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Mafatlal Industries Ltd.

BSE: 500264 Sector: Industrials
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OPEN 230.05
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52-Week high 374.40
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Mafatlal Industries Ltd. (MAFATLAIND) - Director Report

Company director report


The Members

Mafatlal Industries Limited

Your Directors are pleased to present the 103rd Annual Report together with the AuditedStatement of Accounts for the year ended 31st March 2017.

1. Financial Results:

The Financial Results of the Company are as under:

(Rs. in Lakhs)

Current Year 2016-17 Previous Year 2015-16
Revenue from Operations 127022.28 132308.74
Other Income 1046.11 2157.19
Total Income / Revenues 128068.39 134465.93
EBIDTA 3764.09 6119.18
Less: Depreciation 2705.59 2119.18
Finance Costs 2620.14 2116.12
Profit before Exceptional Items (1561.64) 1883.88
Exceptional Items (Net) 869.94 -
Profit before Taxes (691.70) 1883.88
Tax (Expense) / Benefits 477.17 (171.50)
Profit after Taxes (214.53) 1712.38
Add: Surplus brought forward from previous year 6080.27 4870.25
Amount available for appropriation 5865.74 6582.63
Proposed Dividend - 417.39
Corporate Dividend Tax - 84.97
Surplus carried to Balance Sheet 5865.74 6080.27

Note: Figures are regrouped wherever necessary to make the information comparable.

2. Year in Retrospect:

During the year under review consumer spending remained subdued with continued globaleconomic slowdown; the geopolitical risk environment across the globe and the challengingregulatory changes on the domestic front. Despite the favorable monsoon and 7thpay commission pay-outs which led to agriculture and rural growth the slowdown inindustrial and service sector and demonetisation kept the scope of growth for the textilesector limited. Profit margins for the organised textile sector remained depressed withhigher raw material cost and intense competition in the segment.

Against this backdrop the year was indeed very challenging for your company. Theoverall performance of the Company during FY 2016-17 was adversely impacted by severalmacro level factors. Total Revenue fell by 5% to Rs.128068.39 Lakhs EBIDTA went down by38% to Rs.3764.09 Lakhs leading to a Net Loss for the year of Rs.214.53 Lakhs as againsta Net Profit of Rs.1712.38 Lakhs for the previous year.

At the macro level the factors like a steep increase in Cotton prices impact ofdemonetisation on retail demand and a slump in the Denim industry impacted the performanceof the Company.

Further for FY 2016-17 the Company had higher Finance Cost & Depreciation chargesince we have implemented the capacity expansion projects leading to higher termborrowings and increase in fixed assets. The full benefits of these projects shall accruein subsequent years. Further operating margins were squeezed because of higher Cottonprices on one side and intense competition weaker demand and curtailed selling prices onthe other side.

After an arduous year the Company expects to turn around on the back of initiativestaken for improvements in plant efficiency new product developments and a widening of themarketing and distribution network. Towards this during the year the Company invested netof Rs.10196.21 Lakhs in Fixed Assets to balance and upgrade the existing manufacturingequipment's and facilities.

During the year under review your company has repaid long term borrowings amounting toRs.1711.79 Lakhs as per scheduled timeline and raised Rs.6975.53 Lakhs to part financecapital expenditure plans being implemented. Your company expresses gratitude to all theterm loan and working capital lenders for their continuing support and faith in thecompany.

During the year Credit Analysis & Research Limited (CARE) has upgraded the creditrating of the Company to CARE BBB from "CARE BBB-" for the long term facilitieshaving tenure of more than one year and also upgraded its "CARE A3" rating to"CARE A3+" for the short term facilities having tenure of up to one year.

Pursuant to the disclosure requirements it is pertinent to note here that there hasbeen no change in nature of business during the year under review and no order has beenpassed by any Regulator or Court or Tribunal which can impact the going concern status ofthe Company and its Operations in the future. A detailed analysis of the financial resultsis given in the Management Discussion and Analysis Report which forms part of this report.

