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Cochin Shipyard Ltd.

BSE: 540678 Sector: Others
NSE: COCHINSHIP ISIN Code: INE704P01017
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VOLUME 2549
52-Week high 422.10
52-Week low 281.00
P/E 6.99
Mkt Cap.(Rs cr) 4,102
Buy Price 0.00
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Sell Price 0.00
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OPEN 313.15
CLOSE 313.35
VOLUME 2549
52-Week high 422.10
52-Week low 281.00
P/E 6.99
Mkt Cap.(Rs cr) 4,102
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Cochin Shipyard Ltd. (COCHINSHIP) - Director Report

Company director report

Dear Shareholders

1. Your Directors have pleasure in presenting the 49th Annual

Report of your Company along with the audited financial statements for the year endedMarch 31 2021.

Financial Performance

2. Your Company posted yet another year of impressive performance despite variousconstraints due to COVID-19 pandemic and when the shipbuilding market scenario remaininglackluster.Diversifiedoperational segments and product profile helped the Company toachieve a turnover of H2818.90 crore s for the year as compared to H3422.49 crores inthe year 2019-20. The profit before tax isH810.59 crores for the year as against H863.43crores in the previous year. The net profit is H610.10 crores as compared to H637.69crores for the previous year.

3. The authorised share capital of the Company is H2500000000/- divided into250000000 equity shares of face value of H10/- each. The paid up share capital of theCompany is H1315403900/- divided into 131540390 equity shares of face value ofH10/- each.

Financial Highlights

Sl. No. Particulars 2020-21 2019-20
(i) Gross Income 3012.76 3669.99
(ii) Profit before finance cost depreciation & tax 914.13 956.75
(iii) Finance costs 50.47 44.59
(iv) Depreciation & write off 53.07 48.73
(v) Profit Before Tax 810.59 863.43
(vi) Tax Expense 200.49 225.74
(vii) Net profit 610.10 637.69

Dividend

4. As per Office Memorandum F.No.5/2/2016-Policy dated

May 27 2016 issued by Department of Investment and

Public Asset Management (DIPAM) every CPSE have to pay a minimum annual dividend of30% of PAT or 5% of the net-worth whichever is higher. Accordingly your Directors arepleased to recommend a final dividend ofH2.50/- per share on the 131540390 fully paidequity shares of H10/- each.

Earlier interim dividends of H9/- and H4/- aggregating H13/- per equity share hadbeen paid to the shareholders during 2020-21. Thus the total dividend for the year2020-21 is H15.50/- per equity share (155%) amounting to H203.89 crores. No unclaimeddividend (previous years') is due to be transferred to the Investor Education andProtection Fund (IEPF).

Dividend Distribution Policy

5. As per Regulation 43A of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the top 1000 listed entitiesshall formulate a dividend distribution policy. Accordingly dividend distribution policyhas been adopted to set out the parameters and circumstances that will be taken intoaccount by the Board in determining the distribution of dividend to its shareholdersand/or retaining the profit into the business. The policy is available on the website ofthe Company at the link https://www.cochinshipyard.in/uploads/coporate/1776176ff06b7942265b7265e3f6bd97.pdf

Transfer to Reserves

6. No amount has been transferred to Reserves for the financial year 2020-21. As perthe amendment made to the Companies (Share Capital and Debentures) Rules

2014 notified vide Notification No. G.S.R. 574(E) by the Ministry of Corporate Affairsthe Company is not required to create Debenture Redemption Reserve in respect of the bondsissued by it. As on March 31 2021 the Company has Reserves and Surplus amounting toH3846.03 crores which reflects the inherent financial strength of the Company.

Contribution to Exchequer

7. The total contribution made during the year by way of income tax customs duty GSTservice tax KGST/KVAT and dividend was around H504.43 crores.

Shipbuilding

8. The Company achieved a total shipbuilding income of H2405.60 crores during 2020-21as against H2852.27 crores in 2019-20. During the year 2020-21 CSL delivered one no. of500 Passenger cum 150 MT Cargo Vessel for Andaman and Nicobar Administration two nos. ofRo-Ro Ferry for Inland Waterways Authority of India (IWAI) three nos. of

Marine Ambulance Boat for the Fisheries Department of Government of Kerala and fivenos. of Tuna Long Liner cum Gillnetter Fishing Boat for the beneficiaries of Tamil Nadu.CSL also delivered two Brows and Pontoons for Indian Navy.

Further the construction of three nos. of Anti-Submarine Warfare Shallow Water Craftfor Indian Navy nine nos. of

Floating Border Outpost (FBOP) Vessel for the Ministry of Home Affairs four nos. of8000 DWT Mini General Cargo Ship for JSW Shipping & Logistics Private Limited and fivenos. of Hybrid Electric Passenger Ferry for Kochi Metro

Rail Limited (KMRL) are progressing.

9. The yard also completed major milestones on various projects including launching offive vessels at one go from its Building Dock at Kochi and also laid the keel for twovessels on the same day. The vessels launched were two 8000 DWT Mini General Cargo Shipsfor JSW Shipping

& Logistics Private Limited three FBOP Vessels for the Ministry of Home Affairsand the keel laying was carried out for two 8000 DWT Mini General Cargo Ships for JSWShipping & Logistics Private Limited. Further CSL also launched one Hybrid ElectricPassenger Ferry (100 Pax) for KMRL and carried out keel laying for three FBOP Vessels forthe Ministry of Home Affairs. CSL also carried out steel cutting of three Anti-SubmarineWarfare Shallow Water

Craft for Indian Navy and five Hybrid Electric Passenger Ferries (100 Pax) for KMRL.CSL achieved these milestones amidst the COVID-19 pandemic by working with availableresources with necessary precautions.

10. The prestigious Indigenous Aircraft Carrier (IAC) project is in the trials phase.The entire hull work (structural fabrication and erection) and 95% outfitting has beencompleted. In spite of the various difficulties/imponderables posed by COVID-19 pandemicthe basin trials of the vessel which are primarily aimed at proving the performance of themain propulsion plant of the ship in harbour was successfully completed in November 2020.The basin trials are a precursor to the ensuing sea trials slated for the second quarterof this calendar year which included extensive harbour trials of all four LM2500 gasturbines main gearboxes shafting and controllable pitch propellers along with theirintegrated control systems. Moreover major auxiliary equipment and systems such assteering gear air conditioning plants compressors centrifuges all critical pumpspower generation and distribution system major machinery fire-fighting floodingsystemsand de-deck machinery internal communication equipment etc. were also tested prior to theabove trials.

11. The trials of the navigation and communication systems HVAC system and readinessof sea trial critical habitability spaces are being undertaken in order to make the vesselready for its maiden sea trials. The aviation facilities complex related works has alsorecommenced after the arrival of the Russian facilities in March 2021 after a gap of ayear.

12. The sea trials of the IAC is scheduled to start in Q1 FY – 2022. The vesselwill go through multiple rounds of sea trials planned to be undertaken in two phases.

Ship Repair

13. During the year the Company achieved a total ship repair income of H413.30 croresas compared to H570.23 crores during the year 2019-20. Major vessels repaired during theyear in the main yard include INS Magar MODU Sagar Vijay MT Swarna Krishna GTV SamudraSarvekshak INS Sudarshini & DCI Dredge VII. Major vessels repaired during the year inCSL Mumbai Ship Repair Unit include INS

Mumbai MV Campbhell Bay ICGS Sangram & Separation of

IN Submarine – 5 (INS Vagir). Major vessels repaired during the year in CSLKolkata Ship Repair Unit are Dredge XVIII

Svitzer Foxtrot & DCI Survey Launch III.

Shipbuilding Order Book Position

14. During the year 2020-21 CSL had been successful in securing against intensecompetition shipbuilding orders for 2 nos. of Autonomous Electric Vessels for ASKO

Maritime AS Norway. The order book position as on March 31 2021 is as follows:

Vessel Type Nos.
Indigenous Aircraft Carrier for the Indian Navy 01
Technology Demonstration Vessel (Special 01
Purpose Vessel) for DRDO
500 passenger cum 150 MT cargo vessel for A&N 01
Administration
1200 passenger cum 1000 MT cargo vessel for 02
A&N Administration
Mini Bulk Carrier of 8000 DWT for JSW Shipping & 04
Logistics Private Limited
Floating Border Outpost vessel for Ministry of 09
Home Affairs
Anti-Submarine Warfare Shallow Water Craft for 08
Indian Navy
Hybrid Electric Passenger Ferry (100 Pax) for KMRL 23
Autonomous Electric Vessel for ASKO Maritime 02
AS Norway

Expansion Projects

15. The status of major projects and initiatives are as follows:

i) International Ship Repair Facility (ISRF) at Cochin

Port Trust

CSL continued to operate the dry-dock & existing facilities in the leased area(first phase) at Cochin Port premises.

