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Jindal Poly Films Ltd.

BSE: 500227 Sector: Industrials
NSE: JINDALPOLY ISIN Code: INE197D01010
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OPEN 370.50
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VOLUME 19304
52-Week high 476.10
52-Week low 300.00
P/E 18.38
Mkt Cap.(Rs cr) 1,607
Buy Price 368.10
Buy Qty 5.00
Sell Price 0.00
Sell Qty 0.00
OPEN 370.50
CLOSE 376.75
VOLUME 19304
52-Week high 476.10
52-Week low 300.00
P/E 18.38
Mkt Cap.(Rs cr) 1,607
Buy Price 368.10
Buy Qty 5.00
Sell Price 0.00
Sell Qty 0.00

Jindal Poly Films Ltd. (JINDALPOLY) - Director Report

Company director report

To the Members

Your Directors have pleasure in presenting the 42nd Annual Report ofthe Company together with Audited Accounts for the year ended 31st March 2016.

The Financial results of the year under review are as given below:-

FINANCIAL RESULTS

(Rs. In Crores)
2015-2016 2014-2015
Profit from Operations (EBITDA) 406.86 321.43
Less / (Add) Exceptional items 1.58 2.98
Less: Finance Cost 35.69 28.54
Profit Before Depreciation and Tax 369.59 289.91
Less: Depreciation 59.25 57.69
Profit before Tax 310.34 232.22
Less: Income Tax for the year 90.98 70.37
Less Deferred Taxation (Provision) 13.58 8.39
Profit After Tax 205.78 153.46
Add: Balance brought forward 643.06 519.66
Balance available for appropriation 848.84 673.12
APPROPRIATIONS
Dividend on Equity shares 4.38 4.2
Tax on Dividend 0.89 0.86
Transfer to general Reserve - 25
Balance carried forward 843.57 643.06

PERFORMANCE HIGHLIGHTS

During the year under review the Total Turnover/sales of the Company was Rs. 2641.04crore as against Rs. 2753.99 crore during the previous financial year.

The operating profit (EBITDA) before exceptional item was Rs. 406.86 crore as againstRs. 321.43 crore last year growing at 26.58 %.

The Company is taking various measures to retain increase its market share and also toimprove margins.

Further during the year under review consolidated financial Turnover/sales was Rs.7220.66 crore and Net Profit after Tax was Rs. 371.13 crore.

Earning Per Equity share (Consolidated) was Rs. 84.76 Per Equity share against the Rs.39.34 of Previous year.

DIVIDEND

Your Directors are pleased to recommend a dividend of Re.1/- per equity share (10%)(Previous year Re.1/ per equity share) for the Financial Year 2015-16 for approval of theMembers.

The total dividend would absorb a sum of Rs.4.38 crore and tax thereon of Rs. 0.89crore.

DEMERGER OF MANUFACTURING UNIT OF JINDAL PHOTO LTD. INTO JINDAL POLY FILMS LTD.

Board of Directors of your Company had at its meeting held on January 12 2015approved a scheme of Arrangement (‘the scheme’) between Jindal Photo Limited("Demerged Company") and Jindal Poly Films Limited ("ResultingCompany") for demerger of the manufacturing division of the demerged Company whichis engaged in the business of manufacture production sale and distribution ofphotographic products ("Demerged Undertaking") into the Resulting Company.

Subsequently the scheme was filed by both Companies with stock exchanges NsE and BsEwho had given in principle approval vide letter dated 12th March 2015 and 11th March2015 respectively.

Thereafter Petition was filed with Hon’ble High Courts Allahabad and Mumbai. TheHon’ble Allahabad High court in its hearing held on 12th October 2015 hadapproved the scheme.

Further Hon’ble High Court Mumbai in its hearing held on 26th Feb 2016 hadapproved the scheme.

As per the sanctioned scheme the scheme is effective from the appointed date i.e 1stApril 2014.

Now the manufacturing division of Jindal Photo Ltd. is a part of Jindal Poly Films Ltdand doing manufacturing business as "JINDAL PHOTO (A Divn. of Jindal Poly FilmsLtd.)".

As per conditions of sanctioned scheme as a Consideration Jindal Poly Films Ltd. hasissued and allotted 10 equity shares of Jindal Poly Films Ltd for every 59 equity sharesof Jindal Photo Ltd. held by Jindal Photo shareholders on record date. (13th May 2016.)and total No. of allotted Equity shares were 1738700."

Further these shares have been listed on NsE and BsE in July 2016.

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the Annual Report as a separate section.