3. Dividend:

Your Board of Directors are cognizant of the fact that during the year under review theoperations of the Company have resulted in losses. However in the opinion of the Boardthis is an aberration as Company was impacted by macro level factors at the same time itcommissioned capacity expansion projects leading to higher interest and depreciation cost.Your Directors believe that the capital expenditure which the Company has incurred oncapacity expansion and for improving the product mix should yield result in the years tocome. Keeping in mind the future outlook it is proposed to pay dividend out of theaccumulated profits of the Company for the previous financial years ('6080.27 lakhs)remaining undistributed and not transferred to general reserves in absence of profit forthe financial year ended 31st March 2017. The Loss for the financial yearended 31st March 2017 is Rs.214.53 lakhs. Accordingly the Board of Directorsrecommends a dividend for the year of Rs.2/- per share (previous year Rs.3/- per share) on13912886 Equity Shares of face value of Rs.10/- each aggregating to Rs.278.26 lakhs.(Previous year Rs.417.39 lakhs)

4. Restructuring of Promoters Shareholding:

During the year under review Shri H. A. Mafatlal Shri V. P. Mafatlal their familymembers family trusts and the Companies including the three listed entities viz. theCompany Navin Fluorine International Limited (NFIL) and NOCIL Ltd. entered into anagreement to amicably restructure the shareholding of the three listed companies and othergroup companies in such a way that the Management of the Company and NOCIL Ltd. residewith Shri H. A. Mafatlal and the Management of NFIL reside with Shri V. P. Mafatlal. Therestructuring is part of a family settlement and succession plan between Shri H. A.Mafatlal and Shri V. P. Mafatlal.

Pursuant to the above the Company has divested part of its shareholding in NavinFluorine International Limited and increased its shareholding in NOCIL Ltd. during theyear.

5. Details of changes of Directors and Key Managerial Personnel:

During the year under review Shri Praful R. Amin Non-Executive Independent Directorof the Company has opted for retirement after a very long association with the Companyand accordingly he ceased to be a director w.e.f. 11th August 2016.

Pursuant to the arrangements amongst the Promoters as mentioned hereinabove in para 4Shri V. P. Mafatlal Executive Vice Chairman stepped aside as such with effect from closeof office hours on 19th August 2016.

The Board of Directors of the Company places on record its appreciation for theservices rendered and invaluable contributions made by Shri Praful R. Amin and Shri V. P.Mafatlal during their long tenure with the Company.

Further the Board of Directors of the Company at their meeting held on 25thOctober 2016 appointed Shri Hrishikesh A. Mafatlal as Executive Chairman of the Companyw.e.f. 1st November 2016 subject to the approval of the shareholders of theCompany. Besides the Board at that meeting also appointed Shri Priyavrata H. Mafatlal asan Additional Director of the Company who will hold office until the date of ensuing 103rdAnnual General Meeting of the shareholders of the Company. He has also been appointed asExecutive Director (whole time director) w.e.f. 1st November 2016 of theCompany for a period of five years subject to the approval of the shareholders of theCompany. Accordingly the requisite resolutions for approval of the shareholders have beenproposed in the Notice convening 103rd Annual General Meeting.

Pursuant to the provisions of Section 152(6) of the Companies Act 2013 Shri Atul KSrivastava (DIN 00046776) Director of the Company retires by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.

6. Subsidiaries Associates and Joint Ventures:

Mafatlal Services Ltd continues to be a subsidiary of the Company and Al Fahim MafatlalTextiles LLC (UAE) continues to be Joint Venture (JV company) in which the Company and JVPartner has 49:51 share.

The financial position of the subsidiary company is given in the Notes to ConsolidatedFinancial Statements. The Company does not have any material subsidiary.The Policy onMaterial Subsidiary framed by the Board of Directors of the Company is available on on_materiality_of_subsidiary.pdf.The audited accounts of Mafatlal Services Limited a subsidiary of the Company for theyear ended 31st March 2017 is placed on the Company's and is also open for inspection by any member at the Registered Officeof the Company on any working day (Monday-Friday) during working hours and the Companywill make available these documents upon request by any member of the Company who may beinterested in obtaining the same.

Al Fahim Mafatlal Textiles LLC (UAE) remained non-operational and since there is noforeseeable beneficial future the Board of Directors of the Company as well as the JVPartner have consented for voluntary winding up/closure of that entity subject to thecompliance of applicable laws. Accordingly even the audited accounts of that JV Companyare not available and the same are not consolidated with the Accounts of the Company forthe year 2016-17.

