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Gujarat Mineral Development Corporation Ltd.

BSE: 532181 Sector: Metals & Mining
NSE: GMDCLTD ISIN Code: INE131A01031
BSE 00:00 | 18 Sep 45.45 -0.05
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45.75

HIGH

45.90

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44.30

NSE 00:00 | 18 Sep 45.25 -0.25
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OPEN 45.75
PREVIOUS CLOSE 45.50
VOLUME 57811
52-Week high 72.40
52-Week low 29.50
P/E 5.93
Mkt Cap.(Rs cr) 1,445
Buy Price 45.10
Buy Qty 1000.00
Sell Price 45.35
Sell Qty 500.00
OPEN 45.75
CLOSE 45.50
VOLUME 57811
52-Week high 72.40
52-Week low 29.50
P/E 5.93
Mkt Cap.(Rs cr) 1,445
Buy Price 45.10
Buy Qty 1000.00
Sell Price 45.35
Sell Qty 500.00

Gujarat Mineral Development Corporation Ltd. (GMDCLTD) - Director Report

Company director report

To

The Shareholders

Gujarat Mineral Development Corporation Limited

Your Directors have pleasure in presenting 56th Board's Report along with the auditedaccounts of your company for the financial year 2018-19.

1. FINANCIAL RESULTS

Our profit after tax for the year is Rs 138.79 crore as against Rs 428.27 crore lastyear.

Particulars 2018-19 2017-18
Rs In Lakh Rs In Lakh
Total Income from Operations (net) 202225.52 218938.65
Net Profit/(Loss) for the period (before Tax and Exceptional items) 60495.08 55054.87
Net Profit/(Loss) after tax (after Exceptional items) 13878.68 42822.69
Total Comprehensive Income for the period [Comprising Profit/(Loss) after tax and Other Comprehensive Income (after tax)] 1898.11 54132.40

2. REVIEW OF THE BUSINESS OPERATIONS

2.1 LIGNITE PROJECTS:

During the year the Company operated six lignite mines namely PanandhroMata-No-Madh Rajpardi Tadkeshwar Bhavnagar and Umarsar Lignite Mines. During the yearunder review 91.90 lakh MT of lignite were produced from these mines. The mine-wiseproduction figures are as follows:

Sr. No. Name of mine Lignite production in lakh MT
1 Panandhro 7.08
2 Mata-No-Madh 32.81
3 Raipardi 9.98
4 Tadkeshwar 19.43
5 Bhavnagar 6.72
6 Umarsar 15.88
Total 91.90

2.2 POWER PROJECT - NANI CHHER

During the year under review 2 x 125 MW Akrimota Thermal Power Station is runningsuccessfully. This year the Power Plant generated 1187.43 MUs having 54.22% PLF.

2.3 WIND AND SOLAR POWER

Wind Farm Projects of 200.9 MW are situated at different locations in Gujarat and 5 MWSolar Power Project is situated at Panandhro Lignite Project which are runningsatisfactorily. The 200.9 MW Wind Projects have achieved 24.35% PLF (Plant Load Factor)whereas Solar Project is running at 16.91% CUF (Capacity Utilization Factor).

2.4 BAUXITE AND MANGANESE

2.4.1 Gadhsisa Group of Bauxite Mines - Kutch

In the Financial year 2018-19 Company has sold 111560.60 MT of (<52% Al2O3)Non Plant Grade Bauxite along with 6636.93 MT of mine dust from Gadhsisa Group of mineDistrict Kutch.

2.4.2 Mevasa Bauxite Mines Devbhoomi Dwarka

In the Financial year 2018-19 Company has sold 5125.48 MT (> 52% Al2O3)Plant Grade Bauxite and 54513.74 MT of (<52% Al2O3) Non PlantGrade Bauxite from Mevasa Mine District Devbhoomi Dwarka.

2.4.3 Manganese

In the Financial year 2018-19 Company has sold 48713.68 MT of Sub grade Manganese Orefrom Waste dump of Shivrajpur Project District Panchmahal.