DIRECTORS

1. During the year following Directors have resigned

A. Mr. Hemant sharma (DIN 05235723) Non-Executive Director w.e.f 21stAugust2015.

B. Ms. sumita Dhingra whole Time Director (DIN 06929317) w.e.f 14thOctober 2015.

C. Mr. Anil Kumar goel (DIN 07195300) Non-Executive Independent Director w.e.f 7thNovember2015.

D. Mr. sanjay Mittal (DIN: 01327274) whole-time Director w.e.f. 31st May2016.

All Directors resigned from Directorship due to their preoccupation and the Board wishto place on record its appreciation of the valuable service rendered by these Directorsduring their tenure as Directors of your Company.

2. During the year following Directors have been appointed:

A. Mr. Amit Jain (DIN: 00028335) Non-Executive Independent Director w.e.f 29thsept 2015.

B. Mr. P Uma shankar (00130363) Non-Executive Director w.e.f 7th November2015.

C. Ms. shakshi gupta (07388012) Non-Executive Director w.e.f 12th January2016.

D. Mr. sanjay Digambar Kapote as whole Time Director w.e.f. 01st June 2016.

Except Mr. Amit Jain the term and conditions of appointment of all three directors asmentioned above are subject to approval of members.

Brief resumes of the directors names of other company (ies) in which they holddirectorship membership of committees of the Board and their shareholdings are given inthe Notice to the shareholders.

3. Mr. Suresh Dattatraya Gosavi (DIN: 07015202) whole-time Director is liable toretire by rotation and being eligible offer himself for re-appointment.

PARTICULAR OF EMPLOYEES

The information required pursuant to section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will be provided upon request. In terms of section 136 of the Act theReport and Accounts are being sent to the Members and others entitled thereto excludingthe information on employees’ particulars which is available for inspection by theMembers at the Registered Office of the Company during business hours on working days ofthe Company up to the date of the ensuing Annual general Meeting. Member interested inobtaining a copy thereof may write to the Company secretary in this regard.

Disclosures pertaining to remuneration and other details as required under section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided as per Annexure ‘E’.

PERSONNEL

Personnel relations with all employees remained cordial and harmonious throughout theyear. Your Directors wish to place on record their sincere appreciations for thecontinued sincere and devoted services rendered by all the employees of the Company.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate governance asprescribed in the Listing Agreement with the stock Exchanges. A separate report onCorporate governance is included as a part of the Annual Report along with the Auditor'sReport on its compliance.

RELATIONSHIP BETWEEN DIRECTORS INTER-SE

None of the Directors are related to each other within the meaning of the term"relative" as per section 2(77) of the Companies Act 2013.

DIRECTORS’ RESPONSIBILITY STATEMENT

On the basis of compliance certificates received from the Executives of the Companysubject to disclosures in the Annual Accounts and also on the basis of the discussion withthe statutory Auditors/Internal Auditors of the Company from time to time your Directorsmake the following statements in terms of section 134(3)(c) of the Companies Act 2013:

a) in the preparation of the Annual Accounts for the year ended March 31 2016 theapplicable accounting standards read with requirements set out under schedule III to theAct have been followed and there are no material departures from the same;

b) the Directors have 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 as at March 31 2016 and of the profit ofthe Company for the year ended on that date;

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

d) the Directors have prepared the Annual Accounts on a ‘going concern’basis;

e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

The Company’s Internal Auditors have conducted periodic audit to providereasonable assurance that the Company’s established policies and procedures have beenfollowed.

The Audit Committee constituted by the Board reviewed the internal controls andfinancial reporting issues with Internal Auditors and statutory Auditors.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

A. Jindal Film India Ltd.(Previously known as Jindal Metal & Mining Ltd.) globalNonwovens Ltd. and M/s JPF Netherland B.V Jindal Imaging Limited and Jindal Photo ImagingLimited (Pursuant to scheme of Arrangement) are subsidiary Companies u/s 2(87) of theCompanies Act 2013.

B. JPF Dutch BV JPF UsA Holding LLC Jindal Films Americas LLC Jindal Films EuropeBrindisi srl Jindal Films Europe Kerkrade BV Jindal Films Europe s.a.r.l Jindal Filmssingapore Pte. Ltd. Jindal Films shanghai Co. Limited Jindal Films Europe Virtons.p.r.l are stepdown subsidiaries of the Company .

C. Hindustan Powergen Ltd. and Rexor "sAs" are Associate Companies howeverthe company has transferred its all shareholding of Rexor SAS to JPF Netherland B.V on18th July 2016.

