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Sri Nachammai Cotton Mills Ltd.

BSE: 521234 Sector: Industrials
NSE: N.A. ISIN Code: INE443E01016
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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 20.00
52-Week high 25.00
52-Week low 11.00
P/E 28.60
Mkt Cap.(Rs cr) 9
Buy Price 20.05
Buy Qty 81.00
Sell Price 21.45
Sell Qty 71.00
OPEN 20.00
CLOSE 20.45
52-Week high 25.00
52-Week low 11.00
P/E 28.60
Mkt Cap.(Rs cr) 9
Buy Price 20.05
Buy Qty 81.00
Sell Price 21.45
Sell Qty 71.00

Sri Nachammai Cotton Mills Ltd. (SRINACHACOTT) - Director Report

Company director report

Dear Shareholders

The Board of Directors of your Company are pleased to present the 36* Annual report onthe business of the Company along with summaryof financial statements for theperiod ended31"March2016.The report is prepared in accordance with the provisions of theCompanies Act2013.

Financial Highlights

During the year under reviewperformance of your company is as under:

Particulars 31.03.2016 30.06.2015
(9 months) (12 months)
Profit before finance costs and Depreciation 50611025 103800528
Finance costs (43926234) (68078625)
Depreciation (30081041) (41785632)
Profit / (Loss) before taxation (23396250) (6063729)
Less: Tax expense 2431163 1647058
Profit/(Loss) after tax (20965087) (4416671)

Financial Year

The Company in compliance with Section 2(41) of the Companies Act2013 with henceforthhave 1 "April to 31" March as its Financial year instead of 1st July to 30thJune being adopted before and hence the current Financial year is for the period of 9months commencing 1st July2015 and ended on 31st March2016.


In view of the Lossesno dividend is proposed by the Board of Directors.

Review of Operations

During the 9 months under reviewthe Company has made a turnover ofRs.1135464664/-.The Company incurred a loss of Rs.23306250/- in the previous 9months mainly due to uneconomical yam prices in the domestic market.There was oversupplyof yam both in the domestic and international market.Hence the Company was forced to sellbags at uneconomical prices.Thusthe company had to incur losses.

During the Current yearthe Company has bought quality cotton at reasonable pricesthepower cost will come down this year due to soaring power from cheaper sources.Otherexpenses like labour wagesfixed interest and other overheads will reduce as a percentageof turnoverdue to increase in production at all departments.

Fixed Deposits

Your Company has not accepted any fixed deposit from public and there are nooutstanding dues in respect of thereof.

Details of Directors and Key Managerial Personnel

Pursuant to the provisions of Section 152 of the Companies Act2013 Smt.Vasantha retireby rotation and being eligible offers herself for appointment and the resolution is placedbefore the members for approval.

A brief resumeexpertiseshareholding in the company and details of other entities inwhich the Directors are interested as stipulated under Regulation 36(3)(a) of SEBI(Listing Obligations and Disclosure Requirements) Regulations2015 and as per SecretarialStandard is provided in the Noticeattached hereto.

Smt.Vasantha was appointed at the 34*AGM held on 10" December2014 and SriA.Arunkumar was appointed as Director of the Company at the 35th AGM held on 15thDecember2015 and they are eligible to retire by rotation.

At the Board Meeting held on 2111 August2014Sri P.PalnaiappanChairman cum ManagingDirector and Smt.P.UmayalJoint ManagingDirectoroftheCompanywas reappointed foraterm offive years from 19.12.2014 to 18.12.2019 and designated as "Key ManagerialPersonnel" of the Company pursuant to Section 2(51)203 of the Companies Act2013read with Companies (Appointment and remuneration of Managerial Personnel)Rules2014.Company's Code of Conduct applicable to the Board has been adopted by the Boardand all Directors of the Company have confirmed compliance with the Code of Conduct.

Sri.P.Palaniappanresigned from Chairman cum Managing Director from the Office of theBoard of Directors with effect from 18th November2015 and he shall continue to be theManaging Director of the Company.

Smt.P.Umayal shall be appointed as the Chairman of the Board of Directors with effectfrom 18* November2015 and she shall remain as Chairman cum Managing Director of theCompany.

