Container Corporation Of India Ltd.
|BSE: 531344||Sector: Others|
|NSE: CONCOR||ISIN Code: INE111A01025|
|BSE 00:00 | 24 Sep||370.65||
|NSE 00:00 | 24 Sep||371.10||
|Mkt Cap.(Rs cr)||22,584|
|Mkt Cap.(Rs cr)||22583.70|
Container Corporation Of India Ltd. (CONCOR) - Director Report
Company director report
Your directors are pleased to present their report on the business andoperations of the Company and the statement of accounts for the financial year ended on 31stMarch 2019.
(Rs. in crores)
As per the guidelines issued by Department of Investment and PublicAsset Management (DIPAM) the minimum dividend to be paid for the year should be at least5% of net worth or 30% of profit after tax whichever is higher. Taking into considerationthe above and other factors the Board recommended a final dividend of 171% (Rs.8.55 perequity share of Rs.5/- each) on the paid up share capital of Rs.304.65 crores. The totaldividend including Dividend Distribution Tax (DDT) for the year 2018-19 will be Rs.628.01crores as compared to Rs.499.23 crores for the FY 2017-18 which is an increase of 25.20%over previous year. As per Dividend Distribution Policy of the company DDT shall beconsidered as part of dividend. The dividend including DDT for the year 2018-19 works outto 51.67% of profit after tax of the Company for the year and is 6.06% of its net worth asat 31.03.2019.
The operating turnover of your Company registered a growth of 11.77%during the year under review increasing from Rs.6157.16 crores in the previous year toRs.6881.91 crores in the current year. Total expenditure increased by 8.93% fromRs.5074.10 crores in 2017-18 to Rs.5527.26 crores in 2018-19. The profit before taxworks out to Rs.1688.88 crores higher by 21.88% over 2017-18. After making provisionsfor income tax tax adjustments the net profit stands at Rs.1215.41 crores which is16.37% higher than last year. This increase in Profit After Tax (PAT) is attributable tobetter physical and financial performance during the year. The operating turnover and pAtduring the year 2018-19 are the highest ever achieved in any one year in the history ofCONCOR.
The throughput of your Company increased during the year 2018-19 incomparison to the year 2017-18. The segment-wise comparison is as under:-
As can be seen there has been an increase of 8.11% in EXIM and 10.23%in Domestic throughput. In terms of tonnage carried by rail the Company carried a totaltonnage of 43.50 million tons in current fiscal as against 39.97 Million tons in previousfiscal (2017-18) with an increase of 8.83%. The EXIM throughput total throughput andtotal tonnage (carried by Rail) by CONCOr are the highest ever volumes in the Company'shistory.
During the year CONCOR has participated in Freight Advance Scheme(FAS) of Indian Railways and has made an advance freight payment of Rs.3000 crores toIndian Railways on this account. After CONCOR's participation in FAS any increase in basefreight rates will not be applicable to it during the period the amount remains in advancewith the Railways however other charges like busy season charge development surchargeany discounts or concessions shall continue to apply as per concerned specific orders/circulars.
During the year the Company implemented sub-division of one equityshare of face value of Rs.10/- each into two equity share of face value of Rs.5/- each forwhich approval of shareholders through postal ballot route was taken. The Board ofDirectors recommended above sub-division in its meeting held on 30.04.2018 and after theapproval of shareholders on 12.06.2018 the same was carried out. Resultantly the capitalstructure of the Company was changed and the paid up share capital post sub-division stoodat Rs.243.72 crores comprising of 487435478 equity shares Rs.5/- each from earlierRs.243.72 crores consisting of 243717739 equity shares of Rs.10/- each. To enable theabove sub-division the Authorized Share Capital of the Company had also undergone a changefrom Rs.400 crores comprising of 40 Crores equity shares of Rs.10/- each to Rs.400 Crorescomprising of 80 Crores equity shares of Rs.5/- each. New ISIN allotted for Company'sequity shares having face value of Rs.5/- each is INE111A01025.
In addition to the above sub-division in equity shares in the month ofDecember 2018 issuance of one bonus equity share for every four equity shares held onrecord date was recommended by Board of Directors for which approval of shareholdersthrough postal ballot route was taken by the Company. After the approval of shareholdersthe Board of Directors allotted bonus shares on 07.02.2019 to the shareholders. As aresult of this bonus issue the paid up share capital of the Company increased fromRs.243.72 crores to Rs.304.65 crores comprising of 609294348 equity shares of Rs.5/-each.
There was no change in the overall percentage shareholding ofGovernment of India and others in the Company during the year 2018-19 and as on 31.03.2019their shareholding was 54.80% and 45.20% respectively.
LISTING AND DEMATERIALIZATION OF SHARES:
CONCOR has only one class of security i.e. equity shares listed withthe Stock Exchanges in India. CONCOR's equity shares are listed with the two boursesnamely BSE Limited (BSE) and National Stock Exchange of India Limited (NSE). The listingfees of both the stock exchanges have been paid. To facilitate dematerialization of sharesby its shareholders CONCOR has signed agreements with both the Depositories (NSDL &CDSL). As per SEBI guidelines CONCOR's shares have been placed under 'Compulsory DematMode'. Out of 609294348 equity shares of Rs.5/- each listed on the Stock Exchanges609289387 equity shares (99.9992% of the total equity shares) were in demat mode as on31.03.2019. The market capitalization of the Company was Rs.32006 crores as on 31.03.2019(as per closing price on last trading day of the year at NSE).
Capital Expenditure of Rs.768.35 crores approx. was incurred during theyear mainly on development/expansion of terminals acquisition of wagons handlingequipments and IT Infrastructure etc.
NEW TERMINALS & TERMINAL NETWORK EXPANSION:
During the year the Company has further strengthened its existingTerminal Network to provide efficient services to its customers. The Company has beenoperating at 83 terminals in total as on 31.03.2019 out of which 75 are its own terminals(14 pure EXIM 37 Combined Container 24 pure Domestic) and it has entered into 8 (eight)Strategic tie ups for various locations.
Three facilities were developed in FY 2018-19 and their dates ofcommencement of operations are as under:
Further atleast 5 (five) new facilities and completion of the balanceinfrastructure in few of the above facilities is planned during 2019-20. One Centre forDistribution Logistics has been opened at Chennai during the year. CONCOR will continuewith its plans for aggressive CAPEX programme for further development of new upcomingterminals.
As a part of overall strategy of expansion and entry into new areas ofbusiness to complement CONCOR's position as a Multimodal Logistics service providerCONCOR has commenced coastal shipping operations from 10.01.2019.
HIGH SPEED WAGONS CONTAINERS AND HANDLING EQUIPMENTS:
In order to strengthen and improve the service level during the yearunder review 180 Bogie Low Container (BLC) wagons and 320 Bogie Low Longer (BLL) wagonswere added to the existing fleet of CONCOR owned wagons increasing the holding of BLC andBLL wagons to 13417. During the year 1350 numbers of BLC wagons converted into BogieLow Container Modified (BLCM) rakes with increasing axle load capacity from 20.3T to 22T.Further 470 numbers of BLCM wagons have been taken on Lease for the period of 10 years.Therefore total wagons (BLC+BLCM+BLL+BFKHN +BVZI) holding including leased wagons as on31.03.2019 was 15498.
