Oswal Greentech Limited
Your Directors now submit the report of the business and operations of Company alongwith the audited financial statements for the financial year ended 31st March2016. The consolidated performance of the Company and its subsidiaries has been referredto wherever required.
Shri. Abhey Kumar Oswal our founder Chairman left for his heavenly abode on 29thMarch 2016 in Russia where he was exploring new business opportunities for the Company.He was truly a visionary leader who devoted his life for the growth and development of theCompany and its business.
The Board of Directors take on record the immeasurable contribution made by Shri. AbheyKumar Oswal in the growth of the Company.
His untiring efforts have led the Company to be amongst the most successful growthoriented and respected companies in the country. After promoting this Company at his earlyage he had set up the urea plant at Shahjahanpur in Uttar Pradesh in a record time andhad moved to set up Asias largest Di-Ammonium Phosphate (D.A.P) plant at Paradeep inOrissa. It was under his dynamic leadership that the Company became the largest fertilizerCompany in the Country.
He provided a strong leadership to the Company and the board of directors managementand other employees will always feel the vacuum created by his sudden death.
The Board of Directors have now elected Smt. Aruna Oswal as the Chairperson of theCompany. Smt. Aruna Oswal comes from a business family and was actively engaged in themanagement and running of business concerns prior to her appointment in Oswal GreentechLimited as Additional Director. She is International Director in Lions Club Internationaland is widely travelled across the globe. She will continue to implement the vision andideology of Shri Abhey Kumar Oswal.
|The summary of operating results for the year is given below:- || ||( Rs. in Lacs) |
|Particulars ||2015-16 ||2014-15 |
|Gross Profit before Depreciation and Tax ||5330.44 ||5117.87 |
|Depreciation ||239.03 ||305.96 |
|Profit/(Loss) before Tax ||5091.41 ||4811.91 |
|Tax ||1301.77 ||1081.87 |
|Profit/(Loss) after Taxation ||3789.64 ||3730.04 |
|Add : Balance brought forward from last year ||(4452.70) ||(8169.99) |
|Less: Adjustment for Depreciation || ||12.75 |
|Balance in Profit/(Loss) Accounts ||(663.06) ||(4452.70) |
REVIEW OF OPERATIONS & FUTURE OUTLOOK
During the year the Company carried on the activities of development of real estatesecurities trading and investments. The Company earned a profit before tax of Rs. 5091.41Lacs and profit after tax of Rs. 3789.64 Lacs as against a profit before tax of Rs.4811.91 Lacs and profit after tax of Rs. 3730.04 Lacs in the previous year.
The Companys residential complex at Ludhiana under joint development isprogressing well within the stipulated time and is expected to be ready for delivery intime in 2017-18. This project consists of the development of an integrated residentialcomplex of 532 residential units along with all modern facilities.
This residential project is quite prestigious and will open many opportunities for theCompany in the real estate sector. The future outlook is very encouraging.
SUBSIDIARY COMPANY AND ASSOCIATES Subsidiary
The Company has one subsidiary namely Oswal Engineering Limited at UAE.
The Company has one associate namely M/s News Nation Network Private Limited.
The Accounting of Subsidiary and Associate have been done in consolidated financialstatements in accordance with the relevant accounting standards.
The Company has not accepted or renewed any deposits within the meaning of Section 73to 76 of Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.
Your directors are not recommending any dividend in view of requirements of funds forvarious projects being undertaken by the Company.
There are no material changes to report for.
STATUTORY AUDITORS AND THEIR REPORT
M/s T R Chadha & Co Chartered Accountants (Registration No. 006711N) theStatutory Auditors of the Company has converted their partnership firm into LimitedLiability Partnership and thus changed their constitution w.e.f. 28th December2015 and are known as M/s T R Chadha & Co LLP (A Limited Liability Partnership withLLP Identification No. AAF-3926). They are the Statutory Auditors of the Company till theconclusion of the ensuing Annual General Meeting and being eligible offer themselves forre-appointment.
The Auditors Report is enclosed with the financial statements in this AnnualReport.
SECRETARIAL AUDITORS AND THEIR REPORT
M/s C T & Company New Delhi Practicing Company Secretaries were appointed toconduct the secretarial audit of the Company for the F.Y. 2015-16 as required underSection 204 of the Companies Act 2013 and Rules made thereunder. The Secretarial AuditReport for F.Y. 2015-16 forms part of the Annual Report as Annexure-I to the BoardsReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark.
EXTRACTS OF ANNUAL RETURN AND OTHER DISCLOSURES UNDER COMPANIES (APPOINTMENT &REMUNERATION) RULES 2014
The extract of Annual Return pursuant to the provisions of Section 92 of the CompaniesAct 2013 read with rule 12 of the Companies (Management & Administration) Rules 2014is furnished in Annexure-II and is attached to this report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
As per the provisions of the Companies Act 2013 and Articles of Association of theCompany Shri Anil Bhalla (DIN: 00587533) and Shri Atul Kulshrestha (DIN: 00194733)directors of the Company who retire by rotation and being eligible offer themselves forre-appointment. The Board of Directors recommend their re-appointment.
As required under Regulation 36 of SEBI Listing Regulations 2015 the requisiteinformation of Shri Anil Bhalla and Shri Atul Kulshrestha inter alia in the nature ofbrief resume nature of expertise companies in which they hold directorship/membershipsof Board Committees shareholding in all Companies forms part of the Notice of the AnnualGeneral Meeting.
Pursuant to provision of section 196197 203 read with Schedule V of the CompaniesAct 2013 Smt. Aruna Oswal is appointed as additional director and chairperson of theCompany w.e.f. 2nd April 2016 and thereafter she is appointed as additionalcum whole time director and chairperson of the Company for the period of three yearsw.e.f. 1st June 2016 to 31st May 2019 subject to the approval ofmembers by way of special resolution in the ensuing Annual General Meeting of the Company.
Pursuant to provision of section 196197 203 read with Schedule V of the CompaniesAct 2013 the Board of directors propose to re-appoint Shri Anil Bhalla as CEO &Managing Director of the Company for a further period of three years w.e.f. 1stApril 2017 to 31st March 2020 subject to the approval of members by way ofspecial resolution in the ensuing Annual General Meeting of the Company without anymodification in the salary last drawn by Shri Anil Bhalla in his current tenure of CEO& Managing Director of the Company.
Details of the proposal for the appointment/re-appointment of above Directors arementioned in the Explanatory Statement under section 102 of the Companies Act 2013 of theNotice of the ensuing Annual General Meeting of the Company.
Shri Abhey Kumar Oswal is no more on the Board of the Company w.e.f. 29.03.2016 due tohis death.
DECLARATION ON INDEPENDENT DIRECTORS
The Company has received necessary declaration from each Independent Director u/s 149(7) of the Companies Act 2013 that he/she meets the criteria of independence laid downin Section 149 (6) of the Companies Act 2013 and Regulation 16(1)(b) of SEBI ListingRegulations 2015.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 sub-section 3 (c) and subsection(5) of the Companies Act 2013 with respect to the Directors ResponsibilityStatement it is hereby stated and confirmed that:
i. in preparation of the annual accounts the applicable accounting standards had beenfollowed along with proper explanation relating to material departures;
ii. that directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at the end of the financial year andof the profit of the Company for that period;
iii. that directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv. that the directors had prepared the annual accounts on a going concern basis and;
v. that the directors had laid down the internal financial controls to be followed bythe Company and that such internal financial controls are adequate and were operatingeffectively.
vi. that directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
The powers role and terms of reference of the Audit Committee are in consonance withthe requirements mandated under Section 177 of the Companies Act 2013 and Regulation 18of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The AuditCommittee comprises of Four Non-Executive Directors out of them three are Non-ExecutiveIndependent Directors.
During the period under review the suggestions put forth by the Audit Committee wereduly considered and accepted by the Board of Directors. There were no instances ofnon-acceptance of such recommendations.
The audit committee has met 4 times and reviewed the financial statements for eachquarter/ financial year ended 31.03.2016 and has not given any adverse observations.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of SEBI Listing Regulations 2015 is presented in a separate sectionforming part of the Annual Report.
Your Company has a strong legacy of fair transparent and ethical governance practices.Pursuant to Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("SEBI Listing Regulations") the Company hasexecuted fresh Listing Agreements with the Stock Exchanges.
As per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 aseparate section on Corporate Governance practice followed by the Company together with aCertificate from the Companys Statutory Auditor confirming compliance forms anintegral part of this report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTIVE PROHIBITIONAND REDRESSAL) ACT 2013.
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at Work Place (Prevention Prohibition andRedressal) Act 2013. An Internal Complaints Committee has been set up to redresscomplaints received regarding sexual harassment. The Company affirms that during the yearunder review no cases were filed under the said Act by any of its women employee beforethe Internal Complaints Committee.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 a statement showing the names and other particulars of the top 10employees in terms of remuneration drawn and the name of every employee of the Companydrawing remuneration in excess of the limits set out in the said rules is furnished inAnnexure-III and is attached to this report.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annual Report.
NUMBER OF MEETINGS OF THE BOARD
The Board met seven times during the Financial Year the details of which are given inthe Corporate Governance Report that forms part of this Annual Report. The intervening gapbetween any two meetings is within the period prescribed by the Companies Act 2013.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDEDU/S 186 of the Companies Act 2013
Particulars of loans given are provided under Note No. 3.35 to the financial statement.Particulars of investment made are provided under Note No.3.8 and Note No.3.11 to thefinancial statement provided in this Annual Report. The Company has not given anyguarantee or security in connection with a loan to any other body corporate or person.
PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTY REFERRED TO IN SUB-SECTION(1) OF SECTION 188 of the Companies Act 2013
With reference to Section 134(3)(h) of the Companies Act 2013 all contracts andarrangements with related parties under Section 188(1) of the Companies Act 2013 enteredby the Company during the financial year were in the ordinary course of business and onan arms length basis.
During the year the Company has not entered into any contract or arrangement withrelated parties which could be considered material (i.e. transactionsexceeding ten percent of the annual consolidated turnover as per the last auditedfinancial statements entered into individually or taken together with previoustransactions during the financial year) according to the policy of the Company onmateriality of Related Party Transactions. Accordingly there are no transactions that arerequired to be reported in form AOC-2.
A detailed report on related party disclosures during the financial year 2015-16 hasbeen reported and annexed as Note No. 3.33 to the Standalone Financial Statement.
PARTICULARS OF ENERGY CONSERVATION/TECHNOLOGY ABSORPTION/FOREIGN EXCHANGE EARNING ANDOUT GO
Information in accordance with the provision of Section 134 (m) of the Companies Act2013 read with rule 8(3) of the Companies (Accounts) Rules 2014 regarding conservationof energy and technology absorption are not applicable to the Company. During the yearunder review the foreign exchange earnings were Nil (previous year Rs. 95.14 lacs) andforeign exchange outgo was Rs. 28.00 Lacs (previous year Rs. 15.86 Lacs).
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLETO THE CENTRAL GOVERNMENT
The Statutory Auditors or Secretarial Auditors of the Company have not reported anyfrauds to the Audit Committee or to the Board of Directors under Section 143(12) of theCompanies Act 2013 including rules made thereunder.
POLICY ON DIRECTORS APPOINTMENT AND POLICY ON REMUNERATION
Pursuant to Section 134(3)(e) and Section 178(3) of the Companies Act 2013 the policyon appointment of Board members including criteria for determining qualificationspositive attributes independence of a Director and the policy on remuneration ofDirectors KMP and other employees is attached as Annexure-IV respectively which formspart of this report.
DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT
The Company has in place comprehensive risk assessment and minimization procedureswhich are reviewed by the Board periodically. The Board is responsible for preparation ofRisk Management Plan reviewing and monitoring the same on regular basis identifying andreviewing critical risks on regular basis.
The risks faced by the Company their impact and their minimization procedures areassessed categorically under the broad heads of High Medium and Low risks. Thenon-critical risks faced by the Company and their mitigation are also reviewed by theBoard from time to time.
The risk management approach is based on a clear understanding of the variety of risksthat the organization faces disciplined risk monitoring and measurement and continuousrisk assessment and mitigation measures.
In the opinion of the Board there has been no identification of elements of risk thatmay threaten the existence of the Company.
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED ON CORPORATE SOCIAL RESPONSIBILITIES (CSR)INITIATIVES
The Company has in place a CSR policy in line with Schedule VII of the Companies Act2013. As per the policy the CSR activities are focused not just around the offices of theCompany but also in other geographies based on the needs of the communities. The Companyhas actively contributed to "Mohan Dai Oswal Cancer Treatment and ResearchFoundation" for providing medical facilities to the underprivileged.
The annual report on CSR activities is furnished in Annexure-V and forming part of thisreport.
PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND INDIVIDUAL DIRECTORS
The performance of the Directors is evaluated on the basis of their contributions atthe meetings strategic inputs for the performance and growth of the Company among others.The Directors have carried out performance evaluation on annual basis of DirectorsCommittee and the Board. The Nomination and Remuneration Committee of the Board has laiddown the performance evaluation framework under which performance of every Director isevaluated. The framework also provides the manner in which the Directors as a collectiveunit in the form of Board Committees and the Board function and perform.
INTERNAL FINANCIAL CONTROL SYSTEM
According to Section 134(5)(e) of the Companies Act 2013 the term Internal FinancialControl (IFC) means the policies and procedures adopted by the Company for ensuring theorderly and efficient conduct of its business including adherence to Companyspolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.
The Company has a well placed proper and adequate IFC system which ensures that allassets are safeguarded and protected and that the transactions are authorized recordedand reported correctly. The Internal Auditors independently evaluate the adequacy ofinternal controls and concurrently audit the majority of the transactions in value terms.
Independence of the audit and compliance is ensured by direct reporting of InternalAuditors to the Audit Committee of the Board.
During the year the consultants were engaged for providing assistance in improvisingIFC framework including preparation of Management Risk Control Matrix for variousprocesses and deployment of Self Assessment Tool.
OGL has aligned its current systems of internal financial control with the requirementof Companies Act 2013 on lines of globally accepted risk based framework as issued bythe committee of sponsoring organisations (COSO) of the treadway commission. The InternalControl
Integrated Framework (the 2013 framework) is intended to increase transparencyand accountability in an organisations process of designing and implementing asystem of internal control. The framework requires a Company to identify and analyze risksand manage appropriate responses. The Company has successfully laid down the framework andensured its effectiveness.
OGLs internal controls commensurate with its size and the nature of itsoperations. These have been designed to provide reasonable assurance with regard torecording and providing reliable financial and operational information complying withapplicable statutes safeguarding assets from unauthorised use executing transactionswith proper authorisation and ensuring compliance of corporate policies. OGL has awell-defined delegation of power with authority limits for approving revenue as well asexpenditure.
Processes for formulating and reviewing annual and long term business plans have beenlaid down.
Our management assessed the effectiveness of the Companys internal control overfinancial reporting (as defined in Regulation 17 of SEBI Listing Regulations) 2015 as of31st March 2016. The assessment involved self review peer review and externalaudit.
T R Chadha & Co LLP the statutory auditors of OGL has audited the financialstatements included in this annual report and has issued an attestation report on ourinternal control over financial reporting (as defined in section 143 of Companies Act2013).
OGL has appointed M/s. R Arora & Associates Chartered Accountants to oversee andcarry out internal audit of its activities. The audit is based on an internal audit planwhich is reviewed each year in consultation with the statutory auditors (T R Chadha &Co LLP) and the audit committee. In line with international practice the conduct ofinternal audit is oriented towards the review of internal controls and risks in itsoperations such as accounting and finance procurement employee engagement travelinsurance IT processes etc.
Suggestions for improvement are considered and the audit committee follows up oncorrective action. The audit committee also meets OGL statutory auditors toascertain inter alia their views on the adequacy of internal control systems and keepsthe board of directors informed of its major observations periodically.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Companies Act 2013 re-emphasizes the need for an effective Internal FinancialControl system in the Company which should be adequate and shall operate effectively. Rule8(5)(viii) of Companies (Accounts) Rules 2014 requires the information regarding adequacyof Internal Financial Controls with reference to the financial statements to be disclosedin the Boards report.
The internal financial controls were in operation during the reporting period from 1stApril 2015 to 31st March 2016. Our management assessed the effectiveness ofthe Companys internal control over financial reporting as of 31st March2016.
T.R. Chadha & Co Chartered Accountants LLP the statutory auditors have audited thefinancial statements. They have assessed the internal financial controls including theEntity Level Controls Process Application and Transaction Controls and InformationTechnology General Controls.
The audit committee review reports have been submitted by the management and auditreports have been submitted by internal auditors and statutory auditors. Suggestions forimprovement are considered and the audit committee follows up on corrective action. Theaudit committee also meets statutory auditors to ascertain inter alia their views on theadequacy of internal control systems and keeps the board of directors informed of itsmajor observations periodically.
The Company has a comprehensive risk management framework. The Company has in place awell-defined Whistle Blower Policy/ Vigil Mechanism. Compliance of secretarial functionsis ensured by way of secretarial audit.
Based on its evaluation as defined in section 177 of Companies Act 2013 and Regulation18 of SEBI Listing Regulations 2015 audit committee has concluded that as of 31stMarch 2016 the internal financial controls were adequate and operating effectively.
CODE OF CONDUCT
Pursuant to Clause 49 of the Listing Agreement the declaration signed by the ManagingDirector affirming the compliance of Code of Conduct by the Directors and SeniorManagement Personnel for the year under review is annexed to and forms part of theCorporate Governance Report.
The Board of Directors would like to take this opportunity to place on record itsappreciation for the committed services and contributions made by the employees of theCompany during the year.
LISTING/DELISTING OF SHARES
Presently the Companys equity shares are listed on the following StockExchanges: The National Stock Exchange of India Ltd. Mumbai Bombay Stock Exchange MumbaiThe Calcutta Stock Exchange Association Ltd. Kolkata The Ahmedabad Stock Exchange.Ahmedabad
The Applications for delisting of shares are pending with Calcutta Stock Exchange andAhmedabad Stock Exchange The equity shares of the Company listed with National StockExchange of India Ltd. and Bombay Stock Exchange Mumbai. Listing Fee for the year 2016-17has been paid to the National Stock Exchange of India Ltd. and Bombay Stock ExchangeMumbai.
Your Directors place on record their sincere thanks to the Companys esteemedshareholders customers suppliers associates bankers and the authorities for theircontinued support and co-operation at all level.
The Directors also wish to acknowledge the contribution made by the employees at alllevels for steering the growth of the organization.
The Board would like to express its gratitude to the members for their continued trustcooperation and support.
| ||For & on behalf of the Board |
| ||Oswal Greentech Limited |
| ||Anil Bhalla |
|Place : New Delhi ||CEO & Managing Director |
|Date : 06.08.2016 ||DIN : 00587533 |