Declaration by Independent Directors

Pursuant to the provisions of Section 149 of the Actwhich came into effect from1" April2014Sri Perumal MadhavagopalSri A.AIagappanSri S.RavichasndranSriPL.Subbiah and Smt.Shantha Radhakrishnan were appointed at the 34’ AGM of theCompany held on 10th December2014 for a term of five consecutive years from 10/12/2014 to09/12/2019.The terms and conditions of appointment of Independent Directors are as perSchedule IV of the ActThey have submitted a Declaration that each of them meets thecriteria of Independent as provided in Section 149(6) of the Companies Act2013 and therehas been no change in the circumstances which may affect their status as IndependentDirectors during the year.

During the yearone separate meeting of Independent Directors was held.All theIndependent Directors were present at this meeting.In the said meetingthe IndependentDirectors assessed the qualityquantity and timeliness of flow of information between themanagement and the Board and expressed that the Current flow of information and contentswere adequate for the Board to effectively perform its duties.

Familiarization Programmes

The Company had conducted various sessions during the financial year to familiarizeIndependent Directors with the Companytheir rulesresponsibilities in the Companyand thetechnology and the risk management systems of the Company.Furtherthe Directors areencouraged to attend the training programmes being organized by variousregulators/bodies/institutions on above matters.

All the Directors of the Company have confirmed that they are not disqualified frombeing appointed as directors in terms of Section 184(1) and Rule 9 (1) of theCompaniesAct2013.

Nomination and Remuneration Policy

The Board hason the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of DirectorsSenior Management and theirremuneration.The salient aspects covered in the Nomination and RemunerationPolicycovering the policy on appointment and remuneration of Directors and other mattersas provided under Section 178(3) of the Companies Act2013 have been outlined in theCorporate Governance Report which forms part of this Report.

Number of Board Meetings and Committee Meetings

During the Financial year 2015-163 (Three) Board Meetings on the followingdates-27.08.201531.10.2015 and 30.01.2016 were held.

SubsidiariesJoint Ventures and Associates

The Company does not have any SubsidiaryJoint venture or Associate Company.

Corporate Social Responsibility

Pursuant to Section 135 of the Act.the Company does not satisfy the eligibilitycriteria with regard to net worth turnover and netprofit.HencethecompanyisnotrequiredtocomplywiththeprovisionsrelatingtoCSR.

Material Changes and Commitments affecting the Financial Position of the Company

They have been no material changes and commitmentsif anyaffecting the financialposition of the Company which have occurred between the end of financial year (March312016) to which the financial statements relate and the date of the report.

Adequacy of Internal Financial Controls with Reference to Financial Statements

The Company has in place adequacy internal financial controls with reference tofinancial statements.During the year under reviewsuch controlswere tested and noreportable material weakness in the design or operation were observed.

Particulars of LoanGuarantees and Investments under Section 186 -Details of Loan

Period of making Loan Details of Lender Amount in Rs. Purproe for which the toanistobeuEzed by prerecipient Time period for which it is given Date of BR Rate of interest
1 01.07.2015 to 31.032016 Supreme Yam Spinners Limited 30Sugavaneswara RoadSalem-4 11725000/- Inter Corporate Loan Repayable on Demand 27.08.2015 31.10.2015 30.01.2016 12%
2 01.07.2015 to 3103.2016 Raja Yarn Spinners Limited 30Sugavaneswara RoadSalem-4 51534500/- Inter Corporate Loan Repayable on Demand 27.08.2015 31.10.2015 30.01.2016 5.5%

Details of Significant & Materia! orders passed by the Regulations or courts orTribunal

No Significant and Materials orders have been passed by any Regulator or Court orTribunal which can have an impact on the going concern status and the Company's operationsin future.

Investments made under Section 186 of the Companies Act2013

No investments were made by the Company under Section 186 of the Companies Act2013during the year under review.

Disclosure as required under Section 22 of Sexual Harassment of Workmen at Workplace(PreventionProhibition and Redressal) Act2013

As per the provisions of the Sexual Harassment of Women at Workplace(PreventionProhibition and Redressal) Act2013the Company has constituted an InternalComplaints Committee.During the year 2015-2016 no compliant was received before thecommittee.