CSL completed repairs of twelve ships during the year 2020-21. The construction worksof ISRF project which commenced on November 17 2017 is progressing despite the setbacksdue to COVID-19 pandemic. 100% piling works & 87% of the deck concreting workscompleted. Various industrial buildings are in the advanced stages of completion. CSLreceived all components pertaining to the transfer system supplied by M/s. IMG Germany.With regards to shiplift system CSL started receiving various consignments from M/s.Syncrolift AS Norway. Structural works are in progress at manufacturer's premises for the10 T crane ordered on M/s. CJSC SMM Russia. Order has been issued to M/s. LiebherrGermany for the supply & commissioning of 3 nos. tower cranes. ISRF project istargeted for commissioning in the latter part of the calendar year 2022. Ten globallyrenowned firms in the maritime industry have already partnered with CSL for setting uptheir units in the Maritime Park in first phase. CSL expects to position Kochi as a majorship repair hub with major operations in the present ship repair dock coupled withincreased capacities that would be available when the ISRF is commissioned.

ii) New Dry-dock Project

The new dry-dock measuring 310 x 75/60 x 13m with

600T gantry crane will be located at the northern end of the existing premises of theCompany. The new dock will augment the Company's shipbuilding and ship repair capacityessentially required to tap the market potential of building specialized andtechnologically advanced vessels such as LNG Carriers Aircraft Carriers of highercapacity jack up rigs drill ships large dredgers and repairing of offshore platformsand larger vessels. Construction activities commenced in June 2018 is progressing despitethe setbacks due to COVID-19 pandemic. Ground improvement works cofferdam works dockwall sheet pile installation works has been completed. Further around 70% of RCC pilinghave also been completed. Contract for the supply & commissioning of 600T gantry cranewas also issued and review of design submitted by the contractor is being carried out.

iii) CSL-Mumbai Ship Repair Unit (CMSRU)

CSL entered into an agreement with the Mumbai Port Trust on October 20 2018 toupgrade operate and manage Ship Repair Facility at Hughes dry-dock and berth nos. 5 6 7and 8 of Indira Dock of Mumbai Port. Post operationalisation CSL has successfully stagesof discussion with undertaken repairs to around 49 vessels.

During the year 2020-21 in spite of the COVID-19 pandemic affecting operations CSLhas undertaken dry-dock and afloat repair to 20 ships. These repair projects include shipsof (1) defence clients notably Indian Navy's guided-missile destroyer INS Mumbaisubmarine separation operation of IN Submarine - 5

(INS Vagir) through MDL afloat repair to ICG Coast guard vessels and (2) commercialclients notably offshore vessels of Shipping Corporation of India

(SCI) survey vessels of FSI passenger vessels of A&N and also to various privateowners including M/s. Greatship India. CSL had also taken up repairs for a foreign clientand successfully completed repairs to

DSP NPP Nusantara for M/s. Miclyn Express Offshore

Singapore.

iv) CSL-Kolkata Ship Repair Unit (CKSRU)

After resumption of work at CKSRU Kolkata post nationwide lockdown on June 08 2020dry-dock repair of DCI vessels ‘Survey Launch – III' was undertaken according tothe Standard Operating Procedures for work resumption after lock down. Since then CKSRUhas successfully completed 3 projects viz. repair of DCI Dredge XVIII which was awardedbased on a global tender emergency repair of Tug Svitzer Foxtrot the first foreignvessel repair order from M/s. Svitzer Asia

Pvt. Ltd. part of Maersk Lines and the feasibility study of their No. 1 Box Caissonfor Syama Prasad Mookerjee

Port Kolkata. Firm stemming orders have been received for dry-dock repair of TugTamralipta from Syama Prasad Mookerjee Port and MV Dering from SCI.

CKSRU facility was successfully audited by ABS Quality Evaluations as part ofResponsible Procurement Audit for Maersk Supplier Code of Conduct and also by Indian

Coast Guard for undertaking refit/repair of ICG ships. Various infrastructuredevelopment activities and recruitment of dedicated manpower are in progress. 4 majorcontractors have already been empanelled for turnkey services and registration of 100+contractor/ suppliers is in progress for undertaking various ship repair related services.

v) CSL-Andaman & Nicobar Ship Repair Unit (CANSRU)

Agreement executed between CSL and A&N

Administration has been made effective as on January

15 2021 by mutually complying with the condition precedents stipulated in theagreement and submission of asset verification and dipstick audit reports. CSL is agenciesin final for preparation of DPR for modernization of Marine

Dockyard Port Blair to effectively undertake repair of fleet of vessels owned by theAdministration and to ensure availability of the vessels for operation. First set of CSLexecutives nominated for CANSRU are working on establishment of offices positioning ofessential infrastructure empanelment of turnkey contractors and vendors for varioussubcontract works and supply of material at CANSRU. Overwhelming response has beenreceived for Expression of Interest for "Empanelment for Undertaking TurnkeySubcontract Works at CANSRU". Recruitment of officers and staff in various cadresboth on permanent rolls and contract basis and deployment of Quality Control and HSEpersonnel are in progress with the aim to commence ship repair activities at the earliest.

vi) Hooghly Cochin Shipyard Limited (HCSL)

Hooghly Cochin Shipyard Limited (HCSL) was initially set up as a joint venture betweenCSL and Hooghly

Dock & Port Engineers Limited (HDPEL). Pursuant to the approval of the UnionCabinet HCSL became a wholly owned subsidiary of CSL with effect from

November 01 2019. HCSL aspires to establish itself as one of the leading shipbuildingyard in east coast for quality inland and coastal vessel construction.

The "new yard construction of Hooghly Cochin Shipyard Limited Nazirgungeunit" is in advanced stage of completion and the facility has become ready foroperation with effect from March 09 2021. The final commissioning of balance systems& equipments are in progress. At the end of financial year 2020-

21 physical progress to the tune of 93% is already attained for civil work whilecommissioning work of machineries mechanical and electrical is in progress with 85%completion.

The construction activities under civil works package had crossed the 50% mark in2019-20 when all works at site had to be stopped on March 23 2020 due to the outbreak ofCOVID-19 pandemic. The stoppage of work continued till June 09 2020 which lasted for aperiod of 79 days. Work could be resumed only post relocating workmen within the confinesof the site in order to minimize impact of COVID-19 pandemic even though it remainedunabated in the whole state. Although work at the site resumed by June 10 2020 themomentum of work progress could not be regained to pre-COVID pace due to regular interimlockdown imposed by respective State Governments thereby effecting the mobilisation ofwork force and materials to the desired level. Considering the loss of man-days due to thepandemic the original contractual completion date of June 2021 would be revised toSeptember 2021 as per force majeure clause.

However all efforts are being made to complete the balance commissioning and alliedworks by July 2021. challenges is the work of One of the most significant construction atthe slipway being undertaken in the open river with substantial tidal variation steepwater current & proximity to navigational channel of Kolkata

Port Trust.

vii) Tebma Shipyards Limited (TSL)

As part of CSL's long term strategy viz. CRUISE 2030 CSL had identifieddeep seafishing vessel as one of the several opportunities and towards this CSL acquired TebmaShipyards Limited (TSL) on September 15 2020 through the statutory insolvency resolutionprocess and since then TSL is a wholly owned subsidiary of CSL. CSL proposes to utilisethe facilities at TSL for building fishing vessels (especially technologically advanceddeep sea fishing vessels) tugs and specialized crafts of upto 80 M length which projectshuge potential in domestic as well as international markets in the coming years. TSL hastwo facilities; one in Malpe Karnataka and the other in Chengalpet Tamil Nadu. Thefacilities at Malpe is spread across three units as below:

(a) Malpe Harbour Complex Hull erection and launching;

(b) Hangarkatta – Steel preparation and block fabrication; and

(c) Babuthotta Warehouse.

Due to the financial difficulties and consequent statutory insolvency resolutionprocess TSL's facilities had been non-operational for the past several years. Posttakeover by CSL in September 2020 TSL has initiated the process of revamping itsinfrastructure facilities at Malpe for commencing the operations. Out of the threefacilities at Malpe the revival of

Babuthotta warehouse is completed and is operational.

The revival of Hangarkatta unit is at the advanced stages and is expected to beoperational by July 2021. The revamping activities at Malpe Harbour Complex are alsoprogressing. The transfer bays are made ready and restoration of main new building shopand surface treatment shop is progressing for completion by August 2021. The recruitmentprocess for positioning the required manpower is in the advanced stage and is expected tobe completed soon.

The facility at Chengalpet is planned to be utilised for manufacturing structuraloutfitting items rudders hydrophore units etc. and the activities in this regard willbe initiated once the Malpe facility is up and running and the feasibility of Chengalpetfacility is established.

A separate statement containing the salient features of the financial statements ofsubsidiaries/ associates/ joint venture companies in form AOC-1 pursuant to the provisionsof Section 129 (3) of the Companies Act

2013 is attached along with the financial statements.

