuing AGM in accordancewith Section 139 and other applicable provisions if any of the Companies Act 2013 readwith the Companies (Audit and Auditors) Rules 2014 (including any statutorymodification(s) or re-enactment(s) thereof for the time being in force).
The Board of Directors at their Meeting held on 11th August2017 recommended to the Members that M/s. Kulkarni & Associates CharteredAccountants be appointed as Independent Auditors of the Company at the 30thAnnual General Meeting till the conclusion of the 35th Annual General Meetingsubject to ratification of their appointment by the shareholders of the Company at everyAnnual General Meeting held thereafter.
The Company has received written consent(s) and certificate(s) ofeligibility in accordance with Sections 139 141 and other applicable provisions of theCompanies Act 2013 and Rules issued thereunder (including any statutory modification(s)or re-enactment(s) thereof for the time being in force) from M/s. Kulkarni &Associates. Further M/s. Kulkarni & Associates Chartered Accountants have confirmedthat they hold a valid certificate issued by the Peer Review Board of the Institute ofChartered Accountants of India as required under the Listing Regulations.
19. COST AUDITOR
In terms of Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Amendment Rules 2014 the cost audit recordsmaintained by the Company are required to be audited by a Cost Accountant in practice whoshall be appointed by the Board. In view of the above the Company has appointed M/sKailash Sankhlecha and Associates to audit the cost audit records maintained by theCompany for Financial Year 2017-18 on a remuneration of Rs. 300000/-. As required underthe referred Section of the Companies Act 2013 and relevant Rules the remunerationpayable to the Cost Auditor is required to be placed before the Members in a GeneralMeeting for their ratification. Accordingly a resolution seeking Members'ratification for the remuneration payable to M/s Kailash Sankhlecha & Associates CostAuditors is included at Item No. 8 of the Notice convening the Annual General Meeting.
Particulars of Cost Audit Report Submitted by M/s. Kailash Sankhlecha& Associates in respect of Financial Year 2015-16 is as follows.
|Financial Year ||2015-16 |
|Due Date of Filing Cost Audit Report ||9th October 2016 |
|Date of Filing Cost Audit Report ||27th September 2016 |
20. SECRETARIAL AUDIT REPORT
In terms of Section 204 of the Companies Act 2013 read with Rule 9 ofthe Companies (Appointment & Remuneration of Managerial Personnel) Rules 2013 theCompany has appointed M/s Samdani Shah & Kabra a firm of Practising CompanySecretaries to conduct Secretarial Audit of the Company. The Secretarial Audit Reportgiven by M/s Samdani Shah & Kabra in Form no. MR-3 which has no qualifications isannexed to this report as
21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year underreview as stipulated under Regulation 34 (3) of the Listing Regulations read with para Bof Schedule V is presented in a separate Section forming part of this Annual Report.
22. CORPORATE GOVERNANCE REPORT
Pursuant Regulation 34 (3) read with Para C of Schedule V of ListingRegulations the Corporate Governance Report of the Company for the year under review andthe Auditors' Certificate regarding compliance of conditions of Corporate Governanceis annexed to this report.
In compliance with the requirements of Regulation 17 (8) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 a certificate fromthe Managing Director and Chief Financial Officer of the Company who are responsible forthe finance function was placed before the Board.
All the Board Members and Senior Management Personnel of the Companyhad affirmed compliance with the Code of Conduct for Board and Senior ManagementPersonnel. A declaration to this effect duly signed by the Managing Director is enclosedas a part of the Corporate Governance Report.
23. BUSINESS RESPONSIBILITY REPORT
A Business Responsibility Report as per Regulation 34 of the ListingRegulations detailing the various initiatives taken by the Company on the environmentalsocial and governance front forms an integral part of this report. The said report isavailable on the website of the Company www.g_.co.in.
24. EXTRACT OF ANNUAL RETURN
In terms of Section 92 (3) of the Companies Act 2013 read with Rule 12of the Companies (Management & Administration) Rules 2013 the extract of AnnualReturn as provided in Form no. MGT -9 is annexed to this report as Annexure D.
25. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
Information in respect of conservation of energy technologyabsorption foreign exchange earnings and outgo pursuant to Section 134 of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in the mannerprescribed is annexed to this report as Annexure E.
26. PARTICULARS OF EMPLOYEES
In accordance with the provisions of Section 197 (12) of the CompaniesAct 2013 read with Rules 5 (2) and 5 (3) of The Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 a statement showing the name and other particularsof the employees drawing remuneration in excess of the limits set out in the said rule isannexed to this report.
Disclosure pertaining to remuneration and other details as requiredunder Section 197 (12) read with Rule 5 (1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 are annexed to this report as Annexure F.
In terms of Section 136 of the Companies Act 2013 the Report andAccounts are being sent to the Members of the Company excluding information onemployees' particulars which is available for inspection by the Members at theRegistered Office of the Company during the business hours on working days of the Companyup to the date of the ensuing Annual General Meeting. If any Member is interested inobtaining such information may write to the Company Secretary at the Registered Office ofthe Company.
27. CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES
The Corporate Social Responsibility (CSR) Committee of the Companycomprises of Shri Shanti Prasad Jain Independent Director Shri Vivek Jain and ShriDeepak Asher Non Independent Directors of the Company. The CSR Policy of the Company isdisclosed on the website of the Company which can be viewed at http://www.g_.co.in/pdf/CSR_Policy_Final_05112014.pdf. The report on CSR activities as per Companies(Corporate Social Responsibility) Rules 2014 is annexed to this Report as Annexure G.
28. SAFETY HEALTH AND ENVIRONMENT
Safety health and environment have been of prime concern to theCompany and necessary efforts were made in this direction in line with the safety healthand environment policy laid down by the Company. The Company has achieved certification ofISO: 14001:2004 (Environment Management System) ISO 18001:2007 (Occupational Health andSafety Management System) and ISO 9001:2008 (Quality Management System) for itsRanjitnagar and Dahej Unit. Health of employees is being regularly monitored andenvironment has been maintained as per statutory requirements.
The Company's property and assets have been adequately insured.
30. RISK MANAGEMENT
The Company has in place a mechanism to inform the Board about the riskassessment and minimization procedures to review key elements of risks viz Regulatory andLegal Competition and Financial involved and measures taken to ensure that risk iscontrolled by means of a properly defined framework. In the Board's view there areno material risks which may threaten the existence of the Company. For further detailsplease refer to the Management Discussion and Analysis Report annexed to this report.
31. INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has in place an Anti-Sexual Harassment Policy in line withthe requirements of The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013. Your Company has formed an Internal Complaints Committee (ICC)to redress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this Policy.
The following is the summary of sexual harassment complaints receivedand disposed of during the year 2016-17.
|No. of Complaints Received ||Nil |
|No. of Complaints disposed of ||Not Applicable |
32. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIALPOSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THECOMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
There are no material changes and commitments affecting the financialposition of the Company which have occurred between the end of the Financial Year of theCompany to which the Financial Statements relate and the date of this report.
33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTSOR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There are no orders passed by the regulators or courts or tribunalsimpacting the going concern status and the Company's operations in future.
Your Directors express their gratitude to all other external agenciesfor the assistance co-operation and guidance received. Your Directors place on recordtheir deep sense of appreciation for the dedicated services rendered by the workforce ofthe Company.
| ||By Order of the Board of Directors |
|Date : 11th August 2017 ||Devendra Kumar Jain |
|Place : Noida ||Chairman |