Your Directors have pleasure in presenting the Twenty-Third Annual Report of TransportCorporation of India Limited (your Company' or the Company' or TCI')along with the Audited Standalone and Consolidated Financial Accounts and the Auditors'Report thereon for the Year ended 31st March 2018.
The highlights of Consolidated as well as Standalone Financial Results of your Companyare as follows:
H ( in Lakhs)
|Particulars ||Consolidated ||Standalone |
| ||2017-18 ||2016-17 ||2017-18 ||2016-17 |
|Total Income from Operations ||236431.41 ||195469.91 ||220227.17 ||182196.54 |
|Total Expenses ||223425.57 ||186979.61 ||206670.85 ||173321.03 |
|Exceptional Item ||- ||- ||400 ||- |
|Add: Profit From JV ||2241.99 ||1546.58 ||- ||- |
|Profit Before Tax ||15247.83 ||10036.88 ||13156.32 ||8875.51 |
|Less: Provision for Tax-Current & deferred ||2816.18 ||1910.41 ||2731.30 ||1849.21 |
| For earlier years ||49.88 ||- ||49.88 ||- |
|Profit after Tax (PAT) ||12381.77 ||8126.47 ||10375.14 ||7026.30 |
|Other Comprehensive Income ||301.51 ||42.24 ||301.62 ||42.25 |
DIVIDEND & TRANSFER TO RESERVES
The Company has a Dividend Policy in terms of Securities and Exchange Board of India(SEBI) Circular No. SEBI/LAD-NRO/6N/2016-17/008 and the same is available on the websiteof the Company (www.tcil.com).
In line with the policy during the year under review the Board has declared dividendsas under:
|Date of Declaration ||Dividend Type ||%age of Dividend Declared ||Dividend per Share (in H) |
|2nd November 2017 ||1st Interim ||30% ||0.60 |
|8th February 2018 ||2nd Interim ||50% ||1.00 |
Since the total dividend outflow has achieved targets in line with the Dividend Policyof the Company your Board does not recommend any final dividend for the Financial Year2017-18.
During the year RS 6000 Lakhs were transferred to the General Reserves.
TRANSFER OF UNPAID / UNCLAIMED DIVIDENDS & SHARES TO IEPF
The details of unpaid/unclaimed dividend(s) & shares transferred to IEPF during theyear and the dividend(s) which are due for transfer to IEPF in the forthcoming years areprovided in the Corporate Governance Report forming part of this report.
SUBSIDIARIES JOINT VENTURES & ASSOCIATE COMPANIES
A statement in Form AOC-I pursuant to the provisions of the Companies Act 2013 andRules made thereunder (the Act) containing salient features of the financial statement ofSubsidiaries/ Associate Companies/ Joint Ventures forms a part of this report. The Companyhas adopted Ind AS from April 1 2016 and accordingly the consolidated financialstatements of the Company and its subsidiaries are prepared in accordance with therecognition and measurement principles stated therein.
During the year following subsidiary companies have been incorporated/liquidated:
|S. No. Name of the Company ||% of Shareholding ||Status ||Subsidiary/ Step down Subsidiary |
|1 TCI Nepal Pvt. Ltd. ||100% ||Incorporated ||Subsidiary |
|2 Stratsol Logistics Pvt. Ltd. ||100% ||Incorporated ||Step-down Subsidiary |
|3 PT. TCI Global Indonesia ||48% ||Liquidated ||Step-down Subsidiary |
|4 PT. TCI Global ||100% ||Liquidated ||Step-down Subsidiary |
|5 TCI Global (Thailand) Co. Ltd. ||49% ||Liquidated ||Step-down Subsidiary |
The audited accounts of the subsidiaries will be provided on request to any shareholderdesiring to have a copy on receipt of such request addressed to the Company Secretary.These documents will also be available for inspection by any shareholder at the registeredoffice of the Company and will be available on the website of the Company.
The Company's Policy on Material Subsidiaries may be accessed on the website at thefollowing link: http://www.tcil.com/tcil/tci-policies.html.