7. Deposits:

The Company does not have "Deposits" as contemplated under Chapter V of theCompanies Act 2013. Further the Company has not invited or accepted any such depositsduring the year ended 31st March 2017.

8. Internal Financial Controls:

The existing internal financial controls are adequate and commensurate with the naturesize complexity of the Business and the Business Processes followed by the Company.During the year the Company has laid down the framework for ensuring adequate internalcontrols over financial reporting and such Internal Financial Controls have been reviewedby Independent Experts to ensure its effectiveness who have confirmed that such controlsare adequate and operating effectively.

9. Directors' Responsibility Statement:

As required under the provisions of Section 134 (5) of the Companies Act 2013 yourDirectors state that:

(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(ii) the directors have 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 the financial year and ofthe loss of the Company for the period under review;

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

(iv) the directors have prepared the annual accounts on a Rs.going concern' basis;

(v) the directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.

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

10. Industrial Relations:

The relations between the employees and the Management have remained cordial andharmonious during the year under review. The total number of permanent employees as on 31stMarch 2017 were 2808 (2769 in previous year).

11. Insurance:

The properties and insurable interests of your Company like buildings plant andmachinery stocks etc. are adequately insured by the Company. Further disclosure on RiskManagement of the Company has been made under the Corporate Governance Report which formsa part of this report.

12. Corporate Social Responsibility (CSR):

Mafatlal Industries Ltd. a part of Arvind Mafatlal Group has been fulfilling itscorporate social responsibilities for over 50 years much before CSR has been prescribedstatutorily. The focus area of our working has been in the field of poverty alleviationhealth care education for young children and women's upliftment in rural India.

In conformity with the provisions of Section 135 of the Companies Act 2013 read withthe Companies (Corporate Social Responsibility Policy) Rules 2014 the Company has a CSRCommittee which presently comprises of Shri H. A. Mafatlal who is the Chairman of the saidCommittee Shri A. K .Srivastava and Shri V. R. Gupte (Independent Director) are otherMembers of the Committee. Shri V. P. Mafatlal was a member of the Committee until hisresignation on 19th August 2016 when he ceased to be a director of theCompany. Shri A. K. Srivastava Non-Executive Director of the Company was appointed as amember of the said Committee. During the year under review two meetings of CSR Committeewere held i.e. on 29th July 2016 and 23rd March 2017 which wereattended by all Committee members.

Based on the recommendations of the CSR Committee the Board of Directors haveformulated a CSR Policy encompassing the Group's and the Company's philosophy fordescribing its responsibility as a corporate citizen and laid down the guidelines andmechanisms for undertaking socially relevant programs in conformity with the statutoryprovisions which is posted on the website of the Company and available on web linkhttp://www.

The Company has fulfilled its CSR Obligation for the year 2016 -17. The statutorydisclosures in respect of the CSR activities undertaken and amount spent by the Companyduring the year under review is disclosed in prescribed format and the same is annexedhereto forming a part of this report.

13. Related Party Transactions:

There are no materially significant related party transactions made by the Companyduring the year. Related Party Transactions Policy is posted on the website of the companyand is available at The details of all the transactions with the related parties aredisclosed in the Notes forming part of financial statements annexed to the financialstatements for the year 2016-17.

All the Related Party Transactions entered in to by the Company are in ordinary courseof business and on an arm's length basis except the promoters shareholding changes(selling of shares of Navin Fluorine International Limited and purchase of shares of NOCILLimited by the Company) which were on an arms' length basis for which requisite approvalsfrom the Audit Committee and the Board of Directors were obtained. The transactions amountwere not exceeding the applicable statutory limits and therefore no approvals from theshareholders were required.

14. Management Discussion and Analysis Report & Corporate Governance:

As required under Schedule V (B) and (C) of the SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 "Management Discussion and AnalysisReport" as well as "Corporate Governance Report" are attached herewith andmarked as Annexure I & II respectively and the same forms part of thisDirectors' Report.

Further during the year under review the Company has complied with all the mandatoryrequirements of the Corporate Governance. A certificate from the statutory auditors of theCompany regarding compliance of conditions of Corporate Governance as stipulated underSEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 is annexed tothe Report on Corporate Governance.

