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TCI Express Ltd.
|BSE: 540212||Sector: Services|
|NSE: TCIEXP||ISIN Code: INE586V01016|
|BSE 12:22 | 16 Aug||725.00||
|NSE 12:14 | 16 Aug||724.60||
|Mkt Cap.(Rs cr)||2,777|
|Mkt Cap.(Rs cr)||2776.75|
TCI Express Ltd. (TCIEXP) - Director Report
Company director report
Your Directors take immense pleasure in presenting their 9th Annual Reporton the business and operations of the Company along with the Audited Financial Statementfor the year ended March 312017.
The summarized financial highlights of the Company for the year under review along withprevious year figures are depicted below:
SCHEME OF ARRANGEMENT
During the year under review pursuant to the Scheme of Arrangement between TransportCorporation of India Limited (TCI) and TCI Express Limited (Company) and their respectiveshareholders and creditors the XPS division of TCI demerged and vested into the Company.The Hon'ble High Court of Judicature at Hyderabad for the State of Telangana and the Stateof Andhra Pradesh sanctioned the Scheme of Arrangement vide its order dated June 14 2016and the Scheme became effective from August 11 2016. The appointed date under the Schemewas close of business hours of March 31 2016. Pursuant to the Scheme the above financialresults of the Company for the year ended March 31 2017 are not comparable with thefinancial results for the previous year ended March 312016.
During the financial year ended March 31 2017 your Company earned total income of Rs.75523.63 Lakhs as compared to Rs. 0.25 Lakhs in previous financial year and made a profitbefore tax of Rs. 6144.12 Lakhs compared to loss of Rs. 1.40 Lakhs in previous financialyear and profit after tax of Rs. 4071.32 Lakhs as compared to loss of Rs. 1.40 Lakhs inprevious financial year.
The Board in its meeting held on January 31 2017 has declared an interim dividend of40% (Re. 0.80 per equity share of Rs. 2/- each) which was paid to the shareholders in themonth of February 2017.
Further the Board in its meeting held on May 23 2017 has recommended a finaldividend of 40% (Re. 0.80 per equity share of Rs. 2/- each) for the financial year endedon March
31 2017. The proposal is subject to the approval of the shareholders at theforthcoming Annual General Meeting.
The Final Dividend if approved by the shareholders in the ensuing Annual GeneralMeeting will be paid to those members whose names appear in the Register of Members andto those persons whose names appear as Beneficial owners as per the details to befurnished by National Securities Depository Limited and Central Depository Services(India) Ltd on the date of book closure.
TRANSFER TO GENERAL RESERVE
For Financial year ended March 31 2017 the Company has transferred Rs. 2500 Lakhs toGeneral Reserve.
SHARE CAPITAL AND LISTING OF SHARES ON STOCK EXCHANGES
As on March 312016 paid up share capital of the Company was Rs. 500000/- dividedinto 50000 equity shares of Rs. 10/- each. In terms of the Scheme of Arrangement thesaid capital of Rs. 500000/- has been extinguished and cancelled. Pursuant to the Schemeof Arrangement the Company has issued and allotted fully paid 38288725 equity sharesof Rs. 2/- each in the ratio of 1:2 to the shareholders ofTransport Corporation of IndiaLimited on August 31 2016. The Securities and Exchange Board of India vide its letterdated December 6 2016 has granted the necessary relaxation under Rule19(2)(b) ofSecurities Contracts (Regulation) Rules 1957 for the listing of the aforesaid equityshares of the Company and consequently trading commenced with effect from December 152016 on BSE Ltd. and National Stock Exchange of India Limited.
EMPLOYEE STOCK OPTION PLAN-2016
The shareholders of the Company in the 8th Annual General Meeting held onNovember 4 2016 approved the Employee
Stock Option Plan-2016. In terms of the provisions of Companies Act 2013 and SEBI(Share Based Employee Benefits) Regulations 2014 the detail of Employee Stock OptionPlan-2016 is hereunder:
During the year under review the Board of Directors has not granted any options to theemployees in terms of Employee Stock Option Plan-2016.
