On behalf of the Board of Directors of your Company I am delighted to present the 34thDirectors Report of your Maharatna Company along with Audited Financial Statements forthe nancial year 2017-18.
The important nancial highlights on standalone basis for the year 2017-18 are as under:
|Particulars ||2017-18 ||2016-17 |
| ||US $ Million ||(Rs in Crore) ||US $ Million ||Rs ( in Crore) |
|Gross sales ||8181 ||53690 ||7457 ||48789 |
|Other income (including other operating income) ||171 ||1122 ||194 ||1271 |
|Cost of sales (excluding interest and depreciation including extraordinary items) ||7038 ||46192 ||6491 ||42474 |
|Net Exceptional Items (Prot on Sale of Investments & Impairment of Assets) ||4 ||28 ||(46) ||(299) |
|Gross margin ||1318 ||8649 ||1114 ||7287 |
|Finance Cost ||42 ||275 ||73 ||479 |
|Depreciation ||216 ||1415 ||213 ||1397 |
|Prot Before Tax (PBT) ||1060 ||6958 ||827 ||5411 |
|Provision for tax ||357 ||2340 ||292 ||1908 |
|Prot Aer Tax (PAT) ||704 ||4618 ||535 ||3503 |
|Appropriations || || || || |
|Final Dividend for previous year ||70 ||457 ||58 ||381 |
|Interim Dividend for current year ||197 ||1294 ||165 ||1078 |
|Corporate Dividend Tax ||54 ||353 ||45 ||295 |
|Net transfer to/from Bond Redemption || || || || |
|Reserve ||(42) ||(277) ||15 ||98 |
|Transfer to CSR Reserve ||- ||- ||- ||- |
|Transfer to General Reserve ||70 ||462 ||54 ||350 |
|Net surplus aer Appropriations ||355 ||2329 ||199 ||1301 |
|1 US $ in INR converted at the exchange rate as on 31st March of the respective financial year ||65.63 || ||65.43 || |
Gross sales increased by 10 % from Rs48789 crore during 2016-17 to Rs53690 crore in2017-18.
Prot Before Tax (PBT)
PBT registered a jump of 29% to Rs6958 crore during 2017-18 from Rs 5411 crore in2016-17.
Prot Aer Tax (PAT)
Prot aer Tax increased by 32% from Rs3503 crore during 2016-17 to a record high ofRs4618 crore in 2017-18.
Earnings Per Share (EPS)
In view of the increase in PAT EPS (adjusted aer Bonus issue in FY 17-18) has gone upfrom Rs15.53 per share as on March 31 2017 to Rs20.48 per share as on March 31 2018.
Consolidated Financial Statements
Your Company has prepared the Consolidated Financial Statements in accordance with theInd AS consolidating its subsidiaries associates and joint venture entities. Thehighlights of the Consolidated Financial Results are as follows:
| || ||(Rs in Crore) |
|Particulars ||2017-18 ||2016-17 |
|Turnover ||54694 ||49334 |
|Prot Before Tax ||6936 ||5183 |
|Prot Aer Tax ||4799 ||3368 |
|Other comprehensive income ||(321) ||1300 |
During the year under review the segment wise business performance of your Company isas under:
Natural Gas Marketing
Natural gas trading continues to constitute your Company core business. During FY2017-18 gas sales volume increased 5% to 85.0 MMSCMD from 81.21 MMSCMD in the previous%nancial year. Gross revenue of your Company due to gas marketing in FY 17-18 was
Rs 38021 Crore registering a jump of 10% mainly on account of the increase in saleprice and volume contributing 71% to the topline of the Company.
Natural gas transmission
Your Company owns and operates a network of around 11400 km of natural gas highpressure trunk pipeline with a pan-India capacity to handle volumes of around 206.03MMSCMD. The average gas transmission during the year 2017-18 was 105.23 MMSCMD comparedto 100.4 MMSCMD in the previous nancial year. The EBIDTA of Natural Gas transmissionincreased by 15% to Rs3633 crore from Rs3170 crore in the previous year.
Your Company operates 2038 kms of pipeline for LPG transmission. Jamnager-Loni and theVizag-Secunderabad pipeline networks achieved a throughput of 3.72 MMTPA during the yearagainst 3.36 MMTPA in the previous %scal year. Gross revenue of your Company from LPGtransmission in FY 17-18 was Rs558 crore as against Rs514 crore in FY 2016-17.