15. Other Statutory disclosures:

The other statutory disclosures pursuant to Sections 134 135 188 197 and otherapplicable provisions of the Companies Act 2013 read with related rules are attachedherewith and marked as Annexure III.

16. Statutory Auditors & Audit Report:

The existing Statutory Auditors M/s. Deloitte Haskins & Sells CharteredAccountants will retire upon conclusion of the ensuing 103rd Annual GeneralMeeting in compliance with the provisions relating to mandatory rotation of Auditorsunder the Companies Act 2013. Accordingly pursuant to Section 139 of the Companies Act2013 the Board of Directors has at its meeting held on 24th March 2017 basedon the recommendation of the Audit Committee subject to the approval of the Members atthe ensuing 103rd Annual General Meeting approved the appointment of M/s.Price Waterhouse Chartered Accountants LLP (Firm Registration No.012754N/N500016) as theStatutory Auditors of the Company to hold office from the conclusion of the ensuing 103rdAnnual General Meeting until the conclusion of 108th Annual General Meeting.

At the ensuing Annual General Meeting Members are requested to approve the appointmentof M/s. Price Waterhouse Chartered Accountants LLp (Firm Registration No.012754N/N500016)as Auditors of the Company to hold office from the conclusion of the 103rd Annual GeneralMeeting until the conclusion of the 108th Annual General Meeting. The requisite resolutionwith explanatory statement is proposed for consideration by the members in the noticeconvening ensuing annual general meeting.

The specific notes forming part of the Accounts referred to in the Auditor's Reportread with the notes to financial statements as referred to therein are self-explanatoryand give complete information and addresses the observations if any . The Audit reportdoes not have any qualification or reservations or adverse comments.

17. Cost Audit:

In accordance with the provisions of Section 148 (3) of the Companies Act 2013 readrelevant Rules made thereunder the audit of the cost records of the Company for the year2016-17 relating to the "Textiles" products manufactured and traded by theCompany is being carried out by Cost Auditors Shri. B. C. Desai Cost Accountants. TheCost Audit Report will be filed on or before due date with the Ministry of CorporateAffairs in due course of time after the same is approved by the Board of Directors of theCompany by 27th September 2017.

The Board has at their Meeting held on 5th May 2017 reappointed Shri B. C. Desai asCost Auditor to audit cost records in respect of "Textiles" productsmanufactured and traded by the Company for the Financial Year 2017-18 and the remunerationpayable to the Cost Auditor has been proposed for the approval/ ratification by theMembers of the Company at the ensuing Annual General Meeting.

18. Internal Auditor:

M/s. Aneja Associates a reputed firm of Chartered Accountants are Internal Auditorsof the Company. The Audit Committee of the Board of Directors in consultation with theInternal Auditors formulate the scope functioning periodicity and methodology forconducting the internal audit.

19. Secretarial Auditor and Secretarial Audit Report:

The Board of Directors of the Company has in compliance with the provisions of Section304(1) of the Companies Act 2013 and Rules made in this behalf appointed Shri ManuprasadM. Patel Company Secretary in practice to carry out Secretarial Audit of the Company forthe financial year 2016-17. The Report of the Secretarial Auditor is annexed to thisReport as Annexure IV. The said report does not contain any qualification adverseobservations/ remarks. The observations made therein are selfexplanatory.

20. Appreciation:

The Directors wish to place on record their appreciation of the devoted services of theworkers staff and the officers for their continued contribution to your Company.

For and on behalf of the Board
Place: Mumbai H.A. MAFATLAL
Date: 5th May 2017 Chairman
(DIN: 00009872)

3. Report on Conservation of Energy Technology Absorption and Foreign Exchange Earning& Out go :



- 26 Lakh Units Solar Power utilised through Bilateral agreement with Solarism.

- Installed Thermic Fluid Heater to reduce stenter heating cost.

- Installed energy efficient 6400 CFM centrifugal compressors to reduce powerconsumption.

- Installed VFD in ID fan of Boiler to reduce CPP auxilury power consumption.

- Reduced DM water consumption by 14% by utilising Condensate water in CPP.

- Installed LED lights in Weaving RA trenches & process department.