ABRIDGED ANNUAL REPORT
In line with the provisions of the Act the Abridged Annual Report is being sent to allthe shareholders who have not registered their email address(es). The comprehensive AnnualReport for the year 2017-18 is being sent via email to all shareholders who haveregistered their email address(es) and is also available on the website of the Company. Itis also available for inspection at the Registered Office of the Company during workinghours upto the date of ensuing Annual General Meeting (AGM).
Any member requiring full Annual Report may write to the Company Secretary.
EMPLOYEE STOCK OPTION SCHEME
During the year under review the shareholders approved the Employee Stock OptionPlan-2017.
The Company also has another ESOP Scheme running since 2006 called Employee StockOption Scheme-2006 for the employees of the Company and its subsidiaries.
During the year under review the Compensation/ Nomination & Remuneration Committeeof the Board of Directors granted options under Employee Stock Option Scheme-2006 PartIX.
The details with regard to ESOP Scheme as on 31st March 2018 as required to bedisclosed pursuant to the provisions of SEBI (Share Based Employee Benefits) Regulations2014 are set out in Annexure A to this Report.
STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS
The Company has in place adequate internal financial controls with reference tofinancial statements.
During the year under review such controls were tested and no reportable materialweakness in the policy or procedures was observed.
The Company has established a well-documented and robust risk management frameworkwhich identifies risks across all business processes of the Company on a continuous basis.
The details of risk management are given in a separate section forming part of thisAnnual Report.
WHISTLE BLOWER MECHANISM
The Company has a structured Vigil Mechanism via the Whistle Blower Policy forreporting instances of alleged wrongful conduct including instances of unethical behavioractual or suspected fraud or violation of the Company's code of conduct.
The Whistle Blower Policy is available on the website of the Company.
DIRECTORS & KEY MANAGERIAL PERSONNEL (KMPs)
As per the provisions of Section 152 of the Act Mr. S N Agarwal and Mrs. UrmilaAgarwal Non-executive Directors retire by rotation and being eligible offer themselvesfor re-appointment.
Further the current tenure of Mr. D P Agarwal Vice Chairman & Managing Directorand Mr. Vineet Agarwal Managing Director is expiring on 31st July 2018 and 30th June2018 respectively. Based upon recommendation of the Compensation/ Nomination &Remuneration Committee it is proposed to appoint them for a further period of
05 (five) years each subject to the approval of shareholders in the ensuing AGM.
Brief resume of director seeking appointment/re-appointment alongwith other details asstipulated under SEBI (Listing Obligations & Disclosure Requirements) Regulations2015 (SEBI Listing Regulations' or the Regulations') is provided in theNotice convening the Annual General Meeting.
None of the Company's directors are disqualified from being appointed as a director asspecified in Section 164 of the Act.
The Independent Directors of the Company have furnished the declaration under the Actand the SEBI Listing Regulations that each of them meets the criteria of independence asprovided in the Act/ Regulations and during the year there has been no change in thecircumstances which may affect their position as Independent Director.
The terms and conditions of appointment of the Independent Directors are placed on theCompany's website http://cdn.tcil.in/website/tcil/corporate-governance/terms-and-conditions-of-independent-directors/terms-and-conditions-of-independent-directors.pdf.
The Company has also placed the Director's familiarisation programme on its website andthe same can be accessed on http://cdn.tcil.in/website/tcil/corporate-governance/familarisation-programme-of-independent-directors/familiarisation-programme-for-independent-directors.pdf.
As on 31st March 2018 the Key Managerial Personnel of the Company were Mr. AshishKumar Tiwari Group CFO Ms. Archana Pandey Company Secretary Mr. Jasjit Singh SethiCEO- TCI Supply Chain Solutions (a Division of the Company) and Mr. Ishwar Singh SigarCEO- TCI Freight (a Division of the Company). There has been no change in the KMPs duringthe period under review.
During the year 04 (four) Meetings of the Board of Directors were held. The details ofthe meetings are laid out in the Corporate Governance Report.
AUDIT COMMITTEE MEETINGS
The composition of the Audit Committee is in compliance with the provisions of the Act& the SEBI Listing Regulations. The detailed information regarding the Audit Committeeforms part of the Corporate Governance Report.
The Board has accepted all the recommendations made by the Audit Committee during theyear.
