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Oriental Carbon & Chemicals Ltd.

BSE: 506579 Sector: Industrials
NSE: OCCL ISIN Code: INE321D01016
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OPEN 1068.50
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VOLUME 152
52-Week high 1589.00
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P/E 21.45
Mkt Cap.(Rs cr) 1,106
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OPEN 1068.50
CLOSE 1095.80
VOLUME 152
52-Week high 1589.00
52-Week low 906.00
P/E 21.45
Mkt Cap.(Rs cr) 1,106
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Oriental Carbon & Chemicals Ltd. (OCCL) - Director Report

Company director report

TO THE MEMBERS

Your Directors hereby present their Thirty Seventh Report along with the Audited AnnualFinancial Statements (including Audited Consolidated Financial Statements) of the Companyfor the Financial Year ended March 31 2017.

1. FINANCIAL RESULTS (Rs. Lakhs)
Particulars For the Year ended For the Year ended
31.3.2017 31.3.2016
Net Sales/Income from Operations 29745.16 27471.72
Other Income 659.96 568.64
Total Revenue 30405.12 28040.36
Profit/(Loss) Before Taxation 7358.33 6476.32
Provision for Taxation * (2015.10) (1177.59)
Profit/(Loss) after Taxation 5343.23 5298.73
Amount Available for Appropriation 26772.99 22483.09
Appropriation:
Interim Dividend on Equity Shares 308.88 308.88
Tax on Interim Dividend 62.88 62.88
Proposed Final Dividend on Equity Shares - 566.29
Tax on Proposed Final Dividend - 115.28
Balance Carried to Balance Sheet 26401.23 21429.76

* Including Rs.(791.72) Lakhs Deferred Tax (Previous year Rs.2.08 Lakhs). Increase indeferred tax is attributable to the new capacity added at Mundra.

2. DIVIDEND

Your Directors are pleased to recommend Final Dividend of 70% on 10296062 Equity Shares(Rs.7 per share of Rs.10 each) which is subject to the approval of Shareholders in theensuing Annual General Meeting. The Dividend will absorb Rs.867.45 Lakhs (inclusive ofDividend Tax of Rs.146.72 Lakhs). With this the total dividend for the year includinginterim dividend of 30% comes to 100%.

3. OPERATIONS

Insoluble Sulphur

During the year the Company registered a growth of about 9% in Insoluble Sulphur Sales.The growth was achieved consequent to commissioning of the new line at Mundra SEZ inDecember 2016. The additional sales were mainly on account of increase in domestic demandand export mainly due to new geographies added. The sales volume growth was in doubledigit in both the markets. Average Sales Realisation was lower during the year due toreduction in Raw Material Prices. However there was an improvement in margin over lastyear on account of better capacity utilization.

The first phase (5500MTPA) of Expansion of Insoluble Sulphur at Mundra Gujarat wascompleted during the year and commercial production was started on 20thDecember 2016.

Sulphuric Acid & Oleum

Sulphuric Acid margin were better than the previous year resulting in betterprofitability. However sales were lower due to lower production on account of maintenanceissues in the plant. Steam produced as a byproduct was supplied to Insoluble SulphurPlants resulting in fuel savings.

FUTURE PROSPECTS

Insoluble Sulphur

Growth in global tyre Industry after a period of lull has started picking up. ManyTyre companies are working on expanding their capacities. This will add to growth indemand of Insoluble sulphur. Growth numbers are also expected to be healthy as Tyrecompanies where we have full approvals and good standing are also expanding.

Other growth driver is the new compounds being designed for Ultra High PerformanceTyres where requirement of Insoluble sulphur is on the higher side. This will add furtherto the growth of Insoluble sulphur consumption globally. Our product is accepted and issuitable for such new age applications.

We have successfully opened up newer markets like China and USA. The response for theCompany's products has been good and there is sufficient head room for growth in thosemarkets. These markets are expected to be our major growth drivers.

The Company has also been able to get approvals from couple of new Tyre customers. Thisalong with new geographies apart from adding to the sales numbers will also help tomitigate risks.

The work on second phase of capacity expansion of Insoluble Sulphur at its Mundra Plantis under progress and expected to be commissioned on schedule in second quarter of2018-19.

Sulphuric Acid & Oleum

Sulphuric Acid Plant performance is expected to be profitable in next year also due tostable market as monsoon have been forecasted to be normal resulting in better fertilizerdemand for which Sulphuric Acid is a raw material.

4. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has in place an established internal control system including InternalFinancial Controls designed to ensure proper recording of financial and operationalinformation compliance of various internal controls and other regulatory and statutorycompliances. Self-certification exercise is also conducted by which senior managementcertifies effectiveness of the internal control system of the Company. Internal Audit isconducted throughout the organization by qualified outside Internal Auditors. Findings ofthe internal Audit Report are reviewed by the top Management and by the Audit Committee ofthe Board and proper follow up action are ensured wherever required. The StatutoryAuditors have evaluated the system of internal controls including internal financialcontrol of the Company and have reported that the same are adequate and commensurate withthe size of the Company and nature of its business.

5. CHANGE IN THE NATURE OF BUSINESS

There was no change in the nature of the business of the Company during the year. TheCompany has only one subsidiary namely Duncan Engineering Ltd (formerly known as SchraderDuncan Limited).The name of the Subsidiary has been changed during the year as per agreedterms at the time of acquisition. One production line of this subsidiary producing tyretube valves was closed during the year.

There were no significant and material orders passed by regulators or courts ortribunals impacting the going concern status and Company's operations in future. Therewere no material changes and commitments affecting the financial position of the companyoccurring between March 31 2017 and the date of this report.

6. RESEARCH & DEVELOPMENT

Research & Development is fundamental to the Company's efforts to maintain thetechnical and quality edge for the product. A full in-house Research & Developmentteam works on continuous basis to improve the quality of product and its properties. NewGrades are also being developed to meet customers varied requirements. Research in theareas of reducing utility cost and process parameters improvement is also being done. Helpof accredited independent laboratories is also taken as and when required for studying andevolving critical parameters.

The Company's Research and Development Facility is approved by Department of Scientificand Industrial Research Ministry of Science and Technology Government of India.

The R&D lab is regularly augmented by acquiring state of the art analytical andprocess equipments to help in faster and detailed analysis. Further pilot plants asrequired are being set up to validate the research findings. The details of some specificR&D activities carried out and benefits derived out of them have been annexed to thisreport.

7. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS &OUTGO

As required under Section 134(3) (m) of the Companies Act 2013 read with Rule8 (3) ofthe Companies (Accounts) Rules 2014 the information relating to conservation of energytechnology absorption and foreign exchange earnings and outgo is annexed to this Report.

8. POLLUTION CONTROL

Your Company's Plants have all the requisite Pollution Control Equipments and meets allthe desired and statutory norms in this regard. The Insoluble Sulphur Units of the Companyenjoys ISO-TS 16949:2009 EMS14001-2004 and OHSAS18001:2007 Certification.

9. STATUTORY AUDITORS AND AUDIT REPORT

Messrs Singhi & Co. Chartered Accountants were appointed as Auditors of theCompany for tenure of three years i.e. from the conclusion of 34th AnnualGeneral Meeting till the conclusion of the 37th Annual General Meeting of theCompany.

Pursuant to Sec 139 of Companies Act 2013 Messrs Singhi & Co are not eligible forreappointment as Statutory Auditors of the Company.

M/s SS Kothari Mehta & Co has given its consent to be appointed as StatutoryAuditor of the Company with effect from Financial Year 2017-18. The Board of Directors hasevaluated the same and found them suitable and recommend that they may be appointed asStatutory Auditors of the Company for five years as per terms of the Companies Act 2013.

However this appointment is subject to ratification by members at every Annual GeneralMeeting held after appointment during their tenure of office. The Auditors have confirmedtheir eligibility and qualification under Section 141 of Companies Act 2013.

As regards the comments in the Auditors' Report if any the relevant notes in theAccounts are self-explanatory and may be treated as information/ explanation submitted bythe Board as contemplated under provisions of the Companies Act 2013.

10. SECRETARIAL AUDIT

In compliance with the provisions of Sec 204 and other applicable provisions ofCompanies Act 2013 a Secretarial Audit was conducted during the year by SecretarialAuditors M/s. S. Rath & Company. The Secretarial Auditor's Report is attached asannexure and form part of this report. There are no qualifications or observations orremarks made by the Secretarial Auditors in their Audit Report.

11. COST AUDIT

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Amendment Rules 2014 the cost audit records maintained by the Companyrelating to insoluble Sulphur plants located at Dharuhera Haryana is required to beaudited. Your Board had on recommendation of the Audit Committee appointed Messrs J KKabra & Co. Cost Accountants to audit the cost accounts of the Company for thefinancial year 2016-17. The Cost Audit Report for the year ended 31st March 2016 has beensubmitted to the Ministry of Corporate Affairs within stipulated time period.

Messrs J K Kabra & Co. Cost Accountants has been appointed as Cost Auditor of theCompany by the Board on recommendation of the Audit Committee to carry out the requisitecost audit for the financial year 2017-18 on a remuneration of Rs1.35 lakhs. As requiredunder the Companies Act 2013 the remuneration payable to Cost Auditors is required to beplaced before the members in a General Meeting for their ratification. Accordingly aResolution seeking member's ratification for remuneration payable to Messrs J K Kabra& Co. Cost Auditors is included at item no. 5 of the Notice convening the AnnualGeneral Meeting.

12. PUBLIC DEPOSITS

Fixed Deposits from public outstanding with your Company at the end of the financialyear stood at Rs. 49435000/-. Of this a deposit of Rs.10000/- which had fallen duefor payment on 7th May 2003 was claimed by the depositor on 5th May 2010 but the samecould not be paid as the depositor has failed to produce the Original Deposit Receipt.This apart deposits amounting to Rs.1295000/- though fallen due for payment could notbe settled as there is dispute between the concerned joint depositors and the matter issub-judice. Deposits aggregating to Rs.368000/- due for repayment on or before 31stMarch 2017 were not claimed by the depositors by the said date. Out of these depositsaggregating to Rs. 90000/- have since been claimed and settled.

13. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of your Director's knowledge and belief and according to the informationand explanations obtained your Directors make the following statements in terms ofsection 134 (3)(c) of the Companies Act 2013:

i) that in the preparation of the annual financial statements for the year ended March31 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;

ii) the directors had selected such accounting policies and applied them consistentlyand made judgements 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 theprofit and loss of the Company for that period.

iii) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that proper financial controls were in place and that the financial controls wereadequate and were operating effectively.

vi) that systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.

14. AUDIT COMMITTEE

The Audit Committee of the Board of Directors of the Company consists of Mr. O P Dubeyas Chairman Mr. B B Tandon Mr. S J Khaitan and Mr. Akshat Goenka as Members. The CompanySecretary is the Secretary of the Committee. The Managing Director Chief FinancialOfficer and Auditors are permanent invitees to the committee meetings. The detail of termsof reference of Audit Committee number and dates of meetings held attendance of thedirectors and remunerations paid to them are given separately in the attached CorporateGovernance Report. Your Company has a well structured Internal Audit System commensuratewith its size and operations. During the year there were no instances where the board hadnot accepted the recommendations of the Audit Committee.

15. STAKE HOLDER'S RELATIONSHIP COMMITTEE

The Company has a Stake Holder's Relationship Committee for reviewingShareholders/Investors complaints. The present members of this Committee are Mr. J PGoenka (Chairman) Mr. Arvind Goenka (Member) and Mr. S J Khaitan (Member). The detail ofnumber and dates of meetings held attendance of the Directors and remunerations paid tothem are given separately in the attached Corporate Governance Report.

16. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility Committee has Mr. S J Khaitan as Chairman Mr. KRaghuraman and Mr. Arvind Goenka as members. The detail of terms of reference number anddates of meetings held attendance of the Directors and remunerations paid to them aregiven separately in the attached Corporate Governance Report.

The Company recognizes that an effective practice of CSR is required giving dueconsideration to the welfare of the community environment and social structure that itoperates in and that of the country including focus welfare areas identified by the Stateand Central Governments. The CSR Committee of the Company has laid down the policy to meetthe Corporate Social Responsibility objectives of the Company.

The CSR Policy includes activities prescribed as CSR activity as per the Rules ofCompanies Act 2013.The main Focus areas taken in the policy are Education Health careand family welfare Environmental Safety contribution to any relief fund setup by theGovernment of India and any State Government.

Rs.119 Lakhs were spent on CSR activities and projects undertaken during the year thedetails of which are given in the annexure to this Reports.

The detailed CSR policy of the Company is available on the website of the Company whichis www.occlindia.com.

17. NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee has Mr. O P Dubey as Chairman Mr. B B Tandonand Mr. K Raghuraman as members. The detail of terms of reference of this Committeenumber and dates of meetings held attendance of the directors and remunerations paid tothem and the brief outline of the Remuneration policy of the Company are given separatelyin the attached Corporate Governance Report.

The approved Remuneration Policy of the Company is also available on the website of theCompany which is www. occlindia.com.

18. BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance the Directors individually as well as theevaluation of the working of its Audit Nomination and Remuneration and other Committees.The manner in which the evaluation has been carried out is explained in the CorporateGovernance Report. The Independent Directors are regularly updated on industry &market trends plant process and operational performance of the Company etc throughpresentations in this regard and periodic plant visits. They are also periodically keptaware of the latest developments in Corporate Governance their duties as directors andrelevant laws.

19. DIRECTORS

Mr. J P Goenka retires by rotation at the forthcoming Annual General Meeting and beingeligible offer himself for reappointment.

Mr. O. P. Dubey Mr. B. B. Tandon Mr. S J Khaitan Mr. K. Raghuraman Mrs. RunaMukherjee are Independent Directors of the Board of the Company. The Company has receiveddeclarations from all the Independent Directors of the Company confirming that they meetthe criteria of Independence as prescribed both under the Companies Act 2013 and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

20. PARTICULARS OF EMPLOYEES AND KEY MANAGERIAL PERSONNEL (KMP)

The following four persons are the Key Managerial Personnel of the Company as per theprovisions of Sec 203 of the Companies Act 2013.

a) Mr. Arvind Goenka Managing Director

b) Mr. Akshat Goenka Jt. Managing Director

c) Mr. Anurag Jain Chief Financial Officer

d) Mr. Pranab Maity Company Secretary

Pursuant to Sec 134(3) (q) read with Rule 5 of Companies (appointment and Remunerationof Managerial Personnel) Rules 2014 The Remuneration and other details of Key ManagerialPersonnel and other Employees for the year ended March 2017 are annexed to this report.

21. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the financial Statements.

22. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were onarms' length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of Company at large. All related party transactions are placed before theAudit Committee and given in the notes annexed to and forming part of this FinancialStatement. The approved policy on Related Party Transactions is also available on thewebsite of the Company www.occlindia.com.

23. SUBSIDIARY

The Company has only one subsidiary namely Duncan Engineering Ltd (formerly known asSchrader Duncan Limited). The name of the Subsidiary has been changed during the year asper agreed terms at the time of acquisition. A Statement in Form AOC -1 containing thesalient features of the Subsidiary Companies is attached to the Financial Statements in aseparate section and forms part of this Report. The separate audited accounts of theSubsidiary Companies are available on the website of the Company.

The Company's subsidiary registered a turnover of Rs 3773.31 lakh during the currentFinancial Year against Rs 6400.39 Lakhs during FY 2015-16. The Subsidiary also reported aloss of Rs 588.98 lakhs (Previous Year Rs.607.42 lakhs). During the year the loss makingTyre Tube Valve business was discontinued. The above loss includes the cost of closer andimpairment of assets on account thereof. The Management is now concentrating on theengineering division. During the year Mr. Akshat Goenka Jt. Managing Director of theCompany was appointed as Managing Director of the Subsidiary.

In accordance with the provisions of Section 129(3) of the Companies Act 2013 and theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 a ConsolidatedFinancial Statements prepared by the Company in this Report include the financial resultsof the subsidiary company duly audited by the Statutory Auditors. The said statements havebeen prepared in accordance with the relevant accounting standards as prescribed under theCompanies Act 2013. The Company does not have any material subsidiary in the immediatelypreceding accounting year. However as per SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 SEBI has made it mandatory for all listed companies toformulate a policy for determining ‘material' subsidiaries. Accordingly a policy on‘material' subsidiaries was formulated by the Audit Committee of the Board ofDirectors and same is also posted on the website of the Company and may be accessed at thelink http://www.occlindia.com/policies.htm

24. VIGIL MACHANISM POLICY

The Company has a Vigil Mechanism Policy to deal with instance of fraud andmismanagement if any. The details of the Vigil Mechanism Policy is explained in theCorporate Governance Report and also posted on the website of the Company.

25. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 is annexedto this report.

26. FRAUD REPORTING

There was no fraud reported by the Auditors of the Company under Section 143(12) of theCompanies Act 2013 to the Audit Committee or the Board of Directors during the yearunder review.

27. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013

No case was filed under the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 during the year under review.

28. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS /TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE

During the period under review there were no significant and material orders passed byany regulator / court / tribunal impacting the going concern status and the Company'soperations in future.

29. RISK MANAGEMENT

As a policy The Company has identified key risk concern/areas. The assessment of eachrisk area is done on quarterly basis. Following are the main concern/ risk related to theCompany:

Market Related Risk: mainly demand realisation and redundancy of the product.

Production related Risk: mainly availability of inputs accident or break down in theplant and rejection of material by the customers.

Human Resources Risk includes the risk of labour unrest high employee turnover ratioand lower productivity due to dissatisfaction of employees.

Revenue Risk: adverse exchange rate movement. Govt. Policies and duty rates Data andrecords: data loss fire and Virus attack etc.

A Risk Management committee has been formed for the purpose of evaluation of Risks. TheBoard and the Audit Committee also takes note of Risk management of the Company in everyquarter.

The Risk Assessment is also discussed in the Management Discussion and Analysisattached to this report.

30. NUMBER OF MEETINGS OF THE BOARD

During the year four Board Meetings and four Audit Committee Meetings were convened andheld. The details of which are given in the Corporate Governance Report. The interveninggap between the Meetings was within the period prescribed under the Companies Act 2013.

31. CORPORATE GOVERNANCE

a) As per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 aManagement Discussion & Analysis a Report on Corporate Governance together with theAuditors' certificate regarding the Compliance of conditions of Corporate Governance formspart of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conductfor all its Board members and senior management personnel which have also been posted onthe website of the Company. A certificate by the Managing Director regarding compliance ofthe code of conduct of the Company is also included in the Annual report.

32. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of variousBanks Government Agencies Suppliers valued Customers and the shareholders in particularand looks forward to their continued support. Relations between your Company and itsemployees remain cordial and the Directors wish to express their appreciation for theco-operation and dedication of all employees of the Company.

On behalf of the Board of Directors

Place : Noida Arvind Goenka O.P. Dubey

Date :23rd May 2017 Managing Director Director

DIN:00135653

DIN:228441

ANNEXURE TO DIRECTORS' REPORT

INFORMATION AS PER SECTION 134(3)(m) OF COMPANIES ACT 2013 AND FORMING PART OF THEDIRECTOR'S REPORT FOR THE YEAR ENDED 31 ST MARCH 2017

I. CONSERVATION OF ENERGY

(a) Energy Conservation Measures taken:

- Sulphuric Acid Plant de-bottlenecked to meet 100% steam requirement of InsolubleSulphur plants at Dharuhera through utilisation of excess steam generated in SulphuricAcid Plant by installing High Pressure Waste Heat Boiler.

- Recycling of condensate for steam generation implemented.

- Motors of lower rating & high efficiency as per requirments are being used.

- Improvement in Heat transfer through optimisation of equipments.

- Provision of VFD in various pumps etc.

- Coal Fire Boiler was Commissioned on 1st April'2016 since then the Steam to Fuelratio has been optimised to reach consistent value.

- Installed New Model Steam traps to Control Steam Losses.

(b) Additional investments and proposals if any being implemented for reduction ofconsumption of energy:

- Utilisation of waste Hot air form one process in other processes.

- Optimisation of Chilling unit through various means.

- resizing (optimisation) of vaccum pumps.

(c) Impact of measures at (a) and (b) above for reduction of energy consumption andconsequent impact on the cost of production of goods:

- The above measures have helped in the conservation of energy reducing environmentalfootprint and optimising the cost of production.

- Surplus Steam available for meeting 100% requirement of Insoluble Sulphur Plants atDharuhera.

(d) Total energy consumption and energy consumption per unit of production:

FORM-A

Form for disclosure of particulars with respect to conservation of energy.

A. POWER AND FUEL CONSUMPTION Current year Previous year
1. Electricity
(a) Purchased Units (KWH) 30391095 28846814
Total Amount (Rs. in Lakhs) 2028.32 2002.40
Rate/ Unit (Rs.) 6.67 6.94
(b) Own generation
(i) Through Diesel Generator
Units (KWH) 1551442 1704994
Units/Ltr. of Diesel (KWH) 3.47 3.54
Cost/Unit (Rs.) 10.99 10.99
2. Coal (For Steam Generation for Captive consumption)
Quantity (Tonnes) 7256 -
Total cost (Rs. in Lakhs) 355.89 -
Average Rate (Rs.) 4904.72 -
3. Furnace Oil /HSD
Quantity (Ltrs) 2833311 2082025
Total cost (Rs. in Lakhs) 938.46 675.82
Average Rate (Rs.) 33.12 32.46
4. Other / Internal Generation (Steam)
Quantity (MT) 84073 78407
Total Cost (Rs. in Lakhs) 699.34 659.64
Rate/ Unit (Rs.) 831.83 841.31
B. CONSUMPTION PER UNIT OF PRODUCTION (MT)
Products Standards if any
(a) Sulphuric Acid
Electricity (in Units) N.A. 37 36
(b) Oleum
Electricity (in Units) N.A. 71 76

ORIENTAL CARBON & CHEMICALS LIMITED

(c) Insoluble Sulphur

(i) Electricity (in Units) N.A. 1284 1331

(ii) HSD (in Ltrs) N.A. 88 74

(iii) Others-Steam (in MT) N.A. 4 4

II. TECHNOLOGY ABSORPTION

Efforts made in technology absorption as per Form-B of the Annexure to the Rules.

1. Research & Development
(i) Specific area in which R&D carried out by the Company : 1. Improvement in stability of Insoluble Sulphur
2. Improvement in dispersion of Insoluble Sulphur
3. Introduction of new grades in collaboration with Customers
4. Process Improvement to minimise rejection and optimisation of energy cost and consumption norms.
5. Development of New Grades specific to customer requirements
(ii) Benefits derived as a result of the above R&D : Loyalty of existing customers coupled with enlistment of new quality-conscious customers value addition in products edge over competitors and better control over qualitative deviations control over cost
(iii) Future plan of action : 1. Commercialisation of pre-dispursed Insoluble Sulphur.
2. Process Side research for optimisation of various production parameters and costs.
3. The Company has a in-house R&D unit which has been recognised by Ministry of Science & Technology Department of Scientific & Industrial Research. The R&D Unit is being augmented through acquisition of state of art analytical and process equipments.
4. Development of New High Dispersion Grades.
(iv) Expenditure on R&D (Rs. in Lakhs)
(a) Capital : 2.56
(b) Recurring : 86.91
(c) Total : 89.47
(d) Total R&D expenditure as a percentage of net turnover. : 0.30%

 

2. Technology absorption adaptation and innovation: : Production optimisation and innovation in the field of developing new and improved offerings savings in consumption ratios and utilities
III FOREIGN EXCHANGE EARNING AND OUTGO
(a) Activities relating to exports initiatives taken to increase exports development of new export markets for products and services and export plans. : The Company registered a growth of 11.77% by value in exports. Exports constituted 69.69% of total Insoluble Sulphur sales during the year by value.
(b) Total foreign exchange used and earned (Rs. in lakhs)
(i) Earned : 18101.45
(ii) Used : 1149.53

On behalf of the Board of Directors

Place : Noida Arvind Goenka O.P. Dubey

Date : 23rd May 2017 Managing Director Director

DIN: 00135653 DIN: 228441

ANNEXURE TO DIRECTORS' REPORT

PARTICULARS OF EMPLOYEES PERSUANT TO SECTION 134(3)(q) OF THE COMPANIES ACT 2013 READWITH RULE 5(1) OF THE COMPANIES(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL)RULES 2014

I. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year ; Mr. J.P Goenka- 7:10 Mr. Arvind Goenka 333:10 Mr. B.B Tandon- 22:10 Mr. K Raghuraman- 18:10 Mr. O.P Dubey- 22:10 Mr. S.J Khaitan- 31:10 Mr. H S Shashikumar-9:10 Mr Akshat Goenka- 299:10 Mrs Runa Mukherjee- 13:10
II. The percentage increase in remuneration of each director Chief Financial Officer Chief Executive Officer Company Secretary or Manager if any in the financial year ; Directors:

Mr. J.P Goenka - 12.5%

Mr.Arvind Goenka- 10%

Mr.B.B Tandon- NIL Mr. K Raghuraman- NIL Mr. O.P Dubey- NIL Mr. S.J Khaitan- (2.4%)

Mr. H Shashikumar NIL Mr. Akshat Goenka 25% *

Mrs.Runa Mukherjee-NIL Key Managerial Personnel Mr.Arvind Goenka-10%

Mr. Akshat Goenka- 25%

Mr. Anurag Jain- 13%

Mr. Pranab Maity- 17%

*Mr Akshat Goenka was appointed as Jt. Managing Director on 1st June 2016 Percentage increase on annualised basis is 12%.

III. The percentage increase in the median remuneration of employees in the financial year; 21%
IV The number of permanent employees on the rolls of Company; 416 employees as on 31/03/2017
V.Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration; Average Salary increase of non managerial employees was 17%

Increase in managerial remuneration was 18%

The increase in managerial remuneration reflects the contribution of MD and JMD in steering the Company to a growth path and is commensurate with the industry standards. Average salary reflects average increase of all employees who have contributed to a varying degree to the growth of the Company.

VI. The key parameters for any variable component of remuneration availed by the directors; Managing Director and Jt. Managing Director are entitled to performance linked bonus.

All other directors are also entitled to Commission based on the performance of the Company in addition to the sitting fees.

VII. Affirmation that the remuneration is as per the remuneration policy of the Company. Remuneration paid during the year ended March 31 2017 is as per the remuneration policy of the Company.

On behalf of the Board of Directors

Place : Noida Arvind Goenka O.P. Dubey

Date :23rd May 2017 Managing Director Director

PARTICULARS OF EMPLOYEES PERSUANT TO SECTION 134(3)(q) OF THE COMPANIES ACT 2013 READWITH RULE 5(1) OF THE COMPANIES(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL)RULES 2014

Sl. Name No.

Designation & Nature of Duties

Remuneration (Rs.)

Qualification & Total Service Experience (Years)

Age

(Years)

Date of

Commencement of Employment

Last employment held before Joining the Company

Company Designation

(A) EMPLOYED THROUGHOUT THE YEAR
1 Goenka Arvind Managing

Director

17322069 B.Com

(31)

54 01.10.2009 Duncan International India Ltd. Vice President
2 Goenka Akshat Joint

Managing

Director

15581833 Graduate in Economics (6) 29 01.01.2010 NA NA
3 Jain Anurag Chief

Financial

Officer

11970450 B.Sc

(26)

50 01.10.1990 NA NA
4 Chandak O.P* Corporate

Advisor

4221500 B.Com(H) & LLB (56) 72 01.07.2014 NA Consultant
5 Sabarwal Vijay President

(operations)

7712312 BE (Mech) (26) 51 20.10.2014 Subros Ltd Sr. Vice President
6 Almeida D Antony Sr.Vice

President

(F&A)

6108390 M.Com

(44)

65 01.05.1991 Swan Mills Ltd Manager
7 Batta K Muneesh Vice

President

(Marketing)

5691260 MIB BA (23) 47 14.05.1997 Usha

International

(India)Ltd.

Dy.Manager
8 Gupta Alok General

Manager

(Works)

3055605 MSc

(25)

54 15.12.1992 IFFCO Process

Controller

9 Goel Chetan General

Manager

(Purchase)

3576241 B.E (Mech) MBA (PMIT) (27) 50 23.08.2010 Indo Gulf Fertilizer General

Manager

10 Pathak D Govind General

Manager

(Technical)

3569628 B.Tech

(Chem)

(23)

45 12.08.2013 Continental Carbon India Ltd. General

Manager

* Retired on 31/12/2016 NOTES:

1 Remuneration has been calculated on the basis of Section 198 of the Companies Act2013 and includes expenditure incurred by the Company on salary and for provision ofbenefits to the employees excluding actuarial valuation of Retirement Benefits.