- Installed fully automised Humidification Plant in Weaving Department.

- Installed fully automised Caustic Recovery Plant to increase the utilisation ofrecycled caustic.

- Installed 3 stage RO system on ETP to reduce water consumption.

- Installed 4 stage Multi Effective Evaporator to reduce water consumption.

- Water consumption reduced in various process machines.

- Recycled cooling water of Sienging machines.

- Installed Float steam trap in place of conventional Bucket trap to reduce steamwastages.

- Installed VFD (Inverter) in PA Fan of FBC Boiler to control speed instead ofcontrolling Damper.

- Reduced Submersible pump capacity at New Unit.

- Replaced Energy saving spindle in Old Ring Frame In Spinning Department.

- Installed Timer in Ring Frame O.H.C. to reduce energy consumption.

- To reduce power consumption in Ring Frame m/c converted to Flat Belt drive insteadof V belt drive.

- Installed Energy efficient LED Lights in place of conventional Electronics/Copperballast Tube light fixtures .

- Installed VFD Controlled Water Pressure control system

- Replaced old Reciprocating Air compressor with new Energy efficient Centrifugal andscrew Air compressors.


I) Installation of new machines for better Process Performance and low specific energyconsumption.

High Speed Tsudokoma Air Jet looms.

High Speed ITEMA Air Jet Looms

ITEMA Rapier Looms

Yarn Steaming Machine Make:Sieger.

Osthof Seinging Machine Conversion of Stenters from PNG to Oil.

II) Installation of new latest technology machines for better Process performance andlow specific energy consumption.

a) Ingersoll Rand Centrifugal Air compressor and ELGI Screw Air compressor

b) Advance make energy efficient Cooling tower

c) Puriflair make Air dryers

d) Thermax make VTIF 20 Thermic Heater

e) Luwa Humidification systems with Automation

f) Water softening plant

g) Zimmer 12 Color Rotary Printing m/c

h) Texfab Print washer

i) Inspiron make Motex Stenter m/c with Heat recovery system

j) FIMAT Screen coating m/c

k) CST Laser Rotary Engraving mc

l) Konica Minolta Digital printing m/c

m) Biancalani Aero 24

n) Roving stop motion

o) Embee Printing mc

Investments Proposals for 2017-18

1 Installation of New attachment to reduce energy consumption.

a. Optipneuatex Unit on 4 nos of New LMW Ring Frame

b. VFD with Pressure Transducer control on Auto Conner Model 238

2 Installation of New Energy efficient Screw Air Compressors at New Unit


- Water consumption in Ltr/Mtr reduced by 9% due to various water saving activities.

- Steam KG/Mtr reduced from 4.58 Kg/Mtr to 4.44 Kg/Mtr due to various Energy savingactivities and enhanced utilization of machines.

- Power consumption in Compressor Unit/Mtr reduced by 2.63% due to optimising thecompressed air system.

- Utilisation of Recycled caustic increased by 25% due to Automation in Causticrecovery plant & optimising Mercerise machine parameters.

- Reduced cost of Coal & PNG by 1.08 % by installing Thermic Fluid Heater &various energy saving activities.

- Specific Power consumption of Spg. dept has been reduced to 4.50 Units/ Kg ascompared to previous year's of 4.65 units/ Kg .

- Specific Steam consumption of Processing has been reduced to 24.16 kg/kg as comparedto previous year 25.39 kg/kg of finished fabric .

- Total Power consumption has been reduced to 1.21 Units/ Mtr as compared to previousyear of 1.34 units/ Mtr of finished fabric .

- Solid fuel consumption has been reduced to 1.17 Kg/Mt of Finished fabric as comparedto previous year of 1.24 Kg/Mt of finished fabric

- In house Power Generation from COGEN has been increased to 106.73 Lakhs/Annum ascompared to last year of 80.51 Lakhs .


The above information is to be furnished in the prescribed Form "A" annexedhereto.

