Your Directors have great pleasure in presenting the report of the Business andOperations of your Company (the Company' or Gati') along with the auditedfinancial statements for the financial year ended March 31 2019. The ConsolidatedPerformance of your Company and its subsidiaries has been referred to wherever required.
1) Financial Highlights
| || || |
(Rs in mn)
|Particulars ||Standalone ||Consolidated |
| ||2018-19 ||2017-18 ||2018-19 ||2017-18 |
|Total Income ||5424* ||5247* ||18792 ||18143 |
|Profit before Finance Cost Depreciation & Amortization Expenses Exceptional items & Tax Expenses ||447 ||886 ||1103 ||1549 |
|Less: Finance cost ||151 ||194 ||453 ||470 |
|Less : Depreciation and Amortization Expenses ||40 ||50 ||295 ||300 |
|Profit before tax & Exceptional items ||256 ||643 ||355 ||780 |
|Less: Exceptional items ||- ||236 ||- ||236 |
|Profit before tax ||256 ||407 ||355 ||544 |
|Less: Tax expenses ||13 ||62 ||124 ||153 |
|Profit after tax ||243 ||345 ||230 ||391 |
|Attributable to || || || || |
|Owners of the company ||243 ||345 ||183 ||342 |
|Non controlling Interest ||- ||- ||47 ||49 |
|Add: other comprehensive Income (net of Tax) ||-19 ||2 ||31 ||-99 |
|Total comprehensive income ||224 ||347 ||199 ||292 |
|Attributable to || || || || |
|Owners of the company ||224 ||347 ||155 ||244 |
|Non controlling Interest ||- ||- ||44 ||49 |
* includes dividend Income from GKEPL
Your Directors have recommended dividend of (Re. 0.80/- per share) for the financialyear ended March 31 2019 (previous year 45%) when approved will be paid out of retainedearnings.
3) R eview of Operations
During the year under review at consolidated your Company achieved a revenue of RS18792 mn EBITDA of RS 1103 mn PBT of H 355 mn and PAT of RS 230 mn as against arevenue of RS 18143 mn EBITDA of RS 1549 mn PBT of RS 544 mn and PAT of H 391 mnrespectively in the previous year.
At standalone level your Company recorded revenue of RS 5424 mn EBITDA of RS 447 mnPBT of RS 256 mn and PAT of RS 243 mn as against revenue of RS 5247 mn EBITDA of RS 886mn PBT of RS 407 mn and PAT of H 345 mn in the previous year.
4) C ompany's performance
Gati Ecommerce Business
The e-commerce retail industry in India has grown at a substantial rate majorly drivenby increasing internet penetration (450 mn + internet users in India) and smart phoneusage. Some of the challenges that confront the sector and which in a way are shapingthe ways the e-commerce retail supply chain functions include changing governmentpolicies rising consumer expectations and amplified demand for same-day deliveries. Asdynamic as it is it is also experiencing the rise of new business models like omnichannel retailing and new business models for last mile delivery like delivery throughlocal retailers. Logistics requirements for the e-commerce retail sector are gettingreshaped by continuously evolving business demands.
The ecommerce retail logistics market in India is valued at around RS 100 billion in2018 and is projected to witness a growth of more than 30% in the coming five years andamounting to 19 lakh shipments per day signalling an upward growth trajectory of thesector with logistics being seen as a key enabler in its growth.
During the year under review your company's e-commerce segment strived towardsincreasing the share of higher weight shipments and as result saw the charged weight risebetween FY 2018 and FY 2019. During the year under review the e-Commerce division of yourcompany has recorded revenue of RS 178 Crores as against RS 160 Crores in the previousperiod.
We are re-positioning ourselves for the End to End Logistics play beyond First Mile& Last Mile Business to expand into Middle Mile Transportation and e fulfilmentWarehousing. Our focus is to develop efficient solutions to address the current challengesof the industry like reaching difficult locations (e.g. East North East Centralheartland of India). The e-commerce ecosystem is expected to progress towardscollaborative logistics and your company with its wide-ranging portfolio of services willbe a formidable player in this arena.