Utilisation of IPO Proceeds

16. During the financial year the Company has fully utilized the funds raised throughits Initial Public Offer (IPO). The details are as follows:

Particulars
Proceeds from Initial Public Offer 961.95
(IPO)
Less IPO expenses (Company's share) 21.72
Net IPO proceeds 940.23
Less Utilisation of Proceeds for:
General Corporate Purpose (GCP) 165.23
Construction of New Dry Dock 510.00
ISRF 265.00 940.23
IPO Proceeds balance 0.00

Manpower Status

17. The manpower strength of the Company as on March 31

2021 was 1727 consisting of 397 executives 156 supervisors and 1174 workmen.

Industrial Relations

18. CSL continued to maintain and foster cordial industrial relation atmosphere duringthe year. There was no loss of man hours on account of labour unrest due to reasonsattributable to the Company exclusively.

19. Process of collective bargaining for framing a Long Term Settlement (LTS) for CSLpermanent workmen by recognized trade unions of the Company concluded amicably. Afterprotracted discussions at different levels in a series of 46 meetings a memorandum ofagreement for wage revision of workmen was signed by the management and recognized tradeunions on March 28 2019 which is valid till March 31 2027. Subsequently under Section12(3) of the Industrial Disputes Act 1947 this memorandum of agreement was signed as aMemorandum of Settlement before the Dy. Chief Labour Commissioner by the management andrecognized trade unions on June 18 2019.

20. This milestone LTS for wage revision kindled general contentment and happinessamong the workmen of the Company. The recognized trade unions with their pro-activeapproach during the course of the negotiation have once again exhibited their trueallegiance to the enhanced productivity and economic sustainability of the Company.

21. Further the referendum for recognizing trade unions was conducted on March 192021 by the Dy. Chief Labour Commissioner (C) therein 2 unions namely

Cochin Shipyard Employees Federation (CSEF) and Cochin Shipyard Employees Organisation(CSEO) have secured the recognition status as per the norms stipulated for recognition.However formal approval for the same is awaited from the Chief Labour Commissioner (CLC).

22. The executives and non-unionised supervisors also continued to contribute theirbest to the Company during the year.

23. The joint management forums like joint councils shop council central safetycommittee shop level safety committees contract worker safety committee canteenmanagement committee employees' contributory provident fund trust etc. continued tofunction effectively.

24. Employees and their dependents welfare and wellbeing are well taken care throughvarious voluntary schemes like

Employees Medical Assistance Scheme Employees Pension

Scheme Shipyard Parivar Prathibha Puraskar Scheme

Employees Educational Assistance Scheme etc.

Human Resource Development

Learning and Development Activities during 2020-21

25. Due to COVID-19 pandemic traditional internal and external training &development activities usually conducted in CSL had to be suspended for a few months inthe first two quarters of 2020 and later on programs were conducted on virtual mediumusing Microsoft teams zoom etc.

26. The prominent external webinars for which executives were nominated include thefollowing topics.

a) Design and implementation of ISO 50001

b) Stress and lifestyle by Engineering Staff College ofIndia Hyderabad

c) Transfer pricing – including impact of COVID-19

d) Structuring and financing of mergers and acquisition

e) Understanding of Insolvency and Bankruptcy Code

f) India maritime tech conference 2020

g) Data analytics for financial professionals

h) Static electricity and industrial safety

i) Risk management

j) Contract drafting and management

k) Assessment Examination and Certification of Seafarers (AECS)

l) Corrosion engineering emerging technologies coating and advance material by ESCIHyderabad m) Ind AS Master class for finance professionals

n) High impact corporate governance Excellence of CSR sustainability and responsiblebusiness by Department of Public Enterprises o) Maritime hydrogen fuel cells conferenceEurope etc. 27. Company also nominated senior executives under the scheme "IgnitingMinds" to virtual programs of Indian Institute of Management Ahmedabad on topics like"Mergers Acquisitions and Restructuring" and "Contract Management"etc. but rest of the nominations were not materialized as the institutes had cancelledthe sessions.

Customised Internal Trainings

28. 300 executives in CSL and its units at Mumbai and Kolkata were given 18 hour moduletraining on ISO 45001:2018 – Internal auditor up gradation training with a videobased online training conducted by KSPC as part of external audit readiness before auditby M/s. DNV GL. The certification was followed by an online assessment which required 85%correct answers to pass the course and 296 executives on permanent rolls as well as oncontract had successfully completed the same.

29. Online interactive session on Business Ethics in connection with vigilanceawareness week 2020 was conducted on October 27 2020 by CVO CSL Shri K Rajendran and thesame was attended by 37 executives.

30. In order to comply with legal requirements by Food Safety and Standards Act 2006CSL also conducted a customized one day "Advanced certification on Food SafetyAdvanced

Catering and COVID Awareness" following COVID protocols to 10 supervisors andemployees of CSL Employees Canteen in November 2020. 10 participants passed thecertification test and the certification is valid for a period of two years.

31. Four executives completed onlinecertificateprogramme on Construction ContractManagement conducted by National Institute of Construction Management and Research(NICMAR) Pune.

32. Induction programme to 38 newly joined supervisors was conducted in two phases of 4days each per batch in November 2020 and January 2021.

33. A customized Management Development Programme

(MDP) "Competency Based Assessment" was conducted on

February 24 2021 at Rajagiri Research Institute Kakkanad.

19 executives completed the programme.

34. One executive was nominated to 6 day online course on

"Hydrodynamics in Ship Design" by Maritime Research Institute Netherlands(MARIN) Amsterdam.

35. An online based session by NSDL regarding New Pension System was conducted atTraining Institute on March 25 2020 for employees who are about to retire from CSLService.

36. Novex Platform A cloud based online repository has been launched by CSL recentlyand courses on different competencies are currently being pursued by appropriate targetgroup of executives and supervisors. This is accessible on mobile as well as on computers.

37. A webinar was organized in association with Dupont

Sustainable Solutions on "Balancing Operational Focus with

Risk Management" in June 2020 for Senior Managers and above Cadre.

Educational Scholarships to Wards of Employees

38. "Shipyard Pariwar Prathibha Puraskar" an educational scholarship schemeintroduced from the year 2016 aims to reward and promote the star performers among thewards of regular employees of CSL. A scholarship of H25000/- per year for a maximumperiod of 5 years shall be bestowed in the order of highest marks scored by the wards inclass

XII final examination. During the year 2020-21 17 eligible students have been grantedscholarship under the said scheme.

Recognising Excellence

39. CSL has introduced the Employee Excellence Awards

Scheme envisaging reward and recognition of innovative ideas and practices among theemployees below the level of AGMs. The highest award under the scheme is Chairman's awardwith a citation and cash price of H15000/-. During the Republic day celebrations in2020-21 23 permanent employees and 9 contract personnel/trainees have been honored withChairman's Commendation which carries H2000/- cash prize.

Aesthetic Design Competition for Kochi Water Metro Project

40. An aesthetic design competition for Kochi Water Metro

Project was conducted in CSL for exterior styling of the prestigious catamaran ferries.The design selected for use of Kochi Water Metro Project was awarded with prize money ofH25000/- (Shri Vivek Vijayan Code No. 3985 Sr. Ship Draughtsman). Designs selected forfuture use of CSL submitted by 4 employees were awarded with prize money of H5000/- each& a certificate.

International Yoga Day

41. Employees were encouraged to observe international yoga day in small groups and attheir homes with family members without affecting COVID protocols and the photographs ofthe same were shared to concerned government portals.

Constitution Day

42. Constitution day was celebrated in CSL on November 26 2020 with reading ofPreamble and an online session on the topic "The Indian Constitution – TheTreasure House of Values" was organized on November 30 2020. The session was engagedby Dr. Pauly Mathew Muricken a practicing lawyer at the High Court of Kerala aconstitutional law expert and a known legal academician from The National

University of Advanced Legal Studies Kochi.

Prajnan Talk Series

43. ‘Prajnan' the technical talk series launched in the year 2018 continued witha session by Shri Harikrishnan S GM (Materials) on December 28 2020 on "ForceMajeure in Times of COVID Challenges".

Training

44. Under the Apprentices Act the Company has imparted training to 237 ITI tradeapprentices 60 engineering graduates 6 non-engineering graduates 58 diploma holders and5 vocational trainees in 2020-21. Furthermore specialized training mainly in thetechnical streams was extended to 251 trainees under the Company scheme. The Companyduring the year had also inducted 9 executive trainees for one-year training. The GMEcourse approved by Director General of Shipping Government of India was undergone by 132engineering cadets during the year to qualify for marine engineering jobs onboard vessels.

Samanvay portal

45. Samanvay is the common Knowledge Management Portal for all CPSEs. The website isdesigned & developed by ONGC on behalf of the Department of Public Enterprises (DPE).The primary objective of the Samanvay Knowledge Management Portal is to create a platformfor enabling individuals teams & entire Public Sector Enterprises to collectively andsystematically share knowledge infrastructure best practices SOP etc. to learn fromothers' experiences. The usage of Samanvay is being closely monitored by DPE. Periodicmeetings and reviews are conducted by DPE with CPSEs which are chaired by top officials ofDPE and there has been continuous follow up from DPE to increase the usage of the portal.CSL has given user access for the portal to all officers and the users can share lessonslearnt from their work place through the portal. CSL has shared around 106 articlesincluding 31 lessons learnt 75 CSR HR HSE practices best practices at work place &articles on innovation through the Samanvay portal till date.