SUBSIDIARY HOLDING JOINT VENTURE AND ASSOCIATE COMPANIES
As on March 312017 the Company did not have any subsidiary or holding or jointventure or associate company as defined under Companies Act 2013.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors
The shareholders in the 8th Annual General Meeting held on November 4 2016has approved the appointment/ regularization of following Director(s):
Mr. Chander Agarwal and Mr. Phool Chand Sharma were appointed as ManagingDirector and Whole Time Director respectively for a period of five years with effectfrom August 18 2016.
Mr. D.P. Agarwal and Mr. Vineet Agarwal were regularized as Non-Executive NonIndependent Directors of the Company whose offices are liable to retire by rotation.
Mr. Murali Krishna Chevuturi Mr. Ashok Kumar Ladha Mr. Prashant Jain and Mrs.Manisha Agarwal were appointed as Non-Executive Independent Directors of the Company fora period of five consecutive years whose offices are not liable to retire by rotation.
Post last Annual General Meeting held on November 4 2016 Mrs. Manisha Agarwal hasresigned from the Directorship of the Company effective from January 312017. Subsequentto resignation of Mrs. Manisha Agarwal the Board of Directors has appointed Mrs. TarunaSinghi as Additional Director in category of Non-Executive Independent Director w.e.f.January 31 2017. In terms of Section 161 of the Companies Act 2013 she will hold officeup to the date of this Annual
General Meeting. The Company has received notice from a member proposing thecandidature of Mrs. Taruna Singhi for appointment as Director. Accordingly the requisiteresolution for her appointment will be placed before the shareholders for their approval.
Pursuant to the Companies Act 2013 and rules made thereunder Mr. Vineet AgarwalDirector retires by rotation at the ensuing Annual General Meeting and being eligibleoffers himself for re-appointment.
Brief resumes of the Directors being appointed/re-appointed nature of their expertisein specific functional areas details of Directorship in other Companies Membership /Chairmanship of Committees of the board and other details as stipulated under Regulation36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 areforming part of the Annual Report.
The Independent Directors have submitted their respective declarations of Independenceas required pursuant to Section 149(7) of the Companies Act 2013 confirming that theymeet the criteria of Independence specified in the Act and the Rules made thereunder asalso under Regulation 25 of the SEBI (Listing Obligations and Disclsoure Requirements)Regulations 2015.
Key Managerial Personnel
Pursuant to the provisions of Section 203 of the Companies Act 2013 the KeyManagerial Personnel of the Company are Mr. Chander Agarwal Managing Director Mr. P. C.Sharma Whole Time Director Mr. Mukti Lal Chief Financial Officer and Mr. Vinay GujralCompany Secretary.
INDEPENDENT DIRECTORS' MEETING
The details pertaining to separate meeting of Independent Directors held during theyear are provided in the Corporate Governance Report forming part of the Annual Report.
ANNUAL EVALUATION OF THE BOARD ITS COMMITTEE AND INDIVIDUAL DIRECTORS
The Board of Directors has carried out an annual evaluation of its own performanceBoard Committees and individual Directors pursuant to the provisions of the Companies ActCorporate Governance requirements as prescribed by SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and guidance note issued by SEBI vide itscircular dated January 5 2017.
The performance of the Board was evaluated after seeking inputs from the Directors onthe basis of the criteria such as the structure of Board meeting and functions of theBoard evaluation of the performance of the Management Committees of the Board etc. Thecriteria for performance evaluation of the individual Directors includes aspects onqualification experience knowledge contribution to the Board and Committee meetingsetc.