During 2017-18 your Companys production increased by 11% to 671 TMTs of polymers andsales increased by 15% to 674 TMTs of polymers from the Pata plant. Additionally morethan 205.56 TMTs of polymer produced by BCPL was sold by GAIL. Gross revenue of yourCompany from Petrochemicals in FY 17-18 was Rs5788 crore as against Rs5626 crore in FY2016-17.
LPG and Other Liquid Hydrocarbon Production
Your Company has six LPG plants at five locations in the country having a productioncapacity of 1.5 million MT. In 2017-18 total liquid hydrocarbon production was about 1.28Million MT of which over 80% constitutes LPG and Propane. This segment showed a signicantjump of 83% at the EBIDTA level which increased to Rs2372 crore from Rs1293 crore inthe previous year. The improvement was largely due to buoyant prices and 15% increase insale volumes.
Exploration and Production (E&P)
Your Company now has participating interest in 10 E&P blocks of which 8 blocks arein India and 2 blocks in Myanmar. Out of these your Company is Operator in one onlandblock viz. CB-ONN-2010/11 in the Cambay basin awarded during the NELP-IX bidding round.Revenue of approx. Rs631 crore has been generated from sale of hydrocarbons from theseblocks during the year 2017-18.
GAIL Global (USA) Inc. (GGUI) a wholly owned subsidiary of GAIL
(India) Limited executed a Purchase and Participation Agreement with Carrizo Oil &Gas Inc. in September 2011 in order to enter into an unincorporated Joint Venture foracquiring 20% working interest in Carrizo
certain Eagle Ford Shale acreage position in Texas USA. Carrizo is the Operatorof the JV. The JV
lease holding is primarily located in the wet gas / condensate window in EagleFord shale in South Texas having signi%cant liquids content.
Disinvestment by President of India
The Government of India disinvested 13026898 shares in June 2018 through CPSE Bharat22 ETF. A;er disinvestment the President of India shareholding is 1195521226 equityshares representing 53.01% of paid-up share capital of GAIL.
Your Company has a consistent track-record of dividend payment. The Board of Directorsof your Company had earlier approved payment of an interim dividend @ 76.50% on equityshare of Rs10 each (Rs 7.65 per equity share) amounting to Rs1293.85 crore on thenpaid-up equity share capital of the
Company (Rs 1691.30 crores) which was paid in January 2018. Further the Board hasrecommended payment of nal dividend @14.40% on an equity share of Rs10 each (Rs1.44 perequity share) on expanded equity post issue of Bonus shares i.e. Rs2255.07 crores forFY 2017-18 amounting to Rs324.72 crore.
With this the total dividend payment for the %scal year 2017-18 will be 71.80% on anequity share of Rs10 each (Rs 7.18 /- per equity share) amounting to Rs1618.57 crore onits paid-up equity capital of Rs2255.07 crore which is 35.05% of PAT and equals 5% ofopening net worth of Rs32349.69 crore as per the Companies Act 2013 and in compliance ofDepartment of Investment & Public Asset Management (DIPAM) guidelines. In addition tothe payment of dividend to the shareholders your Company paid dividend distribution taxof Rs352.53 crore.
Contribution to Exchequer
Your Company has contributed Rs6782 crore in 2017-18 to the exchequer throughdividend duties taxes and others as compared to Rs5909 crore in 2016-17.
Your Company has been rearmed the highest domestic credit rating of AAA from ICRA CARECRISIL and India Rating. This signies the highest credit rating in India hence carrieslower credit risk of the Company.
The International rating agency Moodys International Singapore has upgraded thecorporate issuer rating from Baa3 with a positive outlook to Baa2 with stable outlookwhich is equal to the sovereign rating of India. Further Fitch Ratings has also assigneda long-term foreign currency issuer default rating of BBB- with a stable outlook which isalso equal to the sovereign rating of India. The international rating agencies Moody
s and Fitch have rated your Company at par with India
s international rating. The agencies have indicated that your Companys rating may beupgraded once the sovereign rating of India improves.
Particulars of Loans Investments and Corporate Guarantees
Details of investments loan and guarantee covered under Section 186 of The CompaniesAct 2013 forms part of the nancial statement as a separate section in the Annual ReportFY 2017-18.