Employee Welfare Measures

46. Infertility treatment scheme was launched in the year 2020 for providingreimbursement of medical expenses incurred for infertility treatment for all permanentemployees. An amount not exceeding H100000/- (Rupees One Lakh only) per cycle or theactual cost whichever is lower is permitted for reimbursement and the same will be allowedupto maximum of three fresh cycles with prior approval. Special Leave for maximum 10 daysin a year and maximum of 20 days are being granted during the service of an employee whoundergo procedures as a part of infertility treatment.

Total 11 employees were granted permission to avail the benefits under this scheme ason March 2021.

47. All employees (permanent & on contract employees) and trainees were grantedspecial leave for being stranded out in containment zones & quarantine leave wasgranted for those who have undergone treatment for being COVID positive and who were underquarantine amidst of the spread of COVID-19 pandemic.

48. Pregnant women employees and employees with co-morbidities were exempted fromroaster/shift duties based on their specific request during resumption of work in CSL postlockdown period. Also post lockdown women employees are being deployed only in generalshift.

49. National Pension System (NPS) was introduced in CSL in order to facilitatecontributory pension scheme for all permanent employees. A kiosk centre was arranged inCSL premises in the month of February 2021 for all employees through which the employeeshave opened their individual NPS account. CSL will be contributing 10% of the wages

(Basic + DA) to the individual account of the employees as employer contribution. Thescheme provides attractive income tax benefits to the employees and also ensures ahassle-free life post retirement.

50. CSL introduced paternity leave in the year 2019 to male employees of the Companyincluding for valid adoption of a child below the age of one year.

Encouraging Thought Provoking Ideas

51. "Nethruthwa Samvriddhi Yojana" – Leadership Acceleration

Programme (LEAP) was launched in the year 2016 to encourage and motivate executives inthe grades E1 to E4 for pursuing higher studies in premier institutes both in

India and abroad. The core benefit under the scheme is not only a grant of study leavefor two years but reimbursement of tuition fees in installments after they come back andjoin for duty. A maximum of three applicants are considered on a yearly basis under LEAPscheme.

52. CSL launched special financial assistance scheme applicable to SC/ST apprenticetrainees in 2018 to provide monthly financial assistance of H1500/- for meeting theirexpenses towards rental accommodation in Kochi. The monthly financial support is extendedto a maximum of 20 trainees during the period of apprenticeship training subject toperiodical review by CSL.

53. Mentor-Mentee scheme launched in the year 2016 continued this year also forensuring personalized special attention by a senior executive. It is extended to all newexecutives/executive trainees joining CSL. This collaboration gives junior executives whoare freshers a feeling of engagement belongingness and significant improvement in theinter and intra personal relationship in the organisation which lead to better retention.

54. Buddy scheme was launched in the year 2019 with the induction of new batch ofexecutive trainees. The objective of the scheme is to encourage the younger executives inCSL to be a guide to the new entrants especially executive trainees joining CSL. Thescheme will help the new entrants especially those from outside Kochi to socialize andget a support/guidance during their organisational entry as well as experience a smoothtransition from campus to corporate life.

55. CSL Star Board a mobile application for executives was introduced in 2017 for thepurpose of knowledge sharing.

The objective of Star Board is to enable the executives to share their technicalknowledge latest technical information and to provide a platform for innovative minds onmatters related to their profession/work. Star Board will promote knowledge sharingculture in CSL which is essential for the existence and success of any business. Thisplatform has provisions for sharing of both explicit knowledge and tacit knowledge.

56. Sandbox - The ‘Sandbox' is an online platform introduced in

2019 to act as a launch pad of new ideas formed primarily with the vision of becominga collaboration platform for officers of CSL. ‘Sandbox' is envisaged to act as apeople engagement platform which will provide each executive of the organisation anopportunity to express their innovative ideas and to implement those ideas associatingwith likeminded people while getting guided by mentors and experts in the relevant areas.The platform is expected to nurture creativity encouraging innovation technologyinduction and thereby to try a change culture within the organisation which wouldcontribute towards a larger transformation of organisation.

Professional Assessments

57. Through an elaborate competency mapping exercise four cultural competencies namelyteaming execution excellence constraint breaking and continuous learning have beenidentified for CSL. It has been decided that these cultural competencies will beincorporated in all HR sub systems like recruitment training performance managementcareer development etc. in future.

58. During the year 2018 M/s. Korn Ferry Hay Group a leading HR consultancyorganisation in Asia was awarded the work order for conducting executives' AssessmentDevelopment

Centre (ADC) and creation of Individual Development Plans (IDPs) for successionplanning. ADC was conducted to assess the competencies of executives in CSL vis-a-vis therequired competencies. ADC was conducted successfully for 202 selected executives in thegrades of DMs and above during the year 2018 and 2019. M/s. Korn Ferry Hay Group assessedthe strengths and areas for development of the executives using various assessment toolsand prepared detailed IDP. In addition to formulation of succession plan the ADC wasbeneficial to CSL as it provided right direction for planning HR interventions.

People Capability Maturity Model (PCMM)

59. In the year 2018 the Company commenced activities for obtaining a level 3 PCMMcertification. As part of implementation of PCMM conscious and collective efforts arebeing undertaken by the executives in HR department in formulation of various policies andbringing in improvements in existing HR procedures and practices.

60. PCMM is a maturity framework that focuses on continuously improving the managementand development of the human assets of an organisation. The PCMM helps organisationscharacterize the maturity of their workforce practices establish a programme ofcontinuous workforce development set priorities for improvement actions integrateworkforce development with process improvement and establish a culture of excellence. ThePCMM consists of five maturity levels; Level 1 to Level 5. Each maturity level is awell-defined evolutionary plateau that institutionalizes new capabilities for developingthe organisation's workforce. Unlike other HR models PCMM requires that keyfunctions/process areas improvements interventions policies procedures and practicesare institutionalized across the organisation irrespective of function or level.Therefore all improvements have to percolate throughout the organisation to ensureemphasis on a participatory culture embodied in a team-based environment and encouragingindividual innovation and creativity.

Status on Affirmative Action to Implement

Presidential Directives on Reservations

61. Cochin Shipyard has been strictly complying with the Presidential directives andguidelines on reservation for Scheduled Caste

(SC)/ Scheduled Tribes (ST)/ Other Backward Classes (OBC)/ Economically Weaker Sections(EWS) and Persons with Benchmark Disabilities (PwBD) issued by the Government of Indiafrom time to time. The Company has appointed a liaison officer for SC/ST/PwBD/Ex-Servicemen and a separate liaison officer for OBCs and EWSs to oversee theimplementation of reservation policies. Reservation percentage is ensured through themaintenance of post-based roster system as prescribed by the Government of India.

Representation of SC/ST/OBC employees

62. The representation of SC ST and OBC employees in various groups of posts as onMarch 31 2021 is given below:

Category CSL's Total Strength SC ST OBC
Group A 327 48 15 85
Group B 146 18 14 27
Group C 930 131 10 414
Group D 324 40 8 178
Total 1727 237 47 704

Representation of Persons with Benchmark Disabilities (PwBD) and Minority employees

63. The representation of Persons with Benchmark Disabilities (PwBD) and Minorityemployees in various groups of posts as on

March 31 2021 is given below:

Category CSL's Total Strength PwBD Minority
Group A 327 7 89
Group B 146 6 38
Group C 930 24 226
Group D 324 20 96
Total 1727 57 449

Provision for Safeguard of Women

64. The Sexual Harassment Wednesday of every of Women at month as Work Place

(Prevention Prohibition and Redressal) Act 2013 and Rules framed thereunder arestrictly complied with. An Internal Complaints Committee has been constituted inaccordance with the Act chaired by a senior woman executive. The

Committee had closed one compliant which was received during 2020-21.

65. CSL has a Women Welfare Officer specifically to promote women empowermentactivities and to formulate and implement welfare measures according to the needs of womenemployees of the Company.

Integrated Management System (IMS)

66. Cochin Shipyard maintained its Integrated Management System (IMS) under the ISO9001:2015 Quality Management

System and ISO 14001:2015 Environmental Management

System standards. CSL upgraded its Health and Safety Management System to the latestISO 45001:2018 in September 2020. The next re-certification audit scheduled in September2021. It is proposed to cover all the ancillary units of CSL within the certificationsystem during the forthcoming re-certification audit.

Facility Upgrade and Capital Expenditure

67. The total capital expenditure incurred in 2020-21 amounted to 264.34 crores. Thisrelated to renewals and replacements modernization and expansion dry-dock

ISRF CMSRU CKSRU etc.

Implementation of Official Language Policy

68. In pursuance of sub rule (4) of rule 10 of the Official Language (Use for theOfficial Purposes of the Union) Rules 1976 Government of India have notified in theGazette of India that 80% of ministerial staff of the Company have acquired workingknowledge/proficiency in Hindi.