Management Discussion and Analysis Report

The Report on Management Discussion and Analysisas per the Regulation 34(1) (e) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations2015 with StockExchange covering industry structure and developmentsopportunities and threats-outlookdiscussion on financial contained "Management Discussionand Analysis Report" that forms an integral part of this Report and annexed asAnnexure -1

Statement showing details of Conservation of EnergyTechnology AbsorptionExports andForeign Exchange earnings and outgo.

The information on Conservation of EnergyTechnology Absorption and Foreign Exchangeearnings and outgo stipulated under Section 134(3) (m) of the Companies Act2013 read withRule 8 of the Companies (Accounts) Rules 2014 is annexed herewith as Annexure -II

Corporate Governance

As per the new Regulation 27(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations2015a Corporate Governance Reporttogether with the Certificatefrom the Company's Auditors confirming the compliance of conditions on CorporateGovernance is given in Annexure-lll

Extract of Annual Return

The extract of Annual Return pursuant to the provisions of Section 92 read with Rule 12of the Companies (Management and administration) Rules2014in format MGT - 9for theFinancial Year 2015-16 is enclosed with this report - Annexure -IV

Particulars of Contracts or Arrangements with Related Parties

The particulars of contracts or arrangements with related parties referred to inSection 188(1) of the Companies Act2013 for the Financial Year 2015-16 is given AOC - 2 -Annexure - V.

The Board had devised a Policy on dealing with Related party transactions and thePolicy has been uploaded on the Company's website

Vigil Mechanism/Whistle Blower Policy

.In pursuant to the provisions of Section 177(9) & (10) of the Companies Act2013aVigil Mechanism for Directors and employees to report genuine concerns has beenestablished.

The Vigil Mechanism Policy has been uploaded on the website of the Company at

The main objective of this policy is to ensure sustainable business growth withstability and to promote a pro-active approach in reportingevaluating and resolving risksassociated with the business.In order to achieve the key objectivethe policy establishesa structures and disciplined approach to risk managementin order to guide decisions onrisk related issues.

Audit Committee

Audit Committee is in existence in accordance with the provisions of Section 177 of theCompanies Act2013.Kindly refer to the Section of Corporate Governanceunder thehead'Audit Committee' for matters relating to the compositionmeetingsand functions ofthe Committee.The Board was accepted the Audit Committee recommendations during the yearwhenever requiredhence no disclosure required under Section 177(8) of the CompaniesAct2013 with respect to rejection of any recommendations of Audit Committee by Board.

Risk Management Policy

As per the Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations2015 the Board members were informed about risk assessment and minimizationprocedures after which the Board formally adopted steps for framingimplementing andmonitoring the risk management plan for the company.All the results and evaluation hasbeen communicated.

Board Evaluation

On the advice of the Board of Directorsthe Nomination and Remuneration Committee ofthe Board of Directors the Company formulated the criteria for the evaluation of theperformance of the Board of Directors & its CommitteesIndependentDirectorsNonIndependent DirectorsChairman cum Managing Director and ManagingDirector.Based on that performance valuation has been undertaken.

Remuneration Policy of the Company

The Board hason the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of DirectorsSenior Management and theirremuneration.The salient aspects covered in the Nomination and RemunerationPolicycovering the policy on appointment and remuneration of Directors and other mattersas provided under Section 178(3) of the Companies Act2013 have been outlined in theCorporate Governance Report which forms part of this Report.The Remuneration details toDirectors is given in Annexure - VI.

The Remuneration Policy has been uploaded on the website of the Company

Internal Control systems and their Adequacy

Your Company has established adequate Internal Control procedurescommensurate with thenature of its business and size of its operations.

The Company has appointed Internal Auditor to observe the Internal controlswhether thework flow of organization is being done through the approved policies of the Company.Inevery quarter during the approval of Financial statementsInternal Auditor will presentthe Internal Audit Report and Management Comments on the Internal Audit observation; and

1 The Board of Directors of the Company have adopted various Policies like RelatedParty Transactions PolicyWhistle Blower Policy

: Policy to determine Material Subsidiaries and such other procedure for ensuring theorderly and efficient conduct of its business for safeguarding of its assetstheprevention and detection of frauds and errorsthe accuracy and completeness of theaccounting recordsand the timely preparation of reliable financial information.

Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act2013yourdirectors confirm that:

(a) in the preparation of the annual accountsthe applicable accounting standards hasbeen 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 and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) have laid down internal financial controls to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively.

(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

Auditors and Secretarial Auditor Report

There no disqualificationsreservation or adverse remarks or disclaimers in theAuditors and Secretarial Auditors Report.Particulars of Employees’

The disclosure referred to the Rule 5(2) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules2014 does not apply to the Company as there were no employeeswho are in receipt of remuneration in the aggregate at the rate of not less thanRs.6000000/- if employed throughout the year or Rs.500000/- per month if employed forpart of the year.

Statutory Auditors

M/S.M.S.Jaganathan & VisvanathanChartered Accountants were appointed as theAuditors of the Company with effect from this Annual General Meeting to hold office tillthe conclusion of next Annual General Meeting.

Internal Auditor

The Company has appointed Mr.H.Venugopal asthe Internal Auditor of the Company for thefinancial year 2016-17.The scope of work includes review of process for safeguarding theassets of the Companyreview of operational efficiencyeffectiveness of system andprocesses and assessing the strength and weaknesses of internal control.Internal Auditorreports are placed before the Audit Committee on a regular basis for taking suitableaction for improvementwherever required.

Cost Auditor

Cost Audit was not applicable for the Company 2014-15.In view of the Companymaintaining the Cost Records continuouslyand in order to provide the comparable auditedfigures for the year 2014-15 in the Cost Audit report for the year 2015-16Cost Audit forthe year 2014-15 was carried out on a voluntary basis.

In accordance with the amendments effected in the Cost Audit rulesCost Audit isapplicable for the year 2015-16and the Cost Audit report for the year 2015 -16 in XBRLformat will be filed with MCA on or before 30th September2016.

On the recommendation of the Audit Committee Mr.V.BalasubramanianCost Accountant wasreappointed as Cost Auditor of the Company for the financial year 2016-17 and Board placesbefore the members the resolution for ratification of remuneration payable to CostAuditor.

Secretarial Auditor

Sri M.R.L.NarasimhaPractising Company Secretary was appointed to conduct theSecretarial Audit of the Company for the Financial Year2015-16 as required under Section204 of theActand Rules made there under.The Secretarial Audit Report for the FinancialYear 2015-16 forms part of the Annual Report as annexure to the Board's Report(Annexure-VII)


The Equity Shares of the Company are Listed in BSE Limited and the Company has dulypaid the Annual listing fees for the year 2015-16.

M/s.Cameo Corporate Services LimitedChennai is the Registrar for providing depositoryservices through National Securities Depository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL)for holding Shares in Electronic mode (De-mat) of ourShareholders and also is the Registrar for Share Transfer Services for physical segment.


Your Directors wish to place on record their deep sense of appreciation for thetremendous support from the Bankers M/s.Indian Overseas Bankthe shareholdersand all oursuppliers and customers.The Board also wishes to place on record their appreciation forthe contribution made by the employees at all levels.

For and on behalf of the Board of Directors
Salem Chairman cum Managing Director
23rd May2016 Din.00110260.



Conservation of Energytechnology absorption and research and development and foreignexchange eamings and outgo

A.Conservation of energy
(a) Power And Fuel Consumption Period ended on 31.03.2016 Previous year ended 30.06.2015
(i) Purchased
Units 22802782 303.78345
Total Amount (Rs.) 156698360 230396088
Rate Per unit (Rs.) 6.87 7.58
(ii) Own Generation
(a) Through Diesel Generator
Units 124670 437942
Units per ire of Diesel 3.38 3.43
Cost/Unit (Rs.) 12.29 14.67
(b) Through Steam Turbine / Generator Nil Nil
2.Coal Nil Nil
3.Fumace Oil Nil Nil
4.Other Nil Nil
(b) Consumption per unit of production
Yam produced (kgs) 5689579 8801327
Electricity Consumed (Units) 22927452 30816287
Consumption per Kgof Yam 4.03 3.50

B. Particular* of Technology Absorption

The Company has no R & D Division.The Company is a member of South India TextileResearch Association and gets the benefits of their research.