FORM-A Current Year 2016-17 Previous Year 2015-16
1 Electricity:
a) Purchased: Units Lakhs KWH 633.94 681.50
Total Cost (Lakhs Rs.) 5012.25 5461.82
Rate/KWH 7.91 8.01
b) Own Generation:
i) Through Diesel Generator:
Units Lakhs KWH 0.01 0.02
Unit per litre of diesel oil (KWH) 2.79 1.48
Cost/Unit (Only Diesel) (') 22.40 34.12
ii) Through Gas Generator
Units Lakhs KWH (Exp.Units) 4.14 7.57
Cost/Unit (Only Natural Gas)(Rs.) 8.85 12.87
iii) Through Steam Turbine/Generator
Units Lakhs KWH (Exp.Units) 265.79 220.56
Cost/Unit (Only Coal /Lignite/Baggas (Rs.) 3.03 3.26
2 Coal/Lignite : (Specify quality and where used)
Steam Coal and Lignite used for Steam Genration in
Boilers for Departmental use.
Quantity (Tonnes) 75541 72078
Total Cost ('Lakhs) 3428.64 2809.92
Average Rate/Tonne (') 4538.81 3898.43
3 Furnace Oil:
Quantity ( KLtrs.) - -
Total Amount (Rs. in Lakhs) - -
Average Rate ('/Ltr.) - -
4 Others/Internal Generation:
Steam Coal and Lignite used for Heating Oil of
Thermic Fluid Heater(TFH) for Stenter Heating.
Quantity (Tonnes) - -
Total Cost ('Lakhs) - -
Average Rate/Tonne (') - -


FORM B Current Year 2016-17 Previous Year 2015-16
B. Consumption Per Unit of Production:
1 Electricity :
Purchased and Generation
KWH/Metre of Grey Production* 1.66 1.81
KWH/Metre of Wet Production 0.33 0.26
Chemicals - -
2 Furnace OIl: - -
Litre/KWH of Grey Production
KWH/Metre of Wet Production
3 Coal/Lignite : (Specify quality - Steam Coal)
Kgs. of Coal/Metre of Grey Production 0.21 0.18
Kgs. of Coal Metre of Wet Production (Finished Production) 0.89 0.93
4 Others N.A N.A


Efforts made in technology absorption are to be furnished in the prescribed Form- BAnnexed hereto.



1. Specific areas in which R. & D. carried out by the Company :

1. Lab upgraded to international standard for better control over quality and customerservice.

2. Inhouse Bleaching process established to meet the market requirement of specificproduct category.

3. New dimension to Denim given with addition of new concepts of Bi-stretch denim &Warp stretch denim.

4. New Seasonal collection made for Domestic and Exports market as per the recent trendof respective market and customer demand.

5. Polyester - Cotton blend stretch yarn developed in-house to meet the customerrequirement.

6. Reed group ratinalization introduced in weaving to increase productivity andefficiency.

7. Packing material testing started as inward quality control to increase control ofquality.

2. Benefit derived as a result of the above R. &D. :

1. Technology up-gradation quality improvement value engineering pollution controlenergy conservation increase productivity & efficiency de-risking the businessOrganization brand building longer business projections Profitable and Competitivebusiness and strengthening Sustainability.

3. Future Plan of Action :

1. New Equipment to procure in Quality Assurance Lab to create complete testingcapacity inhouse.

2. Spectrophotometer based testing of dyed yarn in dyeing for better control overshade.

3. Technology upgradation for inhouse spinning of Blends and Dual Core Spinning.

4. Looms upgradation to operate eight shaft on old 209i model.

5. To start using raw water in washing to reduce soft water consumption and to reducecost.

6. To start design department for better presentation of products and customer service.

7. To introduce LED tightings in department to reduce power consumption.

8. To introduce Co-creation concept with business partners and customers to compete themarket.

9. To make collection with recycled raw material to strengthen sustainable productportfolio.

10. To upgrade the processing machines with scientific controls for better processparameter control.


Details Current Year 2016-17 Previous Year 2015-16
(Rs. in Lakhs) (Rs. in Lakhs)
(a) Capital Expenditure - -
(b) Recurring Expenditure 85.11 77.56
(c) Total 85.11 77.56
(d) Total R. & D. Expenditure as a percentage of total turnover 0.07% 0.06%