69. Various competitions in Hindi language were organised in connection with Hindimonth celebrations 2020 for employees trainees and employees on contract of CSL in onlineand offline mode. Hindi typing dictation passage reading memory test

Hindi film songs (separate for women and men) and quiz competitions were organised inthis regard. Essay writing sentence making poetry writing short story writing etc.were conducted through online mode. Twelfth issue of Hindi house journal 'Sagar Ratna'was released on Hindi Day.

70. As a special programme in connection with Hindi month celebrations online speechcompetition was organised for State school students and online quiz competition wasorganised for CBSE school students of Kochi. As part of implementation of officiallanguage policy of Government of India CSL observes first

Hindi Day.

71. Cochin Shipyard Limited organised a webinar on 'Career opportunities for HindiGraduate Students' of Maharajas College Ernakulam on February 23 2021 for providinginformation about Hindi language and employment opportunities for undergraduate Hindistudents. The main faculty of this programme was Shri Sambath Kumar P N Assistant GeneralManager (Administration) CSL Kochi. In total more than 100 students participated in thewebinar with great enthusiasm.

72. Official Language (OL) Management Programme was organised for the executives in theyear 2021. Total 22 executives attended the same.

73. One day online Hindi workshop was organised under the auspicious of TOLIC Kochi inwhich 25 persons participated.

Online spoken Hindi classes were organised for the executives

(Director General Managers and Chief General Managers) and 17 executives participatedfor which a Whatsapp group was created so as to upload the spoken Hindi modules.

74. For the smooth implementation of OL six administrative sections were identified toensure 100% compliance of OL policy. Based on this a schedule has been prepared and asection will be inspected in a month during which emphasis is being provided onbilingualization of all documents unicode training for employees maintenance ofregisters in bilingual form preparation of bilingual notings on files etc.

75. During the academic year 2019-20 cash incentives for children of employees forobtaining high marks in Hindi in 10th std. were awarded to 9 children. 24 employees werealso awarded cash incentives for the implementation of Hindi language.

Particulars of Employees and Related Disclosures

76. In accordance with Ministry of Corporate Affairs notification no. GSR 463(E) datedJune 05 2015 government companies are exempt from Section 197 of the Companies Act 2013and its rules thereof.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

77. Details are placed at Annexure I. The Company's major initiative in theconservation of energy was installation of solar panels on the rooftop of variousbuildings inside CSL premises. The programme commenced in the year 2013-14. As of March31 2021 solar power plant having capacity of 1485 kWp has been commissioned in CSL.

Risk Management

78. CSL constituted a Board level Risk Management Committee (RMC) in line with the SEBI(Listing Obligations and Disclosure

Requirements) Regulations 2015 on February 08 2019 for an overall review of thecorporate risks. CSL has adopted a comprehensive Risk Management Policy at the 214thmeeting of the Board of Directors held on September 16

2014. The Company's risk management policy aims to put in place a comprehensive riskmanagement system consisting of a defined process of risk management and methodology ofidentification reporting of risks. The policy provides the management and Board ofDirectors an assurance that key risks are being properly identified and effectivelymanaged.

79. As per the policy CSL Board at the helm will review the risk management system inCSL. The Board shall discharge its responsibility of risk oversight by ensuring the reviewat periodical intervals. The CSL management comprising of CSL Board level and below Boardlevel executives has been entrusted with the implementation of the risk managementprocess. In this respect the Company have functional Risk Management Committees and BoardLevel Risk Management Committees to implement the policy in CSL. The Risk ManagementCommittees and the

Board of Directors periodically review the risk management process and policy. Theyard's product mix comprising of defense and commercial shipbuilding and ship repair givesthe Company a natural hedge against market risk.

Research and Development (R&D) Activities

80. R&D policy of CSL is to enhance the Company's preeminence in shipbuilding shiprepair and other chosen fields and products through research and development. In-houseR&D activities have been undertaken during the year 2020-21 mainly in the areas ofwelding procedure development and qualification of welders.

81. Welding of Aluminum plates with Double pulsed Metal Inert Gas Welding is a newtechnique for which capability building in developing the weld procedure is of paramountimportance to the yard. In the above context weld procedure development has beenundertaken in-house for welding of 5083 grade H116 Aluminum plates using Double pulsed

Metal Inert Gas Welding. The weld procedure specification has been prepared andqualified to weld thickness from

5 mm to 20 mm Aluminum plates. This new process saves considerable amount of man hourand effort. The procedure has been validated by IRS Classification Society.

Health Safety & Environment (HSE)

82. CSL upholds safety as an integrated part of shipbuilding and ship repair process.This underpinned our employees and stakeholders to plan the jobs from an integratedviewpoint.

Workforce engagement is a key role in HSE management and CSL is leveraging this from abusiness standpoint. Subcontractors upliftment on HSE matters has been taken as a keyproject towards the overall HSE upbringing for which several town hall sessions wereconducted to bring awareness into this community.

83. All the legal requirements pertaining to HSE matters are complied with and reportsare submitted to the respective enforcement bodies under respective authorities in Stateand Central Government.

84. Safety awareness through learning management system has been kickstarted in theorganisation and brings more executives in this domain to involve in HSE managementprocess. Hand injury prevention campaigns were conducted among the workforce to remind andinculcate the new habits by way of handling and use of power and non-power hand toolssince hand injuries are high in CSL.

85. HSE index has been introduced at department level to monitor the HSE performanceamong departments. This is a combination of reactive performance and proactive achievementof each department in HSE activities. Normalizing score method used to calculate HSE indexof execution department and services department separately.

86. CSL has been certified ISO 45001:2018 in the year 2020 which enable more ondemonstrative HSE leadership and participative & consultative mechanism adopted in thesystem. This develops HSE leadership at all levels across the organisation. Walk the talkby divisional heads and pep talk by HODs shows an indicative movement in the organisationtowards inclusive HSE culture.

87. CSL has been awarded Silver GreenCo Rating which is the "first of its kind inthe World" holistic framework that evaluates companies on the environmentalfriendliness of their activities using life cycle approach. Implementation of GreenCorating provides leadership and guidance to companies on how to make products services andoperations greener which includes energy efficiency water conservation renewableenergy GHG mitigation waste management material conservation and recyclability greensupply chain product stewardship life cycle assessment and eco-friendly environment& innovation.

88. CSL extends the HSE core standards principles and SOPs to other units of CSL viz.CMSRU CKSRU and subsidiary company HCSL. These units have been audited to monitor thatthe systems are in place. Further CSL is in the process of extending the HSE practices atits unit CANSRU and its subsidiary company TSL.

89. CSL have won the safety award from Factories & Boilers

Department Government of Kerala under the category of very large factories inengineering automobile textile and coir.

Industrial security

91. Cochin Shipyard Limited is a vital organisation with national importance and isclassified as special security zone by both State and Central Government and the securityof establishment has got national importance. The primary security of the establishment isentrusted with Central Industrial Security Force (CISF) unit comprising of 130 CISFpersonnel under the command of Dy. Commandant CISF. Overall security of the Companycontinued to be robust without causing any serious security concern during the year. Allsecurity systems and measures introduced and installed in the Company are of internationalstandards. Periodic joint survey was conducted by the Company along with CISF. Twenty-fourhours waterfront patrolling with armed personnel and wireless surveillance (CCTV) systemcovering all critical locations and installations are in place. The periodic mock drillexercises are conducted in coordination with Intelligence Bureau State Police State FireDepartment Bomb Squad and Navy to assess the readiness of CISF force to counter anysecurity threat security breach crisis or calamities.

92. CISF is carrying out their security surveillance and duties with security gadgetswhich includes biometric access control system x-ray baggage scanner door frame metaldetectors hand held metal detectors breath analysers vehicle patrolling boatpatrolling and foot patrolling etc. The upgradation of security gadgets is being taken upas per the technical survey of CISF to bring modern security gadgets to enhance theexisting security system and facilitate the CISF a foolproof frisking mechanism at allgates.

93. Special security attention is being accorded to the

Indigenous Aircraft Carrier (IAC) with an exclusive security arrangement provided apartfrom the overall security arrangement of the establishment post the incident of theftreported during the year 2019-20 in IAC. The case is being investigated by NationalInvestigation Agency (NIA). NIA arrested two persons in connection with the incident andretrieved the stolen computer hardware components. The issue of security of IAC was takenup at the highest levels of CISF and an additional contingent of 46 CISF securitypersonnel on IS Duty have been posted exclusively for IAC under the command of Asst.Commandant.

94. The security strength and requirements of additional security enhancements areperiodically monitored by the Head Quarters of CISF through technical resurvey forsecurity gadgets and resurvey for manpower augmentations. The proposal for augmentation ofstrength of CISF CSL Unit from the present strength of 130 CISF personnel to 220personnel have been approved by the Ministry of Home

Affairs Government of India with creation of a net additional

96 posts. The deployment procedures are underway.

