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Dredging Corporation of India Ltd.

BSE: 523618 Sector: Others
NSE: DREDGECORP ISIN Code: INE506A01018
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OPEN 216.60
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VOLUME 17606
52-Week high 444.45
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P/E 4.99
Mkt Cap.(Rs cr) 604
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Sell Price 215.70
Sell Qty 1938.00
OPEN 216.60
CLOSE 212.00
VOLUME 17606
52-Week high 444.45
52-Week low 121.80
P/E 4.99
Mkt Cap.(Rs cr) 604
Buy Price 213.05
Buy Qty 1.00
Sell Price 215.70
Sell Qty 1938.00

Dredging Corporation of India Ltd. (DREDGECORP) - Director Report

Company director report

FOR THE YEAR 2018-19

Your Directors have pleasure in presenting this 43RD Annual Report together with theaudited financial statements of the Company for the year ended 31st March 2019.

1. STRATEGIC SALE

The Government of India ("GOI") has concluded the Strategic disinvestment ofDCIL by way of the transfer of management control and sale of whole of 73.47% equity sharecapital of DCIL held by GOI to the four ports – Visakhapatnam Port Trust ParadipPort Trust Deendayal Port Trust and Jawaharlal Nehru Port Trust. The Share PurchaseAgreement in this regard was executed on 08th March 2019. The new Management has takencharge of the company from 08th March 2019. It’s a new beginning for the company andwith the support of all the stakeholders it is expected the Company would prosper.

2. FINANCIAL RESULTS

(Rs. in lakhs)
Particulars 2018-19 2017-18 % Change
(I) INCOME
A. Operations 69174 59187 17%
B. Others 678 2025
TOTAL INCOME 69852 61212 14%
(II) EXPENDITURE
i) Employees Benefits 10437 9660
ii) Depreciation 11291 11318
iii) Repairs and maintenance 2206 1413
iv) Power Fuel and Lubricants 26533 23267
v) Spares and Stores 3803 5602
vi) Insurance 622 660
vii) Other Expenses 8454 5092
viii) Finance costs 1754 2023
TOTAL EXPENDITURE 65100 59035 10%
Profit before Exceptional Items &Tax 4752 2177
Profit before Tax 4752 2177 118%
Less : Provision for taxes 293 463
Profit for the year 4459 1714
Add: Other Comprehensive income 0 (50)
Profit after Tax 4459 1664 168%

3. DIVIDEND

Keeping in view the financial performance of the Company and other relevantconsiderations your Directors have recommended payment of dividend @ 30% on the paid upcapital of the company i.e Rs.3 per equity share amounting to Rs.8.40 lakh for the year2018-19 as compared to 20% declared for the previous year. This would amount to 18.84% ofthe Profit after tax for the year.

4. CAPACITY UTILISATION

The following is the capacity utilisation in number of days and quantity dredged asagainst the targets during the year:-

Target Actual % Utilisation
No. of Days 3228 2501 77.47
Quantity (Mln. Cu.M) 63.90 54.51 85.30

5. DCI FLEET

The Company has 11 Trailer Suction Hopper Dredgers (TSHDs) 2 Cutter Suction Dredgers(CSDs) one Back Hoe Dredger and one Inland Cutter Suction Dredger apart from otherancillary crafts . Dredge IX a 4500 Cu.M TSHD built in 1984 was de-commissioned during theyear.

6. DREDGING OPERATIONS

i) Important Contracts completed during the Year 2018-19:

1. Maintenance dredging in Hooghly Estuary in the shipping channel of Kolkata PortTrust for the period of five years. (April 2018 to Mar 2019).

2. Dredging for maintenance of channels and basins at Cochin Port for 2018-19.

3. Maintenance Dredging at Cochin Ship Yard for 5 Years from 2015 and Capital dredgingwork carried out in connection with INS Vikramaditya for the Year 2018-19.

4. Annual maintenance dredging at New Sand Trap and its approaches and other areas ofVPT for 2018-19.

5. Deployment of DCI Dr-XV at Visakhapatnam on charter hire basis for M/s AVR InfraPvt. Ltd for 2018-19.

6. Development of Multipurpose Terminal by replacement of existing EQ-2 to EQ-5 berthsto cater to 14.00 mtrs draft vessels in Inner harbor of Visakhapatnam Port Trust of M/sITDC Vizag for the year 2018-19.

7. Dredging in front of OB-II of Visakhapatnam Port Trust of M/s ESSAR Vizag for theyear 2018-19.

8. Maintenance dredging works to remove siltation using TSHD at Gangavaram Port for2018-19.

9. Capital dredging for proposed south and North Dock complex at Paradip for 2018-19.

10. Hiring of Services for Maintenance Dredging at Konkal LNG Private Ltd. (earlierRGPPL) – Dabhol for 2018-19.

11. Maintenance dredging of 14.00 Lakh Cubic meters of silt from Naval sites at Mumbaiusing combination of TSHD and Grab dredger for the year 2018-19.