Gati Standalone Freight Forwarding and APAC Performance
Your company's freight forwarding division which deals in Air/Ocean freight servicescoupled with Customs House agency services saw a drop in revenues from RS 465 mn in FY2018 to H 340 mn in FY 2019. Going forward we are strong footed in promoting Last MileDelivery (LMD) service for all small and large e-tailers from china.
Your company's APAC subsidiary revenues stood at H 580 mn in FY 2019 compared to RS 767mn in FY 2018. Our APAC business is eying a China-India express volume increase due togrowing cross-border e-commerce. Your company will continue to support sellers on onlineplatforms to participate in cross-border e-Commerce to grow the APAC business.
Gati Standalone Fuel Station Performance
Your Company operates in fuel station segment and associated products like motor partsand lubricants under the Standalone business. Presently it runs five fuel stations mostlyin South and Central India with the business growing from RS 2399 mn in FY 2018 to Rs2921 mn in FY 2019. Our Gati Fuel station in Bengaluru completed 50 years of itssuccessful operations this year. Your company starting deploying female staff at the GatiFuel station Nagasandra Bengaluru as a showcase of its commitment towards equalopportunity and women empowerment.
Gati-Kintetsu Express Pvt Ltd. (GKEPL)
GKEPL for the last 3 decades is India's proven leader in imparting ExpressDistribution and Supply Chain Solutions and offers an unmatched service offering thatblends local experience with global expertise. During the year under review GKEPLrecorded revenue of RS 12335 mn EBITDA of RS 754 mn and PAT of RS 270 mn against arevenue of RS 11695 mn EBITDA of RS 743 mn and PAT of H 310 mn in the previous year.
GKEPL for the 1st three Quarters of FY 2019 had registered a good growth across itsservice segments and customer verticals. In Q4 the market was sluggishparticularlytheautomobilepharmaceuticalcomputers & electronics and textilessegment which are some of the key verticals that your company operates in. The economicslowdown and consequentially the reduced business of customers had a direct impact on yourcompany's performance in the last quarter of FY 2019.
Your company has been significantly driving strategic actions to re-position its growthby focusing on Key Enterprise accounts (KEA) Industry diversification and drivingend-to-end solutions for the customers. Also there is a significant drive on the part ofyour company for cost reduction & operational efficiency improvement. With theobjective of inculcating the thought of Quality is Everyone's SharedResponsibility' there has been a continuous quality specific trainings and KAIZENprojects across the organization. With regard to the latest regulations relating topollution control your company has plans to purchase vehicles in compliance with theBharat Stage (Euro) norms i.e. BS IV Version for long haul and Electric vehicles and CNGfor last mile delivery. On the operations front your company is planning to furtherincrease its capacity and capability by adding more pin codes & operating units toserve a larger customer base efficiently.
Gati Kausar India Ltd. (GKIL)
The Indian cold chain market was worth RS 1121 Billion in 2018. The market is furtherprojected to reach RS 2618 Billion by 2024 growing at a CAGR of 14.8% during 2019-2024.
The major driving forces of this sector are:
(a) Growth in the organised food retail
(b) Growth in the processed food sector
(c) Consumers demanding and shifting to a healthy lifestyle
(d) Increasing demand from healthcare sector.
During the year under review Gati Kausar recorded a revenue of RS 442 mn compared to H390 mn in the previous year. The EBITDA improved to a positive RS 28 mn against a minus H33 mn in the previous year.
Going forward your company endeavours to disrupt the Cold Chain market with unmatchedquality differentiated & customized services. We added a new fleet and streamlinedour operations in FY 2019 and there is continued focus to eliminate waste and have aleaner operation in the coming financial year.
Gati Import Export Trading Limited (GIETL)
Gati Import Export Trading Limited (GIETL) subsidiary is uniquely positioned to provideexcellent connectivity and regional access to global enterprises and operate highlycomplex inventory management systems. The revenues rose from RS 792 mn in FY 2018 to RS1095 mn in FY 2019.