C. Particulars on foreign exchange earnings and outgo

Eamings outgo : Direct Exports Rs. Nil Rs. Nil
: Import of Spares Rs. 6017930 Rs. 6248853
Import of Capital Goods Rs. Nil Rs. Nil
Import of Raw Material Rs. 109201292 Rs. 210482929
Rs. 115219222 Rs. 216731782


For and on behalf of the Board of Directors
Salem P.Umayal
23^ May2016 Chairman cum Managing Director
DIN: 00110260.

Form No.AOC - 2 -


[Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules2014] Form for disclosure of particulars of contracts /arrangements entered into by the Company with related parties referred to in sub-section(1) of Section 188 of the Companies Act2013 including certain arms length transactionsunder third proviso thereto Details of material contracts or arrangement or transactionsat arm’s length basis

Name(s)ofthe related party and nature of relationship Nature of contracts/ Arrangements / transactions Duration of the contracts/ arrangements / tr ansactions Salient terms of the contracts or arrangements or transactions including the valueif any Date(s) of approval by the BoardH any Amount paid as advanceif any
Supreme Yam Spinners Limited Interested through Directors and their relatives 1.Lease rent paid One Year 01/10/2015 to 31/08/2016 This Company has agreed to grant operational lease of its entire fixed assetswhich shall be renewed from time to time on a monthly rent as agreed upon in the Lease agreement If was approved at the following Board Meetings conducted during the financial year 27.08.2015 31.10.2016 30.01.2016 Nil
Supreme Yam Spinners Limited Interested through Directors and their relatives 2.Rendering of Services 11 months 01/10/2015 to 31/08/2016 Repairs and Maintenance of its Plant & Machinery If was approved at the following Board Meetings conducted during the financial year 27.08.2015 31.10.2015 30.01.2016 Nil


i) The ratio of the remuneration of each director So the median remuneration of theemployees of the company for the financial year is as mentioned below.

Name Category Ratio
1.Sri.Palaniappan Managing Director 10.07: 1
2.Smt.P.Umayal Chairman cum Managing Director 10.07: 1

Note: For this purposesitting fees paid to the Directors have not been considered forremuneration.

ii) The Percentage increase in remuneration of each Director and CEO in the financialyear: There was no increase in the remuneration of the DirectorsCFOCEO and the CompanySecretary in the financial year.

iii) Percentage increase in the median remuneration of employees in the financial year:Nil

iv) Number of permanent employees on the rolls of company: 229

v) Explanation on ttte relationship between average increase in remuneration andCompany performance: On an averageemployees received an increase of 1.92% in accordancewith the contract entered into by the Company with the Employees.

vi) Comparison of the remuneration each Key Managerial Personnel against theperformance of the Company: (in Rupees)..

Remuneration of KMP Remuneration Revenue from operations Remuneration (as % of revenue) Profit Before Tax
Chairman cum Managing Director 1125000 1135464664 0.09% (209.65)
Joint Managing Director 1125000 1135464664 0.09% (209.65)
Chief Financial Officer 204300 1135464664 0.02% (209.65)
Company Secretary 135900 1135464664 0.01% (209.65)

Bracket represents negative figure.

vii) The key parameters for any variable component of remuneration availed by theDirectors: Not Applicable

viii) Variations in the market capitalisation of the Companyprice eamings ratio as atthe closing date of the current financial year and previous financial year

Particulars 31st March2016 30th June2015
Market Capitalisation ofthe Company (in Lakhs) 55384 51385
Closing price at BSE (in Rs.) 12.88 11.95
Earnings per share (in Rs.) -4.89 -1.03
Price Earnings ratio as at the closing date -2.63 -10.92

ix) Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last publicoffer: Not applicable as the last public offerwas in 1994 and the data is incomparable.

x) Percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out ifthereare any exceptional circumstances for increase in the managerial remuneration:

The average increase in salaries of employees other than managerial personnel in 2015-16 was 1.92%.During the year 2015 -16there was no increase in the remuneration ofManagerial Personnel.

xi) The ratio of the remuneration of the highest paid Director to that of the employeeswho are not Directors but receive remuneration in excess ofthe highest paid Directorduring the year: NotAppiicable

xii) Affirmation that the remuneration is as per the remuneration policy ofthe Company:Yes Note:

1. The remuneration details are for the period ended (9 months) 31st March2016 and allother particulars are at 31.03.2016 -

2. The remuneration includes Company’s contribution to provident fundgratuity& perquisites.



Section 178 of the Companies Act2013 and Clausfe 49 of the Listing Agreement requiresthe Board of Directors of every listed Company to constitute the Nomination andRemuneration Committee.