95. The entry to the ship is strictly controlled using access cards thus keeping trackof the number of personnel working onboard at any given point of time. The additionalsecurity gadgets including CCTV surveillance biometric access system two net waterbarrier DDS boat patrolling etc. have also been arranged for safeguarding and avoidingany imminent threat for the ship.

96. The entry to the Yard is effectively controlled via access control systemsincluding biometric embedded turnstile gates x-ray baggage machines DFMD etc. Afull-fledged visitor's facilitation center is operated for scrutiny and verification ofthe credentials of the visitors to the Company. X-ray baggage scanning systems have beeninstalled at the Main entry gate and contractors' workmen entry gate of the Company. Allthe entry passes issued are photo-based entry passes.

97. During the year 2021-22 the Yard has proposed to implement an integrated securitysystem upgrading the existing systems. The project is being carried out through BharatElectronics Limited (BEL) Bangalore. The project envisages introduction of comprehensivesecurity architecture involving complete CCTV surveillance of the perimeter waterfrontand inside the Yard ESPF system visitor's management and ANPR etc.

98. The monitoring of visitors materials and vehicles movement in the Company are donethrough an integrated ERP module of visitor's management system which ensures effectiveand vigilant monitoring of materials movement into and out of the Company. As part of theproposed integrated security system a GPS based tracking tag for the visitors and RFIDtagged pass system are also being implemented thus to keep track of the movements of thevisitors within the Yard.

99. CSL has also engaged DGR sponsored ex-servicemen security agency for supplementingexisting forces mainly catering to external properties of CSL and also internal specificlocations comprising of 98 personnel.

Awards and Recognitions

ficompany 100.CSLhasearnedthedistinctionofbecomingthe in the Shipping sector to becertified by Confederation of

Indian Industry (CII) for the GreenCo Silver rating. CSL has now joined the handful ofbig companies like IOCL HPCL

BPCL ONGC GAIL Indian Railway (units at ICF) which have already been certified."GreenCo" rating is awarded to a company meeting set norms in implementation of‘Green' environment friendly facets in their production activities conserve and ispersistently endeavouring to move towards greener renewable energies like solar/wind etc.The rating is based on performance evaluation of the Company under various parameters suchas Energy Efficiency Water Conservation Renewable Energy Green House Gas EmissionWaste Management Material Conservation

Recycling and Recyclability Green Supply Chain Product Stewardship & Life CycleAssessment Innovation for

Environment Green Infrastructure and Ecology.

101.CSL has bagged the Kerala CSR Leadership Award 2021 during the year. CSL has alsobagged the ‘Roll of Honour' award instituted by the Dalal Street Investment Journalfor the fastest growing ‘Miniratna' manufacturing company for the year. CSL was alsoawarded First Prize for the implementation of Official Language from Kochi Town OfficialLanguage Implementation Committee (TOLIC) among the companies having less than 200employees and Second Prize for the Hindi Home Magazine "Sagar Ratna" from KochiTOLIC (PSUs) for the year 2020.

Board of Directors & Key Managerial Personnel

102. As on March 31 2021 the Board of CSL comprises of 6 directors consisting of aChairman & Managing Director 3 Whole Time

Directors and 2 Official Part Time (Nominee) Directors one each from Government ofIndia and Government of Kerala.

103. During the year Shri Jyothilal K R lAS (DIN: 01650017) Principal Secretary(Transport) Government of Kerala ceased to be Director of the Company pursuant to theprovisions of

Section 167(1)(b) of the Companies Act 2013. The Board of Directors of CSL at their254th meeting held on June 20 2020 took note of the cessation of his Directorship.However the Ministry of Ports Shipping and Waterways (MoPSW) Government of India videletter No. SY-11012/1/2017-CSL dated August 24 2020 reappointed Shri Jyothilal K R

IAS (DIN: 01650017) as the Official Part Time (Nominee) Director on the Board of CSLwith effect from August 24

2020. Further the tenure of Shri Jiji Thomson IAS (Retd.)

(DIN: 01178227) Shri Pradipta Banerji (DIN: 00630615) and

Shri Nanda Kumaran Puthezhath (DIN: 02547619) who were appointed as Non-Official PartTime (Independent) Directors on the Board of CSL for a period of 3 years vide MoPSW letterF.No. SY-11012/1/2016-CSL dated July 15 2017 came to an end on July 14 2020.

104. CSL had six Independent Directors including a Woman Director in compliance withRegulation 17 of the SEBI (Listing

Obligations and Disclosure Requirements) Regulations 2015 till March 20 2020.Subsequently out of the six Independent

Directors three Independent Directors including a Woman

Director had vacated their office with effect from March

21 2020 and the remaining three Independent Directors had vacated their office witheffect from July 15 2020 on completion of tenure of their appointment prescribed by theGovernment of India. CSL has provided necessary intimations to the Administrative Ministryfor filling up the post of

Independent Directors including a Woman Director.

105.Details of changes in Key Managerial Persons during the financial year 2020-21 andalso upto the date of this report are given below:

Sl. No. Name DIN Designation Date of Appointment Date of Cessation Remarks
1 Shri Madhu S Nair* 07376798 Chairman & Managing Director January 01 2016 Continuing No Change
2 Shri Suresh Babu N V** 07482491 Director (Operations) April 26 2016 April 30 2021 Superannuation
3 Shri Bejoy Bhasker 08103825 Director (Technical) Director (Finance) April 05 2018 August 01 2019 Continuing No Change
4 Shri Jose V J 08444440 Chief Financial Officer August 13 2019 Continuing No Change
5 Shri Syamkamal N N.A. Company Secretary & Compliance Officer February 01 2020 Continuing No Change

*The Ministry of Ports Shipping and Waterways Government of India vide letter no.SY-11011/1/2009-CSL dated October 16 2020 extended the tenure of Shri Madhu S Nair (DIN:07376798) as Chairman & Managing Director for a further period of five years fromJanuary 01 2021 or till the date of his superannuation or until further orders whicheveris the earliest.

** Shri Suresh Babu N V was reappointed as director by way of retirement by rotation atthe 48th Annual General Meeting (AGM) of the Company held on

September 29 2020. The Ministry of Ports Shipping and Waterways Government of Indiavide letter no. SY-11012/1/2020-CSL dated February 26 2021 extended his tenure witheffect from April 26 2021 till April 30 2021 i.e. up to the date of his superannuation.Consequently he retired on superannuation from the services of the Company on April 302021.

Declaration and Meeting of Independent Directors

106.During the financial year 2020-21 the Company has received declarations from allthe Independent Directors of the Company confirming that they meet the criteria ofindependence as prescribed under the Companies Act 2013. A separate meeting ofIndependent Directors was held during the financial year on June 19 2020 which wasattended by all the Non-Official Part Time (Independent)

Directors viz. Shri Jiji Thomson IAS (Retd.) Shri Pradipta

Banerji and Shri Nanda Kumaran Puthezhath.

Details of Board Meetings held during 2020-21

107.Six Board Meetings were held during the year 2020-21 and the gap between twomeetings did not exceed the statutory period. The dates on which the Board Meetings wereheld are as follows:

Sl. No. Date Board Strength No. of Directors present
1 June 20 2020 9 8
2 August 10 2020 5 5
3 October 15 2020 6 5
4 November 12 2020 6 6
5 January 04 2021 6 6
6 February 12 2021 6 5

108.For more details with respect to the Directors Board and

Committee meetings held during the year and attendance of these meetings referCorporate Governance Report which forms part of Directors' Report.

Remuneration Policy/Evaluation of Board's Performance

109. Cochin Shipyard is a Government of India company under the Ministry of PortsShipping and Waterways. Presently the Directors of the Company are presidentialappointees and their remuneration is fixed in accordance with the DPE guidelines.

Accordingly Article 21(a) of the Articles of Association of CSL states that Presidentwill appoint Directors and determine their remuneration. Since the Board levelappointments are made by President of India the evaluation of performance of suchappointees is also done by the Government of India. The Independent Directors evaluatedthe performance of the Board as a whole in a separate meeting of Independent

Directors held on June 19 2020.

Report of the Nomination & Remuneration

Committee on Company's Policy on Directors' Remuneration

110. Presently the remuneration of Board level appointees is determined in accordancewith DPE guidelines. CSL at its 228th Board meeting held on December 14 2016 adopted theNomination and Remuneration Policy in compliance with the provisions of Section 178 of theCompanies Act 2013.