Your company's strategy is to provide high margin Importer of Record (IOR) services foroverseas sellers looking to grow their e-Commerce business in India and profitabledomestic services for sellers looking for customised inventory ownership model withend-to-end supply chain solutions.
Your company focused on showcasing it strengths in the end to end logistics spaceamongst its existing customers and potential market. There was considerable increase inthe number of new kiosks and the amount of marketing support to these channel partners. Weparticipated in various logistics industry & consumer vertical conferences andreceived numerous awards from industry bodies and esteemed customers. Your company alsoachieved a critical milestone in by opening the first ever kiosk by a logistics company atthe Chennai Airport for the Excess Baggage services for airline passengers.
5) Consolidated Financial Statements (CFS)
During the year the Board of Directors reviewed the affairs of the subsidiaries. Inaccordance with Section 129(3) of the Companies Act 2013 your company has prepared theconsolidated financial statements of the company which forms part of this Annual Reportin compliance with applicable provisions of the Companies Act 2013 read with the Rulesissued thereunder applicable accounting standards and the provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (hereinafter referred to as the"Listing Regulations").
A separate statement containing the salient features of financial statement of allsubsidiaries of the company in the prescribed Form AOC 1 forms a part ofconsolidated financial statements in compliance with Section 129(3) and other applicableprovisions if any of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014. The said Form also highlights the financial performance of each ofthe subsidiaries is included in the consolidated financial statements of the Companypursuant to Rule 8(1) of the Companies (Accounts) Rules 2014.
In accordance with Section 136 of the Companies Act 2013 the financial statements ofthe subsidiary companies are available for inspection by the members at the RegisteredOffice of the company during the business hours on all days except Saturdays Sundays andpublic holidays upto the date of the Annual General Meeting (AGM'). Any memberdesirous of obtaining a copy of the said financial statements may write to the CompanySecretary at the Registered Office of the Company. The financial statements including theconsolidated financial statements and all other documents required to be attached to thisreport have been uploaded on the website of the Company (www.gati.com).
On a standalone basis your directors have decided to retain the entire amount of RS242.53 mn in the retained earnings.
7) Fixed deposits (FD)
As on March 31 2019 fixed deposits of your Company stood at RS 141.58 mn out of whichRS 5.68 mn remain unclaimed and there were no overdue deposits as on that date. During theyear under review your Company has accepted deposits to the tune of H 36.69 mn There wasno default in repayment of deposits or payment of interest thereon during the year andthere are no deposits which are in non-compliance with the requirements of the CompaniesAct 2013. The current fixed deposits carry a rating of "BBB" issued by CreditAnalysis and Research Limited (CARE).
8) Directors and Key Managerial Personnel (KMP)
In accordance with the provisions of Section 152 of the Companies Act 2013 Mr.Yasuhiro Kaneda Director who retires by rotation and being eligible has offer himselffor re-appointment.
Further Mr KL Chugh Dr. PS Reddy Mr. N Srinivasan Mr. Sunil Alagh & Mr. PNShukla will complete their present term as an Independent Director on August 04 2019.
In compliance with Regulation 36(3) of the Listing Regulations brief resume of all theDirectors proposed to be appointed / re-appointed forms part of the notes and explanatorystatement to the Notice of the ensuing Annual General Meeting.
During the year under review Mr. Manoj Gupta Chief Financial Officer of the Companyresigned w.e.f July 31 2018 and Mr. Amit Pathak Company Secretary and Compliance Officerof the Company resigned w.e.f December 31 2018. Your directors place on record theirsincere appreciation for the valuable contribution made by Mr. Manoj Gupta & Mr. AmitPathak during their tenure.
During the year under review Pursuant to Regulation 17(1A) of the Securities andExchange Board of India Limited the members of the Company approved the continuation ofdirectorship of Mr. KL Chugh Mr. N Srinivasan and Dr. PS Reddy.
