We have pleasure in presenting the Twenty Second Annual Report on the business andoperations of the Company together with the audited results for the financial year endedMarch 31 2017.
| || || |
( Rs in million)
| ||Standalone ||Consolidated |
|Particulars ||2016-17 ||2015-16 ||2016-17 ||2015-16 |
|Total Revenue ||22273.72 ||19521.40 ||22847.52 ||19908.38 |
|Operating Expenditure ||17945.67 ||15095.31 ||18264.09 ||15136.30 |
|Earnings before Interest Depreciation and ||4328.05 ||4426.09 ||4583.43 ||4772.08 |
|Amortisation || || || || |
|Depreciation and Amortisation ||599.88 ||585.84 ||638.23 ||596.89 |
|Finance Cost ||1478.62 ||1529.22 ||1496.70 ||1636.57 |
|Profit Before Tax ||2249.55 ||2311.03 ||2577.75 ||2568.91 |
|Tax Expenses || || || || |
| Current Tax ||866.45 ||255.03 ||961.16 ||360.55 |
| Deferred tax charge / (credit) ||(19.04) ||808.33 ||9.06 ||827.71 |
|Profit after Tax ||1402.14 ||1247.67 ||1607.53 ||1380.65 |
Pursuant to the Listing Regulations the provisions of the IND-AS Accounting System areapplicable to the Company effective Q1 of 2016-17. To that extent the accounting methodsare changed and adjustments have been carried-out wherever necessary. There have been nomaterial changes and commitments affecting the financial position of the Company whichhave occurred between the end of the financial year of the Company to which the auditedresults relates to the date of this report.
BUSINESS AND OPERATIONS
A. Business Overview
The Company is operating in the following two segments.
Construction and development of residential and commercial projects
A summary of completed and ongoing projects as on March 31 2017 has been detailed inthe Management Discussion and Analysis Report titled Management Report forming part of theAnnual Report.
B. Financial Overview
During the financial year 2016-17 the Company on a standalone basis earned totalrevenues of Rs 22273.72 million as compared to Rs 19521.40 million in the previous yearan increase of 14.10 percent y-o-y. The Profit before Tax was Rs 2249.55 million asagainst Rs 2311.03 million during the year (decreased by 2.66 percent) and Profit afterTax was Rs 1402.14 million as against Rs 1247.67 i.e. increased by 12.38 percent.
The consolidated revenues of the Company during financial year 2016-17 were Rs22847.52 million an increase of 14.76 percent from the previous year. The Profit beforeTax increased by 0.34 percent and Profit after Tax (after considering minority interest)increased by 16.43 percent as compared to the financial year 2015-16.
Transfer to Reserves
An amount of Rs 140.21 million is proposed to be transferred out of the current profitsto the General Reserve.
The Board of Directors subject to the approval of the shareholders at the ensuingAnnual General Meeting are pleased to recommend a dividend of Rs 2.50 per equity share ofRs 10 each.
C. Operational Overview
During the year under review the Company executed and handed over seven real estateprojects covering 3.21 Million Square Feet of developable area and 10 contractual projectscovering an area of 1.88 million square feet resulting in an aggregate development of 5.09million square feet.
The Company has completed 118 real estate projects and 288 contractual projectscovering about 86.73 million square feet of area since its inception.
The Company currently has 37 ongoing residential projects aggregating 40.55 millionsquare feet of developable area. It has 30 ongoing contractual projects aggregating 8.81million square feet under various stages of construction.
The Company has a geographic presence in 26 cities and 13 states across India.
The authorized share capital of the Company is Rs 2000000000 divided into150000000 equity shares of Rs 10 each and 5000000 preference shares of Rs 100 each. Atthe beginning of the year under review the issued subscribed and fully paid up capitalwas Rs 980638680 divided into 98063868 equity shares of Rs. 10 each. Consequent tobuy-back of 1759192 equity shares during the year under review the issued subscribedand paid-up capital of the Company as on 31st March 2017 was Rs 963046760divided into 96304 676 equity shares of Rs 10 each.
Sobha Limited is a public limited company and its equity shares are listed on theNational Stock Exchange of India Limited and on BSE Limited.
Buyback of Equity Shares
The Board at its meeting held on 19th May 2016 approved the buybackproposal for purchase of up to 2275000 shares of Rs 10 each (representing 2.32 percentof the total equity capital) by the Company from shareholders on a proportionate basis byway of a tender offer route at a price of Rs 330 per equity share amounting to anaggregate amount not exceeding Rs 750.75 million in accordance with the provision of theCompanies Act 2013 and SEBI (Buy Back of Securities) Regulations 1998. Accordingly thebuy-back of the shares was carried out. In response to the offer given by the Company1759192 equity shares were tendered and the said shares were bought back with a totalcost of Rs 58.05 crores.
Changes in Directors and Key Managerial Personnel
During the year under review Mr. M Damodaran Independent Director resigned from theBoard of Directors effective 12th September 2016. As on 31st March2017 the Board comprised of seven Directors of which three were Executive Directors andfour were Non-Executive Independent Directors.
Further Mr. Kishore Kayarat Company Secretary and Compliance Officer and a KeyManagerial Personnel of the Company resigned from his position effective 10thSeptember 2016. Mr. Vighneshwar G Bhat joined as Company Secretary and Compliance Officerand Key Managerial Personnel in the position vacated by Mr. Kishore Kayarat.
Changes in Subsidiaries Joint Ventures and Associates
The shareholders are aware that Sobha Highrise Ventures Private Limited a jointventure was setup with a private equity player for execution of a specific project"SOBHA Palladian" at Yamlur Bangalore. During the year under review the jointventure partner expressed its willingness to exit from the joint-venture. Accordingly avaluation of the said joint venture was carried out by a competent independent valuer.Based on the valuation report 10300000 shares of different classes held by the jointventure partner were purchased by Sobha Limited for a total consideration of Rs346780000/- (Rupees Thirty Four Crores Sixty Seven Lakhs and Eighty Thousand only). Uponpurchase of the said shares Sobha Highrise Ventures Private Limited has become a whollyowned subsidiary of Sobha Limited.
Significant or Material Orders passed by Regulators / Courts
During the year under review there were no significant or material orders passed bythe regulators or courts or tribunals impacting the going concern status and Company'soperations in the future.
BOARD OF DIRECTORS AND ITS COMMITTEES
A. Composition of the Board of Directors
As on 31st March 2017 the Board of Directors of the Company comprised ofseven Directors of which four were Non-Executive Independent Directors and three wereExecutive Directors. The composition of the Board of Directors is in compliance withRegulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015(Listing Regulations) and Section 149 of the Companies Act 2013.
The Company has received necessary declarations from the Independent Directors statingthat they meet the criteria of independence as specified in Section 149(6) of theCompanies Act 2013 and Regulation 16 of the Listing Regulations.
During the year under review the Board of Directors met five times on the followingdates:
May 19 2016
August 03 2016
September 10 2016
November 21 2016
February 08 2017
In accordance with the provisions of the Companies Act 2013 a separate meeting of theIndependent Directors of the Company was held on May 19 2016.
C. Re-appointment of Director Retiring by Rotation
Pursuant to the provisions of Section 152 of the Companies Act 2013 Mr. J C SharmaVice Chairman and Managing Director (DIN: 01191608) is liable to retire by rotation at theensuing Annual General Meeting and being eligible offers himself for re-appointment. TheBoard based on the recommendations of the Nomination Remuneration and GovernanceCommittee has recommended the re-appointment of Mr. J C Sharma Vice Chairman andManaging Director retiring by rotation.