During the FY 2018-19 7080 twenty feet containers have been inductedin CONCOR's fleet of domestic containers. Further 2093 containers have been off-hired /auctioned during FY 2018-19. As on 31.03.2019 your Company has 25682 (owned plus leased)containers.
During the year 2018-19 11 numbers of SANY make Reach Stackers (RSTs)and 9 numbers of TIL make RSTs have been commissioned and added to the existing fleet ofCONCOR owned RSTs. The condemnation of 17 nos. of Linde make RSTs out of 20 RSTs wasdecided in which 16 nos. RSTs have already been decommissioned by respective terminals. Ason 31.03.2019 the Company owns 82 RSTs and 16 Gantry cranes.
Your Company continued to make progress in the field of InformationTechnology (IT). The VSAT based hybrid network has been extended and now it covers 82locations. The Terminal Management System for Domestic (DTMS) for EXIM (ETMS) ERP forOracle Financial HR Payroll Container Repair System Operation system was implementedfor the expanded network of terminals and a Data Warehouse Module for commercialapplications on centralized architecture is running smoothly across fieldlocations/Regional Offices and Corporate Office.
The web enabled Customer interface through a dedicated Web Server isrunning successfully providing facilities to the customers. The customer feedback facilitysystem as implemented on the website enables us to constantly evaluate our performance andtake corrective action on Customer complaints and feedback.
Public Grievance lodging and monitoring system has been deployed onCONCOR's website for Grievance Redressal system. This system has been developed in linewith the O.M. dated 18.02.2013 of Department of Administrative Reforms & PublicGrievances. The objective of the system is to reduce time in addressing grievance toincrease transparency and round the clock access for lodging and monitoring grievance.
The Electronic-filing of documents on the Commercial System initiallyprovided at ICD/Tughlakabad have now been extended to all EXIM terminals which enable thecustomers to file their documents electronically from their own offices and on-linepayment mode of NEFT/RTGS has been enabled. As part of business continuity plan CONCORhas established backup site and standby system at primary site for its commercial businesscritical applications. CONCOR has been re-certified ISo/iEC-27001: 2013 certification fromSTQC IT Certification Services (Ministry of Communication & Information Technology)for establishing an Information Security Management System (ISMS).
As an extension of existing HRMS employee portal has been introduced.This system facilitates employees to
access information regarding salary/ reimbursements leave balances PFstatement view and submit their APAR online online submission of Annual Property returnpension details etc. and employee has option of viewing of the information on the screenand the printout of the same can also be taken for the record. Online payment systems forCorporate Office and all regions are implemented from Oracle Financials.
e-tender system with e-payment facility for sale and EMDelectronically MSE exemptions has also been introduced. Recruitment on CONCOR's websiteis integrated with online payment gateway for collection of fees. CONCOR has implementedreverse auction and has re-designed its Corporate website to the responsive website.
The e-Samarth application for Online Vigilance Clearances to handlebulk NOC request creation and approval and workflow driven system has been evolved. Thishas increased transparency and drastically reduced the total time of according NOC forvarious purposes. Similarly e-Voting was successfully done for CONCOR shareholders andfile tracking system was implemented at Corporate office of CONCOR. Document ManagementSystem for Company Secretary Module Reimbursement Bills e-meeting app for conductingpaperless Board and Committee meetings of CONCOR and its Subsidiaries have beenimplemented.
CONCOR has launched its mobile app for disseminating the information(public tariff rail tariff track & trace Company directory etc.) for itsstakeholders and has launched mobile app for Exim e-filing (covering reports &queries) for its stakeholders.
CONCOR has implemented:
(i) E-office replacing the physical files with electronic files as astep towards office automation and paperless working.
(ii) E-contractor billing for online submission of invoices bycontractors through their digital signature and online payment by CONCOR.
(iii) Know Your Container Location (KYCL) for online track and trace ofcontainer for its customers through mobile app chatbot etc.
CONCOR continues to enjoy ISO 9001:2015 certification and as on31.03.2019 70 Nos. of Terminals (including Corporate Office and 8 Nos. Regional Offices)were ISO 9001:2015 certified. It is an illustration of the total commitment of yourCompany towards Quality Management System. Quality Policy clearly provides for ensuringcomplete customer convenience & satisfaction and value for money through continualimprovement of system and processes. The Quality Policy has been prominently displayed atall locations of CONCOR. Safety Slogans are displayed at prominent locations at variousterminals of CONCOR. ISO Certification is available for most of the units of the Company.Disaster Management System has been hosted on CONCOR website. Further in its endeavor tomaintain high standards of quality your Company has been taking various steps some ofwhich are as follows:
Conducting periodical Management Review Meetings whereinvarious actions were taken with regard to Disaster Management Safety Norms and QualityStandards.
Quality Audits were undertaken from time to time by QualityAuditors who have been trained internally for this purpose. Special emphasis was made on'Swachh Bharat" campaign in physical cleanliness of the workstation & otherplaces so as to have a positive and vibrant synergy of work environment and cleanliness.
Annual Surveillance Audit was undertaken by an independentagency for a number of units.
The process of migration from ISO 9001:2008 to ISO 9001:2015 hasbeen successfully completed during 2018-19.
Successful implementation of e-Office has been done on pan Indiabasis during the financial year.
JOINT VENTURES (JVs) / STRATEGIC ALLIANCES:
Your Company continued to place emphasis on providing total logisticsand transport solutions to its customers by exploring the possibilities of expanding thepresence of the Company in all segments of Logistics value chain in the EXIM as well asDomestic segments. Strategic alliances firmed up both for optimal utilization ofinfrastructure as well as expansion into other segments of the value chain for effectivelyachieving the goals.
The company has several joint ventures whose performance are given inthe financial statement. The particulars of JVs which are also subsidiaries are as under:
SIDCUL CONCOR Infra Company Ltd. (SCICL) a Joint Venture Company (JVC)with shareholding of 74% and 26% of Container Corporation of India Limited (CONCOR) andState Infrastructure & Industrial Development Corporation of Uttarakhand Ltd.(SIIDCUL) respectively has developed a Multimodal Logistic Park (MMLP) at Pantnagarlocated approx. 300 mts from Rudrapur-Haldwani State Highway and approx. one km. from theNH- 87. SCICL is doing operations in both the stream i.e. EXIM and Domestic.
During FY 2018-19 SCICL handled 364 rakes. The containers handled atMMLP Pantnagar for the said period were 29049 TEUs and it has also handled NMG Rakes atits terminal. Its revenue from business operations for the said period was Rs.8.51 croreswhich was Rs.6.76 crores in FY 2017-18 reflecting the growth of 25.89% over previousyear. The JVC is expected to emerge as a major logistics service provider for raillogistics for the rapidly industrializing State of Uttarakhand.
Punjab Logistics Infrastructure Limited (PLIL) is a JVC of CONCOR andPunjab State Container and Warehousing Corporation Limited (CONWARE). This Company hasdeveloped a MMLP in the State of Punjab facilitating trade and industry of the State andputting them on International map.