Related Parties - Subsidiaries/ Associates/ Joint Ventures
Your Company has formed subsidiaries/ associates/ joint venture companies for City GasDistribution such as GAIL Gas Limited Indraprastha Limited Mahanagar Gas Limited etc.;petrochemicals such as Brahmaputra Cracker and Polymer Limited ONGC Petro-additionLimited; LNG/ Re-gasi%cation such as GAIL Global (USA) LNG LLC Petronet LNG Limitedetc.; gas trading power generation and shale gas. Contracts or arrangements/ transactionswith related parties were on an arms length basis and in the ordinary course of business.
In order to facilitate the transfer of LNG undertaking pursuant to the Demerger Schemeof RGPPL RGPPL incorporated Konkan LNG Private Limited (KLPL) as its wholly-ownedsubsidiary in December 2015. The Demerger Scheme of RGPPL was approved by NationalCompany Law Appellate Tribunal (NCLAT) vide order dated February 28 2018 with appointeddate as January 01 2016 thereby transferring LNG business and all its associated assetsand liabilities to KLPL with mirror shareholding to RGPPL.
No subsidiary / joint venture company ceased to exist during the year. Thesubsidiaries/ associates/ joint venture companies of your Company have contributedsignicantly to its business expansion activities. A statement containing the salientfeatures of the nancial statements of your Companys Subsidiaries Associate Companies andJoint Ventures as per first proviso of section 129(3) of The Companies Act 2013 includingdetails of Individual contribution of all subsidiaries associates and joint venturecompanies towards the overall performance of Company during the period is given underConsolidated Financial Statements.
Corporate Vigilance department of your Company is ISO-9001:2008 certied for havingadopted Quality Management System (QMS) in compliance with the requirements of ISO.Further eorts are being made for the transition of existing QMS of Corporate VigilanceDepartment to ISO 9001:2015. To bring transparency in its systems and processes for thebenet of vendors and suppliers status of e-tendering e-payments & receipts ismonitored and reported to MoP&NG. In addition to this a number of system improvementswere aected in your Company during the year for eective utilization of its resourceswhich in turn would help to prevent corruption and ensure all round good governance. Someof these improvements are:
Online vigilance clearance status of senior executives is in place.
List of vendors put on Holiday / Banned is available on GAIL Intranet.
To regulate the release of man-days based payment to contract employees Bio-metriccard based Access Control system for entry/exit of contract employees is underimplementation.
The Vigilance Awareness Week-2017 was observed on the theme My Vision Corruption FreeIndia at the corporate oce and at all the work centers from 30th October to 4th November2017. An interactive session was organized at the GAIL Corporate Oce on October 30 2017where in Sh. K V Chowdary Central Vigilance Commissioner of India interacted with all thework centers of GAIL through Video Conferencing. GAIL Vigilance Magazine QJAGROOK was alsoreleased on the occasion.
Essay writing slogan writing and poster making competition for employees includingcontract employees were organized wherein a total number of 2657 employees & theirwards participated across 31 GAIL work centers. To create awareness among the youthtowards the ill-eNects of corruption debate/allocution competitions were organizedwherein a total number of 2106 students participated from over 27 schools/colleges.Further Online Vigilance Quiz was conducted covering all work centers of GAIL on November01 2017.
Customer/Vendor Interaction Meets were organized at 4 locations. The concludingfunction was held on November 04 2017 at Corporate Oce in which Sh. Pratyush SinhaEx-CVC was the the Chief Guest. A Knowledge Sharing Session was also organized during theevent.
Representation of Priority Section
Your Company has been complying with the Presidential Directives and otherinstructions/guidelines issued from time to time pertaining to Policies and Procedures ofGovernment of India in regard to reservation relaxations concessions etc. for ScheduledCastes (SCs) Scheduled Tribes (STs) Other Backward Classes (OBCs) and Persons withDisabilities (PWDs) in Direct Recruitment.