12. Maintenance dredging at VOC Port Trust by engaging a TSHD & BH-1 through M/sDCI Ltd for the year 2018-19.

13. Maintenance dredging in channels and basins of Krishnapatnam Port Company Ltd forthe year 2018-19.

14. Dredging by engaging a TSHD in the channel and turning circle at Karaikal Port for2018-19.

15. Contract for dredging of LNG Jetty and its approaches at Kamarajar Port Limited forthe year 2018-19. 16. Capital dredging at Pussur River from Mongla Port to Rampal Powerplant for the year 2018-19.

ii) New Contracts during the Year 2018-19:

1. Maintenance Dredging in Shipping Channel of Hooghly Estuary of Kolkata for fiveyears from 2017 i.e 2017 to 2021 - work under progress.

2. Maintenance dredging at Lower Eden Bar by deploying TSHD of 5500 CuM hopper capacityand dumping the dredge material at designated dumping area.

3. Dredging for maintenance of channels and basins at Cochin Port for the year 2019-20.

4. Dredging at VOCPT Port (Tuticorin) by engaging Cutter Suction Dredger (DredgeAquarius) through M/s DCI. Work in progress.

5. Contract for Capital Dredging alongside JD-4 6 & JD west berths for deepeningupto -14.00 mtrs CD and New Coastal berth for deepening upto -9.00 mtrs CD at ChennaiPort.

6. Capital dredging for proposed south and north BOT Dock complex at Paradip Port. Workin progress.

7. Maintenance dredging of Approach Channel Entrance Channel Turning Circle Docks& Sand Trap of Paradip Port Trust for the Year 2019-20.

8. Deployment of Backhoe at PPT in the areas adjacent to PICTPL berth Wet Basin areanear signal station North Oil Jetty and Miscellaneous areas inside the Harbour.

9. Hiring of Services of Maintenance Dredging of RGPPL’S Navigational Channel forthe year 2019-20.

10. Capital dredging at Pussur River from Mongla Port to Rampal Power plant for theYear 2019-20. Work in progress.

11. Deployment of DCI Dr-XXI at Visakhapatnam Port on charter hire basis for dredgingof Inner Harbour Channel Inner Harbour Turning Circle and berth front of EQ-6 berth inNorthern Arm of VPT.

12. Annual maintenance dredging at New Sand Trap and its approaches and other areas ofVPT for 2019-20. 13. Maintenance dredging works to remove siltation using TSHD atGangavaram Port for 2019-20.

14. Dredging in River Muriganga in P.S. Kakdwip & Sagar District South 24Parganas.

15. Assured depth dredging work in the Farakka-Haldia stretch of National Waterway-1under the Jal Vikas Marg Project for the year 2019-20.

16. Capital Dredging at Neendkara Fishing Harbour Kerala.

7. MEMORANDUM OF UNDERSTANDING

The Company has signed Memorandum of Understanding (MOU) with Government of India forthe year 2018-19 with regards to targets for operational and financial performance of theCompany etc.

8. SAFETY MANAGEMENT SYSTEM (ISM)

(a) All dredgers of DCI hold valid Safety Management Certificate (SMC).

(b) DCI holds a Document of Compliance (DOC) valid till 24.06.2022. The same is beingendorsed every year after annual verification audit by DG Shipping.

9. SHIP SECURITY SYSTEM (ISPS)

All dredgers of DCI hold valid International Ship Security Certificate (ISSC).

10. QUALITY MANAGEMENT SYSTEM (ISO 9001:2008)

DCI is certified for Quality Management System (ISO 9001:2015) and the certificate isvalid up to 25th February 2022.The QMS surveillance audit is being carried out every yearby IRQS as part of certification of the system.

11. ENVIRONMENT MANAGEMENT SYSTEM (ISO 14001:2015)

DCI is certified for Environmental Management System (ISO 14001:2015) and thecertificate is valid up to 13th March 2022. The EMS surveillance audit is being carriedout every year by IRQS as part of certification of the system.

12. ENVIRONMENTAL INITIATIVES :

Implemented ISO 14001: 2015 (Environment Management System.) Installed Sewage TreatmentPlants onboard vessels (except Dr. VI VIII & XI). Compliance to MARPOL 73/78Regulations i.e (lnternational Oil Pollution PreventionlOPP) Environmental awarenessamongst the employees and floating personnel is being done onboard dredgers Projectoffices and Head Office on a regular basis.