During the year PLIL achieved turnover of Rs.20.24 crores which isalmost double than what was achieved during the previous financial year. The TEUs handledthis year has been 20178 as compared to 11790 in 201718. The inward movement of TEUs was17254 which was 50% higher than the previous year. The company is venturing into newbusinesses viz. warehousing of grains parking of vehicles etc. SILOS project is alsobeing planned which is likely to generate a significant portion of the revenue in future.
The above two Companies i.e. SCICL & PLIL are also subsidiaries ofyour Company as it is holding majority of shares in these companies.
While the existing Joint Ventures continued to perform to their fullpotential contributing to the growth of the core business of CONCOR following newstrategic alliances were made during the year:
Agreement with Kribhco Infrastructure Limited (KRIL) was enteredinto on 16-05-2018 whereby CONCOR will operate and manage the bonded area of ICD Pali.
Agreement with Bangalore Airport Terminal Services Pvt. Ltd.(BATS) on 12-06-2018 for undertaking Ground Handling & other air cargo relatedactivities at various airports in India to further expand the wings into these activities.
Agreement was signed with M/s Shiv Carriers Roadways Pvt. Ltd.(SCRPL) on 20-08-2018 at Ahmedabad for exclusive Containerised operations by CONCOR atSukhpur.
Memorandum of Understanding (MoU) was signed with KandlaInternational Container Terminal Pvt. Ltd. (KICTPL) in August 2018 wherein CONCOR shallhave exclusive rail access to run the container rakes between KICTPL and variousICDs/Ports for movement of EXIM containers by rail. The MoU aims to promote seamlessconnectivity and faster clearance of EXIM containers from Kandla Port.
To form a Joint Working Group (JWG) with M/s. CentralWarehousing Corporation Ltd. (CWC) an agreement was entered into with them on 10-09-2018to operate the CFS facility of M/s. CWC located at Pipavav Port for the mutual benefit andto promote and meet the growing needs of exports imports and domestic business situatedin and around Pipavav Port as well as to the Multimodal Transport requirements of thecountry in general.
Agreement with M/s. KRIL was entered into on 17-10-2018 whereinCONCOR will operate & manage the Bonded Area at KRIL's Terminal at Modinagar forhandling of EXIM traffic. This will help to promote and meet the growing needs of EXIMbusiness situated in its hinterland.
MOU signed with M/s. ITE Japan on 22-01-2019 for improvement incold storage logistics.
MOU has been signed with JSC RZD Logistics Russia on 30-01-2019for exploring the logistics opportunities in Russia India and International Corridorsbut not limited to the International North South Transportation Corridor (INSTC).
WHOLLY OWNED SUBSIDIARIES:
CONCOR had incorporated M/s. Fresh & Healthy Enterprises Ltd.(FHEL) in the year 2006 as its wholly owned subsidiary to create world class cold storageinfrastructure in the country to provide complete cold chain
logistics solutions to various stakeholders in this field.
With the changed business dynamics on account of implementation ofGoods and Service Tax (GST) and Customized Storage requirements a new business plan wasfinalized in March 2018 for re-engineering of the facility of FHEL at Rai Sonepat in twophases for development as an Agri-Logistics Centre.
For purpose of modification of existing facility under Phase-I ofre-engineering plan CONCOR infused Rs. 13.45 Crores by way of fresh equity subscriptionin FHEL in April 2018. Partial commissioning of the plant was made in July 2018 and 24chambers made available for storage of fruits eggs kirana etc. Further MezzanineFloors have been erected in 24 chambers under Phase-I of the plan and modification work onanother 26 CA chambers is likely to be completed before coming apple season.
One of the major development that took place in March 2019 is thatone-third of the existing Rai facility was notified as a Custom bonded warehouse. Withsuch conversion into Custom bonded warehouse importers/exporters are likely to bebenefitted with reduced overall logistics costs. Operations have also started in theCustom bonded warehouse with the storage of walnuts and apples. As a result of re-startingof operations FHEL reduced its net loss by 21% approx. i.e. from Rs.1062.50 lakhs inFY2017-18 to Rs.838.84 lakhs in FY2018-19.
On account of recent notification for Custom bonded warehouse and thisadditional revenue stream which was not envisaged at the time of making re-engineeringplan in March 2018 and experience of operations of last one year the earlierre-engineering plan was reviewed in April 2019. After the review a revised plan fordevelopment of additional infrastructure under Phase-II has been approved with funding ofRs.30.86 Crores by way of fresh subscription to equity shares by CONCOR.
Further CONCOR's Board has agreed in its meeting held on 30.04.2019to convert the outstanding loan from FHEL of Rs.37.53 crores along-with interest accruedand due of Rs.17.91 crores (net of TDS) as on 31.03.2019 plus further interest accruals(net of TDS) on the said loan till the date of its conversion into equity. Later theabove loan along with interest accured thereon till the date of its converstion intoequity totaling to Rs.55.89 crores was converted into Equity Share Capital of FHEL on14.06.2019.
In order to expand its span of operations and make its presence felt inAir cargo business with a view to establish itself in this Industry CONCOR had formedearlier CONCOR Air Ltd. (CAL) in the year 2012. It is 100% subsidiary of CONCOR and hasan authorised share capital of Rs.50 crores. The objectives of CAL are:
To undertake Air Cargo related activities in International aswell as Domestic circuit.
To contribute in the development of Air Cargo business of thecountry by providing end to end solution to the customers through the mode of bondedtrucking of Import/Export cargo from the various hinterlands to the Airports.
To provide warehousing facilities to International &Domestic Air Cargo and to facilitate the clearance of EXIM & Domestic Air Cargo.
CONCOR Air Ltd. has made its presence felt at Chatrapati ShivajiMaharaj International Airport in the field of domestic and international air cargo relatedactivities by entering into concession agreements with Mumbai International Airport Ltd.(MIAL).
Domestic Air Cargo Concession:
In February 2013 CONCOR Air Ltd. has entered into an agreement withMIAL under which SANTACRUZ AIR CARGO TERMIAL (SACT) has been developed by CONCOR Air Ltd.SACT is a State-of-the-art GREEN terminal with ultra-modern facilities for storage ofcargo handling screening cold storage etc. SACT was commissioned on 09.06.2016. Beforecommissioning of SACT CAL had taken over the existing Domestic Common User Terminal ofMIAL at Marol for operations w.e.f. 01.05.2013. During the year at SACT CAL has handleddomestic air cargo of major five airlines viz; Jet Airways Indigo Spicejet Go Air andVistara. During the FY 2018-19 a new Airline has commenced its air cargo handlingoperations at SACT i.e. Air Asia.
International Concession Agreement:
CAL has successfully completed its concession period with MIAL for itsinternational Operations which ended on 15th April 2018.
CAL has earned a net profit of Rs.3.78 lakhs after tax during FY2018-19. The paid up equity capital of the company was Rs.36.65 Crores as on 31.03.2019.
CONSOLIDATED FINANCIAL STATEMENTS:
The Consolidated Financial Statements of the Company prepared inaccordance with the provisions of the Companies Act 2013 and the applicable IndianAccounting Standards (Ind AS) forms part of the Annual Report of the Company.
HUMAN RESOURCE MANAGEMENT:
Human Resource Management (HRM) in organisation is designed to maximizeemployee performance to achieve strategic objectives. HR is primarily concerned with themanagement of people within organizations focusing on policies and systems. Being aprogressive organisation CONCOR firmly believes in the strength of its most vital asseti.e. Human Resource.
CONCOR has adopted and aligned its HR strategy vis-a-vis systems &procedures taking into account the business objectives and competence building needed forthe organisation. HR strategy acts as a motivating factor for the employees who contributeto the core competence of the organisation to create a match between the Company's futureneeds and the aspirations of individual employees.
CONCOR's HR Philosophy is rooted in encouraging employee empowermentgrowth and development of individuals by realizing their potential encouraging innovativeideas and fair distribution of rewards. Its work culture is open and dynamic enablingemployees to take initiative in job with active support of the top management. It is anemployer of choice and attracts the best available talent with skill sets required for thegrowth and development of the organization.
Right placement and refinement of employees is the primary functionafter induction by which the Company maintains alignment of individual performance andgoals with that of CONCOR goals.
Great care is taken to maintain safe and hygienic working climate andto provide working environment to the employees conducive to their good health. Theoccurrence of industrial accidents is minimal.
CONCOR offers various voluntary benefits (apart from statutorybenefits) to its employees. These are offered in the form of options to the employees tochoose from a mix of perks and allowances available subject to a maximum ceiling. Inaddition to allowances and benefits covered in the cafeteria approach perks in the formof residential accommodation; telephone instruments/service; advances and welfareamenities are provided to employees.
Provision has been made for timely delivery of HR services throughRight to Service for time bound delivery of HR services and benefits.
The Company has a performance oriented culture wherein contribution ofevery employee to the organization is measured and suitably rewarded. CONCOR has a soundand result oriented Performance Management System (PMS). The system promotes CONCOR'sphilosophy of rewarding and recognizing meritocracy at all levels and support developmentof executives through a structured approach woven into the appraisal of the Company.
CONCOR has an exclusive training centre at Gurugram to cater toemployees' developmental needs. It conducts both in-house and specialised topic basedtrainings as per organisational and employees needs from time to time. Feedback ofemployees and reporting authorities is reviewed constructively and accordingly nexttraining calendar is scheduled. Employees are put to 'On the Job Training Programmes' andare evaluated to get an understanding of the suitability of the employee for his/her rightplacement and also to understand specific developmental needs of employees.
The Company provides wider opportunities for growth to its employees.Being a young organisation with an average age of employees at 40 years it has formulateda comprehensive Performance Management System (PMS) in order to identify not only the jobperformance of the employee but also analysis of employee's behavior and personalitytraits under various descriptions of personality. It gives an idea of employee's trainingand developmental needs and thus contributes majorly to the succession planning of theindividual and thereby helps in the analysis of an employee for his placement for aparticular job.
With a view to keep our below board level employees/ officers preparedfor the future requirement of the organisation young managers have been placed as thehead of the terminals and departments under Group General Managers and ExecutiveDirectors who have been placed as head of the Regions and departments. The attrition rateis around 2% owing to CONCOR's employee welfare and career development policies.
Sound and healthy Industrial Relations (IR) is the pivot around whichthe entire business operations revolve. CONCOR believes in community of interests and notin conflicts of interests. Various interest groups strive to further goals in theorganisation and resolution of conflicting interests in a positive manner reinforces faithin the system besides imbibing strength to face external threats. CONCOR maintainedindustrial peace and harmony and no mandays were lost during the year. Positive IR hasbeen the goal of HR department wherein CONCOR provides two way communicationparticipative culture open platforms for discussion for ideas and motivation of theemployees.
CONCOR is a Central Government Public Sector Undertaking (PSU). Itfollows all Government mandates in true spirit. The representation of such categoriesagainst the total strength of 1463 as on 31.03.2019 is as under:
Further the details of reserved category candidates who have beenrecruited/ appointed during the year 201819 are as under:
Your Company continued to excel in fields of its activities and was aproud recipient of the following awards
during the year:
Awarded for 'Highest Wealth Creator - Market Returns Navratna -Non-Manufacturing' under India's Best PSU Awards 2017 by Dalal Street Investment Journal(DSIJ) on 18.05.2018.
CONCOR's Balasore terminal was chosen for 'Smart DCT award' byMaritime Gateway under Smart Logistics Award 2018 at Bhubaneswar on 19.06.2018.
Dun & Bradstreet PSU Awards 2018 under Transport &Logistic Services category by Shri Bibek Debroy Chairman Prime Minister's EconomicAdvisory Council on 24.07.2018.
CONCOR's ICD Sanathnagar was conferred with 'SMART LOGISTICSAWARD' by Maritime Gateway at the Smart Logistics Summit 2018 at Hyderabad on 03.08.2018.
SKOTCH Order-of-Merit 2018 Award during the 53rdSkotch Summit at Constitution Club of India New Delhi on 19.09.2018.
Star of the Industry Awards by ET Now under the category"Best Freight Service Provider: Rail" at New Delhi on 21.12.2018.
Amity Excellence Award for Best Practices in Logistics during 19thINBUSH ERA World Summit 2019 at Noida (UP) on 21.02.2019.
Smart Railway Operator Award at Smart Logistics Summit atKolkata on 21.02.2019.
Inland Container Depot & Rail Operator of The Year (Public)at Northern India Multimodal Logistics Awards at New Delhi on 22.02.2019.
ENERGY CONSERVATION AND TECHNOLOGY ABSORPTION:
The relevant information on conservation of energy and technologyabsorption stipulated under Section 134 of the Companies Act 2013 read with Rule 8 of TheCompanies (Accounts) Rules 2014 are as under:
For energy conservation and technology absorption virtualization isbeing done in the servers of major applications which is the latest technology with theobjective to reduce hardware power onsumption and the cooling requirement.
To save power multiple servers are also being controlled throughsingle console instead of having the separate monitors which save power as well as reducecooling requirement. Most of the CRT monitors have been replaced by LCD/LED monitorswhich have reduced the power requirement drastically. Most of the latest CPU/ Monitors /Printers of desktops /laptop are configured in power saving mode.
In addition to above to conserve energy and to reduce powerrequirement/ heat dissipation wherever possible consolidation is practiced as perrequirement.
The Company is using fuel efficient Rubber Tyre Gantry (RTG) Cranes andReach Stackers (RST) Machines for handling of containers usage of fuel efficient powerpacks to feed power supply to refrigerated containers while transporting to ports. Furtherenergy efficient Rail Mounted Gantry (RMG) Cranes and improved warehouse design is beingused by making them more energy efficient.
FOREIGN EXCHANGE EARNINGS & OUTGO:
During the year there were no foreign exchange earnings. The detailsof foreign exchange outgo are as under:
RESEARCH & DEVELOPMENT (R&D):
CONCOR is upgrading its High Speed Rolling Stock to 22MT axleload to provide economic transportation to trade while at the same time improvingthroughput of Railway System.
Procurement of6000 high capacity containers of 34 Ton inlinewith the upgrading capacity of wagons.
Analytical Studies were conducted for reducing empty running oftrains and developing software for optimization of double stacking of containers.
CONCOR has placed an order for 24 Nos of RSTs on Indian BiddersM/s TIL which is in line with preference to Make in India through Global Tender.
CONCOR has taken the initiative for using the Ice Batterytechnology for storage of cargo under controlled atmosphere for the transportation ofvegetables fruits etc. at the required temperature.
First time procurement of 34 Ton Dry Freight Containers andprocurement of 25 Ton axle high speed BLCS wagons.
No Presidential Directives were received from the Government during thefinancial year 2018-19.
CONCOR implements Government of India Official Language policy inletter and spirit. The provision of Section 3(3) of the Official Language Act 1963 hasbeen fully complied with. The letters received in Hindi were also replied in Hindi.
Quarterly meetings of Official Language Implementation Committee wereheld regularly to review the progress made in promoting use of Hindi in CONCOR and thedecisions taken therein were properly implemented. During the year regional officesincluding corporate office were inspected in order to rectify shortcoming being faced byits employees in use of Hindi in their official work. Hindi workshops on various topicswere organised to create awareness amongst employees in regard to provisions of OfficialLanguage Act and official language rules.
Hindi Pakhwara was organized from 14th to 28thSeptember 2018 in which four competitions were held and about 120 employees participatedin these competitions. Total 39 employees were honored with cash prize and
certificates. A Hindi Kavi Sammelan was also organised during thepakhwara to promote Hindi language which was well received by CONCOR family.
62 employees were given cash awards for doing their official work inHindi under "CONCOR Rajbhasha Puraskar Yojna" for the year 2017-18. Twoofficials were awarded with late Dr. Shankar Dayal Singh Smriti puraskar 2017 for theirsignificant contribution towards promoting Hindi in official work.
CONCOR keeps its library enriched by acquiring Hindi Books of famousauthors on various streams of Hindi literature. The number of books in the library hasincreased to 2458 in which 1740 are Hindi books. 82 New Hindi Books were purchasedduring the year 2018-19. Leading newspapers as well as monthly and fortnightly magazinescontinue to be subscribed. To promote original writing in Hindi & to familiarize withCompany's activities a magazine 'Madhubhasika' has been published regularly. Goodarticles published in this magazine are also suitably awarded. It is also uploaded oncompany's website. CONCOR's website is bilingual and all computers have Unicode facilityto work in Hindi which is being utilised by its officials for doing work in Hindi.
CONCOR constantly endeavours to optimise probity and integrity amongstemployees and to promote transparency fairness and accountability in all areas. Toachieve this objective the Vigilance Department of CONCOR carries out preventiveproactive and punitive actions with greater emphasis in the preventive and proactivefunctions. Following activities were undertaken during the financial year 2018-19.
During the year 2018-19 19 Preventive / Surprise /CTE type checks wereconducted at various Regional Offices / Inland Container Depots/ Container FreightStations of CONCOR. In addition cases were registered / investigated on the basis ofcomplaints and other information. Periodic surprise checks were conducted regularly invulnerable areas of the Company. Suitable penal action was taken against erring officialsand contractors. An amount of Rs.80.67 lakhs was recovered from various contractors/customers during the financial year. During the year Vigilance division disposed off 12cases and 07 cases relating to non-compliance of tender conditions violation of rules andprocedures etc. are pending.
On the suggestion of Vigilance Division respective user departmentshave issued 10 circulars for improvement in systems and procedures. One of the importantsystem improvement carried out at the behest of Vigilance Division was in the area ofdisposal of unclaimed / uncleared goods lying with custodians. On the basis of the reportsubmitted to CVC by the Vigilance Division the Commission directed CONCOR to prepare aStandard Operating Procedure (SOP) for disposal of unclaimed/ uncleared goods lying at itsvarious ICDs/CFSs. Accordingly a draft SOP was prepared by CONCOR and the same wasforwarded to CBIC. On the basis of the draft SOP forwarded by CONCOR Customs Departmentissued revised guidelines/ procedures vide Circular No. 49/2018-Customs dated 03.12.2018for disposal of unclaimed/ uncleared cargo lying with the custodians. The revisedguidelines have resulted in improvement of the system by removing various ambiguitiesfixing the roles of Customs and Custodians and laying a time line to complete the process.
In order to disseminate information among field functionariesVigilance Division organised regular training programmes/ workshops in different Regionscovering topical issues such as D&A Rules Facets of Vigilance and Civil EngineeringWorks etc. Vigilance Division has also released first in-house edition of the vigilance e-bulletin named The purpose of the e-bulletin is to disseminate the latestvigilance instructions and showcase best practices in the field of vigilance. This willcreate awareness and sensitize all officers and staff to discharge their dutiesconsciously meticulously and fearlessly. The e-bulletin is available on CONCOR website.
Information technology is being extensively utilised to ensuretransparency in functioning of various modules such as e-office e-billing e-tenderinge-payments e-receipts e-filing e-auction & reverse auction etc. thereby instillingconfidence of being just and fair organisation amongst our customers business associatesand other stakeholders.
Vigilance Awareness Week (VAW) was observed in all offices of CONCOR byundertaking various activities during the period from 29th October to 3rdNovember 2018. The theme of the Vigilance Awareness Week -2018 was "EradicateCorruption- Build a New India'. VAW-2018 was marked by numerous activities/ competitionsin schools colleges universities Gram Sabhas workshops/ interactive sessions etc.Banners on the VAW theme were displayed at various offices and public places. Severalworkshops seminars nukkad natak Grievances Redressal Camps were organised involvingemployees customers and contractors/ vendors. Essay slogan writing and debatecompetitions were organised for employees and student community. As a new and uniqueinitiative CONCOR flagged off 08 container trains designed as "Satarkata ExpressContainer Train" to create
awareness against corruption amongst the public. The trains carriedpictorial stickers pasted on the containers with messages and slogans related to vigilanceawareness including on the current theme 'Eradicate Corruption-Build a New India'. Themessage and slogans on such containers was disseminated to the general public as thecontainers moved across the length and breadth of country by rail as well as road. Thefirst container train was flagged off by Shri Girish Pillai Member (Traffic)/ RailwayBoard from New Delhi to Chennai in the presence of Shri Sunil Mathur Principal ExecutiveDirector (Vigilance) /Railway Board CMD CVO Directors and other senior officers ofCONCOR & Railways.
In order to motivate the employees in recognition to their contributionin vigilance management the award for "Most Vigilant Employee of the year'' isconstituted and this year the award was given to 'Smt. R Srividya' Additional Officer(C&O)/ Southern Region and 'Shri Himanshu Gautam' Sr. Assistant (C&O)/NorthCentral Region during Vigilance Awareness Week.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 your Directorshereby confirm that:
i) In the preparation of the annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures.
ii) The Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit and loss of the Company for that period.
iii) The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities.
iv) The Directors have prepared the annual accounts on a going concernbasis.
v) The Directors have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and wereoperating effectively.
vi) The directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
MANAGEMENT DISCUSSION AND ANALYSIS:
The detailed Management Discussion and Analysis forms a part of thisreport at Annexure-A.
CORPORATE GOVERNANCE & GREEN INITIATIVE:
Your Company has taken structured initiatives towards CorporateGovernance & its practices are appreciated by various stakeholders. Your Companybelieves in the principle that good Corporate Governance establishes a positiveorganizational culture and it is evident by responsibility accountability consistencyfairness and transparency towards its stakeholders. As required under SEBI (LODR)Regulations and DPE guidelines on Corporate Governance a separate report on CorporateGovernance practices followed by the Company forms part of this Report at Annexure-B.
A Practicing Company Secretary has examined and certified yourCompany's compliance with respect to conditions enumerated in SEBI (LODR) Regulations andDPE guidelines on Corporate Governance. The certificate required in DPE guidelines andSEBI (LODR) Regulations forms part of this Report at Annexure- C.
As a responsible corporate citizen and to reduce carbon foot printyour Company has actively supported the implementation of 'Green Initiative'. Electronicdelivery of notice of Postal Ballot notice of Annual General Meeting (AGM) and AnnualReport alongwith other communications is being done to those shareholders whose email idsare already registered with the respective Depository Participants (DPs) and downloadedfrom the depositories i.e. NSDl/CDSL and who have not opted for receiving Annual Report inphysical form. Accordingly unless otherwise desired by the shareholders the Companysends all documents to the shareholders viz. Notice intimation for dividend AuditedFinancial Statements Directors' and Auditors' Report etc. in electronic form to theirregistered e-mail addresses.
CORPORATE SOCIAL RESPONSIBILITY (CSR) AND SUSTAINABLE DEVELOPMENT:
CONCOR's social activities in FY 2018-19 were continued to be focussedon development of society with prime focus on school education and health in terms ofguidelines issued by Department of Public enterprises (DPE). However activities in otherareas like sanitation skill Development environment sustainability etc. have also beentaken up for the welfare of our stakeholders. Some of activities undertaken by companyunder CSR are :
Solar lights and handpumps have been installed in the rural areas ofGhazipur and Sultanpur Uttar Pradesh.
Skill development activities were completed in the field of Garment andLogistic section in Uttar Pradesh Andhra Pradesh Tamilnadu and Gujarat benefiting 560youths belonging to backward classes.
Preventive Health camps continued to be organized like previous yearsat 27 major locations of CONCOR facilities benefiting approximately 54195 stakeholders byorganizing 86 health camps which have been able to support CONCOR stakeholders towardsfighting their basic health issues.
Support was also extended towards infrastructure development ofhospitals in Chattisgarh and Andhara Pradesh for the benefit of common man of societyincluding support towards cochlear implants surgery to children with hearing impairment.
To promote sanitation among masses toilet blocks including toilets inschools and at public places were constructed in Jahanabad (Bihar) and Ghazipur andVaranasi (Uttar Pradesh) Sonepat (Haryana) and Chennai (Tamil Nadu). Construction ofpublic toilets have been taken up at various Railway Stations of Western Railwaydistricts.
Infrastructure Development of schools found a major place in CONCOR CSRactivities covering Shravasti (UP) Purnia (Bihar) Gauatambudh Nagar (UP) and Kannur(Kerala) districts in which construction of classrooms have been taken up.
In view of guidelines issued by DPE towards CSR expenditure inaspirational districts CONCOR took up four aspirational districts i.e. ChandualiSharavasti in Uttar Pradesh Visakhapatnam in Andhra Pradesh and Asifabad in Telangana forits CSR activities. The focussed areas of CSR activities in these districts have beenschool education and health care activities. Construction of classrooms includingconstruction of Science labs procurement of health equipments like x-ray plants cellcounter/ bio chemical analyzer RO plants and ultra sound machines etc. have been taken upin Asifabad district of Telengana.
Fillip to sports was also undertaken by CONCOR by extending helptowards creation of sports infrastructure /facilities in Nagaon at Assam and Visakhapatnamat Andhra Pradesh as well as contribution in National Sports Development Fund set up byGovt. of India.
CONCOR's commitment to support education to underprivileged section ofsociety continued this year by supporting 30 bright students towards preparation forhigher studies in Uttar Pradesh as well as in Delhi where it furthered its supporttowards operation of a primary school run for slum children benefitting 250 such children.Similarly infrastructure support like maintenance of school buildings provision ofbenches computers toilets R.O. water and other interventions were taken up in schoolsof Ghazipur (Uttar Pradesh) Gautambudh Nagar Khatuwas (Rajasthan) benefitting more than2000 students.
CONCOR took up welfare of Armed forces by contributing in Armed ForcesFlag Day Fund for the welfare of war widows and their dependents.
In terms of funds allocated as per Companies Act 2013 includingunspent balance of previous year towards CSR Expenditure for FY 2018-19 an amount ofRs.13.39 crores has been disbursed towards various CSR activities during the year.
CONCOR is working tirelessly towards achieving sustainable developmentof its stakeholders in order to fulfill its social responsibility towards society in linewith its CSR policy and vision.
The particulars of CSR activities for the year in the form of theAnnual Report on CSR activities is as per Annexure-D to this report.
As per the requirement of SEBI (LODR) Regulations 2015 the Company ishaving a Board level Risk Management Committee. The particulars of Committee are stated inthe Corporate Governance Report forming part of this Report. The Company has a well laiddown Risk Management (RM) system to identify evaluate risks and opportunities. The saidsystem seeks to create transparency minimize adverse impact on the business objectivesand enhance the Company's competitive advantage. The risk management system defines therisk management approach across the enterprise in various business activities. The RMstructure has different risk models which help in identifying risk trends exposure andpotential impact analysis at Company level and also separately for business segments. Itforms an integral part of the Company's functioning and the Board of Directors are beingregularly apprised about the status of various risk elements and the mitigation plans forthe same.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
CONCOR's Internal Control Systems are commensurate with its size scaleand complexity and nature of its business activities. Internal audit constitutes animportant element in overall internal control systems of the Company. The scope of work ofthe internal audit is well defined and is very exhaustive to cover all crucial functionsand businesses of the Company. The internal audit in the Company is carried out by theindependent professional firms appointed for this purpose.
The respective department of the Company monitors and evaluates theefficacy and adequacy of internal control system in the Company its compliance withoperating systems accounting procedures and policies. Based on the report of internalauditors' necessary steps are taken at regular intervals to further strengthen theexisting systems and procedures. The significant observations of internal auditors andcorrective actions thereon are presented to the Audit & Ethics Committee of the Boardat regular intervals. In addition the implementation and effectiveness of internalfinancial controls during 2018-19 was also reported by the internal and statutory auditorsof the Company.
PARTICULARS OF EMPLOYEES:
As per provisions of section 197 of the Companies Act 2013 read withthe Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014every listed company is required to disclose the ratio of the remuneration of eachdirector to the median employee's remuneration and such other details as may be prescribedin the Directors' Report. However as per Notification No. GSR 463(E) dated 5th June2015 issued by the Ministry of Corporate Affairs Government Companies are exempted fromcomplying with provisions of section 197 of the Companies Act 2013. Therefore CONCORbeing a Government Company such particulars are not included as part of Directors'Report.
Being a Government Company the Comptroller & Auditor General(C&AG) of India had appointed Company's Statutory and Branch/Regional Auditors for thefinancial year 2018-19. M/s. Arun K Agarwal & Associates Chartered Accountants wereappointed as Company's Statutory Auditors for the year 2018-19. The statutory auditorswere appointed by C&AG vide its letter No. CA.V/COY/CENTRAL GOVERNMENTCCIL(9)/382dated 31.07.2018. The Statutory Auditors of the Company is being paid an audit fee ofRs.400000/-. The Statutory Auditors have audited the Annual Financial Statements(Standalone and Consolidated) of the Company for the financial year ended on 31.03.2019.The replies of the management to the observations of Statutory Auditors' in their reportson standalone and consolidated financial statements are enclosed as Addendum-I andAddendum- II to Directors' report.
The Comments of C&AG for the financial year 2018-19 are beingprovided elsewhere in the Annual Report. Further CONCOR is not required to maintain costrecords as required under section 148 of Companies Act 2013 and rules made thereunder.
BOARD OF DIRECTORS:
CONCOR being a Government Company the appointment of directors on itsboard are communicated by the Ministry of Railways from time to time. During the financialyear 2018-19 seven meetings of the Board of Directors were held for transacting variousbusinesses. During the year and upto the date of this report the directorship in theCompany are under:
Shri V. Kalyana Rama Chairman and Managing Director [DIN: 07201556]
Shri Pradip K. Agrawal Director (Domestic Division) [DIN: 07557080]
Shri Sanjay Swarup Director (Intl. Mktg. & Ops.) [DIN: 05159435]
Shri Rahul Mithal Director (Projects & Services) [DIN: 07610499]
Shri Manoj K. Dubey Director (Finance) & CFO [DIN: 07518387] (w.e.f.31.10.2018)
Shri Sanjay Bajpai Govt. Nominee Director [DIN: 07549036]
Shri Manoj Kumar Srivastava Govt. Nominee Director [DIN: 06890877] (w.e.f.30.04.2018)
Ms. Vanita Seth Independent Director [DIN: 07944119]
Shri Lov Verma Independent Director [DIN: 07560071]
Shri Anjaneya Prasad Mocherla Independent Director [DIN: 03645659]
Shri Deepak Shetty Independent Director [DIN : 07089315] (w.e.f. 14.07.2018)
Shri Jayasankar M.K. Independent Director
Shri Kamlesh Shivji Vikamsey Independent Director [DIN: 00059620] (upto31.03.2019 and re-appointed w.e.f. 01.04.2019 for one year)
Shri Sanjeev S. Shah Independent Director [DIN: 00323163] (upto 31.03.2019 andre-appointed w.e.f. 01.04.2019 for one year)
Shri Prabhas Dansana Govt. Nominee Director [DIN: 07973307] (upto 18.04.2018)
In terms of order of the Ministry of Railways Government of India ShriDeepak Shetty was appointed as nonofficial part-time (Independent) Director w.e.f.14.07.2018. Shri Manoj Kumar Srivastava EDTT(F) Railway Board was appointed as apart-time Government director w.e.f. 30.04.2018. In terms of order of the Ministry ofRailways Government of India Shri Jaya Sankar M. K. was appointed as non-officialindependent Director by the Board on 31.07.2019 for a period of three years ending on07.07.2022. Also after the completion of their tenure on 31.03.2019 Shri Kamlesh ShivjiVikamsey and Shri Sanjeev S. Shah were re-appointed as nonofficial independent Directorw.e.f. 01.04.2019 for a period of one year by the Board on 31.07.2019. In terms ofprovisions under SEBI Regulations CONCOR being a listed Company and having an executivechairman 50% of its Board of Directors should comprise of independent Directors howeverthe company was not having requisite number of these directors to fulfill the aboverequirement. CONCOR had requested Ministry of Railways for appointment of requisite numberof independent directors to comply with the requirements under SEBI (LODR) Regulations.Recently with the appointment/re-appointment of above three Independent Directors theCompany is now meeting the requirement in respect of constitution for its Board by having50% of Directors as Independent Directors.
RETIREMENT OF DIRECTORS BY ROTATION:
As per the Companies Act 2013 the provisions in respect of retirementof Directors by rotation will not be applicable to Independent Directors. In view of thisno Independent Director is considered to be retiring by rotation but all other directorswill be retiring by rotation. Accordingly one third among all other directors namely ShriV. Kalyana Rama Chairman and Managing Director and Shri Sanjay Bajpai Director areliable to retire by rotation and being eligible offer themselves for reappointment.
EVALUATION & REMUNERATION:
As per Section 134 (3)(p) of the Companies Act 2013 the Board's Reportof a Listed Company shall include a statement indicating the manner of formal annualevaluation of Board Individual Directors etc. Ministry of Corporate Affairs has vide itsnotification dated 5th June 2015 notified the exemptions to GovernmentCompanies from the provisions of the Companies Act 2013 which inter-alia provides thatSec. 134(3)(p) regarding statement on formal annual evaluation shall not apply toGovernment Companies in case the Directors are evaluated by the Ministry which isadministratively in-charge of the company as per its own evaluation methodology. Furtherit has been provided that the provisions of Sub-Sections (2) (3) & (4) of Sec. 178regarding appointment performance evaluation and remuneration shall not apply toDirectors of Government Companies.
In terms of notification dated 05.07.2017 issued by MCA the provisionsin Schedule IV of the Companies Act 2013 about reviewing the performance of Chairpersonand non-independent directors and the Board as a whole by the Independent Directors intheir separate meeting and that on the basis of performance evaluation of IndependentDirectors it shall be determined whether to extend or continue their term of appointmentshall not apply to a Government Company if the requirements in respect of same arespecified by the concerned Ministries or Departments of the Central Government and suchrequirements are complied with by the Government Companies. In view of above since theappointment of the all Directors in the Company is decided by the Govt. of India therequirement related to evaluation of directors as stated in Schedule-IV are not applicableto CONCOR.
CONCOR is a Government Company under the administrative control ofMinistry of Railways. The selection procedure for all the directors is also laid down bythe Government of India and all the directors of the Company have been appointed inaccordance with the said procedure. The functional directors including CMD are selected onthe recommendations of PESB in accordance with the procedure and guidelines laid down byGovt. of India. Its Directors are appointed by Ministry of Railways and there is systemand procedure laid down by Department of Public Enterprises (DPE) for evaluation of itsfunctional directors including Chairman and Managing Director. The evaluation frameworkfor assessing the performance of functional directors comprises of the following keyareas:
Performance of the Company under the MOU signed with Ministry ofRailways.
Performance with respect to the targets fixed for the respectivedirector.
The evaluation includes self evaluation by the respective boardmember and subsequent assessment by CMD for the functional directors and thereafter finalevaluation by the Ministry of Railways the administrative ministry.
In respect of CMD the evaluation includes self evaluation andfinal evaluation by the Ministry of Railways.
In respect of Government nominee directors their evaluation is done bythe Ministry of Railways as per the procedure laid down.
The induction of officers at below board level is made by way ofrecruitment promotion and/or lateral entry by way of deputation/immediate absorption ofthe officials from Ministry of Railways Govt. Departments and other PsUs.
The performance of below Board Level Officials at Group General Managerand Executive Director grades is evaluated on the basis of criteria laid down by DPE inwhich the achievement of MOU targets as approved by
Administrative Ministry and DPE is given due weightage.
CONCOR follows a robust Performance Management System (PMS) incompliance with the DPE instructions for evaluation of performance of its officials in Sr.General Manager and below grade. Format for evaluation comprises broad parameters forassessment of personal traits of the officials and contribution towards performance of theorganization. The Key Result Areas (KRAs) are proposed by the appraisee and approved byappraiser in the beginning of the year which is subject to mid-year review for furthermodification/improvement if any. In this regard for payment of Performance Related Pay(PRP) as per DPE guidelines/instructions the performance rating of an individual officeris considered.
CONCOR being a Government Company the remuneration payable to itsfunctional directors including CMD senior management officials and all other employeesis in accordance with the guidelines issued by Department of Public Enterprises (DPE) inpursuance of recommendations of the committee on pay revision. For fixation ofremuneration at workmen level CONCOR adopts collective bargaining method with registeredtrade union of workmen. For supervisors & officers pay scales have been designed in aprogressive way and all statutory compliances in this regard are being adopted andfollowed. It is being taken care of that no employee gets stagnated.
The Nomination & Remuneration Committee had taken note of theremuneration policy of the Company and the procedure & policy for selection of theDirectors Senior Management and their remuneration.
RELATED PARTY TRANSACTIONS:
The related party transactions that were entered into during the yearwere on an arm's length basis and were in the ordinary course of business. Omnibusapproval of the Audit & Ethics Committee is being taken for the related partytransactions which are of foreseen and repetitive nature. The transactions entered intopursuant to the omnibus approval so granted are placed before the Audit & EthicsCommittee and the Board of Directors on a quarterly basis. The policy on material relatedparty transactions as approved by the Board has been uploaded on the Company's website athttp://www.concorindia.com/assets/pdf/CONCOR_Policy_MRPT.pdf. Though there are no materially significant related partytransactions entered by the Company the particulars as required under section 134(3) ofthe Companies Act 2013 are as per Annexure-E to this report.
Pursuant to the provisions of Section 204 of the Companies Act 2013and The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed M/s Amit Agrawal & Associates a firm of Company Secretaries inPractice to undertake the Secretarial Audit of the Company. The Secretarial Audit Reportfrom the auditor is annexed as Annexure-F to this report.
The Secretarial Auditor as well as the Auditor who has given CorporateGovernance Compliance certificate had observed that the Company is not having adequatenumber of independent directors. The remarks of the directors on the same are that theindependent directors in the Company are appointed by President of India through Ministryof Railways Government of India. The Company has repeatedly requested Ministry ofRailways Government of India for appointment of requisite number of independent directorson its Board and now recently with appointment/re-appointment of three independentdirectors the Company is having required number of Independent Directors on its Board.
The particulars forming part of the extract of the Annual Return in theform MGT-9 is annexed as Annexure-G. In addition statement pursuant to Section 129of the Companies Act 2013 (AOC-1) relating to Subsidiary Companies and Joint Ventures isas per Annexure-H.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
During the year your Company has made investments and has disbursedloans to its subsidiaries and joint ventures. The particulars of which are as under:
(Rs. in Crore)
* Investments were made towards subscription of equity shares of Rs.10each for cash at par.
The above loan disbursed to M/s Fresh & Healthy Enterprises Ltd.(FHEL) during the year 2018-19 is bearing interest rate of 6.58% p.a.
Your Company has not accepted any deposits from public as envisagedunder Sections 73 to 76 of Companies Act 2013 read with Companies (Acceptance of Deposit)Rules 2014. For the purpose of issuer rating and nonfund based bank facilities theCompany has obtained a credit rating of CARE AAA(Is); Stable and CARE AAA; Stable from M/sCare Ratings Limited which indicates 'Instruments are having the highest degree of safetyregarding timely servicing of financial obligations. Such instruments carry lowest creditrisk'.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:
Container Corporation of India Ltd. (CONCOR) prohibits any kind of actof sexual harassment at work place and included the acts amounting to sexual harassment atworkplace in its Conduct Rules and Certified Standing orders and Discipline & AppealRules so as to prohibit any such Act. CONCOR constituted an Internal Complaints Committeein the year 2003 to receive and investigate complaints related to "Sexual harassmentat workplace" following the guidelines issued by Hon'ble Supreme Court of India in"Vishaka Vs. State of Rajasthan".
The 'Internal Complaints Committee' consists of four members at thesenior level including one external female member who is an advocate on record of Hon'bleSupreme Court of India. CONCOR has 172 female employees out of total 1463 employees. TheCompany has created a conducive work environment free from any kind of harassment.
One complaint was received during the FY 2018-19 for which inquiry wasconducted and report submitted by the committee.
CEO & CFO CERTIFICATION:
Pursuant to provisions of Regulation 17(8) of the SEBI (LODR)Regulations certificate for the year under review from Shri V. Kalyana Rama Chairman andManaging Director and Shri Manoj Kumar Dubey Director (Finance) & CFO was placedbefore the Board of Directors of the Company at its meeting held on 30.04.2019. A copy ofthe said certificate on the financial statements for the financial year ended 31stMarch 2019 is as per Annexure-I.
BUSINESS RESPONSIBILITY REPORT:
For describing the initiatives taken by the companies fromEnvironmental Social and Governance perspective under SEBI (LODR) Regulations it hasbeen mandated that the top 500 listed entities based on market capitalisation to includeBusiness Responsibility Report (BRR) as part of the Annual Report. SEBI has provided theformat for BRR reporting in which it has elaborated a disclosure framework mappingCompany's performance on the nine Principles and Core elements. Accordingly in complianceto the said circular and provisions of SEBI (LODR) Regulations the BusinessResponsibility Report (BRR) is at Annexure- J.
CODE OF CONDUCT:
The Code of Conduct has been laid down for the Board Members and seniormanagement. A copy of the same is available on the website of the Company.
Based on the affirmation received from Board Members and SeniorManagement Personnel it is hereby declared that all the members of the Board and SeniorManagement Personnel have affirmed compliance of Code of Conduct for the financial yearended on 31.03.2019.
Your Directors express their gratitude for continued co-operationsupport and guidance in effective management of Company's affairs and resources providedby Government of India in particular the Ministry of Railways Customs Ports and aboveall the customers who have continued to patronize the services provided by your Company.
The Directors also place on record their sincere appreciation for thecontinued support and goodwill of the esteemed Shareholders Institutions StateGovernments where Company operates or is planning to expand its business and all otheragencies who have helped your Company in delivering excellent performance.
Your Directors acknowledge the constructive suggestions received fromAuditors and Comptroller and Auditor General of India and are grateful for theirconsistent support and help.
Your Directors would like to place on record its deep and sincereappreciation for the hard work dedication valuable contribution and unstinted efforts bythe team CONCOR for the excellent performance during the year and for creating a platformto achieve greater success in future.
ADDENDUM-I TO THE DIRECTOR'S REPORT FOR FY 2018-19
ADDENDUM-II TO THE DIRECTOR'S REPORT FOR FY 2018-19