3. DIVIDEND

Your Directors have pleasure to recommend a dividend of 100% i.e. Rs 2.0 per share onequity shares. An amount of Rs 6360 lakh on paid up equity share capital of Rs 6360 lakhshall be paid as dividend.

4. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

In terms of Section 124 of The Companies Act 2013 and applicable provisions ofCompanies Act 2013 any unclaimed dividend or unpaid dividend relating to the financialyear 2011-12 will be transferred to the Investor Education and Protection Fund establishedby the Central Government on due date. Further as per the provisions of IEPF Authority(Accounting Audit Transfer and Refund) Rules 2016 the company will also transfer theshares of the shareholders who have not claimed their dividend for a consecutive sevenyears. The necessary approval and the authorization for this purpose have already beencompleted. In line with the instructions to be received from Ministry of CorporateAffairs the company will transfer such shares to IEPF authority.

5. CONTRIBUTION TO CENTRAL EXCHEQUER:

The company has contributed Rs 197.63 crore towards income tax for the year underconsideration.

6. SHARE CAPITAL

During the year under review the issued subscribed and paid-up share capital remainedconstant at Rs 63.60 Crore divided into 31.80 crore equity shares of Rs 2 each.

7. TAXATION

Income Tax assessment of the Company has been completed up to the Financial Year2014-15.

8. INTERNAL AUDIT

M/s G S V & Co. Chartered Accountants and M/s R S Patel & Co. CharteredAccountants are the internal auditors of the company.

9. STATUTORY AUDIT

M/s. S C Ajmera & Co. Chartered Accountants were appointed Statutory Auditors ofthe Company by the Comptroller & Auditor General of India for the Financial Year2018-19.

10. AUDIT BY COMPTROLLER AND AUDIT GENERAL OF INDIA (C & AG)

Being a Government Company the C & AG has carried out supplementary audit of yourCompany pursuant to Provisions of Section 143 (6) of the Companies Act 2013. The C &A G has not offered any averse comment upon or supplementary to statutory audit report.

11. COST AUDIT

M/s Dinesh Birla & Co. was appointed as Cost Auditors of the company for the year2018-19. The Cost Audit Report has been filed on 6th September 2018 for the FinancialYear 2017-18.

12. SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act 2013 the Company hasappointed M/s. Pinakin Shah & Co. Company Secretary in Practice to undertake theSecretarial Audit of the Company for the year 2018-19. Their secretarial audit report isgiven in Annexure I forms part of this report.

13. STATUS OF VARIOUS JOINT VENTURES

13.1 Naini Coal Company Limited

Naini Coal Block was allocated jointly to the Company and Pondicherry IndustrialPromotion Development & Investment Corporation Limited (PIPDICL) and to develop theCoal Block Naini Coal Company Limited was incorporated as the joint venture company. Dueto slow progress on the project because of non-receipt of PL approval from Govt. ofOdisha Ministry of Coal Govt. of India de-allocated the block invoking 50% of the BankGuarantee. The Hon'ble Supreme Court of India has cancelled all the allocated coal blockswhich include Naini Coal Block also. Hence this joint venture will be closed in duecourse. GMDC has filed a petition in the Hon'ble High Court in respect of invocation ofBank Guarantee and is pending for disposal.

Meanwhile approval of the State Government has been received for closing the company.

13.2 Gujarat Credo Mineral Industries Limited

Dry beneficiation of low grade bauxite and Zeolite manufacturing plant has beencommissioned.

13.3 Alumina and Aluminium Smelter Plant

Land required for the project has been allocated by Government and part possession hasbeen taken. Detailed Project Report for 0.5 Million TPA plant got prepared by NALCO and isnot viable. Hence they had requested GMDC to drop the project for which approval of Govt.of Gujarat has been received.