Your Company has appointed Mr. Peter H. Jayakumar as the Chief Financial Officer of theCompany in the board meeting held on May 28 2019 and Mrs. T.S. Maharani as the CompanySecretary of the Company w.e.f August 02 2019 in the Board Meeting held on August 022019.
Further in the meeting held on August 02 2019 the board approved the reappointmentof Mr. KL Chugh Mr. N Srinivasan Mr. Sunil Alagh Dr. PS Reddy and Mr. PNShukla as Independent Directors of the Company for a second term of two consecutive yearsw.e.f August 04 2019 subject to approval of the members at this Annual General Meeting.
The Board of Directors also appointed two Additional Directors (Non Executive &Independent) Mr Sushil Jiwarajka and Dr. Savita Date Menon w.e.f August 02 2019.
9) Particulars of Employees and related disclosures
The remuneration paid to your Directors is in accordance with the Nomination andRemuneration Policy formulated in accordance with Section 178 of the Companies Act 2013and Regulation 19 of the Listing Regulations. The salient aspects covered in theNomination and Remuneration Policy have been outlined in the Corporate Governance Reportwhich forms part of this report.
The information required under section 197 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 (includingany statutory modification(s) or re-enactment(s) thereof for the time being in force) inrespect of Directors/employees of the Company is set out in the Annexure A tothis report.
10) Declaration on Independent Directors
Pursuant to sub section (6) of Section 149 of the Companies Act 2013 and Regulation16(1)(b) of the Listing Regulations all the Independent Directors of your Company havegiven declaration that they have met the criteria of independence as required under theAct and the regulations.
11) Investment Committee
During the Financial Year 2018-19 The Board of Directors of your Company constitutedInvestment Committee with Mr. PN Shukla as the Chairman & Mr. N Srinivasan as theMember of the Committee.
The Main objective of the Investment Committee is to assist the Board and the Companyin overseeing acquisitions investments and disinvestment made by the Company and toprovide oversight on key financial policies of the Company.
Investment Committee regularly monitors working of subsidiary companies and advancesgiven to them and recommend remedial action wherever necessary.
12) Remuneration Policy
Your Directors have on the recommendation of the Nomination & RemunerationCommittee framed a policy for selection and appointment of Director(s) Senior ManagementPersonnel and their remuneration. The Remuneration Policy forms part of the CorporateGovernance Report.
13) Board Evaluation
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theevaluation of all the directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board and in line with the Guidance Note on BoardEvaluation issued by the Securities and Exchange Board of India on January 5 2017. Theevaluation process has been explained in the Corporate Governance Report.
Detailed composition of the Board committees namely Audit Committee Nomination andRemuneration Committee Corporate Social Responsibility Committee StakeholdersRelationship Committee and Investment Committee number of meetings held during the yearunder review and other related details are set out in the Corporate Governance Reportwhich forms a part of this Report.
15) Audit committee
The details pertaining to the composition of the audit committee are included in theCorporate Governance Report which is a part of this report.
All the recommendations made by the Audit Committee were accepted by the Board ofDirectors of the Company.
16) Particulars of Loans Guarantees and Investments
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 read with the Companies (Meetings of Board and its Powers)Rules 2014 forms part of the Financial Statements.
17) Corporate Social Responsibility (CSR)
In terms of section 135 and Schedule VII of the Companies Act 2013 read with Companies(Corporate Social Responsibility Policy) Rules 2014 made thereunder the Board ofDirectors of your Company have constituted a CSR Committee.
The brief outline of the Corporate Social Responsibility (CSR) Policy of your Companyand the initiatives undertaken on CSR activities during the year are set out in Annexure-Bof this report in the format prescribed in the Companies (Corporate Social ResponsibilityPolicy) Rules 2014. The policy is available on the Company's website.
During the year the Company had spent H 32.25 lakhs towards various social welfareactivities which specifically did not qualify as CSR expenditure.
18) Related Party Transactions
In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onthe Company's website at www.gati. com The Policy intends to ensure that proper reportingapproval and disclosure processes are in place for all transactions between the Companyand Related Parties.
Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were no material relatedparty transactions i.e. transactions exceeding 10% of the annual consolidated turnover asper the last audited financial statement were entered during the year by your Company.Accordingly the disclosure of Related Party Transactions as required under Section134(3)(h) of the Companies Act 2013 in Form AOC-2 is not applicable.
19) Meetings of the Board and Committees
Eight Meetings of the Board of Directors were held during the year. For details of themeetings of the Board please refer to the report on Corporate Governance which formspart of this report.
The Whistle-blower Policy has been approved and adopted by Board of Directors of theCompany in compliance with the provisions of Section 177 (10) of the Companies Act 2013and Regulation 22 of the Listing Regulations. Further the Whistle-blower Policy isavailable on the website of your company at www.gati.com.
21) Policy on prevention of Sexual Harassment at Workplace
As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (POSH Act') and Rules made thereunder yourCompany has complied with the provisions related to the Constitution of InternalComplaints Committee (ICC).
The Company has taken several initiatives across the organization to build awarenessamongst employees about the Policy and the provisions of Prevention of Sexual Harassmentof Women at Workplace Act.
During the Financial Year 2018-19 one case was reported and was appropriately dealtwith by the Internal Complaints Committee.
22) Familiarisation Programme for Independent Directors
Pursuant to the Listing Regulations the Company shall familiarise the IndependentDirectors with the Company their roles rights responsibilities in the Company natureof the industry in which the Company operates business model of the Company etc..
The details of the Familiarisation programme process for the Independent Directorsforms part of the Corporate Governance Report.
23) Directors' Responsibility Statement
Pursuant to the requirement under section 134(5) of the Companies Act 2013 withrespect to the Directors' Responsibility Statement relating to the Company (Standalone)it is hereby confirmed:
a) That in the preparation of the Accounts for the financial year ended March 31 2019the applicable accounting standards and schedule III of the Companies Act 2013 (includingany statutory modification(s) or re-enactment(s) for the time being in force) have beenfollowed along with the proper explanation relating to material departure;
b) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2019 andof the profit and loss of the Company for the financial year ended March 31 2019;
c) That proper and sufficient care has been for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 (including anystatutory modification(s) or re-enactment(s) for the time being in force) forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) That the accounts have been prepared on going concern' basis;
e) The directors had laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and the Company is constantlyendeavouring to improve the standards of internal control in various areas and takingsteps to strengthen the internal control system to make it commensurate and effective withthe nature of its business;
f) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and such systems are adequate and operating effectively.
24) Extract of Annual Return
T he details forming part of the extract of the Return in Form MGT-9 in accordance withSection 92(3) of the Companies Act 2013 read with Companies (Management andAdministration) Rules 2014 is annexed as Annexure C.
25) D evelopment and Implementation of
T he company has a well-defined process in place ensure appropriate identification andtreatment of risks. Risk identification exercise is inter-woven with the annual planningcycle which ensures both regularity and comprehensiveness. The identification of risk isdone at strategic business operational and process levels. While the mitigation plan andactions for risks belonging to strategic business and key critical operational risks aredriven by senior leadership for rest of the risks operating managers drives theconception and subsequent auctioning of mitigation plans.
All risks are well integrated with functional and business plans and are reviewed on aregular basis by the senior leadership.
The Company through its risk management process aims to contain the risks within itsrisk appetite. There are no risks which in the opinion of the Board threaten the existenceof the Company. However some of the risks which may pose challenges are set out in thetaken Management Discussion and Analysis which forms part of this Annual Report.
26) Internal Financial Controls
Your Company has established and maintained a framework of internal financial controlsand compliance systems. Based on the framework of internal financial controls andcompliance systems established and maintained by the Company the work performed by theinternal statutory and secretarial auditors and external consultants including the auditof internal financial controls over financial reporting by the statutory auditors and thereviews performed by management and the relevant board committees including the auditcommittee the Board is of the opinion that the Company's internal financial controls wereadequate and your Company is constantly endeavouring to improve the standards of internalcontrol in various areas and taking steps to strengthen the internal control system tomake it commensurate and effective with the nature of its business.
