Adhunik Metaliks Ltd.
|BSE: 532727||Sector: Metals & Mining|
|NSE: ADHUNIK||ISIN Code: INE400H01019|
|BSE 00:00 | 29 Nov||Adhunik Metaliks Ltd|
|NSE 05:30 | 01 Jan||Adhunik Metaliks Ltd|
|BSE: 532727||Sector: Metals & Mining|
|NSE: ADHUNIK||ISIN Code: INE400H01019|
|BSE 00:00 | 29 Nov||Adhunik Metaliks Ltd|
|NSE 05:30 | 01 Jan||Adhunik Metaliks Ltd|
To the Members of Adhunik Metaliks Limited
The 16th Annual Report and the Audited Financial Results of your Company for thefinancial year ended March 31 2017 along with the report on the business and itsoperations is being presented hereunder:
During the year under review the Total Income from Operations (including other income)was ' 73124.52 Lacs as compared to ' 51821.78 Lacs in the previous year (9 months) onstandalone basis. The Company posted a net loss after tax of ' (87238.86) Lacs ascompared to the net loss of ' (39996.84) during the previous year.
No dividend was recommended during the year under review.
TRANSFER TO RESERVES
In view of losses incurred by the Company during the year no amount has beentransferred to the General Reserve for the financial year ended 31st March2017.
CHANGE IN NATURE OF BUSINESS
During the year under review there has been no change in the nature of business of theCompany.
The financial year of the Company is from 1st April 2016 to 31st March 2017.
Your Company did not accept any deposits within the meaning of Section 73 of theCompanies Act 2013 and the rules made there under. The Company does not hold any depositsfrom the public shareholders and employees as on 31st March 2017.
The Lenders of the Company had invoked Strategic Debt Restructuring (SDR) in theCompany during the FY 2016-17. One of the basic conditions of SDR was to issue andtransfer 51% stake equity to lenders. However the shares could not be transferred to thelenders as the merger of Orissa Manganese & Minerals Limited with Adhunik MetaliksLimited is still pending at Hon'ble Odisha High Court and the ultimate objectives soughtto be achieved under SDR Mechanism couldn't be achieved during the financial year underreview.
SCHEME OF AMALGAMATION
During the Financial year 2013-14 your Directors approved amalgamation of the Companywith its wholly owned subsidiary i.e. Orissa Manganese & Minerals Limited. The Companyhas filed the confirmation Petition before the Hon'ble High Court Cuttack (Odisha) andthe same is pending for approval at present. However due to the ongoing insolvencyresolution process initiated against the Company the fate of the amalgamation shalldepend upon the outcome of the resolution process.
The Company's paid up equity share capital remained at Rs. 1234995360 (Rupees OneHundred Twenty Three Crores Forty Nine Lacs Ninety Five Thousand Three Hundred Sixty only)comprising of 123499536 equity shares of ' 10 each. There was no change in theCompany's paid up share capital during the year under review.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Your Company has subsequent to year end transferred a sum of ' 143619/- to InvestorEducation and Protection Fund in compliance with the provisions of Section 124 125 andother applicable provisions of the Companies Act 2013.
The said amount represents dividend for the year 2008 -09 which remained unclaimed fora period of 7 years from its due date of payment.
SUBSIDIARY/ASSOCIATE COMPANY/JOINT VENTURE AND CONSOLIDATED FINANCIAL STATEMENTS
Your company's wholly owned subsidiary namely Orissa Manganese & Minerals Limited(OMML) operates Ghatkuri Iron ore mines in the state of Jharkhand and Patmunda in thestate of Odisha. OMML operates an iron ore pellet plant at Kandra Jharkhand. Your companyhas one another subsidiary Kolkata Glass & Ceramics Limited and has an associatecompany Adhunik Power & Natural Resources Limited. The company has a joint venturenaming United Minerals.
The consolidated financial statements presented by the Company include financialinformation of its subsidiaries and Joint Venture prepared in compliance with applicableAccounting Standards.