13.4 Fluorspar Beneficiation Plant

GMDC along with M/s. Gujarat Fluorochemicals Limited and M/s Navin FluorineInternational Limited is setting up the fluorspar beneficiation plant a single largestproject of 40000 MTPA capacity at Kadipani. Based on pilot test report Global tenderwill be floated for selection of EPC contract. Valuation report for Kadipani assets hasbeen received. Based on report land will be leased on hire basis to JV Company and assettransfer will be carried out in favour of JV Company.

13.5 Aikya Chemicals Private Limited

Manganese Oxide Manganese dioxide and Manganese Sulphate plant set by JVC has beencommissioned. GMDC has so far invested Rs 3.90 crore as equity in the company.

13.6 Bhavnagar Energy Company Limited

During the year Bhavnagar Energy Company Ltd. has been merged with Gujarat StateElectricity Corporation Ltd. vide Notification dated 27th August 2018 issued by Energyand Petrochemicals Department Government of Gujarat. GMDC has been given one share ofGSECL of Rs 10 fully paid against the total investment of Rs 29765.00 lakh in297650000 equity shares of BECL of Rs 10 each fully paid.

14. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THESE FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT

No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which these financial statements relateand the date of this report.

15. ENVIRONMENTAL PROGRAMME

Environmental Programme refers to the Management of an Organization's EnvironmentalProgrammes in a Systematic Sustainables and Planned Manner along with its documentationimplementation & review.

During the year 2018-19 GMDC has planted total 136518 plants saplings covering 58.91hectares of mine lease and residential colony areas involving State Forest Departmentlocal villagers societies etc. For efficient use of water drip irrigation networks areused for plantation.

Under statutory compliance as a part of monthly environmental monitoring for airwater and noise pollution is being done through the laboratory approved by Ministry ofEnvironment and Forests/ Gujarat Pollution Control Board as well as through in-housefacility. Annual Environment Audit at GMDC Projects is being done by GPCB approvedSchedule I / II Auditors as applicable.

Primary Effluent Treatment Plants (PETP's have been commissioned at major lignite minesof GMDC for the treatment of acid mine drainage water. These ETP's are prefabricatedmovable structure so can be easily shifted to other location after completion of project.We are using Caustic Lye as neutralizing agent to neutralise mine drainage water whichproduces less amount of sludge as well also work as alkali coagulant in precipitation ofmetals present in effluent. It is automatic plant which automatically adjust its processbased on input characteristics of water and all parameters are connected to Cloud BasedTechnology so that its performance can be monitored from anywhere.

GMDC has procured the state-of-the-art mobile water treatment vehicle for efficienttreatment & better utilization of mine seepage water. It has capacity to treat mineseepage water to convert it to the standard of drinking water.

Unique features of mobile water treatment vehicle are as below:

• Mobile self-contained independent and automatic

• Produce drinking water from any contaminated water source

• Connect to any possible Water source (rivers lakes oceans brackish waterwells highly turbidity water)

• Plug & Play configuration

• High transferability and high level of safety

• Integrated water storage tank/distribution system

• Independent energy source

• Resistance to all weather conditions

In our seven mines Environment Clearnace conditions compliance was verified by MOEFBhopal successfully & verification reports received.

To create environmental awareness among all employees and surrounding communitiesincluding schools various environmental awareness programmes have been conducted throughcelebration of World Environment Day and Van Mahotsav in various GMDC projects.

16. INDUSTRIAL RELATIONS HEALTH AND SAFETY

The relations between the company and its employees continued to be cordial throughoutthe year. The company is also committed to the health and safety of not only its staff butalso of the people engaged through its contractors and community living in and around itsproject areas.

Dispensaries with qualified doctors and para-medical staff are in operation atPanandhro Akrimota Thermal Power Plant Rajpardi and Kadipani Projects. Mobile medicalvans facilities are also operational at various projects. At every project GMDC providesISI & DGMS safety shoes and other safety devices and adopts best safety practices.

The Company is an OHSAS 18001 certified company. Regular health check up ofemployees engaged in Mining and Power segment including employees engaged throughcontractors transporters etc. are conducted.