Details with regard to group-wise total number of employees and the representation ofScheduled Castes Scheduled Tribes and Other Backward Classes amongst them in yourCompany as on March 31 2018 are given in the table below:
|Group ||Employees on Roll ||SC ||ST ||OBC ||PWD |
|A ||3247 ||514 ||207 ||606 ||48 |
|B ||507 ||90 ||55 ||110 ||10 |
|C ||669 ||123 ||22 ||222 ||37 |
|D ||57 ||14 ||06 ||16 ||- |
|C&MD DIRECTORS & CVO ||6 ||- ||1 ||- ||- |
|Total ||4486 ||741 ||291 ||954 ||95 |
A total of 222 new employees (including CVO) joined your Company during the FY 2017-18.Total manpower of the Company as on March 31 2018 stood at 4486 (including Whole-timeDirectors & CVO) with 16.5 % of its employees belonging to the SC category 6.5% tothe ST category 21.3% to the OBC category 7.9% to the Minorities and 2.1% to the Personswith Disabilities (PWDs) category. Your Company's workforce comprised of 273 womenemployees as on March 31 2018.
The Ocial Language Implementation Commiees at the Corporate and Work Centre level meetson a quarterly basis to monitor and review the progress made for achieving the targets xedin the Annual Program issued by the Government. of India.
Hindi workshops/trainings are organized on regular basis at Corporate Oce and all workcentres. Hindi computer training sessions are also integral part of these programs. 127Hindi workshops were conducted during 2017-18 in which 2260 employees were providedtraining.
Hindi Fortnight was observed across GAIL from September 14 to 28 2017 to propagatelinguistic harmony and to motivate the employees for the progressive usage of Hindi intheir day-to-day work.
Your Company also publishes its half-yearly Hindi magazine QRajbhasha Sahyog to promoteHindi language and to provide a platform for creative writing in Hindi. During the yearVSuvicharon ka Sankalan a compendium of
365 select inspirational and motivational quotes was published and distributed amongthe employees.
The 18th VGAIL Rajbhasha Sammelan was organized on March 10 2018 at Amritsar (Punjab)to spread and propagate the essence of Hindi and simultaneously review the progress madeon the implementation of the ocial language in the Company.
The First Sub-Commiee of Commiee of Parliament on Ocial Language inspected theAhmadabad Zonal and GAIL Corporate oces to review the steps undertaken to promote theocial language and it was appreciative of the eorts we had undertaken.
Sexual Harassment of Women at Workplace
Your Company has in place a Policy on Prevention Prohibition and Redressal of SexualHarassment of Women at Workplace in line with the requirements of the Sexual Harassment ofWomen at the Workplace (Prevention Prohibition & Redressal) Act 2013.The InternalComplaints Commiee (ICC) has been set up to redress complaints received regarding sexualharassment.
During the year 2017-18 no complaints of sexual harassment were received.
Procurement from Micro and Small Enterprises (MSEs)
The Government of India has notied a Public Procurement Policy for Micro and SmallEnterprises (MSEs) Order 2012.
In terms of the said policy out of the total eligible value of annual procurement ofapprox. Rs 4901 crore towards goods produced and services rendered by MSEs (includingMSEs owned by SC/ST Entrepreneur) during the FY 2017-18 the value of total procurementmade from MSEs is Rs 1362 crore which is approx. 27.79%.
A Memorandum of Understanding (MoU) is signed every year between your Company and itsadministrative ministry i.e. MoP&NG through which performance targets for the yearare set.
Your Company achieved Excellent MoU rating for the nancial year 2016-17.
MoU for the year 2017-18 was signed between Chairman & Managing Director GAIL andSecretary (P&NG) Government of India on July 03 2017.
MoU 2017-18 was majorly aligned towards achieving GoIs vision of India being agas-based economy. The thrust while xing MoU targets was on increasing the number of PNGconnections CNG stations implementation of green corridor and other critical aspects ofthe Company including key nancial parameters gas marketing gas transmission projectimplementation capital expenditure etc.
The evaluation of MoU 2017-18 is under progress and the nal evaluated MoU score andrating is expected to be announced during December 2018.
Right to Information (RTI)
In order to promote transparency and accountability an appropriate mechanism has beenset up across the Company in line with the Right to Information Act 2005. Your Companyhas nominated CPIO/ACPIOs/ Appellate Authorities at its units/oces across the Company toprovide information to citizens under the provisions of the RTI Act.
Your Company has hosted RTI Guidelines and related information on its site and thesemay be accessed at hp://www.gailonline.com/nalfisite/RTI.html. Besides MIS Report on RTIApplications Record Retention Schedule and latest RTI Audit Report had also been hostedunder the same link.