A statement containing the salient features of the financial statement of the Company'ssubsidiaries/associate in the prescribed form AOC-1 pursuant to first proviso to Section129(3) of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 isannexed separately to the financial statements as Annexure-A. The Annual Accounts of thesubsidiary/associate companies will be made available to the shareholders as and when theydemand and will also be kept for inspection by any investor at the registered office ofthe Company and these subsidiaries/associates. The Financial statements of the Company andits subsidiaries are also available on the website of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
MATERIAL CHANGES AFTER THE END OF THE FINANCIAL YEAR
A. Cessation of M/s Orissa Manganese & Minerals Limited as Wholly Owned Subsidiaryof the company
The Board of Directors of Orissa Manganese & Minerals Limited (OMML) at theirmeeting held on 12th May 2017 has issued and allotted 132110000 fully paid-upequity shares pursuant to conversion of 132110000 0.01% Cumulative CompulsorilyConvertible Non-Cumulative Preference shares and consequent to the said allotment theholding of Adhunik Metaliks Limited in OMML has reduced from 100% to 13.15%.
In view of the aforesaid allotment Orissa Manganese & Minerals Limited ceased to bea wholly owned subsidiary of Adhunik Metaliks Limited w.e.f. 12th May 2017.
B. Initiation of Corporate Insolvency Resolution Process
The Hon'ble NCLT Kolkata Bench has vide its order dated 3rd August 2017 has orderedinitiation of insolvency resolution process in respect of the Company with effect from 3rdAugust 2017. Further pursuant to the said Order Mr. Sumit Binani having RegistrationNumber IBBI/IPA-001/IP-N00005/2016-17/10025 has been appointed as the Interim ResolutionProfessional (IRP) from the date of the said order. As such pursuant to the aforesaidorder of the NCLT and in terms of the provisions of Section 17 of the Insolvency andBankruptcy code 2016 the powers of the Board of Directors of the Company standssuspended and is being exercised by the Insolvency Resolution Professional. Hence post 3rdAugust 2017 no meeting of the Board or its Committees shall be convened till theinsolvency resolution process of the Company is on.
This initiation of CIRP is an effort to chalk out a durable and successful revival planfor the Company. The Resolution Professional shall also reach out to resolution applicantsincluding the company and its promoters for puffing forward their resolution plans. Thefuture business plans of the Company will be dependent on the outcome of the CIRP.
RELATED PARTY TRANSACTIONS
As informed to the Interim Resolution Professional by the Directors of the Companyduring the year under review all Related Party Transactions (RPTs) were on Arm's Lengthbasis and in the ordinary course of business and hence do not fall under the ambit ofSection 188(1) of the Act. There was no material RPT entered into by the Company withPromoters Directors KMPs or other designated persons during FY 2016-17 except thosereported in the financial statements.
In compliance with the provisions of the Act and the SEBI Regulation 2015 each RPT isplaced before the AuditCommittee for approval. A prior omnibus approval of the AuditCommittee is obtained on a yearly basis for the transactions which are foreseen andrepetitive in nature. The transactions pursuant to the omnibus approval so granted isaudited and a detailed quarterly statement of all RPTs is placed before the AuditCommittee for its review. The policy on Related Party Transactions as approved by theBoard is uploaded on the Company's website at the link www.adhunikgroup.com.
In view of the above the disclosure required under the Act in Form AOC-2 is notapplicable for FY 2016-17. It has been reported to the Interim Resolution Professionalthat none of the Directors or KMPs has any pecuniary relationships or transactions withthe Company during FY 2016-17.
Board of Directors have formulated and implemented a risk management policy for thecompany. As informed to the Resolution Professional by the Directors during the yearunder review the Board has been addressing various risks impacting the Company includingidentification therein of elements of risk if any which in the opinion of the Board maythreaten the existence of the company. Further the Board and the Audit Committee of theCompany periodically review and evaluate the risk management system of the Company so thatthe management controls the risks through properly defined network.
INTERNAL CONTROL SYSTEM
As informed by the Directors to the Interim Resolution Professional:
Your Company has adequate system of internal control procedures commensurate with itssize and the nature of its business. The internal control systems of the Company aremonitored and evaluated by the Internal Auditors and their audit reports are periodicallyreviewed by the Audit Committee of the Board of Directors of the Company.
Your Company manages and monitors the various risks and uncertainties that can haveadverse impact on the Company's Business. Your Company is giving major thrust indeveloping and strengthening its internal audit so that risk threat can be mitigated.
Internal control systems are integral to the Company's corporate governance policy.Some of the significant features of internal control systems include:
Documenting of policies guidelines authorities and approval proceduresencompassing the Company's all primary functions.
Deploying of an SAP system which covers most of its operations and is supportedby a defined on-line authorisation protocol.
Ensuring complete compliance with laws regulations standards and internalprocedures and systems.