13. MEMBERS/ INVESTOR SERVICES

The shares of the Company are listed on BSE Calcutta and National Stock Exchanges. Theshares of the Company are dematerialised with both the depositories NSDL and CDSL. Thetax free bonds are listed with the Stock Exchange Mumbai. M/s. Karvy Fintech PrivateLimited Hyderabad are the R & T Agents of the Company. M/s CATALYST TRUSTEESHIPLIMITED (formerly GDA Trusteeship Ltd.) Pune is the Trustee for the Tax free bonds issuedin the year 2013-14.

14. THE REQUIRED PARTICULARS ETC. PURSUANT TO SECTION 134 (3) OF THE COMPANIES ACT2013 ARE AS UNDER:-

a) The extract of the Annual Return as provided under Sub-section (3) of Section 92 ofthe Companies Act 2013 in form no. MGT – 9 is placed as Annexure-1 to this Report.

b) Number of meetings of the Board :- During the financial year 2018-19 the company hasheld six Board Meetings. Further details are provided in the Corporate Governance Report.

c) Directors’ Responsibility Statement : - Pursuant to the provisions of Section134 (5) of the Companies Act 2013 your Directors state that :

(i) in the preparation of the Annual Accounts the applicable accounting standards hadbeen followed along with a proper explanation relating to material departures;

(ii) the Directors had selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit or loss of the company for that period;

(iii) the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and preventing and detecting fraud and other irregularities;

(iv) the Directors had prepared the Annual Accounts on a going concern basis; and

(v) the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

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

d) Upto 08thMarch 2019 the Directors of the Company were appointed by Government ofIndia as per the norms pertaining to qualifications etc. prescribed by Government ofIndia. The whole time directors were paid remuneration as prescribed by Government ofIndia from time to time and after 08th March 2019 the new Promoters have been continuingwith the same norms as per the provisions in share purchase agreement. The Independentdirectors are paid only sitting fees of Rs.10000/- for attending each meeting of the boardor committee thereof and are not paid any other remuneration. The Part-time official(Government) Directors were not paid any remuneration by the Company. The Key Managementpersonnel are paid as per the norms fixed by the Department of public enterprises fromtime to time. The Company has constituted Nomination and Remuneration committee as perSection 178 consisting of two Independent Directors and One part-time official Director.

e) Explanations or comments by the Board on every qualification reservation or adverseremark or disclaimer made :-

The statutory auditors of the company have given an unqualified audit report. Howeverthere are two Emphasis of Matters which are reproduced below along with the comments ofManagement on the same.

A. EMPHASIS OF MATTERS BY STATUTORY AUDITORS:

QUOTE

We draw attention to the following matters in the Notes to the financial statements.Our opinion is not qualified in respect of this matter.

a) Trade Receivables include a sum of Rs.13627 lakhs due from M/s SethusamudramCorporation Limited (SCL) towards works executed during 2005-06 to 2008-09 which hasbecome a matter of dispute. A Committee chaired by Additional Secretary & FinancialAdvisor Ministry of Shipping Government of India (AS & FA Committee) compromised theoutstanding issues between the Company and SCL by recommending for payment of Rs.3627lakhs which was accepted by both the Parties. As a consequence of AS & FA Committeerecommendations dated 25.02.2019 the Company has reversed the provision for doubtfuldebts of Rs.3019 lakhs held since FY 2011-12. Further provision of Rs.8444 lakhs madeduring the first half year of the current year has also been withdrawn.

b) Outstanding balances under Trade Payables Other Payables Trade ReceivablesAdvance to Suppliers are subject to reconciliation the impact of which is notascertainable.

UNQUOTE

Management comments to emphasis of matter:

A Committee chaired by Additional Secretary & Financial Advisor Ministry ofShipping Government of India (AS & FA Committee) considered the issue of outstandingissues to the Company by SCL and decided that payment of Rs.3627 lakhs be made to DCI. SCLhas released payment of Rs.1 Cr. to the Company in line with the decisions. Ministry ofShipping has confirmed that releas of balance fund is being considered at appropriatelevel as per the decision taken at AS&FA Committee. As such the Company has reversedthe provision for doubtful debts of Rs.3019 lakhs held since FY 2011-12. Furtherprovision of Rs.8444 lakhs made during the first half year of the current year has alsobeen withdrawn.

With regard to balance of Payables Other Payables Trade Receivables Advance toSuppliers at Sl.No. (b) above it is stated that confirmation for some of the amountsparticularly with regard to sundry debtors due from various ports etc. for the worksexecuted by DCI and/or bills raised for the same is being followde up.

B.. OBSERVATIONS MADE BY THE SECRETARIAL AUDITOR: QUOTE

1. Company did not had requisite number of Independent Directors on the Board for theperiod 01.04.2018 to 31.03.2019 and a woman Director on the Board for the period08.03.2019 to 31.03.2019 as required under Section 149 of the Companies Act 2013Regulation 17 (1) (b) of SEBI (LoDR) Regulations 2015 and as per Clause 3.1.4 of DPEGuidelines

2. Performance evaluation of independent directors was not done by the entire Board ofDirectors as required under Section 149 (8) read with Schedule IV Clause VIII (1) of theCompanies Act 2013 and Regulation 17 (10) of SEBI (LoDR) Regulations 2015

3. There was no Audit Committee for the period from 08.03.2019 to 31.03.2019 asrequired under Section 177 (1) of the Companies Act 2013 and Regulation 18 (1) of SEBI(LoDR) Regulations 2015.

4. Composition of the Nomination and Remuneration Committee did not include atleastfifty percent of the directors as independent directors for the period 08.03.2019 to31.03.2019 as required under Section 178 (1) of the Companies Act 2013 and Regulation 19(1) of SEBI (LoDR) Regulations 2015.

5. Stakeholders Relationship Committee was not constituted for the period 08.03.2019 to31.03.2019 as required under Section 178 (5) of the Companies Act 2013 and Regulation 20(1) of SEBI (LoDR) Regulations 2015.

6. As per Section 178 (2) & (3) of the Companies Act 2013 and Regulation 19 (4)read with Schedule II Part D (A) of SEBI (LoDR) Regulations 2015 the Nomination andRemuneration Committee shall:

(a) formulate the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board of Directors a policy relating tothe remuneration of the directors key managerial personnel and other employees;

(b) formulate the criteria for evaluation of performance of Independent Directors andthe Board of Directors;

(c) devise a policy on diversity of Board of Directors.

7. Meeting of the independent directors was not held during the year as required underSection 149 (8) read with Schedule IV clause VII of the Companies Act 2013 and Regulation25 (3) and (4) of SEBI (LoDR) Regulations 2015.

UNQUOTE

Management’s reply

The Company was a Government of India Undertaking and as per the Articles ofAssociation of the Company the Directors are to be appointed by the President of India.The issue of appointment of requisite number of independent directors was taken up withthe administrative Ministry - Ministry of Shipping and the same was pending with them. Theperformance evaluation of the Whole-time Directors and Part time official Directors isdone by the Government of India. Pursuant to the share Purchase Agreement executed on 08thMarch 2019 between Government of India represented by Ministry of Shipping and the fourPorts ("Purchasers") – Visakhapatnam Port Trust Paradip Port TrustJawaharlal Nehru Port Trust and Deendayal Port Trust all the shares amounting to 73.47%of the Equity share Capital of the Company was transferred to the purchasers -Visakhapatnam Port Trust(19.47%) Paradip Port Trust (18%) Jawaharlal Nehru Port Trust(18%) and Deendayal Port Trust (18%) along with transfer of management and control. As perthe provisions of the Share Purchase Agreement all the directors on the board as on thedate of signing i.e 08th March 2019 resigned. The appointment of independent directorscould not be completed by 31st March and as such the independent Directors meeting couldnot be held by the end of the year and the evaluation of the Board Members could not bedone by the independent directors.However the evaluation of the functional directors isdone by the Government of India as per the procedure.

f) Particulars of loans guarantees or investment under Section 186 :- details ofinvestment given under the respective head in the financial statement. The Company has notgiven any loans or guarantees.

g) Particulars of contracts or arrangements with related parties referred to in Section188 (1) :- In line with the provisions of the Companies Act 2013 and the SEBI (LODR)Regulations 2015 the Company has formulated a Policy on materiality of Related PartyTransactions and also on dealing with Related Party Transactions. The same has been postedon the website of the Company. In terms of Accounting Standard 18 (Revised-2014) nodisclosure is required in the financial statements of State controlled enterprise (Anenterprise which is under the control of the Central Government and/or State Government)as regards related party relationships with other State controlled enterprises andtransactions with such enterprises. The related party transactions of DCI for the year2017-18 are mainly with other State controlled enterprises. Post the strategic sale by GOIon 08/03/2019 DCI is no longer a Government Company and the necessary disclosures withregard to the transactions with the related parties – Promoter Group has been made atNote No. 26 – Additional information on Financial Statements sl.no. 8 with heading– Related Party Transactions in the Financial statement for the year 2018-19 and therelevant disclosure in Form No. AOC-2 is placed at Annexure - 3 to this Report. During theyear under review apart from what is disclosed the Company has not entered intofinancial or other transactions of material nature with its Promoters the Directors andsenior management that may have potential conflict with the interests of the Company atlarge and/or which are not in normal course of business. There have been no loans/advances/investments or any other transactions with any of the entities in which Directorsare interested as per the disclosures given by them coming within the purview andrequiring disclosure under related party transaction under the stated Accounting Standard.

h) The state of the company’s affairs :- This has been explained in report underthe head "Financial Results" "Dredging Operations" at paragraphnumber 2 and 6.

i) The amounts if any which it proposes to carry to any reserves: The followingamounts have been transferred to different reserves during the year:-

a) Tonnage Tax Reserve u/s 115VT uitilisation of the IT Act Rs.140 Lakhs
b) Transfer to General Reserve NIL
c) Transfer to Debenture Redemption Reserve NIL

j) Dividend @30% i.e Rs.3 per equity share is recommended for approval of shareholdersat this AGM. The same will be paid within 30 days after the date of declaration.

k) Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report: Nil

l) The conservation of energy technology absorption foreign exchange earnings andoutgo:

i) Conservation of energy : The following measures have been taken:

For online fuel monitoring flow meters were fitted for both main engines during theyear for Dredge XVI

Continuous efforts are being made to optimise the fuel consumption on board dredgers ascost of fuel constitutes approximately 35-45% of operational cost.

ii) Technology absorption: MAX Impellers for Dredge Pumps which enable in improvementin production and were earlier imported have now been manufactured indigenously during theyear on a pilot basis for one dredger and would be done for more dredgers in future.

iii) Foreign Exchange earnings and outgo:.

(Rs. in Lakhs)
i) Foreign Exchange Earnings : 0.00
Total 0.00
ii) Foreign Exchange outgo:
a) Import of components and spares (CIF value) 3130.99
b) Payment of interest on foreign currency loan 1290.20
c) Repayment of installment of foreign currency loan 13819.40
d) Foreign travel 31.48
Total 18272.07

m) A statement indicating development and implementation of a risk management policyfor the company including identification therein of elements of risk if any which in theopinion of the Board may threaten the existence of the company: The Company has in place aRisk Management Policy to drive a common integrated view of risks optimal risk mitigationresponses and efficient management of internal control and assurance activities. The RiskManagement Committee has been constituted. The threats risk and concerns are discussed inthe Management Discussion and Analysis Report.

n) The details about the policy developed and implemented by the company on corporatesocial responsibility initiatives taken during the year: The Company has in place aCorporate Social Responsibility Committee and a Corporate Social Responsibility andsustainability Policy. During the year 2018-19 the amount required to be spent under CSRis Rs.7.97 lakh. Against this the Company spent Rs.53.38 Lakhs. The particulars of theCSR activities in the prescribed format as required under the Companies Act is placed atAnnexure-2 to this Report.

o) Astatement indicating the manner in which formal annual evaluation has been made bythe Board of its own performance and that of its committees and individual directors:-till 08th March 2019 the Board of Directors of the Company were appointed by Governmentof India. The administrative Ministry – Ministry of Shipping reviews the performanceof the whole time directors on Annual basis. Consequent to the change in the character ofthe company post the strategic sale formal evaluation system is being formulated andwould be in place in the current financial year 2019-20.

15. INSURANCE

The Company has taken appropriate insurance for all assets against foreseeable perils.

16. SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators courts orTribunals which would impact the going concern status and the Company’s futureoperations.

17. DISCLOSURE AS PER SECTION 197 OF THE COMPANIES ACT AND THE REQUIREMENTS OFCOMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014.

Pursuant to provisions of Section 197 of the Companies Act 2013 read with the Rule 5of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the namesand other particulars of employees along with the ratio of remuneration of each Directorto the median employees remuneration and such other details forms part of Directors’Report and is placed at Annexure -4 to this Report.

18. VENDOR DEVELOPMENT

This is a continuous process and DCI procures spares and stores on a regular basis fromsuppliers spread all over the world. DCI is updating the supplier-base continually. DCIhas adopted e-procurement process as per Govt. of India guidelines emphasis was given tofacilitate and enable the vendors by way of training support and hand holding support toparticipate in the e-procurement processes of the company. Tenders are published in DCIofficial website and Central Public Procurement Portal for wider publicity so that MSMEscan participate. In view that out of the total annual procurement a major portion isfuel which cannot be procured from MSME Vendors and further that since most of dredgersof DCI have been built at Netherlands and therefore most of the spares need to be importedfrom OEMs abroad the Company has represented for relaxation for implementation of thePublic Procrurement Policy mandatory provision of 20% procurement from MSMEs.

19. R & D ACTIVITIES

DCI Dredge Aquarius was fitted with an indigeniously developed Programmable LogicController (PLC) in place of existing PLC system which was imported. The newly installedPLC has been found to be cost effective and working satisfactorily.

20. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Pursuant to the DPE Guidelines and SEBI (LoDR) Regulations 2015 Management Discussionand Analysis Report Corporate Governance Report and Certificate from the CompanySecretary in practice regarding compliance of conditions of Corporate Governance areattached forming part of this Report.

21. MAN POWER:

The total number of employees (both Shore and Floating) in the Corporation as on 31stMarch 2019 was as under:-

Shore 248
Floating – Regular -122 Contract- 428 550
Total 798

22. EMPLOYMENT OF VARIOUS RESERVED CATEGORIES:

The manpower position with regard to various reserved categories is as indicatedhereunder:

A. Employment of SC/ST Candidates

The Corporation continued its efforts to fulfill its obligation in providing employmentopportunities to SC/ST candidates in accordance with the Government Policy. The overallrepresentation of SC/STs in the Corporation (both Shore and Floating Establishments butexcluding MPWs) as on 31st March 2019 was SCs - 46 and STs 15.

B. Employment of Ex-Servicemen

The representation of Ex-Servicemen (both Shore and Floating) (regular employees) ingroup C and D categories in the Corporation was Nil as against the percentage of 14.5% and24.5% respectively as prescribed by the Government. However DCI has been recruitingEx.Servicemen on its dredgers on contract basis.

C. Employment of Physically Handicapped

The number of physically handicapped employees in the Corporation as on 31st March2019 is 6 (Six) the group-wise break-up A B C & D for shore side is furnishedbelow:-

Group Total Strength No. of persons with disabilities actuallyEmployed Percentage with reference to identified posts
A 150 04 2.67
B 27 01 3.70
C 55 01 1.82
D 16 - -
Total 248 06 2.42

There are no Physically handicapped persons employed on the floating side as it is notpermitted.

The Physically handicapped persons are being paid additional conveyance assistance asper the Government instructions.

D. Employment of women

The number of women employees on Rolls as on 31st March 2019 is 41 as against 44 as on31st March 2018. Out of them number of executives is 16 and Non-Executives is 25.

Compliance with Government’s Policy on Women:

Basing on the Supreme Court’s judgement and keeping in view the Governmentinstructions on sexual harassment of women at work places a complaints Committee headedby a woman officer was constituted to inquire into the complaints of sexual harassment atwork places. A complaints register is also being maintained.

No compliants of sexual harassment have been received during the year.

DCI is a Life Member of the Forum for Women in Public Sector and one womenrepresentative from DCI has been nominated to the above forum. Apart from the TradeUnions the problems if any relating particularly to women employees are looked into asand when the same are brought to the notice of the Management.

23. EXISTING BENEFITS AND WELFARE MEASURES FOR THE WOMEN EMPLOYEES :

i) The women employees of the Corporation with less than two surviving children areentitled for 26 weeks of Maternity Leave.

ii) Special Casual leave not exceeding 14 working days is sanctioned to regular womenemployees of the Corporation to undergo non- puerperal sterilisation.

iii) One day special casual leave is allowed to the regular women employees of theCorporation who had ICUD insertions.

iv) Working uniforms are provided to Group’D’ women employees as per thescales prescribed in the Rules.

v) As a welfare measure a Rest Room/Recreation is provided exclusively for the womenemployees.

vi) The women employees of DCI are sponsored along with others to various in-house andalso external training programmes.

24. OTHER BENEFITS:

Paternity leave of 15 days is allowed to a regular male employee having less than twochildren during confinement of his wife as per Leave Rules of the Corporation.

25. WAGE SETTLEMENTS A. FLOATING ESTABLISHMENT :

i) The INSA-MUI (FG/HT) Agreement in respect of Floating Officers is due for revisionw.e.f. 01.04.2019

ii) The NMB Agreement relating to HT Petty Officers is due for revision w.e.f.01.04.2019

iii) The Wage Agreement of Crew/MPWs is due for revision w.e.f. 01.04.2019

B. SHORE ESTABLISHMENT:

i) Pay revision of Executive Employees is implemented w.e.f. 01.01.2017.

ii) The wage revision of Non-Executive employees is implemented w.e.f. 01.01.2017.

26. INDUSTRIAL RELATIONS:

The industrial relations in the Corporation continued to be cordial throughout the year2018-19. The employees of the Company both on shore and floating side worked in fullco-operation with the management and there has been no loss of manhours during the year.

27. WELFARE MEASURES:

The Corporation continued various welfare schemes viz. Family Pension Scheme GroupGratuity Assurance Scheme Personal Accident Insurance Coverage Group Savings LinkedInsurance Scheme Contributory Provident Fund Maternity Benefit Scheme SubsidisedCanteen Facility Transport Subsidy Medical Attendance Leave Travel Concession MeritScholarships for the children of SC/ST employees Pension Scheme and DCI Retired EmployeesMedical Trust/Scheme etc. Other welfare measures such as Special Casual Leave formaternity/ paternity are extended to the employees. Staff Welfare Schemes viz. CarAdvance Two wheeler Advance Marriage Advance (Children & Self) Children HigherEducation Advance Festival Advance etc.are provided to the employees.

28. HUMAN RESOURCES DEVELOPMENT

The Corporation is making sincere and concerted efforts for the overall development ofHuman Resources.

i) During the year 2018-19 208 employees were trained in various training programs.

ii) During the year 2018-19 15 DCCP Apprentice Trainees 15 ICMA Industrial Trainees4 Engineering Graduate Apprentices and 6 M.Tech Apprentices (dredging and HarbourEngineering) were inducted for training for a period of 12 months.

29. IMPLEMENTATION OF THE RIGHT TO INFORMATION ACT 2005

As per the Directives of the Government of India the Corporation implemented The Rightto Information Act 2005 w.e.f. 12.10.2005 and made all required infrastructualarrangements such as appointment of Public Information Officers Asst. Public InformationOfficers and Appellate Authority; set-up of procedure and submission of periodical reportson the progress of implementation of the Act. A register is maintained for monitoring therequests from public seeking information and the replies by the concerned are also beingco-ordinated. Required periodical reports on the implementation of RTI/ Status of RTIreplies are being furnished to the Ministry CIC from time to time.

30. ACTIVITIES OF PUBLIC GRIEVANCES AND COMPLAINTS CELL :

A Public Grievance Cell has been functioning in the Corporation since 1988 to look intothe Grievances/Complaints received from the Public. The Company Secretary is the Directorof Public Grievances. As per the Ministry’s guidelines a status report is beingsubmitted for the information of the Board of Directors at the Board meetings and aquarterly status report is forwarded to the Ministry. In line with the Ministry’sdirection a Public Grievance Redressal and Monitoring System (PGRAMS) software wasinstalled in the Computer Network in the Corporation which works in hand-shake modebetween the Ministry and the Corporation. Complaints received during the year weresuitably replied to.

31. INFORMATION & FACILITATION COUNTER

In order to ensure transparency in the functioning of the Corporation and also for easyand speedy access for any information to the public an INFORMATION & FACILITATIONCOUNTER (IFC) was set up at DCI Head Office Visakhapatnam and the same is publicized inthe web-site also.

32. PROGRESSIVE USE OF HINDI

The Corporation continued its efforts to implement the Official Language Policy of theGovernment an Incentive Scheme to award cash prizes etc. is in vogue in the Corporationand employees trained under in-service training in Hindi and qualified in variousexaminations conducted thereunder are being awarded cash awards.

Various Competitions were conducted for employees and nearby school/College studentsduring the Hindi Week Celebration in September 2018.

The officers of the Corporation actively participated in the meetings and activities ofthe Town Official Language Implementation Committee (TOLIC)(UT) Visakhapatnam during theyear. 4 Hindi workshops were conducted for employees to impart working skills in drafting& noting in Hindi and in UNICODE Hindi Typing operation of Bilingual softwares etc..

Computerization of forms / correspondence and reports in Hindi was implemented invarious departments. Several formats PF Statements letter-heads visiting cards bannersand other items of stationery are printed / made bilingual and the same are made availableon the computers. Web-site information was also updated in Hindi. Unicode was installed invarious functional Departments. Issue of Office Orders / Circulars Reports submitted toGovernment and Parliamentary Committees and Annual Report of the Corporation were ensuredin bilingual.

33. CITIZEN CHARTER

As per the directives of the Government of India to focus on the commitment of DCItowards its citizens / clients in respect of standard of services information choice andconsultation non-discrimination and accessibility grievance redress courtesy and valuefor money including expectations of the Organisation from the citizen/client forfulfilling the commitment of the Organisation a Citizen Charter approved by the CompetentAuthority was posted on the Corporate website.

As part of requirement thereof a Task Force has been constituted with representativesfrom the Management and Staff Unions as well as from the Visakhapatnam Port Trust alocal clientele organisation. The Task force attends to the duties as prescribed by theDepartment of Administrative Reforms and Public Grievances. The HoD (HR) is designated tobe the Nodal Officer to coordinate and monitor the formulation and implementation of theCitizens Charter in DCI who also functions as the Member Secretary of the Task Force.

34. ACTIVITIES OF VIGILANCE DEPARTMENT

As a measure of preventive vigilance09 periodic 28 surprise and 01 CTE typeinspections have been taken up during the year. The lapses/ irregularities notices in thisregard have been communicated for taking remedial/ corrective actions. The number ofvigilance cases pending at the begining of the year and end of the year is"Nil". No vigilance cases were initiated during the year.

Vigilance Department is playing a proactive role for continuous simplification andimprovements in systems and procedures and facilitating faster and effective decisionmaking in transparent manner.

The Vigilance Awareness Week 2018 was observed at the Corporate Headquarters andvarious Project Offices of Dredging Corporation of India Ltd. 29th October 2018 to 3rdNovember 2018. CVC’s theme for Vigilance Awareness Week 2018 was "EradicateCorruption Build a New India" with emphasis on spreading awareness in fight againstcorruption to all sections of Society. Competitions for painting easy writing andelocution covered nearly 591 students. Message of the commission was taken to broadsection of society through Dramas Skits Flash mobs songs etc. in Schools collegesUniversities Public Places etc. Skits with Anti-Corruption message are organized inEducational Institutions Public Places during the Vigilance Awareness Week – 2018.Skits broadcasted in All-India Radio and FM radio received wide appreciation. Interviewwith CVO was telecasted on the platform of DD Saptagiri explaining the role of CVCVigilance CBI and importance of public participation in eradicating corruption.Citizen’s Integrity pledges recommended by Central Vigilance Commission as part ofVigilance Awareness Week – 2018 (VAW) is taken up as a Mission and more than 8000people took Integrity Pledge in the year 2018-19 during activities Organized by Vigilancewings of DCIL and VPT. Around 2000 persons took part in Mass Integrity Pledge conducted atvarious schools and colleges in Visakhapatnam. Integrity pledge pamphlets in bilingual(English & Telugu) distributed at various prominent places in Visakhapatnam. VAW-2018banners were displayed on Vessels and DCI dredgers. Specially designed stickers withvigilance and anti-corruption messages have been pasted in all official vehicles of VPTand DCI. To spread awareness against corruption amongst the general public VigilanceAwareness Walk Flash Mobs Skits Signature Campaign etc. are organized at RK BeachVisakhapatnam as it is a popular place frequented by all sections of society.

Formation of Central Vigilance Commission (CVC) logo and human chain by the students ofPort High School. Systems improvement measures were suggested by the Vigilance departmentfor implementation.

35. STATUTORY AUDITORS

M/s Sriramamurthy & Co. Chartered Accountants Visakhapatnam were appointed by theComptroller and Auditor General of India as Statutory Auditors for auditing the accountsof the Company for the financial year 2018-19. Pursuant to Section 142 (1) of theCompanies Act 2013 the remuneration of the Auditors has to be approved by the Members atthe AGM. The Board recommends the remuneration of Rs..50 lakhs plus service tax asapplicable for the year 2018-19 as statutory auditors for approval of the Members at thisAGM.

36. INDEPENDENT AUDITORS’ REPORT

The Independent Auditors’ Report on the Accounts for 2018-19 given by theStatutory Auditors is placed along with the Accounts. Management Comments to the Emphasisof matters of the Auditors have been given in this report.

37. SECRETARIAL AUDIT REPORT

The report of the Secretarial Auditor – Mr. Sachin Agarwal of M/s. Agarwal S &Associates pursuant to Section 204 of the Companies Act 2013 and rules made thereunder isplaced at Annexure - 5 to this Report. The comments/replies of the management on theobservations of the Secretarial Auditor has been given in this report.

38. C&AG COMMENTS

The Comptroller and Auditor General of India has issued "NIL"comments on theAccounts of the Company for the year ended 31st March 2019 and the same are placed nextthe Statutory Auditor’s Report

39. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The directors recommend for approval of the Members the aboveappointments/re-appointment of the Directors as proposed in the Notice to the AGM.

40. AMENDMENT TO MEMORANDUM OF ASSOCIATION AND ARTICLES OF ASSOCIATION

The Board of Directors recommends for approval of the Members the amendment toMemorandum of Association and Articles of Association in line with the Companies Act 2013and the Share Purchase Agreement dated 08/03/2019 entered into between the Government ofIndia and the four ports- Visakhapatnam Port Trust Paradip Port Trust Deendayal PortTrust and Jawaharlal Nehru Port Trust.

41. RELATED PARTY TRANSACTIONS

Consequent to the strategic sale on 08/03/2019 the four ports are now categorised aspromoters of the company. The Board recommends for approval of the Members the contracts/arrangements/transactions entered/ to be entered with the related parties i.e. promoter(s)(viz Visakhapatnam Port Trust Paradip Port Trust Jawaharlal Nehru Port Trust DeendayalPort Trust) during the financial year 2018-19 (for the period 08/03/2019 to 31/03/2019)and for the financial year 2019-20 for supply of goods or service in the ordinary courseof business and on arm’s length basis which may exceed the materiality thresholdlimit i.e. exceeds ten percent of the annual consolidated turnover of the Company or Rs.50Crore whichever is lower as per the last audited financial statements of the Company.

42. ACKNOWLEDGEMENTS

The Directors thank Hon’ble Minister of Shipping and officers and staff ofMinistry of Shipping for the valuable help assistance and guidance rendered from time totime. The Directors thank all other Ministries for the help and co-operation extended bythem. The Board is grateful to the Comptroller & Auditor General of India the MemberAudit Board and the Statutory Auditors for their co-operation. The Board also thanks theBankers of the Company for their valuable services. The Board expresses its gratitude tothe valued customers for their continued patronage. The Directors place on record theirappreciation of the services rendered by all the employees of the Corporation.

For and on behalf of the Board of Directors
Place : Visakhapatnam Rinkesh Roy
Date : 15/07/2019 Chairman