CSL in its 241st Board meeting held on May 24 2018 and further in its 245th Boardmeeting held on October 31 2018 amended the Policy. The Policy is available in thewebsite of the Company at https://cochinshipyard.in/Investors

Directors Responsibility Statement

111.Your Directors state that:

a) in the preparation of the annual accounts for the year ended March 31 2021 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2021 and of the profit ofthe

Company for the year ended on that date; sufficient

c) the Directors have taken proper and for the maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities; d) the Directorshave prepared the annual accounts on a ‘going concern' basis;

e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operating andeffectively;

f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

Contracts and arrangements with related parties

112. During the year the Company had not entered into any contract/ arrangement/transaction with related parties which could be considered material. However pursuant tothe approval of the Board at the meeting held on October

15 2020 a Memorandum of Understanding was entered into with Hooghly Cochin ShipyardLimited (HCSL) the wholly owned subsidiary to enable CSL and HCSL to work together andto enter into a detailed legal agreement for undertaking activities by sharing thefacilities capabilities & resources. Your Directors draw attention of the members toNote 48 to the financial statements which set out related party disclosures as per IndianAccounting Standard (Ind AS) 24. Further Form AOC-2 has been placed at Annexure IIas required under Section 134(3)(h) of the Companies Act 2013.

Corporate Social Responsibility & Sustainable Development Committee (CSR & SDCommittee)

113.From April 01 2020 to July 14 2020 the CSR & SD Committee of CSL comprisedof Shri Jiji Thomson IAS (Retd.)

(DIN: 01178227) Non-Official Part Time (Independent)

Director as Chairman of the Committee Shri Nanda

Kumaran Puthezhath (DIN: 02547619) Non-Official Part Time (Independent) Director ShriBejoy Bhasker

(DIN: 08103825) Director (Technical) and Shri Jose V J (DIN: 08444440) Director(Finance) as members. The

Independent Directors vacated their office with effect from

July 15 2020 on completion of tenure of their appointment prescribed by the Governmentof India. Therefore due to the non-appointment of Independent Directors CSL could notre-constitute the Committee with effect from

July 15 2020. In the absence of CSR & SD Committee CSR proposals were considereddirectly by the Board based on the recommendations of below Board level CSR Executive

Committee.

114.The Corporate Social Responsibility and Sustainable Development (CSR & SD)Committee has formulated and recommended to the Board a Corporate Social

Responsibility Policy (CSR Policy) indicating the activities to be undertaken by theCompany which has been approved by the Board. The CSR Policy can be accessed on theCompany's website at the link https://cochinshipyard.in/Investors

115.Cochin Shipyard started CSR activities in the year 2010-11 based on the guidelinesissued by the Department of Public Enterprises (DPE) applicable to Government Companies.CSL has put in place an effective CSR Policy and implementation machinery. The CSRimplementation machinery consists of three tier system; Tier I CSL Board Tier II CSLBoard Level CSR Committee and Tier III CSL CSR

Executive Committee consisting of senior level executives across various departments ofthe Company. Presently

Tier II CSL Board Level CSR Committee is not functional due to non-appointment ofIndependent Directors. The Committee will be re-constituted on appointment of IndependentDirectors.

116.During the year 2020-21 the Company could engage in meaningful CSR initiativesthat received appreciation both within Kerala and also nationally.

117.The Company has spent H15.27 crores against the target mandatory CSR spending ofH14.80 crores for the financial year 2020-21. The expenditure contained partly from theapproval provided for the year and partly from the ongoing projects which were approved inthe earlier years. It is also pertinent to mention that the Company has taken up 48projects and spent H9.01 crores on government stipulated theme "Healthcare andNutrition" which is around 59% of the total spending.

118. The Annual Report on CSR activities is placed at Annexure III.

Audit Committee

119.From April 01 2020 to July 14 2020 the Audit Committee of CSL comprised of ShriNanda Kumaran Puthezhath (DIN:

02547619) Non-Official Part Time (Independent) Director as Chairman Shri Jiji ThomsonIAS (Retd.) (DIN: 01178227)

Non-Official Part Time (Independent) Director and Shri Pradipta Banerji (DIN:00630615) Non-Official Part Time

(Independent) Director as members. The Independent

Directors vacated their office with effect from July 15 on completion of tenure oftheir appointment prescribed by the Government of India. Therefore CSL could notre-constitute the Committee with effect from July 15

2020. During the year for the period where the Audit Committee was subsisting allrecommendations of the

Audit Committee were accepted by the Board of Directors.

Particulars regarding the Audit Committee are provided under the section ‘BoardCommittees' in the Report on

Corporate Governance.

Corporate Governance

120.The Company is committed to maintaining the highest standards of corporategovernance and has put in place an effective corporate governance system. The Companycomplies with the applicable regulations of Securities and

Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations 2015 and also the Guidelines on Corporate Governance issuedby the Department of

Public Enterprises except with respect to the composition of Board of Directors viz.appointment of Independent

Directors including a Woman Director and consequent compliances related to StatutoryCommittees. CSL being a government company the power to appoint Directors vests with theGovernment of India and the Company has provided necessary intimations to theAdministrative

Ministry for filling up the post of Independent Directors including a Woman Director.The Statutory Committees will also be re-constituted on appointment of IndependentDirectors. Further the Company also submits its quarterly progress reports on corporategovernance within 15 days from the close of each quarter to the Administrative Ministryviz. Ministry of Ports Shipping and Waterways as recommended by the DPE in this regard.The Report on

Corporate Governance forms part of the Directors' Report.

Management Discussion and Analysis

121.A separate section ‘Management Discussion and Analysis Report' has beenincluded in the Annual Report and the same forms part of the Directors' Report.

Internal Financial Controls

122.The Company has in place adequate internal financial controls with reference tofinancial statements. During the financial year 2019-20 the Company had engaged

M/s. Krishnamoorthy & Krishnamoorthy (Firm Registration No. 001488S) CharteredAccountants for reviewing and installing adequate Internal Financial Controls and toensure proper and adequate systems for compliance with the provisions of all applicablelaws. Such controls were tested and no reportable material weakness in the design oroperation was observed. There is no major variation in the control environment during theFY 2020-21. The review of the Internal Financial Controls were carried out by the in-houseinternal audit team during FY 2020-21 and no material weakness in the financial controlswere reported.

123.In order to provide for functional autonomy the Company has a system whereinfinancial powers of the Board of Directors are delegated to the CMD. These powers arefurther sub-delegated to officers at various levels for smooth and efficient day to dayfunctioning. An independent internal audit mechanism is in place for conducting extensiveaudit of various operational and financial matters. C&AG conducts proprietary audit.

124. During the year 2020-21 the Board of Directors examined internal/statutory auditobservations and provided guidance based on the same. The Board of Directors also lookedinto the internal control system Company procedures and internal audit performance andreports. The Company has implemented an integrated ERP System (SAP) since July 2014 whichis enabling better management control. SAP audit was conducted by M/s. KPMG for assessmentand improvement of SAP utilisations. Assessment of the security of the SAP system was alsopart of the audit. A follow up audit was also undertaken by M/s. KPMG.

125.CSL is in the path of digital transformation and the existing SAP ECC system isbeing upgraded to the intelligent ERP system S/4HANA in order to cater to the intelligenttechnology related enhancements in SAP.

126.M/s. E&Y has conducted a Maturity Assessment Audit of the existing ITinfrastructure in CSL. Based on their recommendations the upgradaton activities of ITinfrastructure Security Management System and ISO

27001:2013 certification are in progress.

127. Being a frontrunner in adapting to and leveraging digital technology foroptimizing its procedures and operations CSL had taken another step further in thisdirection by introducing

Legatrix in 2018 a digitally enabled legal and regulatory compliance and supportservice interface. CSL is the first shipping sector PSU to implement this novel system forstreamlining its legal and regulatory compliance requirement.

Statutory Auditors

128.M/s. Elias George & Co. (Firm Registration No. 000801S) Chartered AccountantsErnakulam were appointed as the Statutory Auditors of the Company by the Comptroller &Auditor General of India for the year 2020-21. The shareholders have delegated the powerto fix the remuneration of Statutory Auditors to the Board and accordingly the same hasbeen fixed by the Board.

Auditors Report

129.M/s. Elias George & Co. Statutory Auditors have submitted their report on thestandalone and consolidated financial statements of the Company for the financial yearended

March 31 2021 on June 11 2021. The Report does not contain any qualificationreservation or adverse remark or disclaimer.

Comments of C&AG

130.The comments of the Comptroller and Auditor General of India under Section143(6)(b) of the Companies Act 2013 forms part of the Annual Report.

Cost Auditors

131.The Company maintains cost records with respect to its shipbuilding activities asrequired under Section 148(1) of the Companies Act 2013. The Board has appointed M/s.Felix & Co. (Firm Registration No. 100416) Cost

Accountants as the Cost Auditors for conducting the audit of cost records of theCompany for the financial year 2020-21. The remuneration of Cost Auditor for the financialyear 2020-21 was ratified by the shareholders at the 48th AGM held on September 29 2020.

Secretarial Auditor

132. The Board has appointed M/s. Mehta & Mehta Practicing

Company Secretaries to conduct Secretarial Audit for the financial year 2020-21. TheSecretarial Audit Report for the financial year ended March 31 2021 is placed atAnnexureIV.