De-risking the Company's assets/resources and protecting them from any loss.
Ensuring the accounting system's integrity proper and authorised recording andreporting of all transactions.
Preparing and monitoring of annual budgets for all operating and servicefunctions.
Ensuring the reliability of all financial and operational information.
Forming an Audit committee of the Board of Directors comprising IndependentDirectors. The Audit Committee regularly reviews audit plans significant audit findingsadequacy of internal controls and compliance with accounting standards and so on.
Forming a comprehensive Information Security Policy and continuous up-gradationof IT Systems.
The internal control systems and procedures are designed to assist in theidentification and management of risks the procedure-led verification of all complianceas well as an enhanced control consciousness.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act 2013 and interms with the Articles of Association of the Company Mr. Jugal Kishore Agarwal (DIN:00227460) who retires by rotation and being eligible offers himself for re-appointment.The Board has recommended his re-appointment.
The Company has received declarations from Mr. Nihar Ranjan Hota (DIN: 01173440) Mr.Amrendra Prasad Verma (DIN 00236108) Mr. Nandanandan Mishra (DIN: 00031342) and Mr. GopalDikshit (DIN: 00090579) Independent Directors of the Company confirming that they meetthe criteria of independence as prescribed both under Section 149 (6) of the CompaniesAct 2013 and SEBI (LODR) Regulations 2015.
Mr. Ramgopal Agarwala (DIN: 02054856) Independent Director of the Company stepped downfrom his position with effect from 14th day of September 2016 owing to his health issues.Mr. Nirmal Kumar Agarwal Managing Director and Mr. Sanjay Dey Company Secretarycontinued to be the Key Managerial Personnel of the company during the financial year2016-17 and there was a vacancy of Chief Financial Officer during the period under review.
As informed to the Interim Resolution Professional by the Directors of the Company theBoard of the Company has adopted Governance Guidelines on Board Effectiveness. TheGuidelines cover aspects related to composition and role of the Board Chairman andDirectors Board diversity definition of independence Director Term retirement age andCommittees of the Board. It also covers aspects relating to nomination appointmentinduction and development of Directors Director Remuneration Subsidiary oversight Codeof Conduct Board Effectiveness Review and Mandates of Board Committees. Procedure forNomination and Appointment of Directors:
As informed to the Interim Resolution Professional by the Directors of the Company theNomination and Remuneration Committee (NRC) is responsible for developing competencyrequirements for theBoard based on the industry and strategy of the Company. Boardcomposition analysis reflects in-depth understanding of the Company including itsstrategies environment operations financial conditions and compliance requirements.
The NRC conducts a gap analysis to refresh the Board on a periodic basis includingeach time a Director's appointment orre- appointment is required. The Committee is alsoresponsible for reviewing and veffing the CVs of potential candidates visa-vis therequired competencies and meeting potential candidates prior to making recommendations oftheir nomination to the Board. At the time of appointment specific requirements for theposition including expert knowledge expected is communicated to the appointee.
Criteria for Determining Qualifications Positive Attributes and Independence of aDirector:
As informed to the Interim Resolution Professional by the Directors of the Company theNRC has formulated the criteria for determining qualifications positive attributes andindependence of Directors in terms of provisions of Section 178(3) of the Act andRegulation 19 read with Part D of Schedule II of the Listing Regulations.
Independence: In accordance with the above criteria a Director will be considered asan 'Independent Director' if he/ she meets with the criteria for 'Independent Director' aslaid down in the Act and Regulation 16(1)(b) of the Listing Regulations. Qualifications: Atransparent Board nomination process is in place that encourages diversity of thoughtexperienceknowledge perspective age and gender. It is also ensured that the Board hasan appropriate blend of functional and industry expertise. While recommending theappointment of a Director the NRC considers the manner in which the function and domainexpertise of the individual will contribute to the overall skill-domain mix of the Board.
Positive Attributes: In addition to the duties as prescribed under the Act theDirectors on the Board of the Company are also expected to demonstrate high standards ofethical behavior strong interpersonal and communication skills and soundness of judgment.Independent Directors are also expected to abide by the 'Code for Independent Directors'as outlined in Schedule IV to the Act.
As informed to the Interim Resolution Professional by the Directors of the Company theBoard carried out an annual performance evaluation of its own performance the individualDirectors as well as the Board Committees in due
compliance with the provisions of the Companies Act 2013 and the Listing Regulations.The performance evaluation of the Independent Directors was carried by the entire Boardand the performance evaluation of the Chairman and Non - Independent Directors was carriedout by the Independent Directors.
