Your Directors take pleasure in presenting the Twelfth Annual Report on the businessand operations of the Company along with the audited financial statements for thefinancial year ended March 31 2019.
The Financial Year 2018-19 was a year of consolidation for the business a year whereinthe Company saw marginal dip in revenues due to delayed onset of wind season and impact ofcyclone which resulted in drop in wind availability. The moderate decline in the top-lineunderstates the progress made by the Company in the past few years. The reduced unitsgenerated and decline in revenues resulted in operating de-leverage and impacted EBITDAand resultant profit generating ability of the business. However efforts have beenundertaken to improve efficiencies and a rebound in wind availability and REC mechanismwill enable the company to deliver a steady performance in the future.
Revenues for the year stood at Rs. 37127.62 lakhs as against Rs. 43313.29 lakhsreported for the corresponding period last year.
EBITDA for the year stood at Rs. 24648.97 lakhs as against Rs. 29975.96 lakhs duringprevious year. EBITDA margins for the year stood at 73% as against previous year margin of75%.
Depreciation for the year stood at Rs. 11373.84 lakhs as against Rs. 13662.68 lakhsregistered during last year.
Interest expense for the year stood at Rs.20456.62 lakhs as against the previous outgoof Rs. 23504.79 lakhs.
Loss after tax for the year stood at Rs. 4961.02 lakhs as against a loss of Rs.6322.39 lakhs reported for last year.
Winding up of Orient Green Power Pte. Ltd. Singapore the Promoter Company
Orient Green Power Pte Ltd Singapore ("OGPPL") a company belonging to thePromoter Group has entered into Scheme of Compromise and Arrangement with Shriram EPC(Singapore) PTE Ltd Singapore ("hereinafter SEPC PTE") and Shriram Ventures PteLtd Singapore whereby the shares held by OGPPL in the equity share capital of ourCompany shall stand proportionately distributed to the shareholders of OGPPL.
The Scheme of Arrangement has been approved by the Honorable High Court of the Republicof Singapore. OGPPL has been a promoter of our Company since 2010 and holds 34.91% stakein the Company.
Shriram EPC (Singapore) PTE Ltd Singapore ("SEPC PTE") holds 37.7% in theequity share capital of OGPPL. The entire equity share capital of SEPC PTE is held by SVLLimited the Indian Promoter Group company. The other equity shareholders of OGPPL whoare financial investors are Bessemer India Capital OGPL Ltd ("BVP") with 37.7%and AEP Green Power Limited ("AEP") with 24.6%.
Pursuant to the Scheme of Compromise and Arrangement the shares of the Company held byOGPPL has been distributed to their shareholders of the Company viz. SVL Limited BVP andAEP SVL Limited BVP and AEP will hold 34.95% 13.16% and 8.59% respectively. The promotershareholding in the equity share capital of our Company stands at 48.73%. OGPPL has beenceased to be the Promoter of the Company.
Consolidated Financial Statements
The Consolidated Financial Statements of the Company and its subsidiaries prepared inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards specified under Section 133 of the Companies Act 2013 ('theAct') read with relevant rules issued thereunder form part of the Annual Report and arereflected in the Consolidated Financial Statements of the Company.
The annual financial statements of the subsidiaries and related detailed informationwill be kept at the Registered Office of the Company and will be available to investorsseeking information at any time.
The Company has adopted a Policy for determining Material Subsidiaries in terms ofRegulation 16 (1) (c) of the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 ('Listing Regulations'). The Policy asapproved by the Board are available on our website atHREF="http://orientgreenpower.com/">http://orientgreenpower.com/Companies-Act-and-SEBI- Compliance.asp.
The Company has not declared any dividend in view of the losses incurred by the Companyduring the year.
During the year under review there is no change in the Share Capital of the Company.
Particulars of Loans Guarantees or Investments
Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part of the Notes to the financial statements provided in this Annual Report.
Material changes and commitments affecting financial position between the end of thefinancial year and date of the report
There were no material changes and commitments affecting the financial position of theCompany between the end of the financial year and the date of the report.