The Key Objectives of the Committee would be:

a) To guide the Board in relation to appointment and removal of DirectorsKeyManagerial Personnel and Senior Management.

b) To evaluate the performance of the members of the Board and provide necessary reportto the Board for further evaluation.

c) To recommend to the Board on Remuneration payable to the DirectorsKey ManagerialPersonnel and Senior Management.


The Policy shall be applicable to:

(i) Directors (Executive and Non Executive & Independent)

(ii) Key Managerial Personnel

(iii) Senior Management Personnel DEFINITIONS

a) "Act" means the Companies Act2013 and Rules framed thereunderas amendedfrom time to time.

b) 'Board ’ means Board of Directors of the Company.

c) "Company" means ‘Sri Nachammai Cotton Mills Limited."

d) "Employees’ Stock Option" means the option given to thedirectorsofficers or employees of a company or of its holding company or subsidiarycompany or companiesif anywhich gives such directorsofficers or employeesthe benefitor right to purchaseor to subscribe forthe shares of the company at afuture date at apre-determined price.

e) ‘Independent Director" means a director referred to in Section 149(6)ofthe CompaniesAct2013.

f) "Key Managerial Personnel' (KMP) means

(i) Chief Executive Officer or the Managing Director or the Manager

ii) Company Secretary

iii) Whole-time Director

iv) Chief Financial Officer and

v) Such other officer as may be prescribed.

g) ‘Committee' means Nomination and Remuneration Committee of the Company asConstituted or reconstituted by the Board from time to time.

h) "Policy or This Policy" means"Nomination and RemunerationPolicy."

i) "Senior Management" means personnel of the Company who are members of itscore management team excluding Board of Directors.

This would include all members of management one level below the executivedirectorsincluding all the functional heads.


The Board has the power to constitute/ reconstitute the Committee from time to time inorder to make it consistent with the Company's policy and applicable statutory requirementAt presentthe Nomination and Remuneration Committee comprises of the following Directors:'

(i) Sri.Perumal Madhavagopal - Chairman (Independent Director)
(ii) Sri.Sri.A.AIagappan - Vice Chairman (Independent Director)
(iii) Sri S.Ravichandran - Member (Independent Director)


The role of the Committee inter alia will be the following: '

a) To formulate a criteria for determining qualificationspositive attributes andindependence of a Director

b) Formulate criteria for evaluation of Independent Directors and the Board.

c) Identify persons who are qualified to become Directors and who may be appointed inSenior Management in accordance with the criteria laid down in this policy.

d) To carry out evaluation of every Director's performance.

e) To recommend to the Board the appointment and removal of Directors and SeniorManagement.

f) To recommend to the Board policy relating to remuneration for DirectorsKeyManagerial Personnel and Senior Management.

g) To devise a policy on Board diversity.

h) To perform such other functions as may be necessary or mandated by the Board fromtime to time and/or enforced by any statutory notificationamendment or modificationasmay be applicable or appropriate for the performance of its duties.


The meeting of the Committee shall be held at such regular intervals as may berequired.


Appointment Criteria and Qualifications

1. The Committee shall identify and ascertain the integrityqualificationexpertise andexperience of the person for appointment as DirectorKMP or at Senior Management level andrecommend to the Board his I her appointment

2. A person should possess adequate qualificationexpertise and experience for theposition he I she is considered for appointment.The Committee has discretion to decidewhether qualificationexpertise and experience possessed by a person are sufficient Isatisfactory for the concerned position.

3. The Company shall not appoint or continue the employment of any person as ManagingDirector/Whole-time Director/Manager who has attained the age of seventy years.Providedthat the term of the person holding this position may be extended beyond the age ofseventy years with the approval of shareholders by passing a special resolution based onthe explanatory statement annexed to the notice for such motion indicating thejustification for extension of appointment beyond seventy years.