The Notice convening the Annual General Meeting includes the proposal forre-appointment of Mr. J C Sharma as a Director. A brief resume of Mr. J CSharma has been provided as an Annexure to the Notice convening the Annual GeneralMeeting. Specific information about the nature of Mr. J C Sharma's expertise in specificfunctional areas and the names of the companies in which he holds directorship andmembership / chairmanship of the Board committees have also been provided in the Noticeconvening the Annual General Meeting.
D. Re-constitution of Committees of the Board
Consequent to resignation of Mr. M Damodaran a Member of the Audit Committee theAudit Committee was re-constituted during the year under review. A detailed note on theCommittees of the Board of Directors is given in the Corporate Governance Report formingpart of the Annual Report.
E. Performance Evaluation
In terms of Section 134 (3) (p) read with Articles VII and VIII of Schedule IV of theCompanies Act 2013 the Board carried out an annual evaluation of its own performance andthat of its statutory committees viz. Audit Committee Stakeholders RelationshipCommittee Nomination Remuneration and Governance Committee and that of individualDirectors.
The Board also assessed the performance and the potential of each of the IndependentDirectors with a view to maximising their contribution to the Board. As envisaged by theAct the Independent Directors at a meeting conducted reviewed the performance of theChairman of the Board. At the same meeting the review of the Executive Directors was alsocarried out.
F. Directors' Responsibility Statement
According to the information and explanations obtained your Directors hereby confirmpursuant to Section 134(5) of the Companies Act 2013 that:
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) the 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 at the end of the financial year and ofthe profit of the company for that period;
c) proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of thecompany and for preventing and detecting fraud and other irregularities;
d) the annual accounts have been prepared on a going concern basis; e) internalfinancial controls to be followed by the company has been laid down and such internalfinancial controls are adequate and were operating effectively; and
f) proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
AUDIT RELATED MATTERS
A. Audit Committee
The Company has a duly constituted Audit Committee. The composition of the Committee ason 31st March 2017 was:
1. Mr. R V S Rao (Independent Director) - Chairman
2. Dr. S K Gupta (Independent Director) - Member
3. Mr. Anup Shah (Independent Director) - Member
4. Mr. J C Sharma (Vice Chairman and Managing Director) - Member
The terms of reference powers role and responsibilities of the Audit Committee are inaccordance with the requirements mandated under Section 177 of the Companies Act 2013 andRegulation 18 of the Listing Regulations.
During the period under review the advice and suggestions recommended by the AuditCommittee were duly considered and accepted by the Board of Directors. There were noinstances of non-acceptance of such recommendations.
B. Statutory Auditors
The Statutory Auditors expressed an unmodified opinion in the Audit Reports in respectof the audited financial statements for the financial year ended March 31 2017. There areno qualifications or adverse remarks in the Statutory Auditors' Report which require anyexplanation from the Board of Directors.
The present Statutory Auditors Messrs S R BATLIBOI & ASSOCIATES LLP (FirmRegistration No.101049W/E300004) will hold office upto the conclusion of the ensuingAnnual General Meeting and are not eligible for re-appointment as Statutory
Auditors of the Company as they are completing the maximum permissible period under theCompanies Act 2013 and the Rules made thereunder as the Statutory Auditors of theCompany. The Board of Directors have recommended the appointment of Messrs B S R & Co.LLP Chartered Accountants (Firm Registration No.101248W/W-100022) as new StatutoryAuditors of the Company for a period of five years from the conclusion of this AnnualGeneral Meeting until the conclusion of the 27th Annual General Meetingsubject to ratification of their appointment by the Members at every Annual GeneralMeeting.
A resolution seeking approval of appointment of Messrs B S R & Co. LLP CharteredAccountants as Statutory Auditors of the Company forms part of the Notice convening theensuing Annual General Meeting.
C. Secretarial Audit
Secretarial Audit of the Company for the year ended March 31 2017 was conducted by Mr.Nagendra D Rao Practicing Company Secretary. The Secretarial Audit Report issued by Mr.Nagendra D Rao in accordance with the provisions of Section 204 of the Companies Act2013 is provided separately in the Annual Report (Annexure A). There are noqualifications or adverse remarks in the Secretarial Audit Report which require anyexplanation from the Board of Directors.
D. Cost Audit
The Cost Audit Report for the financial year 2015-16 was filed with the Ministry ofCorporate Affairs New Delhi within the due date prescribed under the Companies (CostRecords and Audit) Rules 2014. There are no qualifications or adverse remarks in the CostAudit Report which require any explanation from the Board of Directors.
Based on the recommendations of the Audit Committee the Board of Directorsre-appointed M/s. Srinivas and Co Cost Accountants (Firm Registration No: 000278)as the Cost Auditors of the Company for the financial year 2016-17. In terms of Rule 14 ofthe Companies (Audit and Auditors) Rules 2014 the remuneration payable to the CostAuditors for financial year 2016-17 is subject to ratification by the shareholders of theCompany. The Notice convening the Annual General Meeting contains the proposal forratification of the remuneration payable to the Cost Auditors.
E. Internal Audit and Internal Financial Controls
The in-house internal audit team is responsible for assurance with regard to theeffectiveness and efficiency of internal control systems and processes. The audit team inyour Company is independent designed to add value and improve the Company's processes. Ithelps the Company to accomplish its objective by bringing a systematic disciplinedapproach to evaluate and improve the effectiveness of risk management control and thegovernance process.
There are adequate internal financial controls in place with reference to the financialstatements. During the year under review these controls were tested and no significantweakness was identified either in the design or operation of the controls. A report issuedby the Statutory Auditors M/s. S R Batliboi & Associates LLP on internal financialcontrols forms part of the Annual Report.
A. Nomination and Remuneration Policy
The Nomination Remuneration and Governance Committee of the Board of Directors isresponsible for recommending the appointment of Directors and Senior Management to theBoard of Directors of the Company. The Company has in place a Nomination and RemunerationPolicy containing the criteria for determining qualifications positive attributes andindependence of a Director and a policy relating to the remuneration for Directors keymanagerial personnel and senior management personnel of the Company. The Nomination andRemuneration Policy is available on the website of the Company at http://www.sobha.com/investor-relations-downloads-pol.php. Extracts from the policy are reproduced in AnnexureB to this report.
B. Risk Management Framework
The Company has developed and implemented a risk management framework detailing thevarious risks faced by the Company and methods and procedures for identificationmonitoring and mitigation of such risks. The Board of Directors of the Company haveconstituted a Risk Management Committee which is entrusted with the task of monitoring andreviewing the risk management plan and procedures of the Company. The risk managementfunction is complimentary to the internal control mechanism of the Company and supplementsthe audit function.
C. Corporate Social Responsibility Policy
The Corporate Social Responsibility Policy as formulated by the Corporate SocialResponsibility Committee and approved by the Board of Directors is available on thewebsite of the Company at http:// www.sobha.com/investor-relations-downloads-pol. php.
In terms of Section 134 of the Companies Act 2013 read with the Companies (CorporateSocial Responsibility Policy) Rules 2014 the Annual Report on Corporate SocialResponsibility activities of the Company is given in Annexure C to this report.
D. Vigil Mechanism
The Company has established a vigil mechanism to promote ethical behaviour in all itsbusiness activities and has in place a mechanism for employees to report any genuinegrievances illegal unethical behaviour suspected fraud or violation of laws rules andregulation or conduct to the Chief Vigilance Officer and the Audit Committee of the Boardof Directors. The policy also provides for adequate protection to whistle blower againstvictimisation or discriminatory practices. The Policy is available on the website of theCompany at http://www.sobha. com/investor-relations-downloads-pol.php.
During the year under review the Company did not receive any complaints relating tounethical behaviour actual or suspected fraud or violation of the Company's Code ofConduct from any employee or directors.