17. PARTICULARS OF EMPLOYEES

GMDC did not have any employee who was employed throughout the financial year and inreceipt of remuneration of Rs 60 lakh or more or employed for part of the year and inreceipt of Rs 5 lakh or more a month under Rule 5 (2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

The table containing other particulars of employees in accordance with the provisionsof Section 197 (1) of the Companies Act 2013 read with Rule 5 (1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is appended atAnnexure II to the Board's Report.

18. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

Additional information on conservation of energy technology absorption foreignexchange earnings and outgo as required by the Section 134 (3) (m) of the Companies Act2013 read with Rule 8 (3) of the Companies (Accounts) Rules 2014 is annexed as AnnexureIII and forms part of this report.

19. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OFTHE COMPANY

Looking to the profile of GMDC i.e. Mining and Power Operations GMDC has inbuiltrisk management practices to address various operational risks. GMDC has standardoperating processes for various mining operations in order to mitigate procedures andprevent risk arising out of various operations. GMDC has no external borrowings. Hencethere is no financial risk that can impact GMDC's Financial Position. GMDC primarily dealswith natural resources. Hence Policy of Government may impact GMDC's operationalstrategy.

GMDC's risk management process revolves around following parameters:

1. Risk Identification and Impact Assessment

2. Risk Evaluation

3. Risk Reporting and Disclosure

4. Risk Mitigation

GMDC has also set up a Risk Management Committee.

20. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013

There were no loans and guarantees given by the company under Section 186 of theCompanies Act 2013.

21. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

During the Financial Year the transactions entered into by the company with therelated parties were in the ordinary course of business at arm's length. The company hasnot entered into contracts / arrangements / transactions with Related Parties which couldbe considered material in accordance with Section 188 of the Act and the Policy of thecompany for Related Party Transactions. Hence the disclosure in Form AOC - 2 underSection 134 (3) of Companies Act 2013 is not required. The Policy on Related PartyTransactions may be accessed on the website of the company at https://www.gmdcltd.com/en/ corporate-polices-gmdc.

22. EXPLANATION OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSE REMARKS ORDISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS

There are no such comments.

23. GMDC'S POLICY RELATING TO DIRECTORS APPOINTMENT PAYMENT OF REMUNERATION ANDDISCHARGE OF THEIR DUTIES

GMDC being a Government Company the Government of Gujarat appoints its Directorsexcept the Independent Directors. GMDC does not pay any remuneration to its Directorsexcept the sitting fees and out of pocket expenses. The Independent Directors areappointed by the Shareholders in their General Meeting. Except the Managing Director allthe Directors of GMDC are nonexecutive directors.

24. EXTRACTS OF ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule12 of the Companies (Management and Administration) Rules 2014 is appended in Annexure IVto this report.

25. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW

GMDC had conducted 4 Board Meetings in the financial year under review.

26. DIRECTORSRs RESPONSIBILIY STATEMENT

In accordance with the provisions of Section 134(5) of the Companies Act 2013 theBoard hereby submits its Responsibility Statement:-

a. In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

b. The Directors has selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of financial year and of theprofit and loss of the company for that period;

c. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

d. The Directors had prepared the annual accounts on a going concern basis;

e. The Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

f. The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

27. DEPOSITS

GMDC has neither accepted nor renewed any deposits during the year under review.

28. DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures that they fulfill all therequirements as stipulated in Section 149(6) of the Companies Act 2013 so as to qualifythemselves to be appointed as Independent Directors under the provisions of the CompaniesAct 2013 and the relevant rules.

29. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM

During the year under review the Audit Committee consisted of the following members:

(i) Shri Bhadresh Mehta

(ii) Shri Sanjeev Kumar IAS

(iii) Shri S B Dangayach

(iv) Shri Nitin Shukla

(v) Prof Shailesh Gandhi

GMDC has established a Whistle Blower / Vigil Mechanism Policy. GMDC has also providedadequate safeguards against victimization of employees and Directors who express theirconcerns. GMDC has also provided direct access to the chairman of the Audit Committee onreporting issues concerning the interests of employees and the Company.

30. SHARES

30.1 BUY BACK OF SECURITIES

GMDC has not bought back any of its securities during the year under review.

30.2 SWEAT EQUITY

GMDC has not issued any Sweat Equity Shares during the year under review.

30.3 BONUS SHARES

No Bonus Shares were issued during the year under review.

30.4 EMPLOYEES STOCK OPTION PLAN

GMDC has not provided any Stock Option Scheme to the employees.

31. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) Act 2013

GMDC has in place Sexual Harassment Policy in line with the requirements of The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual temporary trainees)are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed offduring the year 2018-19:

No. of complaints received : NIL No. of complaints disposed of : NIL

32. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company have been prepared in accordancewith Indian Accounting Standard (Ind AS) notified under Section 133 of the Companies Act2013 read with the Companies (Indian Accounting Standard) Rules 2015 and other relevantprovisions of the Act form part of this Annual Report. Further a statement containingsalient features of the Financial Statements of Subsidiaries / Associate Companies / JointVentures in the prescribed format AOC - 1 is given at Annexure V.

33. BOARD-OF-DIRECTORS

The tenure of Shri Bhadresh Mehta Independent Director was completed on 31.3.2019 andhence he ceased to be the Independent Director of company. After the end of the financialyear Smt. Gauri Kumar IAS has been appointed as additional independent woman directorw.e.f. 7.6.2019.

34. CORPORATE GOVERNANCE

As per requirement of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 and as per the new listing agreement entered into with the variousStock Exchanges the detailed report on the Corporate Governance is given in Annexure VI.

35. MANAGEMENT DISCUSSION AND ANALYSIS

As per requirement of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 and as per

the new listing agreement entered into with the various Stock Exchanges ManagementDiscussion and Analysis is given at Annexure VII and form part of this report.

36. CORPORATE SOCIAL RESPONSIBILITY (CSR) AND CSR POLICY

GMDC has been sensitive towards its Social Responsibility right from its inception. Ithas adopted a business model which has an inclusive approach. The company is always keento address needs and requirements of the community within which it operates. Your companyreaches out to various segments of society in particular of rural community by providingthem critical rural infrastructure in various sectors such as Water Health SanitationEducation Employment Livelihood Agriculture etc. These initiatives of your companyattempt to take the fruits of development to those people who are not yet included in themain stream. In the year passed by your company has embarked upon a unique initiative ofe-clinic whereby the modern medical facilities will be delivered at the door step of ruralmasses apart from this your company has also enriched the libraries of schools in ruralareas of the state by providing them books. Under the CSR activities Modernization ofAnganwadi and making it smart Anganwadi has been taken up.

The CSR Policy of the Company is also uploaded on the website of GMDC. The CSR Policyframework of the company is available elsewhere in this annual report. A CSR Report forFiscal year 2018-19 as prescribed under Section 135 of the Companies Act 2013 read withthe Companies (Corporate Social Responsibility) Rules 2014 forms part of this Reportand is annexed at Annexure VIII.

37. ACKNOWLEDGEMENT

Your Directors are pleased to place on record their deep appreciation for the sincereservices and co-operation extended by the officers employees and workmen of GMDC at alllevels. They also wish to place on record their gratitude for the confidence placed inthem by financial institutions and investors. Further your Directors wish to thankvarious departments of the Central Government viz. the Ministry of Environment and ForestMinistry of Coal Ministry of Mines and various bodies of State Government of Gujarat viz.Industries & Mines Department the Finance Department Commissionerate of Geology andMining and Gujarat State Pollution Control Board. The Directors also extend theirheartiest thanks to the esteemed customers and shareholders of the Company for theirvalued co-operation.

For and on behalf of the Board-of-Directors

Arunkumar Solanki IAS S B Dangayach
Managing Director Independent Director
DIN : 03571453 DIN : 001572754
Date :03rd August2019
Place : Ahmedabad