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Havells India Ltd.

BSE: 517354 Sector: Engineering
NSE: HAVELLS ISIN Code: INE176B01034
BSE LIVE 14:21 | 14 Dec 536.55 1.30
(0.24%)
OPEN

536.00

HIGH

541.40

LOW

529.65

NSE 14:07 | 14 Dec 534.60 -0.55
(-0.10%)
OPEN

537.00

HIGH

540.50

LOW

529.00

OPEN 536.00
PREVIOUS CLOSE 535.25
VOLUME 26211
52-Week high 564.30
52-Week low 310.50
P/E 59.09
Mkt Cap.(Rs cr) 33,540
Buy Price 536.55
Buy Qty 63.00
Sell Price 536.90
Sell Qty 33.00
OPEN 536.00
CLOSE 535.25
VOLUME 26211
52-Week high 564.30
52-Week low 310.50
P/E 59.09
Mkt Cap.(Rs cr) 33,540
Buy Price 536.55
Buy Qty 63.00
Sell Price 536.90
Sell Qty 33.00

Havells India Ltd. (HAVELLS) - Auditors Report

Company auditors report

To the Members of Havells India Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of HavellsIndia Limited ("the Company") which comprise the Balance Sheet as at March31 2017 the Statement of Profit and Loss including the statement of Other ComprehensiveIncome the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified undersection 133 of the Act. read with Rule 7 of the Companies (Accounts) Rules 2014 and theCompanies (Indian Accounting Standards) Rulesfi2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial control that were operatingeffectively for ensuring the accuracy and completeness of the accounting records relevantto the preparation and presentation of the Ind AS financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder. We conductedour audit of the standalone Ind AS financial statements in accordance with the Standardson Auditing issued by the Institute of Chartered Accountants of India as specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone Ind AS financial statements whether due to fraud or error. In making thoserisk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone Ind AS financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone Ind AS financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the standalone Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2017 its profit including other comprehensive income its cash flows andthe changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the Annexure 1 a statement on the matters specified in paragraphs 3and 4 of the Order.

2. As required by section 143 (3) of the Act we report that:

(a) We have sought and obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purpose of our audit;

(b) In our opinion proper books of account as required by law have been kept bythe Company so far as it appears from our examination of those books;

(c) The Balance Sheet Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements complywith the Accounting Standards specified under section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014 Companies (Indian Accounting Standards) Rules 2015as amended;

(e) On the basis of written representations received from the directors as onMarch 31 2017 and taken on record by the Board of Directors none of the directors isdisqualified as on Marchfi31fi2017 from being appointed as a director in terms ofsection 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure 2" to this report;

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rulefi11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements – Refer Note 31 to thestandalone Ind AS financial statements;

ii. The Company has made provision as required under the applicable law oraccounting standards for material foreseeable losses if any on long-term contractsincluding derivative contracts – Refer Note 20 to the standalone Ind AS financialstatements;

iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company;

iv. The Company has provided requisite disclosures in Note 32(18) to thesestandalone IndfiAS financial statements as to the holding of Specified Bank Notes onNovember 8 2016 and December 30 2016 as well as dealings in Specified Bank Notes duringthe period from November 8 2016 to December 30 2016. Based on our audit procedures andrelying on the management representation regarding the holding and nature of cashtransactions including Specified Bank Notes we report that these disclosures are inaccordance with the books of accounts maintained by the Company and as produced to us bythe Management.

For S.R. BATLIBOI & CO LLP For V.R. Bansal & Associates
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 301003E/E300005 ICAI Firm registration number: 016534N
per Manoj Kumar Gupta per V.P. Bansal
Partner Partner
Membership No.: 83906 Membership No.: 08843
Place: Noida
Date : May 11 2017

Annexure-1 referred to in paragraph 1 under the heading "Report on other legal andregulatory requirements" of our report of even date Re: Havells India Limited (theCompany)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) All the fixed assets were physically verified by the management in the previousyear in accordance with a planned programme of verifying them once in two years which inour opinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were identified on such verification.

(b) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipments are held in thename of the Company except for land taken on lease by the Company from its group companyduly approved by board of directors for which lease deed is yet to be registered withappropriate authorities. The Company has constructed building on such land which isappearing in the Company's property plant and equipment having net block of Rs. 14.98crores. Apart from this there are four more immovable properties having aggregate netblock of Rs. 44.12 crores for which title deed is not in the name of the Company for whichthe Company is in the process of getting them registered in its name.