As on 31st March 2017 the Company had various series of outstandingSecured Redeemable Non-Convertible Debentures aggregating Rs 3250000000 (RupeesThree Hundred and Twenty Five Crore). The debentures are listed on BSE Limited. Intereston the said debentures was paid on time as per the relevant provisions of the CompaniesAct 2013 and Listing Regulations. The Company complied with all the applicable provisionsof the Listing Regulations in respect of the said listed debentures.
The Company did not accept any deposits in terms of Chapter V of the Companies Act2013 read with the Companies (Acceptance of Deposit) Rules 2014 during the year underreview and there are no outstanding deposits as on date.
C. Transfer to Investor Education and Protection Fund
In compliance with Section 124 of the Companies Act 2013 the dividends pertaining tofinancial year 2008-09 which was lying unclaimed with the Company was transferred to theInvestor Education and Protection Fund during the financial year 2016-17. The details ofunclaimed dividend transferred to the Investor Education and Protection Fund are detailedin the Corporate Governance Report forming part of the Annual Report.
D. Human Resources
Employee relations continue to be cordial at all levels and in all divisions of theCompany. The Board of Directors would like to express their sincere appreciation to allthe employees for their continued hard work and steadfast dedication.
As on March 31 2017 the Company had an organisational strength of 2698 employees.
Details of the employees are provided in a separate section of the Annual Report.
E. Disclosure under the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal ) Act 2013
Pursuant to the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 the Company has in place an Internal ComplaintsCommittee for prevention and redressal of complaints of sexual harassment of women at thework place. There was no case of sexual harassment reported during the year under review.
F. Awards and Recognition
During financial year 2016-17 the Company was conferred with various awards andrecognitions the details of which are given in a separate section of the Annual Report.
G. Corporate Governance
In accordance with Schedule V of the Listing Regulations a separate report oncorporate governance is provided in the Annual Report.
A certificate from Mr. Nagendra D Rao Practicing Company Secretary affirmingcompliance with the various conditions of corporate governance in terms of the ListingRegulations is given in Annexure D to this report.
H. Code of Conduct
The Company has laid down a Code of Conduct for the Directors as well as for allemployees of the Company. As prescribed under Regulation 17 of the Listing Regulations adeclaration signed by the Vice Chairman and Managing Director affirming compliance withthe Code of Conduct by the Directors and senior management personnel of the Company forthe financial year 2016-17 forms part of the Corporate Governance Report.
I. Management Discussion and Analysis Report
In accordance with the requirements of the Listing Regulations the ManagementDiscussion and Analysis Report titled Management Report is presented in a separate sectionof the Annual Report.
J. Extract of the Annual Return
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of the annual return forthe financial year ended March 31 2017 in MGT 9 is enclosed as Annexure E to thisreport.
K. Particulars of Loans Guarantees and Investments
In terms of Section 134 of the Companies Act 2013 the particulars of loansguarantees and investments made by the Company under Section 186 of the Companies Act2013 is detailed in Notes to Accounts of the Financial Statements.
L. Related Party Transactions
During the year the Company did not enter into any contract / arrangement /transaction with a related party which can be considered as material in terms of thepolicy on related party transactions laid down by the Board of Directors. Related partytransactions if any pursuant to the Listing Regulations were approved by the AuditCommittee from time to time prior to entering into the transactions. The related partytransactions undertaken during the financial year 2016 17 are detailed in the Notesto Accounts of the Financial Statements.
M. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andOutgo
In terms of Section 134 of the Companies Act 2013 read with Rule 8(3) of the Companies(Accounts) Rules 2014 the details of energy conservation technology absorption foreignexchange earnings and outgoings are given as Annexure F to this Report.
N. Remuneration Details of Directors Key Managerial Personnel and Employees
The details of the remuneration of Directors key managerial personnel and thestatement of employees in receipt of remuneration exceeding the limits prescribed underSection 134 of the Companies Act 2013 read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is provided in Annexure G to thisreport.
O. Business Responsibility Report
As required under Regulation 34 of the Listing Regulations the Business ResponsibilityReport is given in Annexure H to this report.
P. Financial Position and Performance of Subsidiaries Joint Ventures and Associates
In terms of Section 134 of the Act and Rule 8(1) of the Companies (Accounts) Rules2014 the financial position and performance of subsidiaries are given as an annexure tothe Consolidated Financial Statements.
Q. Additional Information to Shareholders Information for our Shareholders
All important and pertinent investor information such as financial results investorpresentations press releases new launches and project updates are made available on theCompany's website (www. sobha.com) on a regular basis.
The Directors would like to place on record their sincere appreciation for theCompany's customers vendors and bankers for their continued support to the Companyduring the year. The Directors also wish to acknowledge the contribution made by employeesat all levels for steering the growth of the organisation. We thank the Government ofIndia the State Governments and other Government Agencies for their assistance andcooperation and look forward to their continued support in the future. Finally the Boardwould like to express its gratitude to the members for their continued trust co-operationand support.
| ||For and on behalf of the Board of Directors of || |
| || ||Sobha Limited |
|Place: Bangalore ||Ravi PNC Menon ||J C Sharma |
|Date: May 16 2017 ||Chairman ||Vice Chairman & Managing Director |
Secretarial Audit Report
The Members Sobha Limited
SOBHA Sarjapur-Marathahalli Outer Ring Road (ORR) Devarabisanahalli Bellandur PostBengaluru 560103.
My report of even date is to be read along with this letter.
It is the responsibility of the management of the Company to maintain secretarialrecords devise proper systems to ensure compliance with the provisions of all applicablelaws and regulations and to ensure that the systems are adequate and operate effectively.
1. My responsibility is to express an opinion on these secretarial records standardsand procedures followed by the Company with respect to secretarial compliances.
2. I believe that audit evidence and information obtained from the Company's managementis adequate and appropriate for me to provide a basis for my opinion.
3. Wherever required I have obtained the management's representation about thecompliance of laws rules and regulations and happening of events etc.
The Secretarial Audit Report is neither an assurance as to the future viability of theCompany nor of the efficacy or effectiveness with which the management has conducted theaffairs of the Company.
| ||Nagendra D. Rao |
| ||Practising Company Secretary |
| ||Membership No. FCS 5553 |
| ||Certificate of Practice 7731 |
| ||543/A 7th Main |
| ||3rd Cross S.L.Byrappa Road |
| ||Hanumanthnagar |
| ||Bangalore 560 019. |
|Place: Bengaluru || |
|Date: May 16 2017 || |
EXTRACT FROM NOMINATION AND REMUNERATION POLICY
Policy on Appointment and Removal of Directors Key Managerial Personnel and SeniorManagement:
A. Eligibility or Criteria for Appointment:
Educational Qualification: No person shall be eligible for appointment as aDirector Key Managerial Personnel and / or Senior Management Personnel unless he / shepossesses at least a bachelors' degree in a recognized and relevant field. Educationalqualification over and above the bachelors' degree though not mandatory shall bepreferable. However the requirement of minimum educational qualification can be waived ifthe candidate showcases exceptional knowledge talent creativity and / or aptitude forthe position.
Experience: A person shall be eligible for appointment as a Director KeyManagerial Personnel and / or Senior Management Personnel if he / she possess adequateexperience in the respective field(s). Between two candidates possessing same / similareducational qualification the person with more experience will ordinarily be preferred.Experience in diverse fields will be given due weightage.
Integrity: The person considered for appointment shall be a person of integrity andgood standing. No person convicted of any offence involving moral turpitude shall beconsidered for appointment to post of a Director Key Managerial Personnel and/or SeniorManagement.
Age: A person shall not be considered for appointment to the post of a Whole-timeDirector of the Company if he / she has attained the age of seventy years.
Independence: No person shall be appointed as an Independent Director of theCompany unless he / she meets the criteria of independence as specified in the CompaniesAct 2013 and Listing Agreement.