Management Discussion and Analysis Report
Management Discussion and Analysis Report for the year under review in terms ofRegulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015forms part of the Annual Report.
As at 31st March 2019 your Company had a total of 9 subsidiaries and 4 step downsubsidiaries the details of which are given elsewhere in the Annual Report under therelevant Sections.
Orient Eco Energy Limited (OEEL) a subsidiary of Orient Green Power Company Limitedhas been liquidated during the financial year and accordingly ceased to be a subsidiary ofthe Company.
The information as required under the first proviso to sub-section (3) of Section 129is given in Form AOC-1 is appended as Annexure 1 to the Board's Report.
Further pursuant to the provisions of Section 136 of the Companies Act 2013("Act") financial statements of the Company Consolidated financial statementsalong with the relevant documents and separate audited accounts in respect of thesubsidiaries of the Companies are available in the website of the CompanyHREF="http://www.orientgreenpower.com/">www.orientgreenpower.com/Investor/Subsidiaries Balance Sheet
The Company has not accepted any deposits either from the shareholders or public and assuch no amount of principal or interest was outstanding as on the date of Balance Sheet.
The Company has been complying with the provisions of Corporate Governance asstipulated in Regulations 24 27 and other relevant provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. A separate report on CorporateGovernance along with Auditors' Certificate on compliance of the Corporate Governancenorms as stipulated in Regulation 34(3) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 forming part of this report are provided elsewhere in thisAnnual Report.
Internal Control System
The Company has in place an adequate system of internal controls commensurate with itssize requirements and the nature of operations. These systems are designed keeping inview the nature of activities carried out at each location and the various businessoperations. The company has documented a robust and comprehensive internal control systemfor all the major processes to ensure reliability of financial reporting timely feedbackon achievement of operational and strategic goals compliance with policies procedureslaws and regulations safeguarding of assets and economical and efficient use ofresources.
The Internal Auditor monitors and evaluates the efficacy and adequacy of internalcontrols system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal audit process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. During the year the Audit Committee metregularly to review reports submitted by the Internal Audit. All significant auditobservations and follow-up actions thereon were reported to the Audit Committee. The AuditCommittee also met the Company's Statutory Auditors to ascertain their views on thefinancial statements including the financial reporting system compliance to accountingpolicies and procedures the adequacy and effectiveness of the internal controls andsystems followed by the Company.
Your Company also has a Risk Management Framework in place covering all critical areasof operation. This framework is reviewed periodically keeping in mind the businessdynamics and external environment and provides the guidelines for managing the variousrisks across the business.
Directors' Responsibility Statement
The financial statements are prepared in accordance with Indian Accounting Standards(Ind AS) notified under the Companies (Indian Accounting Standards) Rules 2015 as amendedby the Companies (Indian Accounting Standards) Rules 2016 the provisions of the Act (tothe extent notified) and guidelines issued by the Securities and Exchange Board of India(SEBI). The Ind AS are prescribed under Section 133 of the Companies Act 2013 ('theAct') read with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015 andCompanies (Indian Accounting Standards) Amendment Rules 2016. The Company has adopted allthe Ind AS standards and the adoption was carried out in accordance with applicabletransition guidance. Accounting policies have been consistently applied except where anewly issued accounting standard is initially adopted or a revision to an existingaccounting standard requires a change in the accounting policy hitherto in use.
The directors confirm that:
(i) In the preparation of the annual accounts for the year ended 31st March 2019 theapplicable accounting standards have been followed along with proper explanation relatingto material departures if any;
(ii) the Directors had 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 as at 31st March 2019 and Profit and Lossand cash flow of the Company for the year ended on that date;
(iii) the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) the Directors had prepared the annual accounts of the Company on a 'going concern'basis.
(v) the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are reasonably adequate and operatingeffectively; and
(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are reasonably adequate and operatingeffectively.
Number of Board Meetings
The Board of Directors met 4 (four) times in the year 201819. The details of the boardmeetings and the attendance of the Directors are provided in the Corporate GovernanceReport. The maximum interval between any two meetings did not exceed 120 days asprescribed in the Companies Act 2013.
Familiarization Program for Independent Directors
The Company will impart Familiarization Programme for new Independent Directorsinducted on the Board of the Company. The Familiarization Programme of the Company willprovide information relating to the Company wind energy / renewable energy industrybusiness model of the Company geographies in which Company operates etc. The programmealso intends to improve awareness of the Independent Directors on their roles rightsresponsibilities towards the Company. Further the Familiarization Programme should alsoprovide information relating to the financial performance of the Company and budget andcontrol process of the Company. The format of the letter of appointment is available onour website http://orientgreenpower.com/Companies-Act-and-SEBICompliance.
Directors and Key Managerial Personnel
a) Resignation/Retirement/Demise: -
Mr. S. Srinivasan (DIN: 00014652) Non-Executive Director of the company resigned fromhis position as Director with effect from 30th July 2018.
Ms. Savitha Mahajan (DIN: 06492679) Independent Director of the Company resigned fromher position as Director with effect from 1st December 2018.
The Board placed on record its appreciation for the valuable services rendered by them.
b) Appointment: -
Ms. Chandra Ramesh (DIN 00938694) has been appointed as Additional Director(Independent) of the Company under Section 161 of the Companies Act 2013 with effect from27th February 2019 to hold office up to the date of the forthcoming Annual GeneralMeeting. Ms. Chandra Ramesh has offered herself to be appointed as the IndependentDirector of your Company.
c) Re-appointment: -
Mr. P Krishna Kumar (DIN: 01717373) retires by rotation and being eligibleoffers himself for reappointment in accordance with the provisions of Section 152(6) andArticles of Association of the Company. A resolution seeking shareholders' approval forhis re-appointment forms part of the Notice.
Mr. R. Ganapathi (DIN: 00103623) was appointed as an Independent Director at the7th Annual General Meeting (AGM) held on 12th August 2014 for a period of five years.Based on the recommendation of the Nomination and Remuneration Committee the shareholdersof the Company through postal ballot approved on 27.03.2019 his re-appointment for asecond term of five years i.e from 01.04.2019 to 31.03.2024.
Maj.Gen. A.L. Suri (Retd.) (DIN: 00009532) was appointed as an IndependentDirector at the 7th Annual General Meeting (AGM) held on 12th August 2014 for a period offive years. Based on the recommendation of the Nomination and Remuneration Committee theshareholders of the Company through postal ballot approved on 27.03.2019 hisre-appointment for a second term of five years i.e from 01.04.2019 to 31.03.2024.
In compliance with the Regulation 17(1 A) of LODR approval of the shareholderswas obtained via special resolution through the Postal Ballot process on 27thMarch 2019 for continuation of Mr. N Rangachary (DIN: 00054437) (81 years) as anIndependent Director of the Company till the expiry of his existing term ie. upto 13thAugust 2020.
d) Key Managerial Personnel
There has been no change in the Key Managerial Personnel during the year.
e) Independent Directors:
The Company has received the declarations from each Independent Directors of theCompany under Section 149(7) of the Companies Act 2013 that they meet the criteria ofindependence as laid down in Section 149(6) of the Act.
Committees of the Board
The Company has following committees of the Board:
1. Audit Committee
2. Nomination & Remuneration Committee
3. Stakeholder's Relationship Committee
4. Risk Management Committee
5. Investment/Borrowing Committee
6. Corporate Social Responsibility Committee
A detailed note on the composition of the Board and its committees is provided in theCorporate Governance Report a part of this Annual Report.
Related Party Transactions & Particulars of Contracts or Arrangements made withrelated parties
All the related party transactions that were entered into during the Financial Year2018-19 were on an arm's length basis and in the ordinary course of business. There are nomaterially significant Related Party transactions made by the Company with PromotersDirectors or Key Management Personnel etc. which may have potential conflict with theinterest of the company at large.
All Related Party Transactions are presented to the Audit Committee and the Board. Astatement of all related party transactions was presented before the Audit Committeespecifying the nature value and terms and conditions of the transactions.
The Related Party Transactions Policy as approved by the Board is uploaded on theCompany's website at http://orientgreenpower.com/Companies-Act-and- SEBICompliance.asp.
The details of the transactions with Related Parties during the year are provided inthe accompanying financial statements and also in form AOC-2 is appended as Annexure 2 tothe Board's Report.
Evaluation of the Board's Performance
In compliance with the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the performance evaluation of the Board was carried outduring the year under review. More details on the same are given in the CorporateGovernance Report.
Prevention of Sexual Harassment at workplace
The Company has always provided a congenial atmosphere for work to all the employeesthat is free from discrimination and harassment including sexual harassment. It hasprovided equal opportunities of employment to all without regard to their caste religioncolour marital status and gender. There were no cases reported during the financial yearunder the said policy.
Audit reports and Auditors Audit reports
1. The Auditors' Report for the year 2018- 2019 does not contain any qualificationreservation or adverse remark. The Auditors' Report is enclosed with the financialstatements in this Annual Report.
2. The Secretarial Auditors' Report for the year 20182019 does not contain anyqualification reservation or adverse remark. The Secretarial Auditors' Report is enclosedas Annexure 3 to the Board's Report.
3. As required by the Listing Regulations the auditors' certificate on corporategovernance is enclosed. The auditors' certificate for Year 2018-2019 does not contain anyqualification reservation or adverse remark.
M/s. G.D.Apte & Co (Registration No.100515W) Chartered Accountants Pune had beenappointed as Statutory Auditors of the Company as per Section 139 of the Companies Act2013 for a period of 5 years from the conclusion of Tenth Annual General Meeting till theconclusion of Fifteenth Annual General Meeting by the members at the Annual GeneralMeeting held on August 09 2017.
Internal Audit of the company is handled by M/s. Sundar Srini & Sridhar anindependent Chartered Accountant firm for evaluating the adequacy of internal controlsand concurrently reviews majority of the transactions in value terms.
Independence of the firm and compliance is ensured by the direct reporting of the firmto the Audit Committee of the Board.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s. M Alagar &Associates Practicing Company Secretary were appointed as Secretarial Auditors for thefinancial year 2018-19 to audit the secretarial and related documents of the Company.
In compliance with the SEBI (Prohibition of Insider Trading) Regulations 2015 asamended your Company has instituted a comprehensive Code titled as "Orient GreenPower Company Limited Code of Conduct" which lays down guidelines and advises theDirectors and Employees of the Company on procedures to be followed and disclosures to bemade while dealing in securities of the Company.
Conservation of energy research and development technology absorption foreignexchange earnings and outgo
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3) (m) of the Companies Act 2013 readwith Rule 8 of The Companies (Accounts) Rule 2014 is appended as Annexure- 4 to theBoard's Report.
Particulars of Employees
The Information as required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is appended as Annexure- 5 to the Board's Report.
Pursuant to Section 197 (14) of the Act Mr. Venkatachalam Sesha Ayyar ManagingDirector of the Company received remuneration from one of its step down-subsidary ie.Clarion Wind Farm Private Limited during the period 01st September 2018 to 31st March2019.
The Information as required under Rule 5(1) & Rule 5 (2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided in anannexure forming part of this Annual report. In terms of the first provision to Section136 of the Act the report and accounts are being sent to members excluding the aforesaidAnnexure. Any member interested in obtaining the same may write to the Company Secretaryat the Registered office of the Company. None of the employees listed in the said annexureare related to any directors of the Company.
Significant and Material orders
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
Extract of Annual Return
As per the requirements of Section 92(3) of the Act and Rules framed thereunder theextract of the annual return for FY 2019 is given in Annexure 6 in the prescribed Form No.MGT-9 which is a part of Board's Report.
The details of the policies approved and adopted by the Board are as follows:
Whistle Blower Policy (Policy on Vigil Mechanism)
The company has adopted a whistle blower mechanism for directors and employees toreport concerns about unethical behavior actual or suspected fraud or violation of thecompany's code of conduct and ethics. Details of the policy are available on our websiteat https://www. orientgreenpower.com/ Investor/Companies Act & SEBI Compliance/Policy/Whistle Blower Policy.
Insider Trading Policy
The policy provides the framework in dealing with securities of the Company. Details ofthe policy are available on our website at https://www.orientgreenpower.com/Investor/Companies Act & SEBI Compliance/Policy/ Code of conduct to regulate Monitor andReport trading by Insiders.
Policy for Determining Materiality for Disclosures
The policy applies to disclosures of material events affecting the Company and itssubsidiaries. Details of the policy are available on our website athttps://www.orientgreenpower. com/ Investor/Companies Act & SEBI Compliance/Policy/Policy on Criteria for Determining Materiality of Events.
Nomination and Remuneration Policy
This policy formulates the criteria for determining qualifications competenciespositive attributes and independence for the appointment of the Director (Executive/non-executive) and also the criteria for determining the remunerations of the DirectorsKey Managerial Personnel Senior Management. Details of the policy are available on ourwebsite at https://www.orientgreenpower.com/Investor/ Companies Act & SEBICompliance/Policy/ Nomination Remuneration Policy.
Corporate Social Responsibility Policy
The policy outlines the company's strategy to bring about a positive impact on societythrough programs relating to hunger poverty education healthcare environment and lowerits resource footprint. Details of the CSR policy are available on our website athttps://www.orientgreenpower. com/Investor/Companies Act & SEBI Compliance/Policy/Policy on CSR.
Policy on Material Subsidiaries
The policy is used to determine the material subsidiaries of the company. Details ofthe policy are available on our website at https://www.orientgreenpower.com/Investor/Companies Act & SEBI Compliance/Policy/ Policy on Material Unlisted Subsidiary Company
Related Party Transactions Policy
The policy regulated all transactions between the company and its related parties.Details of the policy are available on our website at https://www.orientgreenpower.com/Investor/Companies Act & SEBI Compliance/Policy/ Policy on Related Party Transactions
Documents Retention and Archival Policy
The policy deals with the retentions and archival of corporate records of the Companyand all its subsidiaries. Details of the policy are available on our website athttps://www.orientgreenpower.com/Investor/Companies Act & SEBI Compliance/Policy/Preservation of Documents & Archival Policy
Investor Education and Protection Fund (IEPF)
Pursuant to the applicable provisions of the Companies Act 2013 read with the IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 ('the Rules') anyApplication money received by the company for allotment of securities and due for refundshall be transferred to the IEPF established by the Central Government after thecompletion of seven years. Further according to the Rules the amounts which have notbeen paid or claimed by the shareholders for seven consecutive years or more shall also betransferred to the IEPF account created by the IEPF Authority. Accordingly on 5th October2017 unclaimed Share Application money amounting to Rs. 16750 has been transferred toIEPF account as per the requirements of the IEPF rules
The Company complies with all applicable mandatory Secretarial Standards issuedby the Institute of Company Secretaries of India.
None of the Auditors of the Company have reported any fraud as specified underthe second proviso of Section 143 (12) of the Companies Act 2013 (including any statutorymodification(s) or re-enactment(s) thereof for the time being in force);
The Company does not have any scheme or provision of money for the purchase ofits own shares by employees/ Directors or by trustees for the benefit of employees/Directors; and
The Company has not issued equity shares with differential rights as todividend voting or otherwise.
Electronic copies of the Annual Report 2018-19 and the Notice of the 12th AnnualGeneral Meeting are sent to all members whose email addresses are registered with theCompany / depository participant(s). For members who have not registered their emailaddresses physical copies are sent in the permitted mode.
Your Directors wish to convey their deep appreciation to all the employees customersvendors investors Bankers Financial Institutions for their sincere and dedicatedservices as well as their collective contribution to the Company's performance.
Your Directors also thank the Government of India Government of various States inIndia and concerned Government Departments for their co-operation.
| ||For and on behalf of the Board of Directors || |
| ||Venkatachalam Sesha Ayyar ||T.Shivaraman |
|Chennai ||Managing Director ||Director |
|April 29 2019 ||DIN:06698233 ||DIN: 01312018 |