1. Efforts in brief made towards technology absorption adaptation and innovation :

1. Autocoro 5 machine for Open end spinning upgraded with new parts and started inoperations.

2. In spinning department Fly catcher designed in-house and installed to improve yarnquality and hygene in department.

3. In finishing department the overdyeing machine is modified to meet the qualityproduction.

4. Single box mercerization concept introduced for Sulphur dyed fabric marecerization.

2. Benefits derived as a result of the above efforts :

1. Increased productivity and quality.

2. Created hygine in the operations and improved quality.

3. Competitive product created for business profitability and de-risking.

4. Energy conservation in operations.

5. Organization brand building.

3. Information regarding technology imported during last 5 years :

(a) Technology Imported : Auto titrators in dyeing 96 New Looms in weaving and Lafer Brushing machine in processing.
(b) Year of Import : 2015 2016
(c) Has technology been fully absorbed : Yes
(d) If not fully absorbed not taken place reasons therefore and future plans of action. : N.A.


(A) Activity relating to exports initiatives taken to increase exports development ofnew export markets for products and services and export plans:

The efforts are on to enter into new markets of the Middle East Europe Africa and theUS. The Company has been successful to some extent in increasing the export of processedfabrics to those countries.

(B) Total Foreign Exchange used and earned:

(Rs. in Lakhs)
Current Year 2016-17 Previous Year 2015-16
Total Foreign Exchange used 5706.14 3568.24
Total Foreign Exchange earned 15721.30 13155.67


In compliance with the provisions of Companies Act 2013 and SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015 the performance evaluation was carriedout as under:


In accordance with the criteria suggested by The Nomination and Remuneration Committeethe Board of Directors evaluated the performance of the Board having regard to variouscriteria such as Board composition Board processes Board dynamics etc. The Board was ofthe unanimous view that performance of the Board of Directors as a whole was satisfactory.

Committees of the Board:

The performance of Audit Committee Corporate Social Responsibility CommitteeNomination and Remuneration Committee and Stakeholders Relationship Committee wasevaluated by the Board of Directors of the Company having regard to various criteria suchas committee composition committee processes committee dynamics presence of membersno. of meetings held etc. The Board was of the unanimous view that all the committees wereperforming their functions satisfactorily and according to the mandate prescribed by theBoard under the regulatory requirements including the provisions of the Companies Act2013 the Rules framed thereunder and SEBI (LODR) Regulations 2015

Individual Directors:

(a) Independent Directors: In accordance with the criteria suggested by TheNomination and Remuneration Committee the performance of each independent director wasevaluated by the entire Board of Directors (excluding the director being evaluated) onbroad parameters like engagement leadership analysis decision making communicationgovernance and interest of stakeholders. The Board was of the unanimous view that eachindependent director was a reputed professional and brought his/her rich experience to thedeliberations of the Board. The Board also appreciated the contribution made by allindependent directors in guiding the management to achieving growth and continuance ofeach independent director on the Board will be in the interest of the Company.

(b) Non-Independent Directors: The performance of each of the non-independentdirectors was evaluated by the Independent Directors at their separate meeting held on 23rdMarch 2017 wherein all the Independent Directors were present. Further the performanceof all Non Independent Directors was also evaluated by the Board of Directors. The variouscriteria considered for the purpose of evaluation included leadership engagementtransparency analysis decision making functional knowledge governance and interest ofstakeholders. The Board was of the unanimous view that each of the non-independentdirectors was providing good business and people leadership.


The requisite details relating to ratio of remuneration percentage increase inremuneration etc. as stipulated under the above Rules are provided herein under:

Note: The Company has considered the management cadre employees remuneration whilecalculating the median concept and accordingly provided the details.

i. Ratio of remuneration of each Director to the median remuneration of the employeesof the company for the financial year




Director Remuneration (Rs. in Lakhs) Ratio *
1 Shri H. A. Mafatlal Chairman 1.75 0.66:1
2 Shri A K Srivastava 3.85 1.45:1
3 Shri V. R. Gupte 4.57 1.73:1
4 Shri P. N. Kapadia 5.25 1.98:1
5 Smt. Latika Pradhan 4.22 1.59:1
6 Shri Gautam Chakravarti 4.92 1.86:1
7 Shri Sujal Shah 5.27 2:1
8 Shri Aniruddha P. Deshmukh Managing Director & CEO 228.84 86:1
9 Shri P H Mafatlal (w.e.f. 1.11.2016) 27.56 10:1
10 Shri P. R. Amin (upto 11.08.2016) 2.45 0.9:1
11 Shri V. P. Mafatlal Whole Time Director(upto 19.08.2016) 149.86 57:1

