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Shipping Corporation of India Ltd.

BSE: 523598 Sector: Infrastructure
NSE: SCI ISIN Code: INE109A01011
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OPEN 94.85
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VOLUME 150892
52-Week high 113.50
52-Week low 56.30
P/E 261.25
Mkt Cap.(Rs cr) 4,381
Buy Price 0.00
Buy Qty 0.00
Sell Price 94.05
Sell Qty 3013.00
OPEN 94.85
CLOSE 93.85
VOLUME 150892
52-Week high 113.50
52-Week low 56.30
P/E 261.25
Mkt Cap.(Rs cr) 4,381
Buy Price 0.00
Buy Qty 0.00
Sell Price 94.05
Sell Qty 3013.00

Shipping Corporation of India Ltd. (SCI) - Director Report

Company director report

To the Members

Your Directors have pleasure in presenting the 67th Annual Report on theworking of your Company for the financial year ended 31st March 2017.

Accounting Year

The year under report covers a period of 12 months ended on 31st March2017.

FINANCIAL PERFORMANCE

The comparative position of the working results for the year under report vis-a-visearlier year is as under:

(' in Crores
2016-17 2015-16
Gross Earnings 3592 4215
Gross Profit (before interest depreciation & exceptional items & tax) 915 1503
Less : Interest 172 172
Depreciation and Impairment 566 738 542 714
Profit before exceptional items & tax 177 789
Exceptional items - -
Provision for Taxation (42) (36)
Net Profit 135 753

The financial statements for the year 2016-17 are the first financial statements theCompany has prepared under Ind AS (Indian Accounting Standards)

The financial statements for the year 2015-16 have been restated in accordance with IndAS for comparative information.

The above figures have been extracted from the Standalone Financial Statements as perIndian Accounting Standards (Ind-AS). The Financial Statements of the company have beenprepared in accordance with Ind-AS notified under the Companies (Indian AccountingStandards) Rules 2015 ( as amended) read with Section 133 of the Companies Act 2013 tothe extent applicable and current practices prevailing within the Shipping Industries inIndia. For the purpose of transition to Ind-AS the Company has followed the guidanceprescribed in IND-AS 101. First time adoption of Indian Accounting Standards with effectfrom transition date of 1st April 2015.

Appropriations :

A sum of ' 7.5 crores has been transferred to Tonnage Tax Reserve for financial year2016-17. The working results for your company for the year 2016-17 shows a net profit of '135.52 crores.

After adjusting an opening credit balance of ' 65.16 crores (being balance retainedearnings brought forward from previous year) and adding items of other comprehensiveincome of ' 8.38 crores that are recognised directly in retained earnings there is acredit balance in retained earnings of ' 201.56 crores as on 31st March 2017.

Brief Analysis of Financial Performance

FY 2016-17 marks the first annual accounts of your company under IND-AS withcomparatives of FY 2015-16 being restated. SCI has reported a net profit of ' 135.52Crores for financial year 2016-17. Reduction in operating revenues of tanker and offshoresegments coupled with an increase in repair costs has resulted in a reduction in netprofits. The Consolidated net profit for the company for Financial Year 201617 was '175.62 crores.

Performance and Financial positions of joint ventures included in ConsolidatedFinancial Statements:

Fig (' in lacs)
Particulars ILT 1 ILT 2 ILT 3 ILT 4 ICSL
As on 31.03.2017 31.03.2017 31.03.2017 31.12.2016 31.03.2017
Total Income 17628 18078 17912 1089 -
PAT 6914 7506 743 -517 -9
Equity capital 14 14 6 27528 5
Number of equity shares 10000 10000 10000 42448300 50000
EPS (Rs/share) 69140 75060 7430 (1.21) -18
Dividend 0 0 0 0 0
Net worth 16646 17190 -19870 14512 -4

• Net Impact on Consolidated profits for the year ended 31st March 2017 isincrease of ' 4010 lacs upon consolidation of above joint ventures and subsidiary and onNet worth is an increase of ' 6135 lacs.

1.0 Fleet Position during the Year:

During the year under report your company has taken delivery of one Multi-PurposeSupport Vessel (MPSV) (named SCI Sabarmati) and has disposed off one Bulk carrier (MvGoa). Thus the overall fleet of SCI was almost constant at 69 vessels of 5.85 million DWTat the end of the year.

Fleet Profile during the Year

Particulars

As on 1.4.2016

Additions

Deletions

As on 31.3.2017

No. DWT No. DWT No. DWT No. DWT
1. (a) Crude Oil Tanker 21 3608001 - - - - 21 3608001
(b) Product Tankers 14 908059 - - - - 14 908059
(c) Gas Carriers 2 35202 - - - - 2 35202
2. Bulk Carriers 17 1113889 - - 1 45801 16 1068088
3. Liner Ships 5 202413 - - - - 5 202413
4. Offshore Supply Vsls. 9 20150 1 3352 - - 10 23502
5. Passenger-Cum-Cargo Vessels 1 5140 - - - - 1 5140
Total 69 5892854 1 3352.31 1 45801 69 5850405

2.0 During the period under report the following vessel was inducted in SCI fleet:

Vessel Name Type Yard Built DWT
SCI Sabarmati MPSV 2013 3352.31

2.1 During the same period the following vessel were disposed off from SCI fleet:

Vessel Name Type Year Built DWT
MV Goa Bulk Carrier 1998 45801

2.2 At the end of the year 2016-17 the Company had no new vessels on order. Howeveryour company had signed MOAs for acquisition of a secondhand Suezmax tanker and a resaleMPSV. These vessels were delivered on 26.4.2017 and 07.07.2017 respectively. Two vesselsviz; MV Indira Gandhi and MV Rajiv Gandhi were sold on 22.05.2017 and 07.07.2017respectively.

Particulars of Loans Guarantees and investments.

Details of Loans Guarantees and Investments are given in the notes to financialstatements.

Extract of Annual Return

In accordance with section 134 (3) (a) and section 92(3) of the companies Act 2013read with relevant rules an extract of annual return in form MGT-9 as on 31st March 2017is appended to the Directors' Report.

Subsidiaries and Associates

Your company has one subsidiary Company and has six Joint Ventures. Investment insubsidiary “Inland and Coastal Shipping Limited” was done on 29th September2016. It is a wholly owned subsidiary of your company. Pursuant to section 129(3) of theCompanies Act 2013 a statement containing salient features of our subsidiary andassociates companies in form AOC-1 is appended to the Director's Report.

In accordance to section 136 of the Companies Act 2013 the audited financialstatements of the company are available on our website www.shipindia.com .

Particulars of contracts/arrangements with related parties

Particulars of contracts/arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed form AOC-2 is appended to theDirector's Report. The details are also available in Note 29 under ‘Notes toFinancial statements'.

Particulars of Employees

In accordance with Ministry of Corporate Affairs notification no. GSR 463(E) dated 5thJune 2015 Government Companies are exempt from Section 197 of the Companies Act 2013and its rules thereof.

Risk Management

In accordance with the section 134(3)(n) of the Companies Act 2013 the Risk Managementis forming a part of the Corporate Governance Report.

Conservation of Energy Technology Absorption

The information pertaining to conservation of energy technology absorption is forminga part of the Management Discussion and Analysis Report.

Particulars 2016-17 2015-16*
Foreign exchange earned & saved including deemed earned & saved 3555.76 3771.57
Foreign exchange used including deemed used 3675.89 3678.42

* Figures as per IGAAP

Expenses on entertainment foreign tours etc - FY 2016-17

During the year under report your Company spent ' 32 lakhs on entertainment ' 393lakhs on publicity and advertisements and ' 335 lakhs on foreign tours of Company'sexecutives.