Section 4(1)(b) of the RTI Act 2005 lays down the information which should bedisclosed by any Public Authorities on a suo-motu or proactive basis. Section 4(2) andSection 4(3) prescribe the method of dissemination of this information. Accordinglykeeping in view the purpose of suo-motu disclosures under Section-4 GAIL
Corporate RTI Cell has hosted a dedicated page on GAIL website through which largeamount of information in the public domain on proactive basis is placed. This is beingdone to make the functioning of your Company more transparent and reduce the need for lingindividual RTI applications.
Further your Company has been made LIVE on the GoIs-DoPT Online RTI Portal from July2016 and ever since we are providing information Online apart from providing therequested information oine.
For the Financial Year 2017-18 GAILs Corporate RTI Cell has 100% disposal rate inrespect of RTI Applications received & disposed o. As on 31st March 2018 we had apendency of 17 RTI Applications which were disposed-o subsequently within timeschedule/as per the provisions of the RTI Statute. Further your Company has received VNILpenalty/adverse remarks from Central Information Commission for the year 2017-18 inrespect of second Appeal led by Appellants.
Management Discussion and Analysis
In terms of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and clause 7.5 of DPE Guidelines on Corporate Governance the detailedManagements Discussion and Analysis forms part of this report at Annexure- A.
Your Company believes that good corporate governance plays a critical role inestablishing a positive organizational culture. It is evident by responsibilityaccountability consistency fairness and transparency towards our stakeholders. Pursuantto the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and DPEguidelines on Corporate Governance a report on Corporate Governance forms part of thisReport at Annexure- B.
The details of the meetings of the Board Companys policy on Directors appointment andtheir remuneration details of establishment of whistle blower mechanism and other maUersetc. forms part of report on Corporate Governance.
There is no signicant and material order passed by the regulators or Courts ortribunals impacting the going concern status and the Companys operations in future.
The statutory auditors of the Company have examined and certied your Companyscompliance with respect to conditions enumerated in SEBI (LODR) Regulations 2015 and DPEguidelines on Corporate Governance. The certicate forms a part of this Report at Annexure-C.
The statutory auditor of your Company is appointed by Comptroller & Auditor Generalof India (CAG). M/s O P Bagla & Co. LLP (Formerly O P
Bagla & Co) Chartered Accountants New Delhi and M/s ASA Associates LLP CharteredAccountants New Delhi were appointed as Joint Statutory Auditors of your Company for theFY 2017-18.
Review and Comments of CAG if any on the Company
s Financial Statements for the nancial year ending March 312018 form part ofFinancial Statement. Notes on Financial Statement referred to in the Auditors Report areself-explanatory and therefore do not call for any further comment.
There are no qualications by the statutory auditors on the nancial statements for FY2017-18.
Your Company has appointed M/s Ramanath Iyer & Co. New Delhi for Northern Region M/s Bandyopadhyaya Bhaumik & Co. Kolkata for Northern and Eastern Region M/s A CDua & Co. Kolkata for Southern Region M/s Musib & Company Mumbai for WesternRegion Part-I M/s N.D Birla & Co. Ahmedabad for Western Region Part-II and M/sSanjay Gupta & Associates New Delhi for Central Region as cost auditors for FY2017-18. M/s Ramanath Iyer & Co. is the lead cost auditor.
Your Company is maintaining cost records as speci%ed by the Central Government undersub-section (1) of section 148 of the Companies Act 2013.
Cost audit reports for the nancial year ended March 31 2017 were led to Registrar ofCompanies on September 07 2017.
Your Company has an in-house Internal Audit Department which is headed by ExecutiveDirector.
Your Company has appointed M/s Agarwal S. & Associates as secretarial auditors forFY 2017-18. Secretarial Audit Report conrming compliance by Practicing Company Secretaryto the applicable provisions of the Companies Act 2013 SEBI (LODR) Regulations 2015 andother applicable laws forms part of this Report at Annexure- D.
The observation made by Secretarial Auditor in his Audit report is as under:
Non-compliance of Regulation 17 (10) & 25 (4) of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 the Company has not carried out theperformance evaluation of the directors.