Limits on Directorship: No person shall be appointed as a Whole-time Director /Independent
Director of the Company unless such directorship is within the limits prescribed by lawin this behalf.
Limits on Committee Membership: The number of Chairmanship or membership ofcommittees held by a person shall be within the limits prescribed by law in this behalf inorder to be considered for appointment as a Whole-time Director / Independent Director ofthe Company.
B. Term of Office:
i. The Whole-time Director(s) of the Company shall be appointed for a term notexceeding five years at a time.
ii. The Whole-time Director(s) shall be eligible for re-appointment for further termsnot exceeding five years at a time subject to the approval of members of the Company.
iii. No such re-appointment shall be made earlier than one year before the expiry ofthe current term.
i. An Independent Director shall hold office for a term up to five consecutive years onthe Board of Directors of the Company.
ii. An Independent Director shall be eligible for re-appointment for another term up tofive consecutive years on passing of a special resolution in this regard by the members ofthe Company.
iii. No Independent Director shall hold office for more than two consecutive terms. AnIndependent Director shall be eligible for reappointment after the expiry of three yearsof ceasing to be an Independent Director where he/she has served for two consecutiveterms.
Key Managerial Personnel and Senior Management:
The term of office of Key Managerial Personnel and Senior Management of the Companyshall be in accordance with the prevailing Human Resource policy of the Company.
C. Removal of Director Key Managerial Personnel and Senior Management of the Company:
The Committee shall recommend to the Board of Directors the removal from office of anyDirector Key Managerial Personnel and / or Senior Management Personnel of the Company:
i. Whenever a Director Key Managerial Personnel and / or Senior Management Personnelof the Company incurs any disqualification specified under any applicable law whichrenders their position untenable.
ii. Whenever a Director Key Managerial Personnel and / or Senior Management Personnelof the Company is found guilty of violating the Code of Conduct the Code of Conduct forPrevention of Insider Trading of the Company and / or such other policy as may be decidedby the Committee.
iii. Whenever a Director Key Managerial Personnel and / or Senior Management of theCompany acts in a manner which is manifestly against the interests of the Company. In caseof any proceedings under this sub-clause the concerned Director Key Managerial Personneland / or Senior Management of the Company shall be given an opportunity of being heard bythe Committee.
Performance Evaluation: i. The performance evaluation of each director will becarried out by the Committee in the first instance. It shall place its recommendationsbefore the Board of Directors.
ii. The performance evaluation of Independent Directors shall be done by the entireBoard of Directors (excluding the director being evaluated). It shall take intoconsideration the views of the Committee.
iii. The Independent Directors shall review the performance of non-independentdirectors and the Board as a whole. The Independent Directors shall take intoconsideration the views of the Committee.
iv. The Independent Directors shall review the performance of the Chairperson of thecompany taking into account the views of the Committee the executive directors andnon-executive directors.
The Independent Directors of the Company are experts in their respective fields. Theybring with them specialized skills vast repertoire of knowledge and a wide diversity ofexperience and perspectives. In view of their significant expertise the IndependentDirectors may recommend the mechanism for evaluating the performance of the Board as awhole as well as individual directors.
In lieu of such recommendation the criteria for Performance Evaluation laid down belowmay be considered. However the below mentioned criteria is only suggestive and the Board/ Directors may consider such other criteria as they may deem necessary for effectiveevaluation of performance.
Board of Directors: i. Establishment of distinct performance objectives andcomparison of performance against such objectives.
ii. Contribution of the Board to the development of strategy.
iii. Contribution of the Board in developing and ensuring robust and effective riskmanagement system.
iv. Response of the Board to problems or crises that have emerged.
v. Suitability of matters being reserved for the Board under the Listing Agreement.
vi. Relationship between the board and its main committees and between the committeesthemselves.
vii. Communication of the Board with the management team key managerial personnel andother employees.
viii. Knowledge of latest developments in the regulatory environment and the market.
ix. Appropriateness quality and timeliness of flow of information to the Board.
x. Adequacy and quality of feedback by the Board to management on its requirements.
xi. Adequacy of frequency and length of board and committee meetings.
xii. Appropriate mix of knowledge and skills in the composition of the board and itscommittees.
Committees of the Board of Directors: i. Suitability of matters being reserved forthe Committee(s).
ii. Communication of the Committee(s) with the management team key managerialpersonnel and other employees.
iii. Appropriateness quality and timeliness of flow of information to theCommittee(s).
iv. Adequacy and quality of feedback by the Committee(s) to management on itsrequirements.
v. Adequacy of frequency and length of the committee meetings.
vi. Appropriate mix of knowledge and skills in the composition of the committees.
i. Level of preparedness for the meetings of the Board and Committees.
ii. Willingness to devote time and effort to understand the Company and its business.
iii. Quality and value of their contributions at Board and Committees meetings.
iv. Contribution of their knowledge and experience to the development of strategy ofthe Company.
v. Effectiveness and pro-activeness in recording and following up their areas ofconcern.
vi. Relationship with fellow board members key managerial personnel and seniormanagement.
vii. Knowledge and understanding of current industry and market conditions.
viii. Attendance at the meetings of the Board and Committees of which the IndependentDirector is a member.
Whole-time Director(s): i. Contribution of the Whole-time Director in achieving theBusiness Plan of the Company.
ii. Contribution of Whole-time Director in the development of new business ideas orverticals.
iii. Contribution of Whole-time Director towards the topline and/or bottom line of theCompany where such contribution is capable of measurement.
iv. Contribution of Whole-time Director in implementing the strategy set by the Boardof Directors of the Company.
v. Knowledge and understanding of current industry and market conditions.
vi. Contribution of Whole-time Director in identifying understanding and mitigatingthe risks faced by the Company.
vii. Contribution of Whole-time Director in identifying and exploiting new businessopportunities for the Company.
viii. Level of preparedness for the meetings of the Board and Committees.
ix. Attendance at the meetings of the Board and Committees of which such Whole-timeDirector is a member.
Policy relating to the Remuneration of Directors Key Managerial Personnel and SeniorManagement:
A. Remuneration Criteria:
The guiding principle while determining the level and composition of remuneration isthe competitiveness required to attract retain and motivate competent personnel. Whiledeciding the remuneration of Directors Key Managerial Personnel and Senior Managementthe following factors shall be taken into consideration:
a. availability of talented skilled and experienced professionals b. industrystandards c. profitability of the Company and growth prospects
B. Payment of Remuneration:
i. The Committee shall recommend the payment of remuneration (including anyrevision thereof) to the Directors of the Company including the Independent Directorswhich shall be subject to the approval of the Board of Directors. It shall also beapproved by the shareholders of the Company and / or Central Government whereverrequired.
ii. The remuneration of Key Managerial Personnel and Senior Management Personnel shallbe determined by the Company in accordance with the prevailing HR Policy of the Company.
C. Remuneration of Whole-time Directors Key Managerial Personnel and SeniorManagement:
Each Whole-time Director Key Managerial Personnel and Senior Management personnelshall be paid a monthly remuneration. The monthly remuneration of Whole-time Director asrecommended by the Committee shall be approved by the Board of Directors and also by theshareholders of the Company if required.
Accommodation or House Rent Allowance:
Each Whole-time Director shall be provided with rent-free furnished accommodation or upto a specified % of the basic salary as House Rent Allowance in lieu of accommodation. KeyManagerial Personnel and Senior Management personnel shall be provided with a specified %of the basic salary as House Rent Allowance.
Each Whole-time Director shall be eligible for performance incentives which shall notexceed a specified % of profits of the Company.
Key Managerial Personnel and Senior Management personnel shall be eligible forperformance incentives as per the prevailing Human Resource policy of the Company in thisregard. The incentive is linked to the performance of the Company in general and theirindividual performance is measured against specific Key Result Areas which are alignedwith the Company's objectives.