INDEPENDENT DIRECTORS' MEETING
For the Financial Year 2017-18 01 (one) separate meeting of the Independent Directorswas held. The details of the meeting are laid out in the Corporate Governance Report.
PERFORMANCE EVALUATION OF THE BOARD
During the year under review the annual evaluation of performance of the Board itsCommittees and of individual Directors was carried out pursuant to the provisions of theAct and the SEBI Listing Regulations.
In the meeting of independent directors the performance of the Board as a whole itscommittees and the Chairman was evaluated. The conclusions were discussed in the meetingof the Compensation/ Nomination & Remuneration Committee where the performances of theBoard its committees and individual directors were reviewed.
Thereafter the Board based on the update by the Chairman and the Compensation/Nomination & Remuneration Committee discussed the assessment of the Board itscommittees and the Chairman.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Act the Board of Directors to thebest of their knowledge and ability confirm that:
a) In the preparation of the annual financial statements for the Financial Year ended31st March 2018 all the applicable accounting standards have been followed and thatthere is no material departure from the same; b) For the Financial Year ended 31st March2018 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 profit and loss of the Company for the Financial Year ended 31st March 2018; c) Thedirectors have taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities; d) The annualaccounts have been prepared on a going concern basis; e) The internal financial controlshave been followed by the Company and that such internal financial controls are adequateand are operating effectively; and f ) The proper systems have been devised to ensurecompliance with the provisions of all applicable laws and that such systems are adequateand operating effectively.
EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act the extract of annual return is given inthe prescribed Form MGT-9 which forms part of the Board's Report as Annexure B.
During the year under review M/s. R S Agarwala & Co. (Firm Registration No.304045E) Chartered Accountants Kolkata retired in line with the provisions of Section139 of the Act.
Accordingly the shareholders based upon recommendations of the Audit Committee &the Board of Directors appointed M/s. Brahmayya & Co. Chartered Accountants (FirmRegistration No. 000511S) as Statutory Auditors of the Company in place of M/s. R SAgarwala & Co. to hold office from the conclusion of 22nd AGM till the conclusion of27th AGM to be held in the calendar year 2022.
The Company has obtained a written consent from the Auditors for such continuedappointment and that they are eligible for such continuation of their appointment.
The report of the Statutory Auditors along with notes & Schedules is enclosed tothis Report. The observations made in the Auditors' Report are self-explanatory andtherefore do not call for any further comments.
During the year under review the Auditors have not reported any matter under Section143(12) of the Act and therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
Secretarial Audit for the Financial Year 2017-18 was conducted by M/s Vinod Kothari& Associates Company Secretaries. The Report on Secretarial Audit in the prescribedformat of MR- 3 is attached as Annexure C to this report.
The Secretarial Audit report does not contain any qualification reservation or adverseremark.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formed Corporate Social Responsibility (CSR) Committee of the Board ofDirectors to overview and supervise the CSR initiatives of the Company. The detailsregarding the CSR Committee are laid down in the Corporate Governance Report.
The brief outline of the CSR Policy of the Company and the initiatives undertakenregarding CSR activities during the year are set out in Annexure D of this reportin the format prescribed in the Act. The CSR policy is available on the website of theCompany.
RELATED PARTY TRANSACTIONS
During the year there were no transactions with related parties which were not atarm's length or materially significant or which were in conflict with the interests of theCompany and that require an approval of the Company's shareholders in terms of the SEBIListing Regulations. Accordingly the disclosure required u/s 134(3)(h) of the Act in FormAOC-2 is not applicable to your Company.
Further details on the policy of the company with respect to the transactions withrelated parties are given in the Corporate Governance Report.
The detailed policy on Related Party Transactions is available on the website of theCompany.
DETAILS OF LOANS/GUARANTEES/INVESTMENTS MADE BY THE COMPANY
The particulars of loans given investments made guarantees given and securitiesprovided alongwith the purpose for which the loan or guarantee or security is proposed tobe utilized as per the provisions of Section 186 of the Act are provided in the financialstatement forming part of the Annual Report.
The objective of the Remuneration Policy is to attract motivate and retain qualifiedand proficient individuals that the Company needs in order to attain its strategic andoperational objectives.
The summary of the remuneration policy has been given in the Corporate GovernanceReport.