Further the statutory auditors of your company have also issued an attestation reporton internal control over financial reporting (as defined in section 143 of Companies Act2013) for the financial year ended March 31 2019 which forms part to the StatutoryAuditors Report.
27) In vestor Education and Protection Fund
Pur suant to the applicable provisions of the Companies Act 2013 read with InvestorEducation and Risk Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 (the Rules') all unpaid or unclaimed dividend are required to betransferred by to the company to the IEPF established by the Central Government after thecompletion of seven years. Further according to the Rules the share in respect of whichdividend has not been paid or claimed by the shareholders for seven consecutive years ormore shall also be transferred to demat account created by the IEPF Authority.Accordingly the company has transferred the unclaimed and unpaid dividend of RS512534/- pertaining to the FY 2010-11. Further 47160 corresponding shares weretransferred as per the requirement of IEPF rules. The details are also available on ourwebsite i.e. www.gati.com.
a) S tatutory Auditors
M/s. Singhi & Co. Chartered Accountants (Firm Registration No. 302049E) wereappointed as Statutory Auditors of the Company at the 22nd AGM till the conclusion of the27th AGM. In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018by the Ministry of Corporate Affairs the appointment of Statutory Auditors is notrequired to be ratified at every Annual General Meeting.
The standalone and consolidated financial statements of the Company have been preparedin accordance with the Indian Accounting Standards prescribed under Section 133 of the Actread with relevant rules issued thereunder (Ind AS) and other accounting principlesgenerally accepted in India.
The Auditors' Report for the financial year ended March 31 2019 on thefinancial statement of the Company is a part of this Annual Report. The Auditors havegiven a qualified opinion as described below:
On Standalone Financial Statements
(i) Auditors Qualification given in point no.
(i) Regarding income tax demand and
(ii) regarding operational advances to few parties under the head "Basis ofQualified Opinion" in the Auditor's Report on standalone financial statements readwith note no. 46 & 47 of the standalone financial statements are self-explanatory.
(a) Regarding Income Tax Demand: The Financial Note is self explanatory. In theunlikely event of the demand we sustained an appeal to the High Court that MAT CreditAvailable in the next three accounting years would be more than the demand in question andthere wouldn't be any significant cashflow in this regard.
(b) Regarding Ovedue Advances: There has been substantial recovery during the financialyear and the note is self explanatory.
(ii) Independent Auditor has also drawn attention in their report for emphasis ofmatter read with Note No. 48 & 49 to the standalone financial statements which isself explanatory.
On Consolidated Financial Statements
(i) Auditors Qualification given in point no. (i) (ii) and (iii) under the head"Basis of Qualified Opinion" in the Auditor's Report on consolidated financialstatements read with note no. 54 55 & 57 of the consolidated financial statements areself-explanatory and do not call for any further comments.
(ii) Independent Auditor has also drawn attention in their report for emphasis ofmatter read with Note No. 56 58 & 59 to the standalone financial statements which isself explanatory.
b) Secretarial Audit
Pursuant to the provisions of Section 204 of theCompaniesAct2013andTheCompanies(Appointment and Remuneration of Managerial Personnel)Rules 2014 your Company has appointed DVM & Associates LLP to undertake theSecretarial Audit of your Company. The Report of the Secretarial Audit is annexed as Annexure D. The Secretarial Auditors have given a qualified opinion which is describedas below:
(a) Chief Financial Officer resigned on July 31 2018 and the Company did not fill thevacancy within 6 months as contemplated under Section 203 of the Companies Act 2013.
(b) Compliance Officer as per SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 has not been complied.
(a) The position of Chief Financial Officer fell vacant from 01.08.2018 to 27.05.2019and was not filled up during the year. The new Chief Financial Officer of was appointed bythe Company w.e.f May 28 2019.