D. Jindal Films Europe services was incorporated as 100% step down subsidiary of JPFDutch BV. Incorporated in Luxembourg on 7th April 2016.

E. i) Films shawnee LLC merged with Jindal Films Americas LLC w.e.f. 30.04.2015.

ii) Films Lagrange LLC merged with Jindal Films Americas LLC w.e.f. 30.04.2015

iii) Films Macedon LLC 100% Membership rights have been transferred from Jindal FilmsAmericas LLC to JPF UsA holding LLC w.e.f. 15th June 2015.

iv) 100% membership rights of Jindal Films Europe Virton LLC has been transferred fromJindal Films Americas LLC to JPF UsA Holding LLC 28th March 2016.

v) Jindal Films Europe services was Incorporated in Luxembourg on 7th April 2016 as100% step down subsidiary of JPF Dutch BV.

In accordance with the general Circular issued by the Ministry of Corporate Affairsgovernment of India the Balance sheet Profit and Loss Account and other documents of thesubsidiary companies are not being attached with the Balance sheet of the Company. TheCompany will make available the Annual Accounts of the subsidiary companies and therelated detailed information to any member of the Company who may be interested inobtaining the same. The annual accounts of the subsidiary companies will also be kept openfor inspection at the Registered Office of the Company. The Consolidated Financialstatement presented by the Company include the financial results of its subsidiaryCompanies & Associate Companies. Financial position of the each of the subsidiaries isprovided in a separate statement attached to the Financial statement pursuant to firstproviso to section 129(3) of the Companies Act 2013.

SHARE CAPITAL

The paid-up equity share capital as on 31st March 2016 was Rs.43.78 Crore(please refer note no 30 of standalone Financial statement). During the year under reviewthe Company has neither issued shares with Differential Voting Rights nor granted stockOptions nor sweat Equity. As on 31st March 2016 none of the Directors of the Company heldshares or convertible instruments of the Company.

FIXED DEPOSITS

The Company has not accepted any deposit during financial year ended on 31stMarch 2016. Further No renewal of deposits were made during the financial year 2015-2016so there was no unclaimed deposits as at 31st March 2016.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

Internal control over financial reporting is a process designed to provide reasonableassurance regarding the reliability accuracy fairness and timeliness of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. The Company has adequate internal controlsystem and procedures to ensure optimal use of Company’s resources.

The Company has appointed Internal Auditors and they do regular audit of variousoperational and financial matters to derive findings as a comparison for targets achievedand observations for further action to be taken.

The audit committee of the board of directors periodically reviews and discusses theaudit observations.

STATUTORY AUDITORS

M/s Kanodia sanyal & Associates Chartered Accountants (FRN 008396N) retire andbeing eligible offer themselves for reappointment. The auditors have furnishedcertificate regarding their eligibility for re-appointment as Company's Auditors pursuantto section 139 of the Companies Act 2013

COST AUDITORS

The Board of Directors of your Company has reappointed M/s. R.J. goel & CompanyCost Accountants (FRN 000026) New Delhi as Cost Auditors of the Company for the financialyear 2016-2017.

INTERNAL AUDITORS.

Pursuant to the provisions of section 138 of the Companies Act 2013 the Board hasappointed M/s. B.K. shroff & Co. Chartered Accountants (FRN 302166F) as InternalAuditors for conducting the Internal Audit of the Company for the financial year 2016-17.

SECRETARIAL AUDITORS

The Board have re-appointed M/s DMK Associates Practicing Company secretaries NewDelhi Practicing Company secretaries Delhi as secretarial Auditor pursuant to theprovisions of section 204 of the Companies Act 2013. The Report of the secretarialAuditor is annexed to the Report as per Annexure ‘A’.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 134 (5) of Companies Act 2013(erstwhile section 217 (2AA) of the Companies Act 1956) regarding conservation of Energytechnology absorption foreign exchange earnings and outgo is given in the 'Annexure"B" forming part of this report.

CORPORATE SOCIAL RESPONSIBILITY

In accordance with the requirements of section 135 of Companies Act 2013 your Companyhas a Corporate social Responsibility (CsR) Committee which comprises Mr. R.K PandeyChairman Mr. P. Uma shankar Member and Mr. sanjay Digambar Kapote Member.

Your Company has also formulated a Corporate social Responsibility Policy (CsR Policy)which is available on the website of the Company "http://www.jindalpoly.com/financial/Final%20CSR%20policy.pdf"

Annual report on CSR activities as required under the Companies (Corporate socialResponsibility Policy) Rules 2014 has been appended as Annexure –"C"and forms integral part of this Report.