1. The ratio is considered only for Executive Directors (ED) comparing the medianremuneration of management employees of Rs.2.64 lakhs C2.52 lakhs in previous year) withthe remuneration of EDs . The Non-Executive Directors were only paid fees for attendingBoard & Committee meetings for the year 2016-17.

ii. Percentage increase in remuneration of each Director CFO CEO Company Secretaryin the financial year 2016-17:

The remuneration increase given to MD & CEO was 10% CFO was 10% and CS was 12%.There is no increase in remuneration of other executive or non-executive directors

iii. Percentage increase in median remuneration of employees in the financial year: 5% (8% in previous year)

iv. The number of permanent employees on the rolls of the company: 2808 (excludingbadli workers) (1272-- (badli workers) last year 3604

v Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:

Average increase in the salaries of employees is 7% (8% in previous year). There is noexceptional increase in the managerial remuneration.

vi. The key parameters for any variable component of remuneration availed by thedirectors:

None. Except that Whole-time Directors are entitled for a commission of 1% on the netprofit of the Company calculated in the manner prescribed under the Companies Act 2013which has not been paid since the managerial remuneration exceeded the limits underSection 197 of the said Act.

vii. Details of the employees employed for full year or part of the year havingremuneration of Rs.102 lakhs p.a. where employed for the full year:

(Note: Remuneration includes salary allowances perquisites contribution to PFSuperannuation fund leave encashment and retire mental benefits incl. of gratuity etc. incase of employees who have resigned/ retired.)

The details are provided in the following prescribed format. Name Designationremuneration received nature of employment (contractual or otherwise) qualificationexperience (in years) date of commencement of employment age of employees (in years)last employment held before joining this company % of equity shares held by the employeewhether such employee is a relative of any of the Director (answer in yes or no and ifyes name of the Director)

(a) Deshmukh Aniruddha MD & CEO 22883223 contractual Mechanical Engineerfrom NlIT Nagpur Post-Graduation in Business Administration from IIM Calcutta 33 yearsof diverse experience 13.08.2015 59 years Raymonds Ltd. Nil No. (b) MafatlalVishad Executive Vice-Chairman(upto 19.08.2016) 14986079 contractual Bachelor ofScience in Economics from the Wharton School USA 22 years in different industries28.05.2013 (due to amalgamation) 42 years Mafatlal Denim Limited 1212316 equityshares of Rs.10/- each 8.71% yes he is nephew of Shri H. A. Mafatlal Chairman of theCompany. (c) Maheshwari V. K. President & Business Head (Textiles) 12733005Bachelor of Textiles (Hons) 31 years 01.06.2014 53 years Morarjee Textiles Ltd. NilNo. (d) Raghunath M. B. President & Business Head (MSD) 13850927contractual Degree in Physics MBA- Mktg from NMMIS-Mumbai 31 years of experience 01.04.1995 52 years Berger Paints Nil no. (e) Shah Milan CFO(w.e.f.19.09.2015)17266172contractual B.Com FCA CS 32 years of experience 58 yearsArvind Limited Nil No.

viii. Details of the employees employed for the part of the year and having salary ofnot less than Rs.8.50 lakhs per month. The details are provided in the followingprescribed format. Name Designation remuneration received nature of employment(contractual or otherwise) qualification experience (in years) date of commencement ofemployment age of employees (in years) last employment held before joining this company% of equity shares held by the employee whether such employee is a relative of any of theDirector (answer in yes or no and if yes names of Directors) :

Jhawar Srigopal President & Business Head (Denim) upto 31/03/2017) 15328171contractual MBA 21 years of experience 53 years Bhaskar Denim Ltd. Nil No.

ix. Details of the employees employed for the full year or part of the year was receiptof remuneration in that year which in the aggregate or as the case may be at a rate whichin the aggregate is in excess of that drawn by the managing director or whole timedirector or manager and holds by himself or along with his spouse and dependent childrennot less than 2% of the equity shares of the Company: