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Orient Cement Ltd.

BSE: 535754 Sector: Industrials
NSE: ORIENTCEM ISIN Code: INE876N01018
BSE LIVE 15:42 | 17 Oct 158.00 2.65
(1.71%)
OPEN

153.10

HIGH

158.75

LOW

153.10

NSE 15:45 | 17 Oct 157.85 2.90
(1.87%)
OPEN

154.60

HIGH

159.00

LOW

153.45

OPEN 153.10
PREVIOUS CLOSE 155.35
VOLUME 16623
52-Week high 199.55
52-Week low 114.80
P/E 225.71
Mkt Cap.(Rs cr) 3,237
Buy Price 158.00
Buy Qty 240.00
Sell Price 0.00
Sell Qty 0.00
OPEN 153.10
CLOSE 155.35
VOLUME 16623
52-Week high 199.55
52-Week low 114.80
P/E 225.71
Mkt Cap.(Rs cr) 3,237
Buy Price 158.00
Buy Qty 240.00
Sell Price 0.00
Sell Qty 0.00

Orient Cement Ltd. (ORIENTCEM) - Director Report

Company director report

Your directors are pleased to present the 6th Annual Report on the business andoperations of the Company along with the audited financial statements for the financialyear ended 31st March 2017.

SUMMARY OF FINANCIAL PERFORMANCE

The financial performance of the Company for the financial year ended 31st March 2017is summarized below:

( Rs in crores)

Particulars 2016-17 2015-16
Gross Sales 2171.28 1691.63
Total Revenue (Net of excise) 1875.14 1469.43
Earnings before interest depreciation amortization & taxation 190.39 193.11
Interest / finance costs 135.33 54.44
Profit before depreciation and taxation 55.06 138.67
Depreciation and amortization expenses 121.54 77.82
Net Profit before taxation (66.48) 60.85
Taxation (34.38) (1.51)
Net profit (32.10) 62.36
Profit brought forward from last year 306.15 268.45
Profit available for appropriations 274.05 330.81
Appropriations
Transfer to Debenture Redemption Reserve - -
Transfer to general reserve - -
Dividend on equity shares 20.49 20.49
Corporate dividend tax 4.17 4.17
Balance carried to balance sheet 249.39 306.15
EPS (1.57) 3.04

BUSINESS AND FINANCIAL PERFORMANCE

After a promising start the financial year 2016-17 proved to be an extremelychallenging year for the cement sector with the industry as a whole registering ade-growth after several consecutive years of growth in the last decade. Demonetization hada particularly adverse efiect on cement volumes with the contraction in the monthsfollowing this event touching double digits. All this occurred even while the overall GDPgrew by an estimated 6.8% thus interrupting the correlation that the cement sector hashistorically shown with national growth. Low consumption was accompanied by a rise in fuelprices on the back of global trends further impacting the profitability of industry. Inthis backdrop the key business and financial highlights of your Company for FY17 are asunder: Successfully ramped up sales and dispatches from the 3 million ton Greenfieldcement plant at Chittapur (Gulbarga Karnataka) following its commissioning in theprevious year.

Total cement sales volume for the year stood at 55.52 lac tons against 44.19 lac tonsin FY16 a growth of over 26% though the industry as a whole de-grew in the year. Wecontinued to focus on PPC cement production in line with your Company’s commitment toenvironmental sustainability; 76% of cement volume was sold as PPC from old operationswhile PPC sales from new operations are also scaling up steadily to reacRs 42% for theyear. Net sales realization during the year remained uneven and volatile due to poordemand and low capacity utilization in the industry leading to low prevailing marketprices in many of our large markets. Variable production costs were slightly higher onaccount of higher raw material and fuel prices as well as the stabilization challenges atthe new plant in Chittapur. Despite an extremely challenging environment capacityutilization at your Company’s older plants was at 76% during FY17 and 69% overall.

EBITDA for the year was H190.4 crores as against H193.1 crores in FY 16.

A Net Loss of H32.10 crores was registered for the year versus a Net Profit of H62.4crores in the previous year primarily due to higher finance costs and depreciationcharges for FY17 as compared with FY16 as a result of the large investments at Chittapurplant. The plant operations at Chittapur are now largely stabilized with performanceguarantee tests on much of the equipment already carried out successfully. Someoptimization work is still in progress by the vendors notably of the kiln cementgrinding mills and the turbine. We expect to get these optimization jobs completed soonand achieve all the planned eficiencies for the plant. The construction work for therailway siding and the township for the employees is beginning very soon now. We are alsoin the advanced stages of firming up the size and specifications for the waste heatrecovery power plant after which the order for the same will be finalized.

We have also taken necessary steps and made investments to comply with the latestemission norms notified for SPM and SO2 while we are working with the rest of theindustry norms which to find a workable solution for the new NOX are proving to be achallenge for the industry when we use pet-coke as a fuel.

DIVIDEND

Your directors are pleased to recommend a final dividend amounting to H0.50 per equityshare of face value of H1 each for the year ended 31st March 2017 subject to approval ofshareholders at the forthcoming Annual General Meeting of the Company. The Register ofMembers and Share Transfer Books of the Company will remain closed from Monday 18th dayof September 2017 to Saturday23rd day of September

2017 both days inclusive for determining the entitlement of the shareholdersto the final dividend for financial year 2016-17.

CHANGES IN DIRECTORS

Pursuant to section 161 of the Companies Act 2013 Mr. I.Y.R. Krishna Rao (DIN00481367) was appointed as an Additional Director w.e.f. 5th May 2017 to hold Office tillthe date of the ensuing Annual General Meeting. The Company has received requisite noticetogether with deposit of H100000 (Rupees one lac only) as provided under section 160 ofthe Companies Act 2013 from the member proposing the appointment of Mr. I.Y.R. KrishnaRao (DIN 00481367) as an Independent Director not liable to retire by rotation.

In terms of the provisions of section 152 of the Companies Act 2013 and in terms ofthe Articles of Association of the Company Mr. Chandrakant Birla (DIN 00118473) aNon-Executive Director of the Company is liable to retire by rotation at the ensuingAnnual General Meeting of the Company and being eligible offers himself for re-appointment.The Board of Directors recommends his re-appointment for the consideration of themembers of the Company at the ensuing Annual General Meeting.

Mr. Desh Deepak Khetrapal (DIN 02362633) was re-appointed as Managing Director& CEO of the Company w.e.f 1st April 2015 for a period of 5 (five) years.However his remuneration was subject to revision every year. On the recommendation of theNomination & Remuneration cum Compensation Committee the Board of Directors in theirmeeting held on 5th May 2017 recommended revision in Mr. Khetrapal’s remunerationfor shareholders’ approval. The resolution seeking consideration of Mr.Khetrapal’s remuneration has been included in the Notice of the Annual GeneralMeeting. The Board of Directors recommends the resolution for your approval.

During the financial year there was no change in the constitution of the Board ofDirectors of the Company.

A brief profile and other details relating to the directors are furnished in the AnnualReport.

None of the directors are disqualified under section 164(2) of the Companies Act 2013.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors of the Company have declared and confirmed that they meetwith the criteria of independence as prescribed under section 149(6) of the Companies Act2013 and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

KEY MANAGERIAL PERSONNEL

In terms of the provisions of section 203 of the Companies Act 2013 Mr. DeshDeepak Khetrapal - Managing Director & CEO (DIN 02362633) Mr. Sushil Gupta - ChiefFinancial Officer (FCA-044924) and Mrs. Deepanjali Gulati

- Company Secretary (FCS-5304) are the Key Managerial Personnel (‘KMP’) ofthe Company.

During the year under review there was no change in the position of KMPs of theCompany.

DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has formulated a vigil mechanism through a Whistle Blower Policy to dealwith instances of illegal practices unethical behaviour actual or suspected fraud orviolation of the Company’s Code of Conduct or Ethics Policy.

Adequate safeguards are provided against victimization to those who avail of themechanism. The details of the Whistle Blower Policy are explained in the CorporateGovernance Report. The Whistle Blower Policy is available on Company’s website andcan be accessed through the web link: http://orientcement.com/investors/.

BOARD OF DIRECTORS ITS COMMITTEES AND MEETINGS THEREOF

The Company has a professional Board with an optimum combination of ExecutiveNon-Executive and Independent Directors (including one Woman Director) who bring to thetable the right mix of knowledge skills and expertise. The Board provides strategicguidance and direction to the Company in achieving its business objectives and protectingthe interest of the stakeholders. The Board is also supported by four Committees ofdirectors viz. the Audit Committee the Nomination & Remuneration cum CompensationCommittee the CSR Committee and the Stakeholders’ Relationship Committee.

One meeting of the Board of Directors is held in each quarter. Additional meetings ofthe Board/Committees are convened as may be necessary for the proper management of thebusiness operations of the Company. A separate meeting of Independent Directors is alsoheld at least once in a calendar year to review the performance of Non-IndependentDirectors the Board as a whole and the Chairman.

During the financial year ended 31st March 2017 the Board of Directors met 5 (five)times viz. on 4th May 2016 3rd August 2016 6th October 2016 9th November 2016 and 4thFebruary 2017. The intervening gap between the meetings was within the period prescribedunder the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

A detailed update on the Board & its Committees’ composition number ofmeetings held during the financial year 2016-17 and attendance of the directors at thesemeetings is provided in the Report on Corporate Governance.

AUDIT COMMITTEE

The Company has a duly constituted Audit Committee in line with the provisions of theCompanies Act 2013 and SEBI (ListingObligationsandDisclosureRequirements)Regulations2015. The primary objective of the Committee is to monitor and provide efiectivesupervision of the Management’s financial reporting process to ensure accurate andtimely disclosures with the highest level of transparency integrity and quality offinancial reporting. The Committee met 4 (four) times during the year the detailsof which are given in the Corporate Governance Report. As on 31st March 2017 theCommittee comprised of five independent directors viz. Mr. Vinod Kumar Dhall (DIN02591373) Mr. Rajeev Jhawar (DIN 00086164) Mr. Rabindranath Jhunjhunwala (DIN00050729) Mr. Swapan Dasgupta (DIN 07113693) and Mr. Janat Shah (DIN 01625535) as well asMr. Desh Deepak Khetrapal-Executive Director (DIN 02362633). Detailed informationpertaining to the Audit Committee has been provided in the Report on Corporate Governance.

POLICY ON DIRECTORS’ APPOINTMENT & REMUNERATION

The Company endeavors to have an appropriate mix of Executive Non-Executive andIndependent Directors so as to have independence on the Board and separate itsfunction of governance from that of management. The selections and appointments on theBoard of the Company are done on the recommendation of the Nomination & Remunerationcum Compensation Committee. The appointments are based on meritocracy and the candidatesare considered against objective criteria having due regard to the benefits of diversityon the Board. While evaluating the candidature of an Independent Director the Committeeabides by the criteria for determining independence as stipulated under theCompanies Act 2013 and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. In case of re-appointment of directors the Board takes intoconsideration the results of the performance evaluation of the directors.

The copy of the Nomination & Remuneration Policy for Directors KMPs and SeniorManagement is attached as Annexure ‘I’ to this Report.

AWARDS AND RECOGNITIONS

In recognition of its constant quest for growth and achievement your Company has beenhonoured and recognized at various forums. The prominent awards are listed below for yourreference:

Devapur Plant:

1. National Energy Management Gold Award from SEEM

2. National Award for Excellence in Energy Management 2016 from CII

3. Mines Safety Week 2016 Awards by Director General of Mines Safety

Overall performance 1st Prize
Loading and Transportation 1st Prize
Drilling and Blasting 1st Prize
Publicity Propaganda & House Keeping 2nd Prize
Lighting and Installations 2nd Prize
4. Mines Environment & Mineral Conservation Week Awards by Indian Bureau of Mines
Reclamation and Rehabilitation 1st Prize
Waste Dump Management 2nd Prize
Sustainable Development 3rd Prize
Overall performance 3rd Prize
Chittapur Plant:
1. Safety Awards from the Mines Safety Association
Karnataka (MSAK)
Safety Management System 1st Prize
Publicity & Propaganda and Safety
is my responsibility Cards 1st Prize
Mine Workings 2nd Prize
Maintenance of Mining Machinery 2nd Prize
Drilling and Blasting 3rd Prize
State Level Overall Performance in mines 2nd Prize

STATUTORY AUDITORS

At the Annual General Meeting held in the year 2014 M/s S.R. Batliboi & Co.LLP Chartered Accountants (ICAI Firm Registration Number 301003E/ E300005) was appointedas Statutory Auditors of the Company by the shareholders to hold Office as StatutoryAuditors from the conclusion of Annual General Meeting held in the year 2014 till theconclusion of eighth Annual General Meeting of the Company to be held in the year 2019subject to ratification of their appointment at every Annual General Meeting.

The Company has received a letter from the auditors confirming that they are eligiblefor appointment as auditors of the Company under section 139 of the Companies Act 2013and meet the criteria for appointment specified in section 141 of the Companies Act 2013.

Based on the recommendation of the Audit Committee and as per the provisions of section139(1) of the Companies Act 2013 the Board of Directors of your Company proposes toratify the appointment of M/s S. R. Batliboi & Co. LLP Chartered Accountants (ICAIFirm Registration Number 301003E/E300005) as the Statutory Auditors of the Company for thefinancial year 2017-18.

Auditors’ Report is self-explanatory and therefore does not require furthercomments and explanation.

Further in terms of section 143 of the Companies Act 2013 read with the Companies(Audit and Auditors) Rules 2014 as amended notifications / circulars issued by theMinistry of Corporate Afiairs from time to time no fraud has been reported by theauditors of the Company where they have reason to believe that an ofience involving fraudis being or has been committed against the Company by Officers or employees of theCompany.

COST AUDITORS

In terms of section 148 of the Companies Act 2013 read with Companies (Cost Recordsand Audit) Rules 2014 the Company is required to maintain Cost Accounting records andget them audited every year. The Board appointed Mr. Somnath Mukherjee CostAccountant (M.No.-F5343) as Cost Auditors of the Company for the financial year 2017-18at a fee of H80000/- (Rupees eighty thousand only) plus out of pocket expenses subject tothe ratification of the said fees by the shareholders at the ensuing Annual GeneralMeeting.

The Company has received a letter from him to the efiect that his re-appointment wouldbe within the limits prescribed under section 141(3)(g) of the Companies Act 2013 andthat he is not disqualified for such re-appointment within the meaning of section 141 ofthe Companies Act 2013.

SECRETARIAL AUDITORS

Pursuant to the provisions of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s Ranjeet Pandey andAssociates Company Secretaries (Registration No. F-5922) were appointed to conduct theSecretarial Audit of the Company for the financial year 2016-17.

The Secretarial Audit Report is annexed to this report as Annexure ‘1’. TheSecretarial Auditors’ report is self-explanatory and therefore does not requirefurther comments and explanation.

The Board has appointed M/s Ranjeet Pandey and Associates Company Secretaries(Registration No. F-5922) as Secretarial Auditor of the Company for the financial year2017-18.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

During the financial year under review your Company has not given any loan orguarantee made investments and provided securities which are covered under the provisionsof section 186 of the Companies Act 2013.

RELATED PARTY TRANSACTIONS

The Company has adequate procedures for identification and monitoring of related partytransactions. All transactions entered into with related parties during the financial yearwere on an arm’s length basis. All related party transactions were placed before theAudit Committee and also the Board for approval wherever required. Prior omnibus approvalof the Audit Committee and Board was obtained for the transactions that were of a foreseenand repetitive nature. These transactions were reviewed by the Audit Committee on aquarterly basis.

There were no materially significant related party transactions made by the Companywith promoters directors key managerial personnel or other designated persons which mayhave a potential conflict with the interest of the Company at large.

For details on related party transactions members may refer to the notes to thefinancial statement. The Policy on related party transactions as approved by the Board isavailable on the Company’s website and can be accessed through the web link:http://orientcement.com/investors/.

Particulars of contract or arrangements with related parties referred to in section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is annexed as Annexure‘2’ to the Report.

CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of business of the Company during the year underreview.

RISK MANAGEMENT

The Company has constituted a Risk Management Committee to review the risk managementplan / process of the Company. The Risk Management Committee identifies potential risksassesses their potential impact and takes timely action to mitigate the same.

The Company has a Risk Management Policy which has been approved by the Board. The RiskManagement Policy acts as an overarching statement of intent and establishes the guidingprinciples by which key risks are managed across the organization. The Board monitors andreviews periodically the implementation of various aspects of the Risk Management Policythrough a duly constituted Risk Management Committee (RMC). The RMC assists the Board inits oversight of the Company’s management of key risks including strategic andoperational risks as well as the guidelines policies and processes for monitoring andmitigating such risks under the aegis of the overall Business Risk Management Framework.

There are no risks identified by the Board which may threaten the existence of theCompany.

INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY

As per the provisions of section 134(5)(e) of the Companies Act 2013 the directorshave an overall responsibility for ensuring that the Company has implemented robustsystems/ framework of internal financial controls to provide them with reasonableassurance regarding the adequacy and operating efiectiveness of controls with regard toreporting operational and compliance risks. To enable the directors to meet theseresponsibilities the management has devised systems/ frameworks which are operatingwithin the Company. In line with best practice the Audit Committee and Board regularlyreview the internal control system to ensure that it remains efiective and fit for thepurpose. Where weaknesses are identified as a result of the reviews new procedures areput in place to strengthen controls and these are in turn reviewed at regular intervals.The systems/ frameworks include proper delegation of authority policies and proceduresefiective IT systems aligned to business requirements internal audit framework ethicsframework risk management framework and adequate segregation of duties.

Your Company’s management has established and maintained internal financialcontrols based on the internal control over financial reporting criteria established inthe integrated framework issued by the Committee of Sponsoring Organizations of theTreadway Commission (2013 Framework) (the COSO criteria) which considers the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia. Based on information provided nothing has come to the attention of directors toindicate that any material breakdown in the function of these controls procedures orsystems occurred during the year under review.

The Internal Auditor of the Company reports functionally to Audit Committee of Boardwhich reviews and approves risk based annual internal audit plan. Audit Committeeperiodically reviews the performance of internal audit function.

CORPORATE SOCIAL RESPONSIBILITY

The basic concept of Company’s CSR is to serve the interest of society in a justand equitable manner along with taking the responsibility for the impact of businessactivities on various stakeholders in all aspects of Company’s operations. YourCompany has been taking several initiatives under Corporate Social Responsibility(‘CSR’) for society at large well before it has been prescribed through theCompanies Act 2013.

The Company has constituted a CSR Committee and has a well-defined Policy on CSR as perthe requirement of section 135 of the Companies Act 2013 which covers theactivities as prescribed under Schedule VII of the Companies Act 2013.

Detailed information pertaining to the CSR Committee has been provided in the Report onCorporate Governance.

The CSR Policy laid down by the Company ensures that:

1. The CSR agenda is integrated with the business;

2. Focused efiorts are made in the identified community development areas to achievethe expected outcome;

3. The Company contributes towards nation-building through its CSR activities. As partof its initiatives under CSR the Company has contributed for healthcare infrastructuredevelopment and education for the year under review.

Corporate Social Responsibility Report pursuant to section 134(3)(o) of the CompaniesAct 2013 and Rule 9 of the Companies (Corporate Social Responsibility) Rules 2014 formspart of this Report as Annexure ‘3’ The CSR Policy of the Company is enclosed asAnnexure –‘II’ to this Report and is also placed on the website of theCompany. This can be accessed through the web link:http://orientcement.com/investors/.

PARTICULARS OF EMPLOYEES DIRECTORS & KEY MANAGERIAL PERSONNEL

The information required pursuant to section 197 of the Companies Act 2013 read withRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is attached as Annexure ‘4’ forming an integral part of this Report.

SHARE CAPITAL

During the year under review the Issued Subscribed and Paid up Share Capital of theCompany was 204868760 shares of H1 each. There was no change in the capital structureof the Company.

EXTRACT OF THE ANNUAL RETURN

Pursuant to section 134(3)(a) and section 92(3) of the Companies Act 2013 read withRule 12 of the Companies (Management and Administration) Rules 2014 relevant extract ofannual return for the financial year 2016-17 is given as Annexure ‘5’ to thisReport.

EMPLOYEES STOCK OPTION SCHEME

The Company has in place the Employees Stock Option Scheme 2015 (‘ESOS-2015’)which provides for grant of Stock Options to eligible employees of the Company.

During the financial year 2016-17 no options were granted under ESOS-2015. Theapplicable disclosures under SEBI (Share Based Employee Benefits) Regulations 2014("SEBI Regulations") as at 31st March 2017 has been uploaded on the website ofthe Company and can be accessed through the web link http://orientcement.com/investors/.There is no change in the ESOS scheme of the Company during the financial year.

Certificate from M/s S.R. Batliboi & Co. LLP Chartered Accountants (ICAI FirmRegistration Number 301003E/ E300005) Statutory Auditors of the Company confirming thatthe scheme has been implemented in accordance with the SEBI Regulations would be placedat the ensuing Annual General Meeting of the Company for inspection by the members.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

The Company has zero tolerance towards sexual harassment at the workplace and hasadopted a policy on prevention prohibition and redressal of sexual harassment atworkplace in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules thereunder. The Companyhas constituted Internal Complaints Committee which is responsible for redressal ofcomplaints related to sexual harassment.

As per the provisions of section 21 and 22 of the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 the report on the details ofthe number of cases filed under sexual harassment and their disposal during the calendaryear 2016 is as under:

Number of cases pending as on the beginning of the financial year Nil
Number of complaints filed during the financial year Nil
Number of cases pending as on the end of the financial year Nil

MANAGEMENT DISCUSSION & ANALYSIS REPORT

As required by Regulation 34(2) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a detailed Management Discussion and Analysis Report ispresented in a separate section forming part of the Annual Report.

CORPORATE GOVERNANCE

Corporate Governance ensures fairness transparency and integrity of the management. Asa part of its strategy the Company believes in adopting the ‘best practices’that are followed in the area of Corporate Governance. The Company emphasizes the need forfull transparency and accountability in all its transactions in order to protect theinterests of its stakeholders. The Board considers itself a Trustee of the Company’sshareholders and acknowledges its responsibilities towards them for creating andsafeguarding their wealth. The Company is committed to high levels of ethics and integrityin all its business dealings that avoids conflicts of interest. In order to conductbusiness with these principles the Company has created a corporate structure based onbusiness needs and maintains a high degree of transparency through regular disclosureswith a focus on adequate control systems.

A detailed report on corporate governance forms an integral part of Annual Report andis set out as separate section therein.

The certificate of M/s S.R. Batliboi & Co. LLP (ICAI Firm Registration Number301003E/ E300005) Chartered Accountants the Statutory Auditors of the Company certifyingcompliance with the conditions of Corporate Governance as stipulated in the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed with the Report onCorporate Governance as Annexure ‘6’. The Auditors’ certificate forfinancial year 2016-17 does not contain any qualification reservation or adverse remark.

PERFORMANCE EVALUATION OF BOARD COMMITTEES & INDIVIDUAL DIRECTORS

A formal evaluation of the performance of the Board its Committees the Chairman andthe individual directors was carried out for the financial year 2016-17. The performanceevaluation was done using individual questionnaires covering amongst others compositionof Board receipt of regular inputs and information functioning performance &structure of Board Committees skill set knowledge & expertise of directorspreparation & contribution at Board Meetings leadership etc. The performanceevaluation of the respective Committees and that of Independent and Non-IndependentDirectors was done by the Board excluding the director being evaluated.