2 The nature of employment is contractual in case of Directors and Permanent for allother employees.

3 Mr. Arvind Goenka is related to Mr. J.P. Goenka (Chairman) and Mr Akshat Goenka (JtManaging Director).

4 Mr. Akshat Goenka is related to Mr. Arvind Goenka (Managing Director) and Mr. J.P.Goenka (Chairman).

On behalf of the Board of Directors

Place : Noida Arvind Goenka O.P. Dubey

Date : 23rd May 2017 Managing Director Director

DIN: 00135653 DIN: 228441

ANNEXURE TO DIRECTORS' REPORT REPORT ON CSR ACTIVITIES/INITIATIVES [Pursuant to Section135 of the Act & Rules made thereunder]

As per the requirment of the Companies Act 2013 Corporate Social Policy was drafted bythe Company. The Corporate Social Responsibility Committee has the following members:-

Mr. Suman J Khaitan Chairman

Mr. Arvind Goenka Member

Mr. K Raghuraman Member

As per the approved CSR policy following focus areas were identified:

Education Health care and Family welfareEnvironmental Safty Contribution to GovtFunds any activity that may be prescribed as CSR activity as per the Rules of CompaniesAct 2013

Based on the Average Net profit for last three financial years the budgeted CSRexpenditure for the FY 2016-17 was Rs 118.6 lakhs The manner in which the amount has beenspent during Financial Year is detailed below:

Sr. CSR project/

No. Activity Identified

Sector in which the Project is covered Projects/Programmes

1. Local area/other -

2. specify the state/ district

(Name of the District/s State/s where project/ programme was undertaken)

Amount

outlay

(budget)

project/

pro

gramme

wise

Amount spent on the

project/programme

Sub-heads:

1. Direct expenditure on

project/programme.

2. Overheads (in ‘Rs.)

Direct:

Cumulative spend upto to the reporting period (in ‘Rs.) Amount spent: Direct/through implementing agency*
1 Construction of Toilets renovation of School/College Building. Promoting Education/ Sanitation/Health Care In the State of Haryana 119405 119405 OCCLCSR Trust
2 Expenses on Govt School Adopted in Rewari Promoting Education/ Sanitation/Health Care Rewari Haryana 315497 434902 OCCLCSR Trust
3 Donation for Education to under privi- ledged Children Promoting Education New Delhi 100000 534902 OCCLCSR Trust
4 Financial Assistence for Poor and Needy for Education Health Care and construction of houses Promoting Education/ Sanitation/Health Care In the state of Haryana Rajasthan West Bengal and Delhi 1705184 2240086 OCCLCSR Trust
5 Construction of School Building Promoting Education Mundra Gujarat 800000 3040086 OCCLCSR Trust
6 Construction of Hospital Building Health Care Mundra Gujarat 90000 3130086 OCCLCSR Trust
7 Mid Day Meal Promoting Education Program Run by Akshay Patra Foundation 250000 3380086 Direct
8 Construction and renovation of School College Building/Provision of Safe Drinking water/ Health Care for students Promoting Education/ Sanitation/Health Care Program run by Ram Chander Goenka Charitable Trust in the state of Rajasthan 3500000 6880086 Direct
9 Construction and renovation of

School/College Building/ Provision of Safe Drinking water/ Health Care for students

Promoting Education/ Sanitation/Health Care Program run by Oriental Foundation. 1000000 7880086 Direct
10 Providing Financial Assistance for Purchase of Computer at School Promoting Education School at Rewari Haryana 501500 8381586 OCCLCSR Trust
11 Administrative cost 342000 8723586 OCCLCSR Trust
12 Construction and renovation of School/ College Building/

Provision of Safe Drinking water/ Health Care for students

Promoting Education/ Sanitation/Health Care Program run by OCCL CSR Trust in the state of Gujarat Haryana Delhi etc 3176414 11900000 OCCLCSR Trust

On behalf of the Board of Directors

Place : Noida Arvind Goenka O.P. Dubey

Date : 23rd May 2017 Managing Director Director

DIN:00135653

DIN:228441