(ii) (a) The inventory has been physically verified by the management during the year.In our opinion the frequency of verification is reasonable. No material discrepancieswere noticed on such physical verification. Inventories lying with third parties have beenconfirmed by them as at March 31 2017 and no material discrepancies were noticed inrespect of such confirmations.

(iii) (a) According to the information and explanations given to us the Company hasnot granted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Accordingly the provisions of clause 3(iii) (a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the Company.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of electrical goodsand are of the opinion that prima facie the specified accounts and records have been madeand maintained. We have not however made a detailed examination of the same.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income-taxsales-tax service tax duty of custom duty of excise value added tax cess and otherstatutory dues applicable to it.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax service taxsales-tax duty of custom duty of excise value added tax cess and other statutory dueswere outstanding at the year end for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues of income-tax sales-taxservice tax duty of custom duty of excise value added tax and cess which have not beendeposited on account of any dispute are as follows.

Name of the Statute Nature of the Dues Amount (Rs. in crores) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Disallowances and additions to taxable income. 15.85 AY 2004-05 to AY 2012-13 Income Tax Appellate Tribunal New Delhi
Income Tax Act 1961 Disallowances and additions to taxable income. 18.52 AY 2010-11 to AY 2013-14 Commissioner of Income Tax (Appeal) New Delhi
Central Excise Act 1944 Excise duty demand/ disallowance of Cenvat credit on various items. 2.69 FY 2003-04 to 2011-12 CESTAT (New Delhi Chandigarh and Ahmedabad)
Central Excise Act 1944 Excise duty demand/ disallowance of Cenvat credit on various items. 0.38 FY 2012-13 to FY 2014-15 The Commissioner (Appeals) Delhi- II LTU Gurgaon (Excise & Customs)
Sales Tax/ VAT Sales tax / VAT demand on various matters. 8.91 FY 2001-02 & FY 2010-11 to 2014- 15 Joint Commissioner (Appeals)
Sales Tax/ VAT Sales tax / VAT demand on various matters. 0.92 FY 2012-13 Additional Commissioner (Appeals)
Sales Tax/ VAT Sales tax / VAT demand on various matters. 0.03 2007-08 Commissioner (Appeals)
Sales Tax/ VAT Sales tax / VAT demand on various matters. 2.42 FY 2007-08 to FY 2011-12 Tribunal (Commercial Tax Department)
Sales Tax/ VAT Sales tax / VAT demand on various matters 0.32 FY 2007-08 to FY 2011-12 Deputy Commissioner (Appeals)
Odisha Entry Tax Act 1999 Demand of entry tax in the state of Orissa on purchase of few items 6.80 Oct 2009 to March 2017 High court of Odisha
The West Bengal tax of entry of goods into local areas Act 2012 Demand of entry tax in the state of West Bengal on purchase of few items. 9.66 FY 2010-11 to FY 2016-17 High court of Calcutta

(viii) In our opinion and according to the information and explanations given by themanagement we are of the opinion that the Company has not defaulted in repayment of duesto banks. The Company did not have any outstanding dues in respect of a financialinstitution or debenture holders or government.

(ix) According to the information and explanations given by the management the Companyhas not raised any money by way of initial public offer/ further public offer/ debtinstruments and term loans hence reporting under clause (ix) is not applicable to theCompany and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the company or no material fraud onthe company by the officers and employees of the Company has been noticed or reportedduring the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S.R. BATLIBOI & CO LLP For V.R. Bansal & Associates
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 301003E/E300005 ICAI Firm registration number: 016534N
per Manoj Kumar Gupta per V.P. Bansal
Partner Partner
Membership No.: 83906 Membership No.: 08843
Place: Noida
Date : May 11 2017

ANNEXURE-2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF HAVELLS INDIA LIMTED

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

To the Members of Havells India Limited

We have audited the internal financial controls over financial reporting of HavellsIndia Limited ("the Company") as of Marchfi31fi2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting were established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at Marchfi31fi2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For S.R. BATLIBOI & CO LLP For V.R. Bansal & Associates
ICAI Firm registration number: 301003E / E300005 ICAI Firm registration number: 016534N
Chartered Accountants Chartered Accountants
per Manoj Kumar Gupta per V.P. Bansal
Partner Partner
Membership No.: 83906 Membership No.: 08843
Place: Noida
Date : May 11 2017