DISCLOSURE UNDER COMPANIES ACT 2013

I. EXTRACTS OF ANNUAL RETURN

The details forming Part of the Extracts of Annual Return is annexed as per Annexure‘D’

(II) MEETINGS

During the year 15 (fifteen) Board Meetings and 08 (Eight) Audit Committee Meetingswere held as per details given in Corporate governance Report.

(III) Composition of Audit Committee

The Board has constituted an Audit Committee which comprises of Mr. Radha KrishnaPandey as the Chairman and Mr. P Umashankar Mr. Amit Jain and Mr. sunil KumarAgarwal as the Members. More details about the Committee are given in the Corporategovernance Report.

(IV) Related Parties Related Party Transactions

All contracts / arrangements / transactions entered into by the Company during thefinancial year with related parties were in the ordinary course of business and on anarm’s length basis. During the year under review your Company had not entered intoany contract / arrangement / transaction with related parties which could be consideredmaterial in accordance with the policy of the Company on materiality of related partytransactions. The Related Party Transactions Policy as approved by the Board is uploadedon the Company’s website http://www.jindalpoly.com/financial/Related PartyTransaction.pdf. The details of the transactions with Related Parties are provided inthe accompanying financial statements.

Details of related party transactions are given elsewhere in the Annual Report as perAccounting standard As-18.

Your Directors draw attention of the members to Note (A & B) to the financialstatement which sets out related party disclosures.

(V) Particulars of Loans Guarantees and Investments

During the year under review the company has made Loan guarantee and Investmentsdetails of these as covered under the provisions of section 186 of the Companies Act 2013are given in the Note no. 31.09 in accompanying Financial statements.

(VI) Risk Management.

The Company has laid down procedures to inform Board members about the risk assessmentand minimisation procedures. These procedures are periodically reviewed to ensure thatexecutive management controls risk through means of a properly defined framework.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators or Courts whichwould impact the going concern status of the Company and its future operations.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY

Terms of reference of Nomination and Remuneration Committee

• Formulate the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board a policy relating to theremuneration for the directors key managerial personnel and other employees.

• Identify persons who are qualified to become directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardtheir appointment and removal.

• Removal should be strictly in terms of the applicable law/s and in compliance ofprinciples of natural justice.

• Formulation of criteria for evaluation of Independent Directors and the Board.

• Devising a policy on the Board diversity.

• Recommend to the Board remuneration including salary perquisite and commissionto be paid to the Company’s Executive Directors on an annual basis or as may bepermissible by laws applicable.

• Recommend to the Board the Sitting Fees payable for attending the meetings ofthe Board/Committee thereof and any other benefits such as Commission if any payableto the Non- Executive Directors.

• Setting the overall Remuneration Policy and other terms of employment ofDirectors wherever required.

As per the requirements of the above provisions of the Companies Act 2013 aNomination and Remuneration Committee of directors was formed by the Board of Directorsconsisting of:

1 Mr. R.K Pandey Chairman (Non-Executive – Independent)

2 Mr. Amit Jain -Member (Non-Executive – Independent)

3 Mr. sunil Kumar Agarwal - Member (Non-Executive)

4 Ms. shakshi gupta- Member (Non-Executive)

The said committee has been empowered and authorised to exercise the power as entrustedunder the provisions of section 178 of the Companies Act 2013. The Company has a policyon directors’ appointment and remuneration including criteria for determiningqualification positive attributes independence of a director and other matters providedunder sub-section (3) of section 178. The Nomination and Remuneration Policy has beenplaced on Company’s website www.jindalpoly.com (investor relation) and otherrequired information is annexed to the Board’s Report as Annexure E.

INTERNAL POLICY ON REMUNERATION

The company has Internal Remuneration Policy for Directors Key Management Personneland senior Management Personnel. The policy takes into account several factors like agequalification years of experience in the industry/ functional area and businessmanagement present emoluments and other qualitative factors such as leadership qualitiescommunication skills and performance track record.

The aim is to ensure that the company attracts and retains competent people.

DECLARATION BY INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in section 149(6) of the Companies Act 2013 soas to qualify themselves to be appointed/continue as Independent Directors under theprovisions of the Companies Act 2013 and the relevant rules.

VIGIL MECHANISM AND WHISTLE BLOWER POLICY

The Company has devised a vigil mechanism in the form of a whistle Blower Policy inpursuance of provisions of section 177(10) of the Companies Act 2013 and details whereofis available on the Company’s website at http://www.jindalpoly.com/financial/Vegil_Mechanism.pdf. During the year under review there was no complaint receivedunder this mechanism.