Explanation on observation made by Secretarial Auditor in his Audit report is as under:
GAIL is a Government Company appointment/ nomination of all the Directors includingIndependent Directors are being done through by the President of India through theMoP&NG therefore performance evaluation of individual Directors includingIndependent Directors is to be done by Government of India being the appointing authority.As per requirement of SEBI (LODR) Regulations 2015 a policy on performance evaluationincluding an evaluation criterion for the Board and its directors has been formulated.
In this regard MCA vide notication dated June 5 2015 & July 5 2017 has exemptedGovernment Companies from applicability of the following provisions:
Section 134 (3)(p) and 178 (2) of The Companies Act 2013 &
Sub-Para (2) and (7) of Para II Para IV Para V clauses (a) and (b) of sub- Para (3)of Para VII and Para VIII of Schedule IV (Code for Independent Directors) respectively.
In this regard SEBI has also been requested for grant of exemption from the provisionsof SEBI (LODR) Regulations 2015 relating to Performance Evaluation of Board and itsdirectors in line with exemptions granted to Government Companies in The Companies Act2013. The reply from SEBI is awaited. The maer was deliberated in Nomination andRemuneration Commiee and it was decided that the dra policy will be considered for Boardsapproval on receipt of any speci%c directives from SEBI in this regard. The same wasinformed to the Board also.
As per provisions of section 134(3)(p) of The Companies Act 2013 for every listedcompany a statement indicating the manner in which formal annual evaluation of theperformance of the Board its Commiees and of individual directors should form part of theDirectors Report.
However as per notication dated June 5 2015 and July 5 2017 issued by the Ministryof Corporate Aairs Government of India government companies are exempted from provisionspertaining to performance evaluation of the Board its commiees and individual directorsunder the Companies Act 2013.
Your Company is a government company and the appointment tenure performanceevaluation etc. of Directors is done by the Government of India therefore suchparticulars have not been included as part of the Directors Report.
Corporate Social Responsibility
Your Company rmly believes that Corporate Social Responsibility (CSR) plays a majorrole in the development of any country and therefore it has made CSR an integral part ofits ethos and culture. Your Company goes beyond the statutory compliances and makes eortscontribute to the economic development while improving the quality of life of the localcommunity around the companys work centers and the society at large. To amplify itsoutreach eorts your Company has incurred an expenditure of 2.63% of the average net protof the preceding three years on CSR projects/activities in FY 2017-18 (Rs91.65 Crore)against the stipulated 2% spend (Rs69.67 crores).
Annual Report on CSR activities as required under Rule 8 of the Companies (CorporateSocial Responsibility Policy) Rules 2014 read with section 134(3) and 135(2) of theCompanies Act 2013 is placed at Annexure E.
Energy Conservation Technology Absorption and Foreign Exchange Earnings and Outgo
As per requirement of 134 (3)(m) of the Companies Act 2013 read with Rule 8(2) of theCompanies (Accounts) Rules 2014 details of conservation of energy and technologyabsorption and Foreign Exchange Earnings and Outgo forms part of this report at Annexure-F
Particulars of contracts or arrangements with related parties
As per requirement of 134 (3) (h) of The Companies Act 2013 read with Rule 8(2) of theCompanies (Accounts) Rules 2014 particulars of contracts or arrangements with relatedparties as referred in section 188(1) of The Companies Act 2013 in the prescribed formAOC-2 is placed at Annexure-G.
Your Company has formulated the policy on dealing with Related Party Transactions andthe same is hosted on your Company
s website athUp://www.gailonline.com/%nalfisite/pdf/GAILfiRelatedfiPartyfiTransactionfi Policy.pdf.
Particulars of Employees
As per provisions of section 197(12) of The Companies Act 2013 read with the Rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 everylisted Company is required to disclose the ratio of the remuneration of each director tothe median employees remuneration etc. in the Directors Report. In terms of theprovisions of section 197(12) of The Companies Act 2013 read with the Rule 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 everyCompany is required to give a statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in the said rules in theAnnual Report.
However as per notication dated June 5 2015 issued by the Ministry of CorporateANairs Government of India Government Companies are exempted from complying withprovisions of section 197 of The Companies Act 2013. Your Company is a GovernmentCompany therefore such particulars have not been included as part of the DirectorsReport.
Extract of Annual Return
Extract of Annual Return forms part of this Report at Annexure-H.