The Board evaluation was carried out in accordance with the criteria laid down in theNomination and Remuneration policy of the Company.
The Company has adopted a Remuneration Policy for the Directors Key ManagerialPersonnel and other employees pursuant to the provisions of the Act and the ListingRegulations. The Remuneration Policy is attached as Annexure-B. BOARD MEETINGS
The Board met 5 (five) times during the year on 26th May 2016 2nd September 201614th September 2016 14th December 2016 and 13th February 2017 and the details of whichare given in the Corporate Governance Report that forms part of the Annual Report. Theintervening gap between the meetings was within the period prescribed under the CompaniesAct 2013 and the SEBI (LODR) Regulations 2015.
Further the Independent Directors at their meeting reviewed the performance of theBoard Chairman of the Board and of Non Independent Directors as required under the Actand the SEBI (LODR) Regulations 2015.
The Audit committee comprises of four (4) members of which three (3) members areindependent including Chairman. Mr. Nandanandan Mishra is the Chairman of the AuditCommittee. The members of the Committee possess adequate knowledge of Accounts Audit andFinance. The composition of the Audit Committee meets the requirements as per Section 177of the Companies Act 2013 and Regulation 18 of SEBI (LODR) Regulations 2015 and isdetailed in the Corporate Governance Report forming part of this Annual Report. Allrecommendations made by the Audit committee were accepted by the Board during FY 2016-17.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee comprises of three (3) members of who all areindependent including Chairman. Mr. Nihar Ranjan Hota is the Chairman of the Nominationand Remuneration Committee. The composition of the Nomination and Remuneration Committeemeets the requirements as per Section 178 of the Companies Act 2013 and Regulation 19 ofSEBI (LODR) Regulations 2015 and is detailed in the Corporate Governance Report formingpart of this Annual Report. All recommendations made by the Nomination and RemunerationCommittee were accepted by the Board during FY 2016-17.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 134(5) of the Companies Act 2013 withrespect to Directors' Responsibility Statement the Directors have confirmed to theResolution Professional the following in respect of the year under review:-
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 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) The Directors had laid down proper internal financial controls and such internalfinancial controls are adequate and were operating effectively;
f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
CORPORATE SOCIAL RESPONSIBILITY POLICY
The Corporate Social Responsibility (CSR) is an integral part of our SustainabilityModel. The corporate social responsibilitypolicy recommended by the Corporate SocialResponsibility Committee had been approved by the Board of
Directors on 14th May 2014. The CSR policy is also available on the website of theCompany at www.adhunikgroup.com. The Board has constituted a Corporate SocialResponsibility Committee headed by Mr. Nirmal Kumar Agarwal as Chairman with Mr.Ghanshyam Das Agarwal and Mr. Nandanadan Mishra as Members. The Company has adopted aCorporate Social Responsibility (CSR) Policy incompliance with the provisions of the Act.
Since your Company's last three financial years average net profit was negative thecompliance requirement of spending 2% for CSR initiative was not needed for 2016-17. Abrief outline on CSR is attached as Annexure-C.
POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE TheCompany has zero tolerance towards sexual harassment at the workplace and has adopted apolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules thereunder.
The Policy aims to provide protection to employees at the workplace and prevent andredress complaints of sexual harassment and for matters connected or incidental theretowith the objective of providing a safe working environment where employees feel secure.The Company has also constituted Internal Committee to inquire into complaints of sexualharassment and recommend appropriate action.
The Company has not received any complaint of sexual harassment during the financialyear 2016-17.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy to provide a formal vigil mechanism tothe Directors and employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policyprovides for adequate safeguards against victimization of employees who avail of themechanism and also provides for direct access to the Chairperson of the Audit Committee.It is affirmed that no personnel of the Company has been denied access to the AuditCommittee.
SIGNIFICANT MATERIAL ORDERS PASSED BY REGULATORS / COURTS ETC.
As informed to the Interim Resolution Professional by the Directors of the Companythere were no significant and material orders passed by the Regulators / Courts /Tribunals impacting the going concern status and company's operations in future.
There were also no material changes and commitments occurred after the closure of theyear till the date of this report which affect the financial position of the company.
DISCLOSURE REGARDING RECEIPT OF COMMISSION BY DIRECTOR
As informed to the Interim Resolution Professional by the Directors of the Companyduring the year under review none of the Directors has received any commission fromholding / subsidiary Company.
