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Mahanagar Gas Ltd.

BSE: 539957 Sector: Others
NSE: MGL ISIN Code: INE002S01010
BSE 00:00 | 24 Jun 756.45 18.10
(2.45%)
OPEN

740.90

HIGH

758.75

LOW

740.40

NSE 00:00 | 24 Jun 756.00 16.90
(2.29%)
OPEN

742.00

HIGH

760.15

LOW

740.00

OPEN 740.90
PREVIOUS CLOSE 738.35
VOLUME 21169
52-Week high 1211.60
52-Week low 666.35
P/E 12.52
Mkt Cap.(Rs cr) 7,472
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 740.90
CLOSE 738.35
VOLUME 21169
52-Week high 1211.60
52-Week low 666.35
P/E 12.52
Mkt Cap.(Rs cr) 7,472
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Mahanagar Gas Ltd. (MGL) - Director Report

Company director report

To

The Members

Your Company's Directors have pleasure in presenting the Twenty-Sixth Annual Reportalong with the Audited Financial Statements of the Company for the Financial Year endedMarch 31 2021 and the Auditors' Report.

1. FINANCIAL RESULTS :

During FY 2020-21 the Turnover was Rs2338 Crores vis a-vis Rs 3264 Crores in FY2019-20. The Profit after Tax (PAT) was Rs619 Crores for FY 2020-21 as compared to Rs 794Crores in FY 2019-20. The Company's financial results for the financial year ended March312021 are depicted below:

(Rs in Crore)
SR PARTICULARS NO. AS ON MARCH 312021 AS ON MARCH 312020
a. Revenue from operations 2338 3264
b. Other Income 81 99
c. Profit before Depreciation and Finance cost 1014 1152
d. Depreciation and Amortization Expenses 174 162
e. Finance cost 7 7
f. Profit before Tax (PBT) [c-d-e] 833 984
g. Income Tax 214 190
h. Profit after Tax (PAT) [f-g] 619 794
i. Other Comprehensive Income 1 -2
j. Total Comprehensive Income [h+i] 620 792
k. Balance of Profit for earlier years 2854 2299
l. Balance Available for appropriation (j+k) 3474 3091
Appropriations:
m. Dividend Paid
Final - FY 2018-19 - 104
Interim - FY 2019-20 - 94
Final - FY 2019-20 252 -
Interim - FY 2020-21 89 -
n. Tax on Dividend - 41
o. Total Appropriations (m+n) 341 239
p. Balance of profit carried in Balance Sheet [l-o] 3134 2852
Earning Per Share (Face value of Rs10.00 each) - Basic and Diluted (Rs) 62.72 80.33

2. TRANSFER TO RESERVES:

The closing balance of the Retained Earnings of the Company after appropriation for thefinancial year 2020-21 was Rs3134 Crore.

3. DIVIDEND:

Your Company is consistently distributing dividends to the Shareholders. Your Directorsrecommended the Final Dividend of Rs14/- per share in its Board Meeting held on May 242021 for approval of shareholders at the 26th Annual General Meeting. The Board ofDirectors in its meeting held on February 09 2021 declared an Interim Dividend ofRs9.00/- per equity share for the financial year 2020-21 and the same has been paid onMarch 03 2021 to all the eligible shareholders as on record date i.e. February 22 2021.

The company's Dividend Distribution Policy is available on the Company's website athttps:// www.mahanagargas.com/investors/dividend/ dividend-policy.aspx

4. STATE OF COMPANY'S AFFAIRS:

The Financial Year 2020-21 was one of the significant years in terms of impact ongrowth and operations. Further information on the business overview and outlook of theCompany is discussed in detail in the Management Discussion & Analysis section formingpart of the Annual Report.

5. DEPOSITS:

During the Financial Year 2020-21 your Company has not accepted any deposit.

6. NUMBER OF MEETINGS OF THE BOARD:

During the year under review the Board met 6 (Six) times i.e. on June 10 2020 June30 2020 August 07 2020 November 12 2020 January 09 2021 and February 09 2021.

7. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Sections 134(3)(c) and 134(5) of the Companies Act 2013 your Directorshereby confirm that:

a) In preparation of the annual accounts the applicable accounting standards had beenfollowed along with proper explanation relating to material departures;

b) The Directors had selected such accounting policies and applied them consistentlywhile reasonable and prudent judgments and estimates were made so as to give a true andfair view of the state of affairs of your Company as at the end of the year and of theprofit & loss of your Company for that period;

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

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

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

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

8. RISK MANAGEMENT:

The revised Enterprise Risk Management (ERM) Policy is in place with updated BusinessRisk Register. The Policy framework includes objective of identification of elements ofrisks which covers operational risks as well as business risks and periodic assessment ofManagement's actions to mitigate the exposures. Further the Risk Management Systems underthe Policy are in place for identification of the elements of risks.

Adequate resources have been allocated to Risk Management function and the departmentis headed by Chief Risk Officer (CRO). CRO presents the updated Risk Register for reviewand assessment to Risk Management Committee (RMC) Audit Committee and the Board as perERM Policy.

A collaborative ERM software tool is implemented to ensure that Risk ManagementProcesses are embedded in all business processes and operations.

9. I NTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY:

The Company maintains adequate and effective internal control systems commensurate withits size and complexity. It believes that these systems provide among other things areasonable assurance that transactions are executed with Management authorization. It alsoensures that they are recorded in all material respects to permit preparation of financialstatements in conformity with established accounting principles along with the assets ofthe Company being adequately safeguarded against significant misuse or loss. Anindependent Internal Audit function is an important element of the Company's internalcontrol systems. This is supplemented through an extensive internal audit programme andperiodic reviews by the Management and the Audit Committee.

10. VIGIL MECHANISM AND WHISTLE BLOWER

policy:

The Company has established a Whistle Blower Policy as part of formal mechanism whichhas provided a stage to the employees to come forward and raise their genuine concernswithout any fear of victimization. The details of the Vigil Mechanism and Whistle BlowerPolicy are available on the web link of the Company at https://www.mahanagargas.com/UploadAssets/UploadedFiles/ 56 MGL-Vigilance Directive 68b18bb05b.pdf andhttps://www.mahanagargas.com/

UploadAssets/UploadedFiles/ 70 MGL- Whistleblower Policy 14b8cc6959.pdf respectively.

11. CORPORATE SOCIAL RESPONSIBILITY:

The Company has constituted the Corporate Social Responsibility (CSR) Committee inaccordance with Section 135 of the Act read with the Companies (Corporate SocialResponsibility Policy) Rules 2014. Pursuant to the provisions of Section 135 of theCompanies Act 2013 the Company has also formulated a Corporate Social ResponsibilityPolicy which is also available on the website of the Company athttps://www.mahanagargas.com/UploadAssets/ UploadedFiles/ MGL-CSR Policy 952a5a4889.pdf

The Annual Report on CSR activities as required under Companies (Corporate SocialResponsibility Policy) Rules 2014 (including the activities undertaken by the Companyduring the period of COVID-19 under CSR) is enclosed herewith as Annexure 1 to thisreport.

12. DISCLOSURES PURSUANT TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:

Your Company has in place a Policy on Prevention of Sexual Harassment of Women atWorkplace which is in line with requirements of the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 ("POSH Act"). Theobjective of this Policy is to provide an effective complaint redressal mechanism if thereis an occurrence of sexual harassment.

Your Company has also complied with the provisions of setting up of an InternalComplaints Committee which is duly constituted in compliance with the provisions of thePOSH Act. Further the Company also conducts adequate awareness programmes and interactivesessions against sexual harassment for all the employees to build awareness amongstemployees about the Policy and the provisions of POSH Act. One complaint pertaining tosexual harassment was received by the Company and it was resolved during the year underreview.

13. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS/ TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE:

There are no significant material orders passed by the Regulators/Courts/Tribunalswhich would impact the going concern status and the Company's future operations.

14. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

A. APPOINTMENT AND CESSATION OF DIRECTORS

The details of appointment and cessation of Directors of the Company as on the date ofreport are given in the table as hereunder:

SR. NAME OF THE DIRECTOR AND DIN NO. DATE OF APPOINTMENT / CESSATION WITH REASON
1. Mrs. Radhika Vijay Haribhakti (DIN: 02409519) Ceased to be Woman Independent Director for a second term as the Special Resolution for re-appointment of Mrs. Radhika Vijay Haribhakti as an Independent Director was not passed by the Members of the Company at the 25th Annual General Meeting (AGM') held on September 24 2020
2. Mr. Raj Kishore Tewari (DIN: 07056080) Ceased to be Independent Director with effect from March 31 2021 on completion of second term as Independent Director of the Company.
3. Mr. Deepak Sawant (DIN: 07339381) Resigned as Whole Time Director (Designated as Deputy Managing Director) with effect from April 05 2021 due to withdrawal of nomination by GAIL (India) Limited
4. Mr. Premesh Kumar Jain (DIN: 02145534) Cessation of directorship on April 20 2021 due to demise.
5. Mr. Baldev Singh (DIN : 03577274) Appointed as Nominee Director (Additional) of Government of Maharashtra on the Board w.e.f. April 28 2021
6. Mr. Sanjay Shende (DIN: 09172642) Appointed as Whole Time Director (Designated as Deputy Managing Director) with effect from May 24 2021

The Board places on record its appreciation for the valuable services rendered by theoutgoing Directors during their tenure as Directors of the Company.

All Independent Directors have affirmed compliance to the Code of Conduct forIndependent Directors as prescribed in Schedule IV of the Companies Act 2013.

Mr. Syed S. Hussain Independent Director of the Company has submitted the Declarationof Independence to the Company and pursuant to the provisions of Section 149 of theCompanies Act 2013 and Regulation 25 of Listing Regulations.

Brief profiles of the Directors proposed to be appointed are annexed to the Noticeconvening Twenty- Sixth Annual General Meeting. The aforesaid appointments /re-appointments were based on the recommendation of the Nomination and RemunerationCommittee of the Board.

B. Key Managerial Personnel other than Directors

The details of appointment and cessation of Key Managerial Personnel of the Companyduring the year under review are given in the table as hereunder:

Sl. Name of the Key No. Managerial Personnel Designation Date of Appointment during the FY 2020-2021 Date of Resignation during the FY 2020-2021 Reason for Resignation / Appointment
1. Mr. Saghan Srivastava Company Secretary & Compliance Officer November 12 2020 Deterioration of health conditions
3. Mr. Atul Prabhu Company Secretary & Compliance Officer February 09 2021 Appointed as Company Secretary

Pursuant to Section 203 of the Act the Key Managerial Personnel of the Company as onMarch 31 2021 are Mr. Sanjib Datta Managing Director Mr. Deepak Sawant Deputy ManagingDirector Mr. Sunil Ranade Chief Financial Officer and Mr. Atul Prabhu Company Secretaryand Compliance Officer.

15. ANNUAL EVALUATION OF THE PERFORMANCE OF THE BOARD ITS COMMITTEES AND OF INDIVIDUALDIRECTORS:

Pursuant to the provisions of the Companies Act 2013 and Listing Regulations theannual evaluation of the performance of the Board and that of its Committees as well as ofindividual Directors was carried out during the year under review based on the formalmechanism adopted by the Board. The same was carried out by the Nomination andRemuneration Committee the Board of Directors and the Independent Directors at theirrespective meetings. In the meeting of Independent Directors the performance evaluationof Board as a whole Chairman of the Board and of other Independent and NonIndependentDirectors (excluding the Director being evaluated) was done on the basis of Questionnaireand Evaluation Sheet after taking into account the views of Executive and Non-ExecutiveDirectors of the Company. In the Board meeting that followed the meeting of theIndependent Directors and meeting of Nomination and Remuneration Committee theperformance of the Board its Committees and individual Directors was also discussed.Performance evaluation of Independent Directors was done by the entire Board excludingthe Independent Director being evaluated.

16. NOMINATION AND REMUNERATION POLICY:

In terms of Section 178 of the Companies Act 2013 and the Listing Regulations apolicy on nomination and remuneration of Directors Key Managerial Personnel (KMP) SeniorManagement and other employees of the Company act as a guideline for determininginter-alia qualifications positive attributes and independence of a Director matters

relating to the remuneration appointment removal and evaluation of performance of theDirectors Key Managerial Personnel Senior Management and other employees. The policy isavailable on the website of the Company at https://www.mahanagargas.com/UploadAssets/UploadedFiles/ MGLNomination and Remuneration Policy 329e2e5b7e.pdf

17. STATUTORY AUDITORS:

At the Twenty-Third Annual General Meeting of the Company held on September 17 2018the Members approved appointment of M/s. S R B C & Co. LLP Chartered Accountants(Firm Reg. No. 324982E/E-300003) as Statutory Auditors of the Company to hold office for aperiod of 5 years from the conclusion of the Twenty-Second Annual General Meeting held onSeptember 25 2017 till the conclusion of the Twenty-Seventh Annual General Meeting to beheld in the year 2022 subject to ratification of their appointment by Members at everyAnnual General Meeting if so required under the Act.

M/s. S R B C & Co. LLP Chartered Accountants (Firm Reg. No. 324982E/E-300003) hascarried out the Statutory Audit of your Company for the financial year 2020-2021. Furtherthe Auditors' Report "with an unmodified opinion" given by the StatutoryAuditors on the Financial Statements of the Company for FY 2020-2021 is disclosed in theFinancial Statements forming part of this Annual Report. There has been no qualificationreservation adverse remark or disclaimer given by the Statutory Auditors in their Reportfor the year under review.

The Notes to the financial statements referred to in the Auditors' Report for FY2020-2021 of M/s. S R B C & Co. LLP are self-explanatory and do not call for anyfurther comments.

18. REPORTING OF FRAUDS BY AUDITORS:

The Statutory Auditors have not reported any incident of fraud to the Audit Committeeor the Board of Directors under Section 143(12) of the Act during the financial year underreview.

19. SECRETARIAL AUDITORS:

Pursuant to provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorsof the Company had appointed M/s. Dholakia & Associates LLP Company Secretaries toconduct the Secretarial Audit of the Company for the Financial Year 2020-2021. TheSecretarial Audit Report for the Financial Year 2020-2021 issued by M/s. Dholakia &Associates LLP Company Secretaries in Form MR-3 is enclosed herewith as Annexure 2 tothis report. The Secretarial Audit Report is self-explanatory in nature. There has been noqualification reservation adverse remark or disclaimer given by the Secretarial Auditorin his Report for the year under review except non-appointment of Independent WomanDirector. Further the Company is reaching out to select professionals and is makingefforts to fill the position of Independent Woman Director as early as possible inaccordance with the provisions of the Companies Act 2013 and SEBI (LODR) Regulations2015.

20. COST AUDITORS:

Your Company is required to carry out Cost Audit pursuant to Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) Rules 2014. M/s.Dhananjay V. Joshi & Associates Cost Accountants conducted this audit for theCompany's Financial Year ended March 312021 and submitted their Report to the CentralGovernment in Form CRA 4. The Board of Directors has on the recommendation of the AuditCommittee appointed M/s. Dhananjay V. Joshi & Associates Cost Auditors to audit theCost Accounts of the Company for Financial Year 2021-2022 on remuneration of Rs250000/-(Rupees Two Lakh Fifty Thousand Only) plus applicable taxes and travelling and out ofpocket expenses to be reimbursed at actuals upto Rs25000/-.

Your Company is maintaining cost records as specified by the Central Government underSection 148 of the Companies Act 2013.

21. PARTICULARS OF LOANS ADVANCES GUARANTEES AND INVESTMENTS:

Pursuant to Section 186 of Companies Act 2013 and Schedule V of the ListingRegulations disclosure on particulars relating to loans advances guarantees andinvestments are provided as part of the financial statements if any.

22. RELATED PARTY TRANSACTIONS:

All Related Party Transactions entered into during the year were in ordinary course ofbusiness and on arm's length basis and same have been disclosed in the Notes to theFinancial Statements. All Related Party Transactions are placed before the Audit Committeefor approval. Prior omnibus approval of the Audit Committee is obtained for thetransactions which are repetitive in nature. A statement of all Related Party Transactionsis placed before the Audit Committee for its review on a quarterly basis.

All Material Related Party Transactions arising from contracts / arrangements withRelated Parties referred to in the Section 188(1) of the Companies Act 2013 and asrequired under Section 134(3)(h) of the Companies Act 2013 in Form AOC-2 have beenattached as Annexure 3 to this Report. The Company has adopted a Related PartyTransactions Policy. The Policy as approved by the Board is uploaded on the Company'swebsite at the web link https://www.mahanagargas.com/ UploadAssets/UploadedFiles/ MGLPolicy on Related Party Transactions 7e65246e63.pdf

23. DISCLOSURE REGARDING REMUNERATION TO DIRECTORS AND EMPLOYEES:

Disclosures pertaining to remuneration of Directors and employees as required underSection 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are enclosed as Annexure 4 to this Report.

Further there is no employee employed throughout the financial year who was in receiptof remuneration exceeding Rs102 Lakh and employees employed for part of the year and inreceipt of remuneration of Rs8.50 Lakh or more per month pursuant to Rule 5(2) theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

24. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGO:

Your Company consciously makes all efforts to conserve energy across all itsoperations. A report containing details with respect to conservation of energy technologyabsorption and foreign exchange earnings and outgo required to be disclosed in terms ofSection 134(3)(m) of the Act read with the Companies (Accounts) Rules 2014 is enclosedas Annexure 5 to this Report.

25. MANAGEMENT DISCUSSION AND ANALYSIS:

A separate report on Management Discussion and Analysis as stipulated by the ListingRegulations forms part of this Annual Report.

26. BUSINESS RESPONSIBILITY REPORT:

The Business Responsibility Report for the year ended March 31 2021 as stipulatedunder Regulation 34 of the Listing Regulations is annexed which forms part of this AnnualReport.

27. CORPORATE GOVERNANCE:

As per the requirements of the Listing Regulations a detailed report on CorporateGovernance and certificate regarding compliance of conditions of Corporate Governance arepart of this Annual Report.

M/s. Santosh Singh & Associates Practicing Company Secretary vide certificatedated May 03 2021 have confirmed that the Company is and has been compliant with theconditions stipulated in the Chapter IV of the Listing Regulations.

28. STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY EXPERTISE ANDEXPERIENCE:

The Board confirms that Independent Directors appointed during the year possessintegrity expertise and experience.

29. ANNUAL RETURN:

Pursuant to the provisions of Section 92(3) and Section 134(3)(a) of the Companies Act2013 read with rules made thereunder the copy of Annual Return is available on thewebsite of the Company i.e. www.mahanagargas.com .

30. OTHER DISCLOSURES

In terms of the applicable provisions of the Act and SEBI Listing Regulations yourCompany additionally discloses that during the year under review :

• There was no change in the nature of business of your Company;

• Your Company has not issued any shares with differential voting rights;

• Your Company has not issued any Sweat Equity Shares;

• There is no plan to revise the Financial Statements or Directors' Report inrespect of any previous financial year;

• No material changes and commitments have occurred between the end of theFinancial Year of the Company to which the Financial Statements relate and the date of theReport affecting the financial position of the Company;

• Your Company does not engage in commodity hedging activities.

31. AWARDS AND RECOGNITIONS:

MGL won the prestigious GREENTECH Safety Platinum Award 2020 for Safety Excellence. Theaward was received by the Company in February 2021.

MGL was conferred with National Award for Excellence in CSR & Sustainability 2020in the category Best COVID-19 solution for community care serving of cooked mealsproviding ration kits to daily wage earners slum dwellers tribals etc. equippingCOVID-19 testing laboratory donating ventilators and extending financial support toMaharashtra State Disaster Management Authority. Our contribution was acknowledged and MGLwas felicitated by the Hon'ble Governor of Maharashtra as 'Covid Warrior' and recognizedfor its work.

A Commemorative Volume Special Postage Stamp and Cover were released to commemoratethe completion of 25 years of your Company.

32. ACKNOWLEDGEMENT:

We take this opportunity to place on record our appreciation to the Ministry ofPetroleum & Natural Gas Government of India Petroleum & Natural Gas RegulatoryBoard Government of Maharashtra (GOM) Maharashtra State Road Development CorporationLimited Municipal Corporations of Greater Mumbai Navi Mumbai Thane Mira-BhayanderKalyan-Dombivali Raigad other State and Central Government Authorities MumbaiMetropolitan Regional Development Authority (MMRDA) Maharashtra Industrial DevelopmentCorporation (MIDC) Police and Fire Brigade authorities all our customers membersinvestors vendors suppliers business associates bankers and financial institutions fortheir continuous cooperation and support.

We are grateful for guidance and support received from Statutory Auditor Cost Auditorand Secretarial Auditor.

COVID-19 pandemic has caused an unprecedented loss of lives in India as well asglobally. We have great respect and are grateful to the COVID warriors and frontlineworkers who risked their lives to fight the pandemic.

We acknowledge the patronage of GAIL (India) Limited and GOM for their support andabove all we place on record our sincere appreciation for the hard-work solidarity andcontribution of each and every employee of the Company in driving the growth of theCompany.

For and on behalf of the Board of Directors

Manoj Jain
Place : New Delhi Chairman
Date : May 24 2021 (DIN: 07556033)

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