COMPLIANCE WITH SECRETARIAL STANDARDS
During the year the company has duly complied with all the applicable SecretarialStandards as issued by ICSI and MCA from time to time.
PARTICULARS OF EMPLOYEES
Disclosure pertaining to the remuneration and other details as required under the Actare attached as Annexure E to this Report.
Details of employee remuneration as required under provisions of Section 197 of the Actare available at the Registered Office of the Company during working hours 21 days beforethe Annual General Meeting and shall be made available to any shareholder on request. Suchdetails are also available on your Company's website.
CORPORATE GOVERNANCE REPORT
Pursuant to the SEBI Listing Regulations the Management Discussion and AnalysisReport Corporate Governance Report and Auditors' Certificate regarding compliance withconditions of corporate governance form part of this Annual Report.
POLICY FOR PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT
Your Company has adopted a policy for prevention prohibition and redressal of sexualharassment. As per the requirements of the Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013 and Rules made thereunder yourCompany has constituted an Internal Complaints Committee.
During the year no complaint with allegations of sexual harassment was filed with theCompany.
The Indian logistics industry is growing not only in terms of numbers but also incomplexity and scope. With the inclusion of Logistics Sector under InfrastructureIndustry career opportunities have opened up & hence there is a strong emphasis toattract and retain talent.
At TCI we continuously strive to adopt the best Human Resource Management practicesacross industries through the development of employee's knowledge skills attitudes andbeing a cohesive team which are the primary building blocks of organizationalcapabilities & culture.
Our endeavor is to continuously attract recruit and nurture the best talent pool ofthe industry and create a benchmark in the field of Logistics.
During the year under review your Company has not accepted any fixed deposit withinthe meaning of the Act.
SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS
There was no material litigation outstanding as on 31st March 2018. Details oflitigation on tax matters are disclosed in the financial statements.
CHANGE IN NATURE OF BUSINESS
During the year under review there was no change in general character or nature ofbusiness.
CONSERVATION OF ENERGY & RESEARCH AND DEVELOPMENT
In keeping up with the Company's commitment towards conservation of energy thefollowing optimization and innovative measures were taken by the Company during thisfiscal :
New BS IV vehicles were purchased for reducing emissions and carbon footprint.
The conversion of National Capital Region (NCR) Delivery vehicles to CNG was100% completed during this fiscal.
Recycling of Radial Tyres for extracting the steel and rubber for alternativeusage was initiated this year.
Warehouse audit for energy consumption and electrical safety was strengthenedwith re-audit by in-house Audit team.
Use of day-light sensors timers that help in controlling street area lightingand prevent electricity consumption when not in use.
Extensive use of energy sub-metering to measure and to have check over use ofenergy for different purposes.
Solar Power generation plant
Have started using solar power generated at one of the warehousing facility toreduce consumption of grid and diesel generator energy.
Cold Chain warehouse in Gurugram was outfitted with a 160KVA roof-top Solarpanels witRs 60 KVA backup.
These are in addition to the measures adopted in yesteryears.
TECHNOLOGY ABSORPTION ADOPTION & INNOVATION
The Company undertook massive steps in the last year in ERP enhancement at alllevels for readiness on GST from 1st July 2017.
Various initiatives for digital transformation helped in improving the internalefficiency and improving customer experience.
Telematics was taken to another level by Integration of ERP and GPS systems.
A new automated warehouse for goods to man was inaugurated making a newbenchmark in the industry.
FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of earnings accrued and expenditure incurred in foreign currency are given inthe Notes to the financial statements.
Your Directors place on record their deep appreciation to employees at all levels fortheir hard work dedication and commitment which enabled the Company to persist asindustry leaders.
The Board also extends its gratitude for the support and cooperation your Company hasbeen receiving from its customers vendors suppliers and others associated with theCompany. The Company always strives to build and nurture relations with all itsstakeholders.
The Directors also take this opportunity to acknowledge the support and assistanceextended to us by the Ministries and Departments of Government of India various StateGovernments financial institutions bankers stock exchanges communities shareholdersand investors at large for their continued support.
| ||For and on behalf of Board of Directors |
|Place: Gurugram ||S. M. Datta |
|Date: 16th May 2018 ||Chairman |