(b) The Compliance officer of the Company resigned w.e.f December 31 2018 and was notfilled up during the year. Further the Board of Directors in its meeting held on August02 2019 appointed Mrs. T.S Maharani as the Company Secretary and Compliance Officer ofthe Company w.e.f August 02 2019.
Further DVM & Associates LLP Practising Company Secretaries carries outReconciliation of Share Capital Audit every quarter and the report thereon is submitted tothe Stock Exchanges.
29) ConservationofEnergyTechnologyAbsorption and Foreign Exchange Earnings & Outgo
The above information as required under the Companies Act 2013 is annexed as Annexure E.
30) Employees Stock Option Scheme
Your Company has two Employee Stock Option Schemes namely ESOS 2006 & ESOS 2007.During the year Company allotted 195342 shares pursuant to Employee Stock Options. TheSchemes are in line with the SEBI (Share Based Employee Benefits) Regulations 2014("SBEB Regulations") and there have been no material changes to the schemesduring the financial year 2018-19. The Company has received a certificate from theAuditors of the Company that the Schemes are implemented in accordance with the SBEBRegulations and the resolutions passed by the members. The certificate would be availableat the Annual General Meeting for inspection by members. The details as required to bedisclosed under the SBEB Regulations and certificate from Auditors are put on theCompany's website and may be accessed at: www.gati.com.
31) Change in Capital Structure and Listing at Stock Exchanges
The equity shares of your Company continue to be listed and traded on the BSE Ltd.(BSE) and National Stock Exchange of India Ltd. (NSE). During the financial year underreview 195342 equity shares were allotted on exercise of the options vested under theEmployee Stock Option Scheme. Consequently the Equity Share Capital of your Companyincreased from RS 216693590/- comprising of 108346795 equity shares of RS 2/- eachto RS 217084274/- comprising of 108542137 equity shares of RS 2/- each as on March31 2019.
32) Company's Policies
The details of the policies approved and adopted by the Board are provided in Annexure- F to this report.
33) Corporate Governance
Your Company is committed to maintain the high standards of corporate governance andadhere to the corporate governance requirements set out by Securities and Exchange Boardof India. The Report on corporate governance as stipulated under the Listing Regulationsforms part of the Annual Report and is annexed as Annexure - G. The requisitecertificate from the Practicing Company Secretary confirming compliance with theconditions of corporate governance as stipulated under the aforesaid Regulations formspart of this report.
34) Management Discussion and Analysis (MD&A)
MD & A Report for the financial year under review as stipulated under Regulation34 of the Listing Regulations is presented in a separate section and forms part of theAnnual Report.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the financial yearunder review:
1. Issue of equity shares with differential rights as to dividend voting or otherwise.
2. Issue of shares (including sweat equity shares) to . employees of your Company underany scheme save and except ESOS referred to in this Report.
3. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
4. During the period under review none of the Auditors of the Company have reportedany fraud as specified under the second proviso of Section 143 (12) of the Companies Act2013 (including any statutory modification(s) or re-enactment(s) thereof for the timebeing in force);
5. The Company has complied with Secretarial Standards i.e. SS-1 and SS-2 relating toMeetings of the Board of Directors and General Meetings issued by the Institute ofCompany Secretaries of India.
6. There were no material changes commitments affecting the financial position of yourCompany between the end of financial year (March 31 2019) and the date of the report(August 02 2019).
7. Company is not required to maintain cost records under Section 148(1) of theCompanies Act 2013.
8. The policy for determining material subsidiaries of the Company has been provided onthe Company's website at www.gati.com
Your Directors thank various departments of Central and State Government Organizationsand Agencies for the continued help and co-operation extended by them to your company.Your Directors also gratefully acknowledge all stakeholders of the Company viz. memberscustomers dealers vendors Financial Institutions banks and other business partners forthe excellent support received from them during the year. Your Directors place on recordtheir sincere appreciation to all employees of the Company for their unstinted commitmentand continued contribution to the Company.
| ||For and on behalf of the Board |
| ||K L Chugh |
|Place: Hyderabad ||Chairman |
|Date: August 02 2019 ||DIN: 00140124 |