The Board of Directors is pleased to present the Twentieth Annual Report of yourCompany together with the audited financial statements for the financial year ended March31 2016.
| || || |
(Rs. in Million)
|Particulars ||Year ended March 31 2016 ||Year ended March 31 2015 |
|Revenues ||58641 ||57481 |
|Profit before financial expenses and depreciation ||455 ||460 |
|Financial expenses ||3310 ||3362 |
|Depreciation ||1458 ||1556 |
|Profit before provision for tax and exceptional items ||(4313) ||(4458) |
|Exceptional Items ||- ||- |
|Provision for taxation: || || |
|- Current ||- ||- |
|- Deferred Tax ||(1460) ||(1507) |
|Net Profit/Loss ||(2853) ||(2951) |
|Profit brought forward from the previous year ||(1259) ||(1551) |
|Profit available for appropriation ||(4112) ||(4502) |
|Transfer from General Reserves ||- ||3166 |
|Transfer to Debenture Redemption Reserves ||(125) ||150 |
|Transitional Impact of change in useful life of assets ||- ||74 |
|Retained in the Profit & Loss Account ||(4237) ||(1259) |
The Company achieved a turnover of Rs. 58641 Million for the year ended March 31 2016as against Rs. 57481 Million for the previous year. The EBITDA for the year under reviewstood at Rs. 1432 Million as compared to Rs. 1802 Million for the previous year whilethe Net Loss stood at Rs. 2853 Million as compared to Net Loss of Rs. 2951 Million forthe previous year. During the year under Corrective Action Plan approved by the JointLenders Forum ("JLF") the JLF Lenders have approved aggregate financialassistance of Rs. 2899.12 Crores to the Company. Analysis of operating performance iscovered under Management Discussion and Analysis which forms part of this Report.
As the Company has incurred loss during the year under review your Directors have notrecommended any dividend for the financial year ended March 31 2016.
TRANSFER TO RESERVES
Debenture Redemption Reserve is created to the extent of 25% of the Non ConvertibleDebentures (NCDs) equally over the period till maturity of the NCDs as per therequirements of the applicable laws. During the year the Company has created DebentureRedemption Reserve of Rs. 125 Million on outstanding amount of NCDs.
Your Company has not accepted any deposits from public / shareholders in accordancewith the Sections 73 and 74 of the Companies Act 2013.
The Company has not raised long term funds through issuance of Non ConvertibleDebentures (NCDs) during the period under review.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report on the business and operations of theCompany is attached to this Report.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standards 21 and 23 issued by the Institute ofChartered Accountants of India on Consolidated Financial Statements attached are theConsolidated Financial Statements which form part of this Annual Report. TheseConsolidated Financial Statements provide financial information about your Company and itssubsidiaries after elimination of minority interest as a single entity.
During the year under review Parana Global Trading (FZE) wholly owned subsidiary ofthe Company situated at UAE has been closed down w.e.f. August 13 2015 due to noncommencement of operations. Further Renuka Commodities DMCC wholly owned subsidiary ofthe Company situated at Dubai is proposed to be amalgamated into the Company to achievebetter synergies and increase net worth of the Company which will facilitate effectiveand fast mobilization of financial resources for meeting increased capital expenditure.
The Brazilian subsidiary of the Company viz. Shree Renuka do Brasil ParticipaesLtda (SRDBPL) together with all of its subsidiaries (collectively RenukaBrazil) on September 28 2015 filed for protection under Judicial Recovery (Law11.101/2005-Recuperao Judicial) in the designated court in the capital of the state ofSo Paulo. The designated court on July 26 2016 approved the Re-organisation Plan of theCompanys subsidiary viz. Renuka Vale do Ivai S/A resulting in debt declining by Rs.1680 Million. While for the remaining debts on book the Company received periodextension grace (ranging from 9 to 15 years) and substantial reduction in interest rates.
A summary of the financial performance of each of the Subsidiary Associate and JointVenture companies in the prescribed Form AOC-1 is provided in the FinancialStatements.
The Companys Policy for Determining Material Subsidiaries may be accessed on theCompanys website at the link http://www.renukasugars.com/en/corporate-governance.html.
In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements and related information of theCompany and accounts of each of the subsidiaries of the Company are available on thewebsite of the Company www.renukasugars.com. These documents will be made available to theMembers for inspection at the Registered Office of the Company on all working days exceptSaturdays Sundays and public holidays between 11.00 a.m. to 1.00 p.m. upto the date ofthe ensuing Annual General Meeting. The Company will make available the documents of thesubsidiaries upon request by any Member of the Company interested in obtaining the same.
The Authorised Capital of the Company is Rs. 185 Crores divided into 1600000000 (OneHundred Sixty Crores) Equity Shares of Rs. 1/- each and 25000000 (Two Crores Fifty Lakh)Preference Shares of Rs. 10/- each. On March 31 2016 the issued subscribed and paid upshare capital of your Company stood at Rs. 928811242 comprising 928811242 Equityshares of Rs. 1/- each.
During the year under review the Company has neither issued any shares nor grantedstock options or sweat equity.
DIRECTORS & KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act 2013 (the Act)Mrs. Vidya Murkumbi Director of the Company retires by rotation and being eligibleoffers herself for re-appointment at the ensuing Annual General Meeting.
Pursuant to the provisions of Sections 149 152 & other applicable provisions ofthe Act & the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015("Listing Regulations") the Board of Directors has appointed Mr. Bhupatrai M.Premji and Mr. Dorab E. Mistry as Independent Directors of the Company to hold office forthe tenure mentioned in the Notice of the Annual General Meeting of the Company subjectto approval of the Members. Pursuant to the terms of the Joint Venture (JV) Agreement withWilmar Sugar Holdings Pte Ltd. (WSH) dated February 20 2014 WSH nominated directorshipof Mr. Stephen Ho Kiam Kong on the Board of Directors of the Company. In view of the samethe Board of Directors has also appointed Mr. Stephen Ho Kiam Kong as Additional Directorof the Company to hold office upto the ensuing Annual General Meeting.
The Company has received requisite notice from a member proposing the appointment ofaforesaid Directors. ThefiCompany has also received the declarations from thefiIndependent Directors confirming that they satisfy thefi criteria of independence asprescribed under Sectionfl149(6) of the Act and under the provisions of ListingRegulations. The Board recommends the appointment / re-appointment of the aforesaidDirectors for members approval.
Brief resumes of the aforesaid Directors seeking appointment / re-appointment offixation of remuneration as stipulated under Regulation 36(3) of the Listing Regulations/ Secretarial Standard-2 on General Meetings are given in the section on CorporateGovernance which forms part of this Annual Report.
During the year under review the Board of Directors and shareholders of the Companyhad re-appointed / appointed Mr. Robert Taylor and Mr. Ashit Mallick as IndependentDirectors of the Company in terms of the provisions of Sections 149 152 & otherapplicable provisions of the Act & the erstwhile Listing Agreement. The Board ofDirectors and shareholders of the Company had also appointed Mr. Jean-Luc Bohbot and Mr.Atul Chaturvedi as Non-Executive Directors of the Company.
The Company has received the declarations from the Independent Directors confirmingthat they satisfy the criteria of independence as prescribed under Section 149(6) of theAct and the Listing Regulations.
The policy of the Company on directors appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand other matters provided under Section 178(3) of the Act and Listing Regulations adoptedby the Board is appended as Annexure 1 to the Directors Report. We afirm that theremuneration paid to the directors is as per the terms laid out in the Nomination andRemuneration Policy of the Company.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors has undertaken anevaluation of its own performance the performance of its Committees and of all theindividual Directors based on various parameters relating to roles responsibilities andobligations of the Board effectiveness of its functioning contribution of Directors atmeetings and the functioning of its Committees.
During the year under review Mr. Naveen Manghani has been appointed as the CompanySecretary and Compliance Officer of the Company w.e.f. August 14 2015 consequent to theresignation of Mr. D. V. Iyer the erstwhile Company Secretary.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 your Directors state that:
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with no material departures;
(b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2016 and of theprofit/loss of the Company for the year ended on that date;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) the Directors have prepared the annual accounts on a going concernbasis;
(e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
AUDITORS AND AUDITORS REPORT
M/s. Ashok Kumar Prabhashankar and Co. Chartered Accountants Bangalore StatutoryAuditors (Registration No. 004982S) of the Company hold office until the conclusion of theensuing Annual General Meeting and are recommended by the Board of Directors forreappointment. Certificate from the said Auditors has been obtained to the eflect thattheir re-appointment if made would be within the limits specified under Section 139 readwith Section 141 of the Companies Act 2013.
The Auditors Report to the Members on the Accounts of the Company for the yearended March 31 2016 does not contain any qualification.
The Board has appointed M/s. B. M. Sharma & Co. Cost Accountants as the CostAuditors (Registration No. 00219) of the Company to conduct the Cost Audit for thefinancial year 2015-16 the Cost Audit Report for which will be submitted to the CentralGovernment before the due date.
The Board has appointed M/s. Sanjay Dholakia & Associates Practicing CompanySecretary (Membership No. 2655) to conduct the Secretarial Audit for the financial year2015-16. The Secretarial Audit Report for the financial year ended March 31 2016 isannexed herewith at Annexure 2 to this Report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
Information as per the Companies Act 2013 and the rules framed thereunder relating toconservation of energy technology absorption foreign exchange earnings and outgo formspart of this Report and is annexed hereto at Annexure 3.
Your Company complies with all mandatory requirements as stipulated under theprovisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015. The Report on Corporate Governance along with the Auditors Certificate on itscompliance composition and details of memberships of various committees viz. AuditCommittee Nomination & Remuneration / Compensation Committee CSR Committee etc.forms part of this Report and is annexed hereto.
MEETINGS OF THE BOARD
During the year twelve meetings of the Board of Directors were held the details ofwhich are given in the report on Corporate Governance.
As required under Regulation 17(8) of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 the CEO/CFO Certificate is attached with this AnnualReport.
PARTICULARS OF EMPLOYEES
Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197 of Companies Act 2013 and Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are appended as Annexure 4 to thisReport.
EMPLOYEE STOCK OPTION SCHEME
The Nomination and Remuneration/Compensation Committee of the Board of Directors of theCompany inter alia administers and monitors the SRSL Employees Stock Option Plan-2011("Scheme") of the Company in accordance with applicable SEBI regulations. Thedisclosure relating to the Scheme and other relevant details are available on theCompanys website at the link http:// www.renukasugars.com/en/corporate-governance.html. During the year the Company has not granted any freshStock Options to the employees.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All Contracts/arrangements entered by the Company during the financial year withrelated parties were in the ordinary course of business and on an arms length basis.The details of transactions with related parties are given in notes to the financialstatements. All transactions with related parties were in the ordinary course of businessand on an arms length basis.
The Companys Policy on Related Party Transactions may be accessed on theCompanys website at the link http://www.renukasugars.com/en/corporate-governance.html. The details of related partytransactions are set out in the notes to the financial statements.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Particulars of loans guarantees given securities provided and investments made areprovided in the notes to the standalone financial statements.
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to Corporate Social Responsibility (CSR) by catering to theneeds of the weaker sections of the society. Pursuant to the provisions of the Section 135of the Companies Act 2013 (the Act) your Company has constituted a CSR Committee of theBoard of Directors to monitor the CSR activities of the Company. The details relating tothe CSR Committee are described in the Corporate Governance Report forming part of thisAnnual Report.
CSR Committee formulated and recommended to the Board the CSR Policy of the Companyand it has been approved by the Board of Directors of the Company. The CSR Policy of theCompany may be accessed on the Companys website at the link http://www.renukasugars.com/en/corporate-governance.html. The report on the CSR activities is provided at Annexure5 to the Directors Report.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure 6 to thisReport.
RISK MANAGEMENT & INTERNAL FINANCIAL CONTROLS
The Company has adopted a Risk Management Policy which is reviewed on a periodic basisin order to recognise and reduce exposure to risks wherever possible. The Companysrisk management policies are based on the philosophy of achieving substantial growth whilemitigating and managing risks involved.
The Companys internal control systems with reference to the financial statementsare adequate and commensurate with the nature of its business and the size and complexityof its operations. Periodic audits and checks are conducted and the controls to preventdetect and correct any irregularities in the operations have been laid down by theCompany.
The Company has in place a Whistleblower Policy / VigilMechanismtodealwithunethicalbehaviorvictimisationfraud and other grievances or concernsif any. The Whistleblower Policy can be accessed on the Companys website http://www.renukasugars.com/en/corporate-governance.html.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
As per the requirement of The Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (the Act) and Rules made thereunderyour Company has constituted Internal Complaints Committees.
During the year there were no complaints received by the Company under the Act.
HUMAN RESOURCES (HR)
The Companys HR policies and procedures are designed to recruit and retain thebest talent to support the operations of your Company and to align the interest ofemployees with the long term organisational goals.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights as to dividend voting or otherwise.
2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.
3. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Companys operations in future.
APPRECIATION & ACKNOWLEDGEMENTS
The Board wishes to place on record its gratitude for the assistance and co-operationreceived from the Financial Institutions Banks Government Authorities CustomersVendors and cane growers and finally to all its members for the trust and confldencereposed on the Company. The Board further wishes to record its sincere appreciation forthe significant contributions made by employees at all levels for their competencededication and contribution towards the operations of the Company.
| ||For and on behalf of the Board |
| ||Vidya Murkumbi |
| ||Executive Chairperson |
|Mumbai || |
|August 22 2016 || |