EVALUATION OF BOARD’S PERFORMANCE

On the advice of the Board of Directors the Nomination and Remuneration Committee hasformulated the criteria for the evaluation of the performance of Independent DirectorsNon-Independent Directors and the Chairman of the Board. The Independent Directors of theCompany have also convened a separate meeting for this purpose. All the results andevaluation have been communicated to the Chairman of the Board of Directors.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013

The Company has constituted an internal Complaints Committee at organization level todeal the issues relating to any complaint regarding sexual Harassment of women atworkplace and During the year 2015- 16 no complaint was received by the committee.However As per provisions of the sexual Harassment of women at workplace (PreventionProhibition and Redressed) Act 2013 the Company has constituted formal Committee.

MATERIAL CHANGES

The subsidiary company global Nonwovens Ltd. has become wholly owned subsidiary Companyin August 2016.

Matters as may be prescribed

As per Rule 8(5) of the Companies (Accounts) Rule 2014 the following additionalinformation are provided:

Sr. No. Particulars
1 The financial summary or highlights The financial highlights including state of Affairs of the Company Dividend & Reserve have been provided in point above of this report.
2 (ii) The change in the nature of business if any. There is no change in the business line of the Company except scheme of arrangement among Jindal Photo Ltd Jindal Poly Films Ltd and their respective Creditors has been approved by the Courts and now Photo division is part of Jindal Poly Films Ltd.
3 The details of directors or key managerial personnel who were appointed or have resigned during the year During the year
1. Mr. Hemant sharma - Non Executive Director (DIN 05235723) has resigned w.e.f 21st August 2015.
2. Ms. sumita Dhingra – whole Time Director (DIN 06929317) has resigned from Directorship w.e.f. 14th October 2015.
3. Mr. Anil Kumar goel Independent Director (DIN 07195300) has resigned w.e.f 07th November 2015
4. Mr sanjay Mittal whole Time Director (DIN – 01327274) has resigned w.e.f. 31st May 2016
5. Mr. Amit Jain (DIN – 00028335) has been appointed as an Independent Director w.e.f. 29th September 2015
6. Mr. P Uma shankar (DIN – 00130363) has been appointed as a Non-Executive Director w.e.f. 07th November2015
7. Ms. shakshi gupta (DIN – 07388012) has been appointed as Non-Executive Director w.e.f. 12th January 2016
8. Mr. sanjay Digamber Kapote (DIN: 07529860) has been appointed as whole-time Director w.e.f 1st June2016.
4 The names of companies which have become or ceased to be subsidiaries joint ventures or associate companies during the year i) Films shawnee LLC merged with Jindal Films Americas LLC w.e.f. 30.04.2015.
ii) Films Lagrange LLC merged with Jindal Films Americas LLC w.e.f. 30.04.2015
iii) Films Macedon LLC 100% Membership rights have been transferred from Jindal Films Americas LLC to JPF UsA holding LLC w.e.f. 15th June 2015.
iv) 100% membership rights of Jindal Films Europe Virton LLC have been transferred from Jindal Films Americas LLC to JPF UsA Holding LLC 28th March 2016.
v) Jindal Films Europe services was Incorporated in Luxembourg on 7th April 2016 as 100% step down subsidiary of JPF Dutch BV.
5 The details relating to deposits covered under Chapter V of the Act The Company has not accepted deposits
6 The details of deposits which are not in compliance with the requirements of Chapter V of the Act Not Applicable
7 The details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future NIL
8 The details in respect of adequacy of internal controls with reference to the Financial Procedures are set so as to detect and prevent frauds and to protect the organisation’s resources both physical (e.g. machinery and property) and Intangible (e.g. Intellectual property such as trademarks). The financial statements are prepared in accordance with the accounting standards issued by the ICAI

ACKNOWLEDGEMENT

Your Directors would like to express their gratitude to financial institutions Banksand various state and Central government authorities for the co-operation extended to theCompany. Directors also take this opportunity to thank the shareholders customerssuppliers and distributors for the confidence reposed by them in the Company. Theemployees of the Company contributed significantly in achieving the results. YourDirectors take this opportunity to thank them and hope that they will maintain theircommitment to excellence in the years to come.

For and on behalf of Board of Directors
Sd/- Sd/-
Date : 23rd August 2016 Whole-time Director Whole-time Director
Place : Delhi. Suresh Dattatraya Gosavi Sanjay Digamber Kapote