Perquisites and Other Allowances:
Each Whole-time Director Key Managerial Personnel and Senior Management personnelshall be entitled to such perquisites allowances benefits facilities and amenities asper the Human Resource policy of the Company in force or as may be approved by the Boardfrom time to time.
D. Remuneration of Independent Directors:
Commission: Each Independent Director shall be paid remuneration by way ofCommission as recommended by the Committee which shall be approved by the Board ofDirectors. Such Commission shall be within the overall limits approved by the shareholdersof the Company.
Sitting Fees: The Independent Director may receive remuneration by way of fees forattending the meetings of Board or Committee thereof as may be decided by the Board ofDirectors from time to time.
E. Limits on Remuneration:
i. The overall remuneration paid by the Company to the Directors includingIndependent Directors shall not exceed 11% of the net profits of the Company for thatfinancial year.
ii. The remuneration paid by the Company to all its whole-time directors shall notexceed 10% of the net profits of the Company for that financial year.
iii. The remuneration paid by the Company to its Independent Directors (excludingsitting fess) shall not exceed 1% of the net profits of the Company for that financialyear.
iv. If in any financial year the Company has no profits or its profits areinadequate the Company shall pay remuneration to its Whole-time Director in accordancewith the provisions of Schedule V of the Companies Act 2013. If the remuneration payableexceeds the limits laid down in Schedule V then the Company shall obtain the previousapproval of the Central Government.
v. Revision of existing remuneration may be recommended by the Committee to the Boardwhich should be within the limits approved by the shareholders.
Corporate Governance Compliance Certificate
To the Members of Sobha Limited
"Sobha" Sarjapur-Marathahalli Outer Ring Road Devarabisanahalli BellandurPost Bengaluru 560 103.
I have examined all the records of Sobha Limited for the purpose of certifyingcompliance of the conditions of the Corporate Governance under the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 for the financial year endedMarch 31 2017. I have obtained all the information and explanations which to the best ofmy knowledge and belief were necessary for the purpose of certification.
The compliance of conditions of corporate governance is the responsibility of theManagement. My examination was limited to the procedure and implementation process adoptedby the Company for ensuring the compliance of the conditions of the Corporate Governance.
This Certificate is neither an assurance as to the future viability of the Company norof the efficacy or effectiveness with which the management has conducted the affairs ofthe Company.
In my opinion and to the best of my information and according to the explanations andinformation furnished to me I certify that the company has complied with all themandatory requirements of Corporate Governance as stipulated in Schedule II of the saidSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. As regardsDiscretionary Requirements specified in Part E of Schedule II of the SEBI ListingObligations and Disclosure Requirements) Regulations 2015 the company has complied withitems C D and E.
| ||Nagendra D. Rao |
| ||Practising Company Secretary |
| ||543/A 7th Main |
| ||3rd Cross S.L.Byrappa Road |
| ||Hanumanthanagar |
| ||Bengaluru 560 019. |
|Place: Bengaluru ||Membership No.: FCS - 5553 |
|Date: May 16 2017. ||Certificate of Practice: 7731 |
Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo
(Pursuant to section 134 of the Act and Rule 8(3) of the Companies (Accounts) Rules2014)
A. Conservation of Energy i. Steps taken or impact on conservation of energy
The Company has adopted the following energy conservation measures:
a. Use of LED' lamps in most of the common area lighting of residential projects &reduction in the use of CFL fluorescent tubes & metal halide lamps.
b. Use of energy efficient control gears ballast VFDs highly efficient motors and PVcells.
c. Use of external street light fixtures with timers.
d. Use of lighting software in the design stage of our projects.
e. Use of daylight sensors and occupancy sensors with dimmable ballasts.
f. Use of low self power loss breakers.
g. Following standard specifications like colour codes independent neutral andearthing for each circuit to curb energy leakage.
h. Use of low- loss electronic ballast.
i. Optimization of DG set rating by using synchronization panels.
j. Introduction of auto-correction power factor capacitor panels and harmonic filters.
k. The use of separate energy meters for major common area loads so that powerconsumption can be monitored and efforts can be made to minimise the same.
l. Use of energy efficient lifts with group control in residential projects.
ii. Steps taken by the Company for utilizing alternative sources of energy a. Gridconnected roof top solar power generation for partial common area load by utilizingterrace space in residential projects.
b. Use of heat pumps and solar water heaters instead of geysers to reduce powerconsumption.
iii. Capital investment on energy conservation equipments
The Company continues to make project level investments for reduction in consumption ofenergy and capital investment on energy conservation equipment cannot be quantified.
B. Technology Absorption i. Efforts made towards technology absorption
TheCompanyusesGermantoolswaterproofing techniques and follows European standards inall its construction activities. SOBHA uses both indigenous and imported technologies forimplementation at all its projects. The Company has taken the following initiatives in thearea of technology:
1. Introduction of laser plummets for accurate marking.
2. Introduction of "Scaff board" for safety of workforce who work at heights.
3. Software for BBS to generate fast and accurate bar bending schedules.
4. "Grab & Trolley" for block shifting.
5. "Debris Crusher" for crushing & recycling the debris generated at thesite.
6. Instead of cast - insitu coping for the terrace parapet and compound walls precastmethodology has been introduced and implemented.
7. Adoption of power feeders for spindle machine instead of manual feeding.
The Company derives benefits in the form of cost reduction and better quality of theend products. The above initiations and implementations have been made after continuousmarket research - trial and testing for quality durability and compatibility inconsideration of cost and time for developing new systems and better technologies at parwith international standards.
ii. Expenditure incurred on Research and Development
The Company had carried out R&D in the following areas:
1. Ready Mixed Concrete Batching Plant Audit' for Vendor Evaluation.
2. Materials testing & validation of the construction materials used on site tocheck their quality durability and compatibility.
3. Pile Integrity Test for qualitative evaluation of the physical dimensions (crosssectional variation) soundness or defects of the piles concrete with respect to itscontinuity.
4. Introduction of Lightweight Deflectometer' for measuring the deflectionmodulus of sub grade/ sub soils and unbound base layers.
5. Introduction of Block Testing Plates' for testing blocks at sites.
6. Introduction of Lift Well' gate for fall protection into the lift pits orshafts.
7. Introduction of Laser Plummet' for maintaining verticality of columns andbuildings.
8. Raised floor system in terraces to prevent direct heat transmission from the roofslab and to protect water resistance treatment of roofs for longer duration.
9. Introduction of tile round cutting using mini drilling machine and tile holesawcutter to get a perfect round finish.
10. Wooden / Bamboo textered glass reinforced concrete cladding panels which islightweight when compared to conventional concrete.
11. Physical measurement technique tools software to measure and analyze elevator ridequality vibration & sound.
12. Epoxy flooring applied to concrete for protection aesthetic enhancement strongadhesion long lasting rustproof waterproof heat resistant salt and acid resistance.
13. Introduction of Switched Mode Power Supply (SMPS) in place of Anti CollisionDevice helps in lower power fluctuations and consequently reduced breakdowns.
14. Construction of a multisport hall which can house a number of sports without therequirement of specific hall for specific sport thereby conserving the common area.
Benefits derived as a result of the above R&D
The benefits derived from the above ensure that the final product delivered by theCompany conforms to international standards.
Future plan of action
The success of R&D initiatives in the construction industry primarily depends onthe selection of the right method of construction type of machines and kind of materials.It also depends on integrating the planning and training process within the Company and ithas to be understood as an ongoing process.
Expenditure on R&D
The R & D activity of the Company forms part of project implementation and cannotbe quantified.
C. Foreign Exchange Earnings and Outgo
|Total expenditure in foreign exchange ||Rs 42.67 million |
|Total income in foreign exchange ||Nil |
Remuneration Details of Directors and Employees
(Pursuant to section 134 of the Act and Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014)
i. Ratio of remuneration of each director to the median remuneration of the employeesand percentage increase in remuneration
|Sl No. ||Name of Director / KMP ||Designation ||Ratio of Remuneration to Median Remuneration1 ||% Increase in Remuneration Y-O-Y ||Comparison of KMP remuneration against the Company's performance |
|1 ||Mr. Ravi PNC Menon ||Chairman ||236.5 ||1.2 ||The revenues increased by 14.10% the Profit before Tax decreased by 2.66% and |
|2 ||Mr. J C Sharma ||Vice Chairman & Managing Director ||124.5 ||2.2 ||Profit after Tax have increased |
|3 ||Mr. P Ramakrishnan ||Deputy Managing Director ||27 ||14.6 ||by 12.65% on a standalone basis. |
| || || || || ||On a consolidated basis the revenues were increased by 14.76% the Profit before Tax by 0.34% and Profit after Tax by 16.68% as compared to the previous financial year 2015-16. |
|4 ||Mr. M Damodaran ||Independent Director ||4.2 ||No Change || |
|5 ||Dr. S K Gupta ||Independent Director ||4.2 ||No Change || |
|6 ||Mr. R V S Rao ||Independent Director ||4.2 ||No Change ||Not Applicable |
|7 ||Dr. Punita Kumar- ||Independent Director ||4.2 ||No Change || |
| ||Sinha || || || || |
|8 ||Mr. Anup Shah ||Independent Director ||4.2 ||No Change || |
|9 ||Mr. Subhash Mohan Bhat1 ||Chief Financial Officer ||28.5 ||26.3% ||The revenues increased by 14.10% the Profit before Tax decreased by 2.66% and Profit after Tax have increased by 12.65% on a standalone basis. |
|10 ||Mr. Vighneshwar G Bhat2 ||Company Secretary & Compliance Officer ||5 ||0% || |
|11 ||Mr. Kishore Kayarat3 ||Company Secretary & Compliance Officer ||5.2 ||(33.7) ||On a consolidated basis the revenues were increased by 14.76% the Profit before Tax by 0.34% and Profit after Tax by 16.68% as compared to the previous financial year 2015-16. |
1. The median remuneration of employees during the financial year was Rs 365796(Rupees Three Lakhs Sixty Five Thousand Seven Hundred and Ninety Six only)
2. % increase in remuneration is not provided as Mr. Vighneshwar G Bhat was appointedas a Company Secretary and Compliance Officer with effect from September 10 2016 and wasnot in employment of the Company for entire financial year 2016-17.
3. Mr. Kishore Kayarat has resigned from the post of Company Secretary & ComplianceOfficer effective September 10 2016 and was not in employment for the entire FinancialYear 2016-17.
ii. The percentage increase in the median remuneration of employees in the financialyear 2016-17 was 0.26%.
iii. The number of permanent employees on the rolls of Company as on March 31 2017 was2698.
iv. Average percentile increase in the salaries of employees other than the managerialpersonnel during 2016-17 was 0.26%. The increase in managerial remuneration was on accountof the variable component of remuneration payable to the managerial personnel as per theterms and conditions of their appointment.
v. The remuneration is as per the Nomination and Remuneration Policy formulated by theNomination Remuneration and Governance Committee and approved by the Board of Directorsof the Company.
Statement pursuant to Section 134 of the Companies Act 2013 and Rule 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014)
|Sl. No ||Name ||Age ||Designation ||Nature of Employment (Contractual or otherwise) ||Gross Remuneration Rs ||Qualification ||Experience (Years) ||Date of commencement of Employment ||Previous Employment held |
| ||(A) Employed throughout the financial year || || || || || || || || |
|1 ||Mr. Ravi PNC Menon ||36 ||Chairman ||Permanent Employee ||81087384 ||B.S.C.E ||13 ||08.06.2004 ||- |
|2 ||Mr. J.C. Sharma ||59 ||Vice Chairman and Managing Director ||Permanent Employee ||41313227 ||B.Com (Hons) ACA ACS ||35 ||01.06.2001 ||Grasim Industries Limited |
| || || || || || || || || || |
|3 ||Mr. Varghese P V ||54 ||Chief Executive Officer ||Permanent Employee ||12244099 ||B.Sc B.Tech ||27 ||01.04.2006 ||Sobha Glazing and Metal works Private Limited |
| || || || || || || || || || |
| || || || || || || || || || |
|4 ||Mr. Bhuvan Bhushan ||38 ||Senior Vice President ||Permanent Employee ||10380569 ||MBA PGDM BA ||15 ||09.03.2015 ||RNA Corp Mumbai |
| ||(B) Employed for part of the financial year || || ||None || || || || |
| ||(C) Employed for whole or part of the financial year || || ||None || || || || |
1. Gross Remuneration comprises salary allowances Company's contribution to providentfund and taxable value of perquisites.
2. An employee would be qualified to be included in Category (A) or (B) on thefollowing basis:
For (A) if the aggregate remuneration drawn by him during the year was not less than Rs10200000 per annum.
For (B) if the aggregate remuneration drawn by him during the part of the year was notless than Rs 850000 per month.
For (C) if the aggregate remuneration drawn by him during the year or part of the yearwas in excess of the remuneration drawn by the managing director or whole-time directorand holds by himself or along with his spouse and dependent children not less than 2% ofthe equity shares of the Company.
3. None of the employees mentioned above are relatives of any Director of the Company.
4. All the employees referred above are / were in full-time employment of the Companyand there is no other employee who is in receipt of remuneration in terms of theprovisions of Section 134 of the Companies Act 2013 read with Rule 5(2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.
BUSINESS RESPONSIBILITY REPORT
SECTION A: GENERAL INFORMATION ABOUT THE COMPANY
|1. Corporate Identity Number ||: L45201KA1995PLC018475 |
|2. Name of the Company ||: Sobha Limited |
|3. Registered Address ||: SOBHA Sarjapur Marathahalli Outer Ring Road (ORR) |
| ||Devarabisanahalli Bellandur Post Bangalore 560 103 |
|4. Website ||: www.sobha.com |
|5. Email ID ||: email@example.com |
|6. Financial Year Reported ||: 2016-17 |
|7. Sector that the Company is engaged in: || |
| ||The Company is engaged in the business of constructiondevelopment sale management and operation of townships housing projects commercial premises and other related activities. |
8. List Key Products / services that the company manufactures / provides:
1. Construction of Residential Projects
2. Construction of Commercial Projects
3. Execution of Contractual Projects
9. Total Number of locations where business activity is undertaken by the Company:
|i. Number of International Locations : ||Nil |
|ii. Number of National Locations: ||The Company is headquartered in Bangalore having its regional offices at NCR Chennai Thrissur Pune Coimbatore Cochin Calicut and Mysore |
|iii. Markets Served by the Company: ||The Company is in the business of Construction of Residential Projects Construction of Commercial Projects and Execution of Contractual Projects in the territory of India |
SECTION B : FINANCIAL DETAILS OF THE COMPANY
|1. Paid Up Capital ||: Rs 963046760 |
|2. Total Turnover ||: Rs 2227323 million (On a standalone basis) |
|3. Total profit after taxes ||: Rs 1402.14 million (On a standalone basis) |
4. Total Spending on Corporate Social Responsibility
(CSR) as percentage of Profit after tax: 10.73% of profit after tax (Rs 150.42 million)
5. List of activities in which expenditure in 4 above has been incurred :
Providing Education and Vocational Training
Providing Healthcare Facilities
Looking after the Aged and the Impoverished
Social empowerment measures
SECTION C: OTHER DETAILS
|Sr. No. ||Particulars ||Remarks |
|1. ||Does the Company have any Subsidiary Company / Companies? ||Yes the Company has 5 subsidiaries. |
|2. ||Do the Subsidiary Company/Companies participate in the BR Initiatives of the parent company? If yes then indicate the number of such subsidiary company(s) ||Yes all the subsidiaries support to the BR Intiatives of the Company. |
|3. ||Do any other entity/entities (e.g. suppliers distributors etc.) that the Company does business with participate in the BR initiatives of the Company? If yes then indicate the percentage of such entity/entities? [Less than 30% 30-60% More than 60%] ||No other entities participate in the BR initiatives of the Company. |
SECTION D: BUSINESS RESPONSIBILITY (BR) INFORMATION
1. Details of Director/Directors responsible for BR
a) Details of the Director/Director responsible for implementation of the BRpolicy/policies
|DIN ||: 01191608 |
|Name ||: Mr. J C Sharma |
|Designation ||: Vice Chairman and Managing Director |
b) Details of the BR head
|Sr. No. ||Particulars ||Details |
|1. ||DIN ||01191608 |
|2. ||Name ||Mr. J C Sharma |
|3. ||Designation ||Vice Chairman and Managing Director |
|4. ||Telephone Number ||080 4932 0000 |
|5. ||E-mail ID ||firstname.lastname@example.org |
2. Principle-wise (as per NVGs) BR Policy / Policies (Reply in Y/N)
|Sr. No. ||Questions ||P ||P ||P ||P ||P ||P ||P ||P ||P |
| || ||1 ||2 ||3 ||4 ||5 ||6 ||7 ||8 ||9 |
|1. ||Do you have a policy/policies for ||Y ||Y ||Y ||Y ||Y ||Y ||Y ||Y ||Y |
|2. ||Has the policy being formulated in consultation with the relevant stakeholders? ||Yes. All the policies are being formulated in consultation with the relevant stakeholders. As per the Statutory Requirement mandatory policies are made available to the public through the website of the Company. |
|3. ||Does the policy confirm to any national / international standards? If yes specify? (50 words) ||All the policies are framed in line with the statutory requirements and hence they adheres to the national standards. |
| || || |
| || || |
|4. ||Has the policy being approved by Board? Is yes has it been signed by MD/owner/CEO/appropriate Board Director? ||Wherever necessary the policies are placed before the Board and requisite approvals obtained. |
| || || |
| || || |
| || || |
|5. ||Does the company have a specified committee of the Board/ Director/ Official to oversee the implementation of the policy? ||Yes |
| || || |
| || || |
| || || |
|6. ||Indicate the link for the policy to be viewed online? ||http://www.sobha.com/investor-relations-investor-updates. php |
| || || |
|Sr. No. ||Questions ||Remarks ||Information for our |
|7. ||Has the policy been formally communicated to all relevant internal and external stakeholders? ||Internal stakeholders are made aware of the policies. External stakeholders are communicated to the extent applicable to the stakeholders. The policies are also loaded on the website of the Company for easy access. || |
|8. ||Does the company have in-house structure to implement the policy/ policies. ||Yes || |
|9. ||Does the Company have a grievance redressal mechanism related to the policy/policies to address stakeholders' grievances related to the policy/ policies? ||Yes all stakeholders grievances may be addressed to email@example.com || |
|10. ||Has the company carried out independent audit/evaluation of the working of this policy by an internal or external agency? ||The policies are reviewed by the Board from time to time. Further the policies and their compliance are also reviewed internally and whenever necessary by external agencies periodically. || |
2a. If answer to S.No. 1 against any principle is No' please explain why: (Tickup to 2 options)
|Sr. No. ||Questions ||P ||P ||P ||P ||P ||P ||P ||P ||P |
| || ||1 ||2 ||3 ||4 ||5 ||6 ||7 ||8 ||9 |
|1. ||The company has not understood the Principles || || || || || || || || || |
| || || || || || || || || || || |
|2. ||The company is not at a stage where it finds itself in a position to formulate and implement the policies on specified principles || || || || || || || || || |
|3. ||The company does not have financial or manpower resources available for the task || || || || |
| || || |
| || || || || || || || || || || |
|4. ||It is planned to be done within next 6 months || || || || || || || || || |
| || || || || || || || || || || |
|5. ||It is planned to be done within the next 1 year || || || || || || || || || |
| || || || || || || || || || || |
|6. ||Any other reason (please specify) || || || || || || || || || |
3. Governance related to BR
|Sr. No. ||Particulars ||Remarks |
|1. ||Indicate the frequency with which the Board of Directors Committee of the Board or CEO to assess the BR performance of the Company. Within 3 months 3-6 months Annually More than 1 year. ||The Board and the Committee assess the performance on a quarterly basis i.e every 3 months. |
| || ||Further in line with the requirements of the Companies Act 2013 the Board has constituted the CSR Committee which formulate the CSR Policy and also approves CSR expenditure. The Committee ensure that expenditure is made for the right cause. |
|2. ||Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it is published? ||The Company has published its Sustainability Report. This is the first ever Business Responsibility Report published by the Company as the same is applicable for the year ended 31st March 2017. The Sustainability report can be accessed from the website of the Company thru http:// www.sobha.com/sustainability-reports.php |
SECTION E: PRINCIPLE-WISE PERFORMANCE
|Sr. No. ||Particulars ||Remarks |
|1 ||Does the policy relating to ethics bribery and corruption cover only the company? Yes/ No. ||Yes. |
| || ||The Company has a Code of Conduct to address ethics bribery and corruption related matters. The code is applicable to all internal and external stakeholders. The code may be accessed form the website. http://www.sobha. com/pdfs/code-of-conduct.pdf. In addition the Company has a vigil mechanism which monitors the ethical behavior of the stakeholders and also alert the top management of the Company to tap the gaps if any in the system. |
| ||Does it extend to the Group/Joint Ventures/ Suppliers/Contractors/NGOs /Others? || |
|2 ||How many stakeholder complaints have been received in the past financial year and what percentage was satisfactorily resolved by the management? If so provide details thereof in about 50 words or so. ||The Company has a dedicated mail id to which the stakeholders may address their queries/complaints. The Secretarial Department caters to the needs of the investors. A summary of the complaints received and resolved during the year is provided in a separate section of the Corporate Governance Report attached to the Directors Report. As at the end of the financial year there were no queries pending which needed to be addressed. |
|Principle 2: || || |
|1 ||List up to 3 of your products or services whose design has incorporated social or environmental concerns risks and/or opportunities. ||Given the nature of our business the Company could consider three "products" viz. (i) Residential units developed by the Company for sale (ii) Completed buildings which are leased (iii) Projects done on a contractual basis. The Company designs "products" in a way that it complies with the mandatorily required standard under the requisite laws. Further being a backward integrated Company it also manufacture supporting materials and the facilities are compliant with all the applicable laws. The Company and its contractors make all possible efforts to provide a healthy and safe working environment to workers at construction sites. |
|2. ||For each such product provide the following details in respect of resource use (energy water raw material etc.) per unit of product(optional): ||Since the products are built in multiple quantities the details are not quantified unit-wise. Hence these details are not available. |
| ||i. Reduction during sourcing/production/ distribution achieved since the previous year throughout the value chain? || |
| ||ii. Reduction during usage by consumers (energy water) has been achieved since the previous year? || |