The performance evaluation of Non-Independent Directors the Chairman and the Board wasdone by the Independent Directors.

LISTING WITH STOCK EXCHANGES

The equity shares of the Company are listed on National Stock Exchange of India Limitedand BSE Limited. The annual listing fees for the financial year 2017-18 have been paid tothese exchanges.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to section 134(3)(c) of the Companies Act 2013 the Board of Directors herebystate that:

1. In the preparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards have been followed along with proper explanationrelating to material departures;

2. They have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of afiairs of the Company as on 31st March 2017 and of the profit andloss of the Company for the year ended on that date;

3. They have taken proper and suficient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

4. They have prepared the annual financial statements on a going concern basis;

5. They have laid down internal financial controls to be followed by the Company andthat such internal financial controls were adequate and were operating efiectively.

6. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating efiectively.

MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments afiecting the financial position of the Companyhave occurred between the end of the financial year of the Company to which the financialstatements relate and on the date of this Report.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The Company values the significance of conservation of energy and technology absorptionand remains conscious about the environment impact of its business operations. During thefinancial year the Company undertook a variety of energy conservation measures across allits plants making continuous efiorts for judicious use of energy at all levels ofoperations by utilizing energy eficient system and processes. Some steps taken towardsenergy conservation are the result of technology absorption. Our new integrated cementmanufacturing unit at Chittapur has been installed with new state of the art technologyand latest energy eficient equipment.

The particulars required under section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 regarding conservation of energytechnology absorption are enclosed as Annexure ‘7’ forming part of this Report.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the financial year the Company has not earned any foreign exchange.

The total foreign exchange outgo during the year was H4773.48 lacs.

SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES

During the financial year 2016-17 the Company had no Subsidiary Associate or JointVenture company.

DEPOSITS

During the financial year under review the Company did not accept deposits coveredunder Chapter V of the Companies Act 2013.

SIGNIFICANT AND MATERIAL ORDERS

No significant and material orders have been passed by any regulators or courts ortribunals against the Company impacting the going concern status and Company’soperations in future.

BUSINESS RESPONSIBILITY REPORT

The SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 mandatesinclusion of Business Responsibility Report as part of Annual Report for top 500 listedentities based on market capitalization. The Company falls under the top 500 listedcompanies by market capitalization. Accordingly in compliance with the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Business ResponsibilityReport is presented in a separate section forming part of the Annual report.

DIVIDEND DISTRIBUTION POLICY

Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 requires top 500 listed Companies based on the market capitalization to formulateDividend Distribution Policy. In compliance of the said requirement the Company hasformulated the Dividend Distribution Policy. The Dividend Distribution Policy of theCompany is enclosed as Annexure –‘III’ to this Report and is also placed onthe website of the Company. This can be accessed through the web link:http://orientcement.com/ investors/.

COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

The Company has complied with Secretarial Standards issued by the Institute of CompanySecretaries of India on Board Meetings and General Meetings.

OTHER STATUTORY DISCLOSURES

Your directors state that no disclosure or reporting is required with respect to thefollowing items as there were no transactions related to these items during the year underreview:

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

2. Issue of sweat equity shares

3. Provision of money for purchase of its own shares by employees or by trustees forthe benefit of employees

ACKNOWLEDGEMENT

Your Directors place on record their appreciation for assistance and co–operationreceived from various Ministries and Departments of Government of India and other StateGovernments banks shareholders of the Company etc. Your Directors wish to place onrecord their sincere appreciation for the dedicated efiorts and consistent contributionmade by the employees at all levels to ensure that the Company continues to grow andexcel.

By order of the Board of Directors
For Orient Cement Limited
CK. Birla
Place: New Delhi Chairman
Date: 5th May 2017 (DIN 00118473)