MEETING OF BOARD OF DIRECTORS
During the year under review five (5) Board Meetings were convened and held. TheDetails of the composition of the Board and its Meetings held attendance of the Directorsat such meetings and other relevant details are provided in the Corporate GovernanceReport forming part of Annual Report. The intervening gap between the Meetings was withinthe period prescribed under the Companies Act. 2013
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the Companies Act 2013 the Board of Directors to the best of theirknowledge and ability state the following:
That in the preparation of the Annual Financial Statements for the year endedMarch 31 2017 all the applicable Accounting Standards have been followed alongwithproper explanation relating to material departures if any;
That such accounting policies have been selected and applied consistently andjudgment and estimates have been made that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at March 312017 and of the profitof the Company for the year ended on that date;
That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
That the Annual Financial Statements have been prepared under the going concernassumption;
That proper internal financial controls are in place and that the financialcontrols are adequate and are operating effectively;
That proper systems to ensure compliance with the provisions of all applicablelaws are in place and are adequate and operating effectively.
COMPOSITION OF AUDIT AND CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The composition of the Audit Committee and CSR Committee of the Board of Directors andtheir meeting held attendance of members at such meeting and other relevant informationis provided in the Corporate Governance Report forming part of Annual Report.
RELATED PARTY TRANSACTIONS
All Related Party Transactions are placed before the Audit Committee for approval.Omnibus approval is obtained for unforeseen related party transactions. Related PartyTransactions entered including omnibus approval are audited by the Internal Auditor and astatement giving details of all Related Party Transactions is placed before the AuditCommittee for review and approval on a quarterly basis.
During the year under review pursuant to SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has entered into material related partytransactions subject to the approval of shareholders in this Annual General Meeting. Alltransactions entered with Related Parties for the year under review were on arm's lengthbasis and in the ordinary course of business.
The particulars of contracts or arrangements with related parties referred to insection 188(1) of the Companies Act 2013 in the prescribed format is attached herewith asAnnexure A.
The policy on Related Party Transactions may be accessed on the Company's website atthe following link
VIGIL MECHANISM/WHITSLE BLOWER POLICY
The details pertaining to Vigil Mechanism/ Whistle Blower Policy of the Company areprovided in the Corporate Governance Report forming part of Annual Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an effective internal control and risk mitigation system which isconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is commensurate with its size scale and complexities ofits operations. The internal and operational audit is carried out by the Internal AuditDepartment headed by the Internal Auditor.
The Audit Committee actively reviews the adequacy and effectiveness of the internalcontrol systems and suggests improvements to strengthen the same. The Audit CommitteeStatutory Auditors and the Operational Heads are periodically apprised of the internalaudit findings and corrective actions taken. The Audit plays a key role in providingassurance to the Board of Directors. The significant audit observations and correctiveactions taken by the management are presented to the Audit Committee.
To maintain its objectivity and independence the Internal Auditor directly interactswith the Chairman and other members of the Audit Committee. The Company has adequateinternal controls and processes in place with respect to financial statements whichprovide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements. The processes and controls of Internal Audit arereviewed periodically.
The Company has devised and implemented a mechanism for risk management. Your Companybelieves that managing risks helps in maximizing returns. The Company's approach toaddressing operational risks is comprehensive and includes periodic review of such risksand a framework for identifying
and addressing the risks has been laid down by the Board of Directors. The AuditCommittee of the Board of Directors periodically reviews the Risk Management frameworkidentified risks with criticality and mitigations plans.
During the year under review your Company has not accepted any fixed deposits in termsof the provisions of the Companies Act 2013.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under the Companies Act 2013 as amended from time totime is attached herewith as Annexure B.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return as on March 31 2017 in the prescribed form pursuant tothe Companies Act 2013 is attached herewith as Annexure C.
The Shareholders of the Company in the 7th Annual General Meeting hadappointed M/s. R.S Agarwala & Co. Chartered Accountants Kolkata as StatutoryAuditors of the Company for a period of five years to hold office till the conclusion ofAnnual General Meeting to be held in calendar year 2020 subject to ratification by theshareholders in every Annual General Meeting.