|3. ||Does the company have procedures in place for sustainable sourcing (including transportation)? ||Yes. The Company has set procedures to select suppliers contractors and service providers based on their competence and capability to perform and are in compliance with the Company's Code of Conduct which includes health & safety environment ethics & integrity and working conditions among others. As a guiding principle the Company prefers to do business with compliant and sustainable suppliers. The detailed percentage is not quantifiable. Further details are provided in the Sustainability Report which can be accessed through http://www.sobha.com/sustainability-reports.php |
| ||If yes what percentage of your inputs was sourced sustainably? Also provide details thereof in about 50 words or so. || |
|4. ||Has the company taken any steps to procure goods and services from local & small producers including communities surrounding their place of work? ||Yes. The Company gives preference to local suppliers while developing its projects. With support the vendors are exposed to best practices of Sobha and deploys the same in their processes. In order to meet stringent quality requisites of Sobha the vendors constantly upgrade their quality and processes which will enhance their competencies in the market. |
| ||If yes what steps have been taken to improve their capacity and capability of local and small vendors? || |
|5. ||Does the company have a mechanism to recycle products and waste? If yes what is the percentage of recycling of products and waste (separately as 10%). Also provide details thereof in about 50 words or so. ||A separate section on this is provided in the Management Report attached to the Directors Report. Additional details can also be obtained from the web-link http://www.sobha. com/pdfs/environment-engineering-initiatives.pdf |
|Principle 3: || || |
|1 ||Please indicate the Total number of employees. ||At the end of the FY 2016-17 the Company employed 2698 individuals. |
|2. ||Please indicate the Total number of employees hired on temporary/contractual/casual basis. ||21 employees were hired on contract basis. |
|3. ||Please indicate the Number of permanent women employees. ||305 permanent women employees were in the Company. |
|4. ||Please indicate the Number of permanent employees with disabilities ||Three employees. |
|5. ||Do you have an employee association that is recognized by management? ||No |
|6. ||What percentage of your permanent employees is members of this recognized employee association? ||Not Applicable |
|7. ||Please indicate the Number of complaints relating to child labour forced labour involuntary labour sexual harassment in the last financial year and pending as on the end of the financial year. ||The Company doesn't employ child labour forced labour or involuntary labour. There was no complaint on Sexual Harassment filed during the financial year 2016-17. |
|8. ||What percentage of your under mentioned employees were given safety & skill up- gradation training in the last year? || |
| ||Permanent Employees ||57.82% |
| ||Permanent Women Employees ||65.25% |
| ||Casual/Temporary/Contractual Employees ||Nil |
| ||Employees with Disabilities ||Nil |
|Principle 4: || || |
|1. ||Has the company mapped its internal and external stakeholders? Yes/No ||Yes The Company has mapped its internal and external stakeholders. The key stakeholders of the Company includes its Customers Regulatory Authorities including the Government Employees Vendors Contractors Bankers Investors and Shareholders. |
|2. ||Out of the above has the company identified the disadvantaged vulnerable & marginalized stakeholders ||All the stakeholders are equally Important for the Company and none of the stakeholders are considered as disadvantaged vulnerable and marginalized. |
|3. ||Are there any special initiatives taken by the company to engage with the disadvantaged vulnerable and marginalized stakeholders. If so provide details thereof in about 50 words or so. ||Not Applicable |
|Principle 5: || || |
|1. ||Does the policy of the company on human rights cover only the company or extend to the Group/Joint Ventures/Suppliers / Contractors /NGOs/Others? ||The Company does not have a specific policy on human rights. However the Company has a Code of Conduct which regulate practices relating to non-employment of child labour assuring safety measures etc. These codes are applicable to the Company and its subsidiaries and to the contractors engaged by the Company. |
|2. ||How many stakeholder complaints have been received in the past financial year and what percent was satisfactorily resolved by the management? ||No complaints were received by the Company on human rights violation. |
|Principle 6: || || |
|1. ||Does the policy related to Principle 6 cover only the company or extends to the Group/Joint Ventures/Suppliers/ Contractors /NGOs/others. ||The Company has its own set of principles when it comes to utilising natural and manmade resources. The same principles are being extended to Group Companies . |
|2. ||Does the company have strategies/ initiatives to address global environmental issues such as climate change global warming etc? Y/N. If yes please give hyperlink for webpage etc. ||Yes. |
| || ||The Company has strategies / initiatives to address global environmental issues. The details may be accessed through http://www.sobha.com/pdfs/environment-engineering- initiatives.pdf http://www.sobha.com/sustainability-reports.php |
|3. ||Does the company identify and assess potential environmental risks? Y/N ||Yes. |
| || ||The Company does identify and assess potential environmental risks and takes step as far as possible to minimise them. |
|4. ||Does the company have any project related to Clean Development Mechanism? If so provide details thereof in about 50 words or so. Also if Yes whether any environmental compliance report is filed? ||Yes. |
| || ||The Sustainability Report addresses the Clean Development Mechanism. |
|5. ||Has the company undertaken any other initiatives on clean technology energy efficiency renewable energy etc. Y/N. If yes please give hyperlink for web page etc. ||Yes. |
| || ||The policy may be accessed form the website. i.e. http://www.sobha.com/sustainability-reports.php |
|6. ||Are the Emissions/Waste generated by the company within the permissible limits given by CPCB/SPCB for the financial year being reported? ||Yes. |
|7. ||Number of show cause/ legal notices received from CPCB/SPCB which are pending (i.e. not resolved to satisfaction) as on end of Financial Year. ||There were no show cause / legal notices received which were materially important and are pending to be resolves at the end of the financial year. |
|Principle 7: || || |
|1. ||Is your company a member of any trade and chamber or association? If Yes Name only those major ones that your business deals with. ||Yes. The Company is a member of CREDAI Bangalore a forum of Real Estate Developers. |
|2. ||Have you advocated/lobbied through above associations for the advancement or improvement of public good? Yes/No; if yes specify the broad areas ( drop box: Governance and Administration Economic Reforms Inclusive Development Policies Energy security Water Food Security Sustainable Business Principles Others) ||Yes. The Company does work for advancement of public good along with the industry colleagues. Such work mainly involves creating framework for sustainable Business development for urban area and inclusive development in this industry. |
|Principle 8: || || |
|1. ||Does the company have specified programmes /initiatives/projects in pursuit of the policy related to Principle 8? If yes details thereof. ||Yes. Such details are provided in CSR Report attached to the Directors Report and also a section in the Management Report. |
|2. ||Are the programmes /projects undertaken through in-house team/own foundation/ external NGO/government structures/any other organization? ||The programmes are carried out by the Sri Kurumba Educational and Charitable Trust a Trust associated with the Company. |
|3. ||Have you done any impact assessment of your initiative? ||The expenditure made on CSR activities and the impact of such expenditure are periodically monitored by the CSR Committee of the Board. |
|4. ||What is your company's direct contribution to community development projects Amount in INR and the details of the projects undertaken. ||The Company spent Rs 150.42 million towards its CSR Initiatives during the year 2016-17. Details of the projects undertaken are as under: |
| || ||i. Eradicating hunger poverty and malnutrition promoting preventive health care and sanitation |
| || ||ii. Promoting education and employment enhancing vocation skills especially among children women elderly and the differently abled and livelihood enhancement projects |
| || ||iii. Promoting gender equality empowering women setting up homes and hostels for women and orphans; setting up old age homes day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups. For further details please refer to the Annual Report on CSR and the CSR Report in the Management Report. |
|5. ||Have you taken steps to ensure that this community development initiative is successfully adopted by the community? ||Yes. For further details please refer to the CSR Report which forms part of the Management Report. |
| ||Please explain in 50 words or so. || |
|Principal 9: || || |
|1. ||What No. of customer complaints/consumer cases were pending as on the end of financial year. ||13 consumer cases were pending as on the end of the financial year 2016-17. |
|2. ||Does the company display product information on the product label over and above what is mandated as per local laws? Yes/No/N.A. /Remarks (additional information) ||Yes. |
|3. ||Is there any case filed by any stakeholder against the company regarding unfair trade practices irresponsible advertising and/or anti-competitive behaviour during the last five years and pending as on end of financial year. If so provide details thereof in about 50 words or so. ||No |
| ||Did your company carry out any consumer survey/ consumer satisfaction trends? ||Yes |