133.The Secretarial Auditors in their Report observed the following:

a) During the year under report there was no Woman

Director on the Board of the Company as required under Regulation 17(1) of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 ("SEBI LODR

Regulations") and Section 149 of the Companies Act 2013; b) The Company washaving requisite number of

Independent Directors on the Board for a period from April 01 2020 to July 14 2020 asrequired under Section 149(4) of the Companies Act 2013. However upon end of the term ofIndependent Directors on July 14 2020 there was no new appointment of IndependentDirectors till March 31 2021;

c) During the period from July 15 2020 to March 31 2021 the Company has notconstituted Audit Committee Nomination and Remuneration Committee StakeholdersRelationship Committee and Corporate Social Responsibility Committee as required undervarious provisions of the SEBI LODR Regulations Companies

Act 2013 and the Corporate Governance Guidelines for

CPSEs wherever applicable; and

d) The Stock Exchanges viz. NSE and BSE had imposed a total fine H1896000 (NSEH958000 and

BSE H938000) for non-compliance of Corporate

Governance conditions of SEBI LODR Regulations.

134.The explanation of the Board to the observations in the

Secretarial Audit Report is given below:

Cochin Shipyard Limited (CSL) is a Central Public Sector

Enterprise under the administrative control of the Ministry of Ports Shipping andWaterways Government of India.

Accordingly the appointment of Directors on the Board of

CSL is done by the Government of India by following due procedure of selection. TheCompany has forwarded necessary intimations to the Administrative Ministry for filling upthe posts of Independent Directors including a Woman Director and frequent follow ups arealso being done. However the filling up of vacancies of the Independent Directors andWoman Director remains pending with the Government of India. Further the Company couldnot re-constitute the aforesaid Statutory Committees due to the non-appointment ofIndependent Directors which will be done once the requisite number of IndependentDirectors are appointed. The Company had forwarded intimations to the Stock Exchangesviz. NSE & BSE explaining the position of the Company with respect to non-complianceof Corporate Governance conditions of SEBI LODR Regulations. BSE vide their communicationon April 19 2021 waived the fine levied on the Company. The fines are levied as per theSEBI Circular SEBI/HO/CFD/CMD/CIR/P/2020/12 dated January 22 2020 which provides that theStock Exchanges shall take uniform action in consultation with each other. Further

NSE has not taken any further action under the SEBI LODR

Regulations in this regard.

Internal Auditor

135.The Board has appointed M/s. Varma & Varma Chartered

Accountants Kochi to conduct Internal Audit for the financial year 2020-21.

Annual Return

136. The annual return of the Company as required under Section 92(3) of the CompaniesAct 2013 is available in the website of the Company athttps://cochinshipyard.in/Investors

Investor Services

137.The shares of the Company are listed in BSE Limited ("BSE") and NationalStock Exchange of India Limited ("NSE"). CSL has paid listing fees to BSE andNSE on time. Link Intime

India Private Limited are the Registrar & Transfer Agents in respect of theseequity shares. The tax free bonds issued by the Company in 2013-14 are fullydematerialized with both the depositories NSDL and CDSL. These bonds are listed onWholesale Debt Market ("WDM") segment of BSE. CSL has paid the listing fees toBSE on time in respect of these bonds. Link Intime India Private Limited is the Registrar& of Transfer Agents and SBICAP Trustee Company Limited is the Debenture Trustees inrespect of these bonds.

Vigilance

138.Vigilance department functions advocating transparency equity and competitivenessin all procurement. Important CVC guidelines are discussed with Heads of Departments forits strict compliance. Emphasis was given to vigilance sensitization among the officersand supervisors for preventive vigilance.

139.Vigilance Department scrutinizes the audit paras of both Internal as well as CAGaudit on quarterly basis and action taken on issues related to vigilance angle if any.Various systemic improvements achieved through vigilance initiatives during the yearincludes updation of vendor list provision for online registration of new vendorsmonitoring of contract closing addition and review of new vendor list on monthly basisintroduction of bill tracking system to enhance transparency emphasis on e-procurementonline scrutiny of property returns of executives & supervisors systematic disposalof shipbuilding & ship repair steel scraps for ensuring grade transparency. Variouscontract details were also scrutinized by collecting data from different departments.Based on audit report the files related to MoU with M/s. SEDS and award of consultancycontract of

ISRF and dry-dock were scrutinized. After scrutiny reports were sent to CMD Ministryand CVC.

140. Vigilance sensitization programmes – Vigilance Awareness

Week observed in a befitting manner as directed by the

Commission strictly in compliance with COVID-19 protocol.

A training session was conducted for the CSL Officers on the subject "BusinessEthics" on October 27 2020 by

Shri Rajendran K CVO CSL through video conferencing.

Essay competitions slogan competitions and drawing competitions were conducted foremployees and wards of CSL through online mode. An online vendor redressal programme wasalso arranged for the suppliers and contractors of CSL through video conferencing onOctober 30 2020.

141.Vigilance Department is scrutinizing the selection process of candidates forvarious posts. Further due to the pandemic concerns Vigilance department has conductedfour surprise/periodic inspection for the year in various areas of operations andsuggested corrective actions on vigilance angle. All reports to the Central VigilanceCommission are submitted in time and no reference is pending with CVC.

Right to Information Act

142.In order to promote transparency and accountability your Company has implementedthe provisions of the RTI Act 2005 in its true letter and spirit and an appropriatemechanism has been set up in the Company with a dedicated centralised RTI Cell to provideinformation to the citizens under the provisions of this Act. All the RTI applications andthe appeals received both online and offline during the year 2020-21 have been processedand information was provided in a time bound manner as stipulated in the Act.

143.There have been no instances of non-compliance by the Company. No penalties orstrictures were imposed on the Company by any statutory authority during the last threeyears with respect to RTI.

Vigil Mechanism

144.The Cochin Shipyard Vigil Mechanism and Whistle Blower Policy of CSL adopted by theBoard of Directors at their 228th Meeting held on December 14 2016 was functioning as theVigil Mechanism of CSL. Further in line with the guidelines on Corporate Governance forCentral

Public Sector Enterprises issued by the Department of Public Enterprises CSL hadadopted Fraud Prevention and Detection Policy at the 214th Board Meeting held on

September 16 2014. Since the larger objective of both policies was similar CSLadopted a combined policy viz.

Whistle Blower and Fraud Prevention Policy at the 252nd Board Meeting held on November12 2019. The Whistle Blower and Fraud Prevention Policy of CSL is available at the linkhttps://cochinshipyard.in/Investors

Details of frauds reported by Auditors under

Section 143

145.Nil.

Particulars of loans guarantees or investments

146.During the year under Report the Company has not and

a) given any loan to any person or other body corporate except as stated below;

b) given any guarantee or provided security in connection with a loan to any other bodycorporate or person; and

c) acquired by way of subscription purchase or otherwise the securities of any otherbody corporate as prescribed under Section 186 of the Companies Act

2013 except as stated below:

Name of the Company Description of Investment Amount (J crores)
Hooghly Cochin Unsecured Loan* 10.00
Shipyard Limited Equity Shares 28.00
Cumulative 56.00
Redeemable
Preference Shares
Tebma Shipyards Unsecured Loan 5.00
Limited Equity Shares 65.00

*Repaid in February 2021

Material changes and commitments

147.No material changes and commitments affecting the financial position of theCompany have occurred between the end of the financial year of the Company and the dateof this Report.

Details of change in nature of business

148.There has been no change in the nature of business of the Company during the yearunder report.

Deposits

149.Your Company has not accepted any deposits from the public under Chapter V of theCompanies Act 2013.

Secretarial Standards

150.The Company has complied with the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India.

Significant and Material orders

material orders were passed by the 151.No significant regulators or any courts ortribunals impacting the going concern status of the Company and affecting its operations.

Business Responsibility Report

152.The Securities and Exchange Board of India (SEBI) has mandated inclusion ofBusiness Responsibility Report ("BR Report") as part of the Annual Report fortop 1000 listed entities based on market capitalization vide Regulation 34(2)(f) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. SEBI has alsoprescribed a format for BR Report. It also contains a list of nine key principles andvarious core elements under each principle to assess compliance with environmental socialand governance norms. The Company's BR Report for the year forms part of the AnnualReport.

Acknowledgement

153.The Board of Directors are extremely thankful for the continued patronage andsupport extended by the Hon'ble Minister of State (Independent Charge) for Shipping andall officials of the Ministry of Ports Shipping and Waterways. The Board would also liketo express their grateful appreciation for the support and co-operation fromvariousoffices of the Government of India Government of Kerala Government of WestBengal Government of Maharashtra Andaman and Nicobar Administration various localbodies the Comptroller & Auditor General of India Statutory Auditors SecretarialAuditors Cost Auditors Internal Auditors Suppliers Sub-contractors Company's Bankersand our valued customers. The Board also places on record its appreciation for thecontribution and support extended by all employees of Cochin Shipyard Limited. YourDirectors express their appreciation and gratitude to all the shareholders/investors forthe trust and confidence reposed in the Company and look forward to their continuedsupport and participation in sustaining the growth of the Company in the coming years.

For and on behalf of the Board of Directors
Madhu S Nair
Kochi Chairman & Managing Director
June 11 2021 DIN: 07376798

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