M/s. R.S Agarwala & Co. Statutory Auditors have expressed their willingness andconfirmed their eligibility to the effect that their re-appointment if made would bewith in the prescribed limits under the Companies Act 2013 and that they are notdisqualified for re-appointment/ratification. Members are requested to ratify theappointment and fix their remuneration.
There are no qualifications or observations or other remarks of the Auditors in theReport issued by them for the financial year 2016-17 which call for any explanation fromthe Board of Directors.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorshad appointed M/s. Vinod Kothari & Company Practicing Company Secretaries toundertake the Secretarial Audit of the Company for the financial year 2016-17. TheSecretarial Audit Report submitted by Secretarial Auditor in the prescribed form isattached herewith as Annexure D.
There are no qualifications or observations or other remarks of the SecretarialAuditors in the Report issued by them for the
financial year 2016-17 which call for any explanation from the Board of Directors.
SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS
There are no material/significant orders passed against the company by the regulatorsas on March 31 2017. Details of litigation on tax matters are disclosed in the financialstatement.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
There were no Loans Guarantees and Investments made by the Company under Section 186of the Companies Act 2013.
CORPORATE SOCIAL RESPONSIBILITY
During the year under review the provisions of section 135 read with Schedule VII ofthe Companies Act 2013 were not applicable on the Company. Accordingly there was noamount required to be spent on Corporate Social Responsibility. Further the Board hasduly constituted a CSR committee and also framed a CSR policy in conformity with theprovisions of Companies Act 2013. The provisions of section 135 of the Companies Act2013 pertaining to CSR expenditure will apply to the Company effective from financial year20 17-18. The CSR policy of the Company can be accessed at http://www. tciexpress.in/pdf/CSR%20Policy.pdf
REMUNERATION POLICY AND DISCLOSURE
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members. Thedetails of this policy are explained in the Corporate Governance Report forming part ofAnnual Report
The information as required under the provisions of Section 197(12) of the CompaniesAct 2013 read with Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as amended from time to time is attached herewith as Annexure E.
CORPORATE GOVERNANCE REPORT
The Equity Shares of the Company got listed and permitted to trade on BSE Ltd. andNational Stock Exchange of India Limited w.e.f December 15 2016. Hence compliance withthe provisions of Corporate Governance norms as specified under SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 is applicable to the Company from the dateof listing i.e December 15 2016. Accordingly a separate Corporate Governance compliancereport as stipulated under SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 alongwith the required Certificate from the Statutory Auditors regardingcompliance with the conditions
of Corporate Governance during the financial year ended March 312017 are forming partof Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
A detailed Management Discussion and Analysis Report as required under SEBI(ListingObligations and Disclosure Requirements) Regulations 2015 is provided in a separatesection forming part of Annual Report.
SEXUAL HARASSMENT POLICY
In terms of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 it is mandatory to disclose status of sexual harassment relatedcomplaints in the Annual Report. For protection against sexual harassment your Companyhas formed a Complaint Committee to which employees can submit their complaints. Therewere no such complaints received during the year or pending for redressal as on March312017.
The Company takes pride in the commitment competence and dedication shown by itsemployees in all areas of its business. The Company has a structured induction process andmanagement development programs to upgrade skills of employees. The Company is committedtowards nurturing enhancing and retaining talent through superior Learning &Organizational Development. This is a part of corporate HR function and is a criticalpillar to support the organization's growth and its sustainability in the long run.
Statements in this Directors' Report and in Management Discussion and Analysis Reportdescribing the Company's objectives projections estimates expectations or predictionsmay be "forward looking statements" within the meaning of applicable SecuritiesLaws and regulations. Actual results could differ materially from those expressed orimplied.
Your Directors place on record their sincere appreciation for assistance andco-operation received from various Ministries and Department of Government of India andother State Governments Financial Institutions Banks Shareholders Suppliers/Vendorsand Bussiness Associates of the Company etc.
Your Directors also wish to place on record their sincere appreciation for thededicated efforts and consistent contribution made by the employees at all levels toensure that the Company continues to grow and excel.
For & on behalf of the Board Place
Place : Gurugram