Dividend Distribution Policy
As per Regulation 43A of the SEBI (LODR) Regulation 2015 your Company has formulated aDividend Distribution Policy. The dividend pay-out is in accordance with the CompanysDividend Distribution Policy.
The Dividend Distribution Policy of the Company is available on the Company
website at hUp://www.gailonline.com/%nalfisite/ pdf/InvestorsZone/GAIL%20Dividend%20Distribution%20Policy.pdf.
Issue of Shares and Fixed Deposits
In March 2018 your Company issued and alloUed Bonus Shares to the shareholders inratio of one equity share of Rs10 each for every three equity shares of Rs10 each held ason 29.03.2018. As a result the Paid-up Equity Capital has increased from Rs1691.30crores to Rs2255.07 crores by capitalizing the General Reserves for Rs563.77 crores.
Your Company has not accepted any xed deposits during the nancial year 2017-18 and assuch no amount of principal or interest was outstanding as of the balance sheet date.
During FY 2017-18 your Company has not raised funds through preferential allotment orqualied institutions placement.
Foreign Exchange Earnings and Outgo
During FY 2017-18 Foreign exchange earnings were Rs 1797.92 crore and foreigncurrency outgo was Rs 11116.05 crore.
Key Managerial Personnel and Directors
The following Key Managerial Personnel (KMP) were appointed on the Board of yourCompany:
Shri Gajendra Singh Director (Marketing) w.e.f April 05 2017.
Shri Manoj Jain Director (Business Development) w.e.f June 05 2018.
The following were appointed on the Board of your Company as a Non-ocial Part-TimeDirector(s):
Dr.Rahul Mukherjee Independent Director w.e.f. September 15 2017 (from the date ofobtaining DIN)
Shri Jayanto Narayan Chaudhury Independent Director w.e.f. September 15 2017 (fromthe date of obtaining DIN)
Ms. Indrani Kaushal Government Nominee w.e.f. September 22 2017
Ms. Banto Devi Kataria Independent Director w.e.f. August 6 2018 (from the date ofobtaining DIN)
Shri Anant Kumar Singh ceased to be Director on the Board of your Company w.e.f. May11 2017.
The Board placed on record its deep appreciation for the valuable services rendered byoutgoing Directors/KMPs during their association with your Company.
Code of Conduct
Pursuant to the requirements of SEBI (LODR) Regulations 2015 and DPE Guidelines onCorporate Governance the Board Members and Senior Management Personnel have armedcompliance with the Code of Conduct for the nancial year ending 31st March 2018.
Directors Responsibility Statement
Yours Directors conrm that they have:
i) followed applicable accounting standards alongwith proper explanation relating tomaterial departures in the preparation of the annual accounts for the nancial year endingMarch 31 2018; ii) selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent to give a true and fair viewof the state of aairs of the Company at the end of the %nancial year and of the pro%t ofthe Company for the year under review;
iii) taken proper and suJcient care for the maintenance of adequate accounting recordsin accordance with the provisions of The Companies Act 2013 for safeguarding the assetsof the Company and for preventing and detecting fraud and other irregularities;
iv) prepared the annual accounts for the nancial year ending March 31 2018 on a goingconcern basis;
v) devised proper systems to ensure compliance with the provisions of all applicablelaws and such systems were adequate and operating eectively; and
vi) laid down internal nancial controls to be followed by the Company and that suchinternal nancial controls are adequate and are operating eectively.
Your Directors express their appreciation for help guidance and support received fromthe Government of India especially the Ministry of Petroleum and Natural Gas variousstate governments regulatory and statutory authorities.
Your Directors acknowledge wise counsel received from Statutory Auditors and CAG andare grateful for their consistent support and cooperation.
Your Directors also wish to thank all the shareowners business partners and members ofthe GAIL family for reposing their faith trust and condence in your Company.
On behalf of your Directors I would like to place on record our deep appreciation forthe hard work dedication commitment and solidarity of your Companys employees.
Your Directors and employees look forward to the future with condence and stand commiedto creating a bright future for all stakeholders.
| ||For and on behalf of the Board |
| ||B.C. Tripathi |
|Place : New Delhi ||Chairman & Managing Director |
|Dated : 10.08.2018 ||(DIN: 01657366) |