AUDITORS & AUDITOR's REPORT
M/s. Das & Prasad Chartered Accountants having registration number FRN 303054Eallotted by The Institute of Chartered Accountants of India (ICAI) retires as Auditor ofyour Company at the ensuing Annual General Meeting (AGM) and have confirmed theireligibility and willingness to accept the office of Auditors if re-appointed. Pursuant tosection 139 of the Companies Act 2013 and rules framed thereunder it is proposed toappoint M/s. Das & Prasad Chartered Accountants (Firm Registration No. 303054E) asStatutory Auditors of the Company for the term of 5 years from the conclusion of thisAnnual General Meeting (AGM) till the conclusion of the Annual General Meeting to be heldfor F.Y. 2021-22.
The response of the Directors of the Company obtained by the Resolution Professionalwith respect to the observations of auditor is as follows:
The observations of the Auditors are duly dealt in Notes to Accounts attached toBalance Sheet and are self-explanatory in nature and do not call for any further comments.
In terms of the provisions of Section 138 of the Companies Act 2013 M/s Sudhir KumarJain & Associates Independent Chartered Accountants of Moon House 5th Floor Suit31 21 Ganesh Chandra Avenue Kolkata- 700013 having Firm Registration No. 318016E wereappointed as Internal Auditors of the Company for the financial year 2016-17. The AuditCommittee in consultation with the Internal Auditors formulates the scope functioningperiodicity and methodology for conducting the Internal Audit. The Audit Committeeinteralia reviews the Internal Audit Report.
In respect of financial year ended 31st March 2017 your Company has appointed M/s.S.B. & Associates Cost Accountants having Firm Registration No. 00109 as Cost Auditorof the Company w.e.f. 1st April 2016 to 31st March 2017 to carry out audit of costrecords of the Company in compliance with the requirements of section 148 and all otherapplicable provisions of the Companies Act 2013 read with Rule 14 of the Companies (Auditand Auditors) Rules 2014 (including any statutory modification(s) or re-enactment thereoffor the time being in force).
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company appointedM/s. Rupanjana De & Co. Practicing Company Secretary having Firm Registration No.S2015WB322300 to undertake the Secretarial Audit of the Company for the year ended 31stMarch 2017. The report has no major observations by the auditor except some of therecommendations for ensuring good corporate governance and it requires no further commentsby the board except some of the action to be taken in this regard. The Secretarial AuditReport is annexed as Annexure - D herewith and forms part of this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of energy conservation technology absorption and foreign exchange earnings andoutgo are annexed to this report as Annexure - E.
The Company adheres to the stipulations prescribed under the prescribed Regulation ofSEBI (LODR) Regulations 2015. A details report on Corporate Governance & ShareholderInformation together with the Practising Company Secretary Certificate thereon is annexedas part of this Annual Report.
DIRECTORS' APPOINTMENT & REMUNERATION POLICY
The Company's policy on Directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the Corporate GovernanceReport which forms part of this Annual Report.
PARTICULARS OF EMPLOYEES AND REMUNERATION
The information required under Section 197(12) of the Act read with Rule 5 of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is attachedas Annexure F.
The information required under Rule 5(2) and (3) of The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is provided in the Annexure forming partof the Report. In terms of the first proviso to Section 136 of the Act the Report andAccounts are being sent to the Shareholders excluding the aforesaid Annexure. AnyShareholder interested in obtaining the same may write to the Company Secretary at theRegistered Office of the Company.
None of the employees listed in the said Annexure is related to any Director of theCompany.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT -9 (Annexure -G) as per provisions of the Companies Act 2013 and rules framed thereunder are annexed tothis Annual Report.
MANAGEMENT DISCUSSION & ANALYSIS
A detailed analysis of the Industry and Company Outlook Company's operations projectreview risk management strategic initiatives and financial review & analysis asstipulated under the Listing Regulation as prepared and signed by the chairman ispresented under a separate section titled "Management Discussion and Analysis"forming part of the Annual Report.
Annexure A to the Report u/s 134 of the Companies Act 2013
(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014) Statement containing salient features of the financialstatement of subsidiaries or associate companies or joint ventures
Part A Subsidiaries
(Information in respect of each subsidiary to be presented with amounts in Rs.)
Part B Associates and Joint Ventures
Statement pursuant to Section 129 (3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures
Annexure B to the Report u/s 134 of the Companies Act 2013
REMUNERATION POLICY FOR DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES
The Remuneration Policy of Adhunik Metaliks Ltd (the "Company") is designedto attract motivate and retain manpower in a competitive and international market. Thepolicy reflects the Company's objectives for good corporate governance as well assustained long-term value creation for shareholders.
The Remuneration Policy applies to the Company's senior management including its KeyManagerial Person and Board of Directors.
The guiding principle is that the remuneration and the other terms of employment shallbe competitive in order to ensure that the Company can attract and retain competentExecutives.
- The remuneration policy for executives reflects the overriding remunerationphilosophy and principles of the Adhunik Group. When determining the remuneration policyand arrangements for Executive Directors/ KMP's the Remuneration Committee considers payand employment conditions with peers / elsewhere in the competitive market to ensure thatpay structures are appropriately aligned and that levels of remuneration remainappropriate in this context.
- The Committee while designing the remuneration package considers the level andcomposition of remuneration to be reasonable and sufficient to attract retain andmotivate the person to ensure the quality required to run the company successfully.
- The Remuneration Committee while considering a remuneration package must ensure abalance between fixed and incentive pay reflecting short and long term performanceobjectives appropriate to the working of the company and its goals.
- The Committee considers that a successful remuneration policy must ensure that asignificant part of the remuneration package is linked to the achievement of corporateperformance targets and a strong alignment of interest with stakeholders.
Reward principles and objectives
Our remuneration policy is guided by a common reward framework and set of principlesand objectives as morefully and particularly envisaged under section 178 of the CompaniesAct 2013 interalia principles pertaining to determining qualifications positivesattributes integrity and independence etc.
Attract and retain: Remuneration packages are designed to attract high-calibreexecutives in a competitive global market and remunerate executives fairly andresponsibly. The remuneration shall be competitive and based on the individualresponsibilities and performance.
Motivate and reward: Remuneration is designed to motivate delivery of our key businessstrategies create a strong performance-orientated environment and reward achievement ofmeaningful targets over the short- and long-term.
The principal terms of non-monetary benefits: The Executives will be entitled tocustomary non-monetary benefits such as company cars and company health care telephoneetc. In addition thereto in individual cases company housing and other benefits may alsobe offered.
Executive Remuneration - Board of Management
Executive remuneration is proposed by the Committee and subsequently approved by theBoard of Directors. Executive remuneration is evaluated annually against performance and abenchmark of international companies which in size and complexity are similar to Adhunik.Benchmark information is obtained from internationally recognized compensation serviceconsultancies. In determining packages of remuneration the Committee may consults withthe Chairman/ Managing Director as appropriate Total remuneration shall be comprised asfollows:
- A fixed base salary set at a level aimed at attracting and retaining executives withprofessional and personal competences required to drive the Company's performance.
- Short-term incentives based on the achievement of a number of individualpre-defined financial and strategic business targets recommended by the Committee andapproved by the Board of Directors and can under normal circumstances not exceed 25% ofthe fixed base salary.
- Long-term incentives in the form of stock options promoting a balance betweenshort-term achievements and longterm thinking. However the Directors should notparticipate in the stock options.
- Pension contributions made in accordance with applicable laws and employmentagreements.
- Severance payments in accordance with termination clauses in employment agreements.Severance payments shall comply with local legal framework.
Disclosure of information
Information on the total remuneration of members of the Company's Board of DirectorsExecutive Board of Management and senior management may be disclosed in the Company'sannual financial statements. This includes any deferred payments and extraordinarycontracts during the preceding financial year.
Approval of the Remuneration Policy
This Remuneration Policy shall apply to all future employment agreements with membersof Company's Senior Management including Key Managerial Person and Board of Directors.
The Remuneration Policy is binding for the Board of Directors including its provisionson stock options. In other respects the Remuneration Policy shall be of guidance for theBoard. Any departure from the policy shall be recorded and reasoned in the Board'sminutes.
Annexure C to the Report u/s 134 of the Companies Act 2013
REPORT ON CSR ACTIVITIES DURING F.Y 2016-17 [Pursuant to Section 135 of the CompaniesAct 2013 read with the Companies (Corporate SocialResponsibility) Rules 2014]
1. A brief outline of the Company's CSR policy including overview of projects orprogrammes proposed to be undertaken and a reference to the web-link to the CSR policy andprojects or programmes-
An aspiration to create meaningful societal value is manifest in Adhunik Metaliks Ltd.strategy to enhance the competitiveness of value chains of which it is a part. It istherefore a conscious strategy to design and implement CSR programmes in the context ofAdhunik Metaliks Ltd. businesses by enriching value chains that encompass the mostdisadvantaged sections of society especially those residing in rural India througheconomic empowerment based on grass-root capacity building. As an Indian enterpriseAdhunik Metaliks Ltd. believes that such an approach can unleash strong drivers of growthto make it more inclusive and equitable for the most marginalized sections of societythrough the creation of sustainable livelihood preventive health care provisioning ofsafe drinking water and women empowerment.
Adhunik Metaliks Ltd. is vigilant in its enforcement towards corporate principles andis committed towards sustainable development and inclusive growth. The company constantlystrives to ensure strong corporate culture which emphasizes on integrating CSR values withbusiness objective and is committed towards aligning with nature and shall always adopteco-friendly practices.
We at Adhunik Metaliks Ltd. strive to conduct our business operations in sociallyresponsible ethical and transparent manner to demonstrate commitment to respect theinterest of and be responsive towards all stakeholders including shareholdersemployees customers suppliers project affected people society at large etc. and createvalue for all of them. We shall develop such mechanism to actively engage with allstakeholders inform them of inherent risks and mitigate them wherever occur.
The Company has framed its CSR Policy in compliance with the provisions of theCompanies Act 2013 and the same is placed on the Company'swebsite at the Weblink:http://www.adhunikgroup.com/CSR%20Policv.pdf.
2. The Composition of the CSR Committee
a. Mr. Nirmal Kumar Agarwal Chairman
b. Mr. Ghanshyam Das Agarwal Member
c. Mr. Ramgopal Agarwala Member (till 14.09.2016)
c. Mr. Amrendra Prasad Verma Member (w.e.f. 14.09.2016)
3. Average net profit (PBT) of the Company for the last three financial years:Nil
4. The prescribed CSR expenditure at 2% of above: Nil
5. Details of CSR spent during the financial year.
a) Total amount to be spent for the financial year: Nil
b) Amount unspent if any: Nil
c) Manner in which the amount spent during the financial year 2016-17- N.A.
6. In case the Company has failed to spend the two per cent of the average net profitof the last three financial years or any part thereof the Company shall provide thereasons for not spending the amount in its Board report.
The company has incurred regular losses during the preceding three financial years.Hence the company is not eligible to spend any amount towards CSR initiatives.
7. A responsibility statement of the CSR Committee that the implementation andmonitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company.
The implementation and monitoring of CSR Policy is in compliance with CSR objectivesand Policy of the Company.
Annexure E to the Report u/s 134 of the Companies Act 2013
[Pursuant to Section 134(3)(m) of The Companies Act 2013 read with Rule 8(3) of TheCompanies (Accounts) Rules 2014]
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information in Accordance with the Provisions of Section 134(3) (M) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 regarding Conservationof Energy Technology Absorption and Foreign Exchange Earnings and Outgo;
A. CONSERVATION OF ENERGY
(i) the steps taken or impact on conservation of energy;
A) Electrical energy saving in arc furnace by using oxygen lancing through multiportnozzle Cost savings by replacement of electrical energy & less refractory consumptionalong with high production. This multiport (4 hole) lance will improve the oxygenpenetration in the liquid bath to achieve faster desired quality in liquid metal.
B) Carbon enrichment in the flue gas through recirculation in DRI Kilns
At present 5 nos. of Waste Heat Recovery Boilers (WHRB) of capacity 10 TPH each arepresent in AML which are used to generate high pressure steam and finally used togenerate power at CPP. The main energy input to these WHRBs is waste hot gas (havingtemperature of more than 950C) of 5 nos. of 100 TPD Sponge Iron Kiln Units. After injectwaste carbon dust from cooler discharge points in to After Burning Chamber (ABC) of kilnsto increase the flue gas temperature and gas volume thereby increasing the steamgeneration from WHRB.
(ii) the steps taken by the company for utilising alternate sources of energy;
During study of Energy conservation following steps have been taken
A) Electrical energy saving in arc furnace by oxygen lancing : Implemented
B) Inject waste carbon dust from cooler discharge points in to After Burning Chamber(ABC) of kilns to increase the flue gas temperature and gas volume : Implemented in Kiln#2 procurement work under progress for rest 4 nos. kiln
C) Improvement of vacuum for condenser of TG-2 and reduction of specific steamconsumption & coal consumption of CFBC Boiler. : Under planning stage
D) Waste Recovery from Flue Gas After Hot Stove & Preheating of Combustion Air& Blast Furnace Gas for Blast Furnace Gas Saving : Under planning stage
E) The condition of sealing at different location of sinter plant was not properleading to increase of air leakage & dust leakage substantially. Hence significantamount of electrical energy can be saved & productivity can be improved. Engineeringand design work are under progress to arresting such air leakage & dust leakage fromsinter plant. : Under planning stage
(iii) The capital investment on energy conservation equipment's-Since the company issuffering from a very high liquidity crunch and was unable to make capital investments.
B. TECHNOLOGY ABSORPTION
(i) The efforts made towards technology absorption;
Installation of ladle trolley to enhance metal recovery by reducing contaminatedmetal generation from long runner. : The hot material is tapped from the furnaceintermittently. When enough smelted ferrochrome has accumulated in the hearth of thefurnace the tap hole is drilled open and the molten metal and slag are rushed down to ametal and slag ladles through long runners. There is less material recovered because ofjamming and runner skull contamination in metal. After installation of ladle trolley wehad reduced length of runner resulting reduction in contaminated metal and metal yield hasbeen increased.
Introducing Circular pan to enhance metallic yield instead of rectangular mouldcasting: In rectangular mould casting the slag separation from metal is done by skimmerblock arrangement which is not suitable for proper separation of slag resulting yieldloss.
Installation of Tundish tilting arrangement for CCM# 1
We have converted CCM# 1 tundish from Board to Spray. The advantages of using Spraytundish over Board tundish are listed below:
As the tundish capacity is more we get more retention time of liquid steel in tundishwhich enables the floatation of inclusions & thus improves quality.
We get more time for sequence change over as tundish capacity is more.
No risk of tundish rejection in case of long preheating times due to upstream delays.
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution; CHP
Truck tippler & magnetic separation system
After installation of truck tippler & magnetic separation system at coal handlingplant (CHP) we have been utilizing more quantity of charcoal and reduced coal handlingcost.
(iii) The expenditure incurred on Research and Development - Since the company issuffering from a very high liquidity crunch and was unable to make capital investments.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
Activities relating to exports initiatives taken to increase exports; development ofnew export markets for products and services; and export plans;
Annexure F to the Report u/s 134 of the Companies Act 2013
[Pursuant to Rule 5 (1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
1. The ratio of the remuneration of each Director/KMP to the median remuneration of theEmployees of the Company for the financial year 2016-17:
2. The percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year2016-17:
3. The percentage increase in the median remuneration of employees in the financialyear: Nil
4. The number of permanent employees on the rolls of the Company: 1270
5. Average 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 if thereare any exceptional circumstances for increase in the managerial remuneration: Nil
6. Affirmation that the remuneration is as per the Remuneration Policy of the Company:
It is affirmed that the remuneration paid is as per the Remuneration Policy forDirectors Key Managerial Personnel and other employees adopted by the Company.
1. The Managing Director was having remuneration of Rs. 1/- per month during thefinancial year 2015-16 and it was increased by the board during the financial year underreview upto Rs. 2 Lacs per month but he waived it due to the financial condition of thecompany.
2. Non-executive directors have not been paid any remuneration during the financialyear under review and Independent directors have been paid siffing fee which has not beenconsidered in above calculation.
INFORMATION AS PER RULE 5(2) OF THE (COMPANIES APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONS) RULES 2014 AND FORMING PART OF THE REPORT U/S 134 OF THE COMPANIESACT 2013 FOR THE YEAR ENDED 31ST MARCH 2017
B. Employed for part of the year and in receipt of remuneration aggregating not lessthan Rs. 850000/- per month- No such case.
1. Gross remuneration received includes salary allowances leave travel expensesmedical benefits in accordance with Company's rules Company's contribution to providentand superannuation funds monetary value of the perquisites calculated in accordance withthe Income Tax Act 1961 and the Rules made thereunder but excludes contribution toGratuity Fund.
2. Net remuneration is gross remuneration less taxes contribution to provident andsuperannuation funds and value of perquisites.
3. The employees have adequate experience to discharge responsibilities assigned tothem.
4. None of the employees are relatives of the Directors of the Company.
5. The nature of employment is permanent.