Term /Tenure

1. Managing Director/Whole-time Director/Manager (Managerial Person)

The Company shall appoint or re-appoint any person as its Managerial Person fof a termnot exceeding five years at a time.No re-appointment shall be made earlier than one yearbefore the expiry of term.

2. Independent Director

An Independent Director shaB hold office for a term up to five consecutive years on theBoard of the Company and will be eligible for re appointment on passing of a specialresolution by the Company and disclosure of such appointment in the Board's report

No Independent Director shat hold offioe for more than two consecutive termsbut suchIndependent Director shall be eligible for appointment after expiry of three years ofceasing to become an Independent Director.Provided that an Independent Director shallnotduring the said period of three yearsbe appointed in or be associated with theCompany in any other capacityeither directly or indirectly.Howeverif a person who hasalready served as an Independent Director for 5 years or more in the Company as on 1stOctober2014 or such other date as may be determined by the Committee as per regulatoryrequirementhe I she shall be eligible for appointment for one more term of 5 years only.

At the time of appointment of Independent Director it should be ensured that number ofBoards on which such Independent Director serves is restricted to seven listed companiesas an Independent Director and three listed companies as an Independent Director in casesuch person is serving as a Whole-time Director of a listed company.


The Committee shall carry out an evaluation of performance of every DirectorKMP andSenior Management on yearly basis.


Due to reasons for any disqualification mentioned in the Companies Act2013rules madethereunder or under any other applicable Act rules and regulationsthe Committee mayrecommendto the Board with reasons recorded in writingremoval of a DirectorKMP orSenior Management subject to the provisions and compliance of the saidActrulesandregulations.


The DirectorKMP and Senior Management shall retire as per the applicable provisionsofthe Companies Act 2013 and the prevailing policy of the Company.The Board will have thediscretion to retain the DirectorKMPSenior Management in the same positron Iremuneration or otherwise even after attaining the retirement agefor the benefit of theCompany.



Managerial PersonKMP and Senior Management shall be eligible for a monthlyremuneration as may be approved by the Board on the recommendation of the Committee inaccordance with the statutory provisions of the Companies Act2013and the rules madethereunder for the time being in force.The break-up of the pay scale and quantum ofperquisites includingemployer's contribution to P.Fpension schememedical expensesclubfees etc.shall be decided and approved by the Board on the recommendation of the Committeeand approved by the shareholders and Central Governmentwhereverrequired.

Ifin any financial yearthe Company has no profits or its profits are inadequatetheCompany shall pay remuneration to its Managerial Person in accordance with the provisionsof Schedule V of the Companies Act2013 and if it is not able to comply with suchprovisionswith the prior approval of the Central Government.


1. Remuneration/Commission

The remuneration I commission shall be in accordance with the statutory provisions ofthe Companies Act2013and the rules made thereunderforthe time being in force. ‘

2. Sitting Fees

The Non- Executive I Independent Director may receive remuneration by way of fees forattending meetings of Board or Committee thereof.Provided that the amount of such feesshall not exceed the maximum amount as provided in the Companies Act2013per meeting ofthe Board or Committee or such amount as may be prescribed by the Central Government fromtime to time.

3. Stock Options

An Independent Director shall not be entitled to any stock option of the Company.


The policy for determination of the remuneration of employees other than DirectorsKMPsand Senior Management personnel shall be as per ' the normsfollowedbvthe Company.


Where any insurance is taken by the Company on behalf of its Managerial PersonKMP andany other employees for indemnifying them against any liabilitythe premium paid on suchinsurance shall not be treated as part of the remuneration payable to any suchpersonnel.‘ Providedthat if such person is proved to be guiltythe premium paid onsuch insurance shall be treated as part of the remuneration.


The Nomination and Remuneration policy shall be disclosed in the Board's report asrequired under the Companies Act2013 and the Listing Agreement.


The Nomination and Remuneration Committee of the Company shall review and may amendthis policy from time to timesubject to the approval of the Board of Directors of theCompany when deemed necessary in the interests of the Company.Any subsequentamendment/modification in the listing agreement and/or other applicable laws in thisregard shall automatically apply to this policy.