DIRECTORS' REPORT To the Members, Your Directors have pleasure in presenting the 41st Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2015. The Financial results of the year under review are as given below:- PERFORMANCE HIGHLIGHTS During the year under review, the Total Turnover/Sales of the Company was Rs. 2732.50 Crores as against Rs. 2848.50 Crores during the previous financial year. The operating profit (EBITDA) before exceptional item was Rs. 316 crores as against Rs. 313.51 crores last year growing at 0.79 %. The Company is taking various measures to retain its market share and also to improve margins. Further during the year under review consolidated financial Turnover/Sales was Rs. 7515 Crores and Net Profit after Tax was Rs. 172.09 Crores. Earning Per Equity Share (Consolidated) was Rs. 43.22 Per Equity share against the Rs. 15.88 per equity Share of Previous year. DIVIDEND Your Directors are pleased to recommend a dividend of Re.1/- per equity share (10%) (Previous year Re.1/ per equity share) for the Financial Year 2014-15 for approval of the Members. The total dividend would absorb a sum of Rs.4.20 crores and tax thereon of Rs. 0.86 crores. The dividend will be free of tax in the hands of recipients. Total amount transferred to General Reserve Account is Rs. 25,00,00,000 (Rupees Twenty Five Crores). PERFORMANCE HIGHLIGHTS During the year under review, the Total Turnover/Sales of the Company was Rs. 2732.50 Crores as against Rs. 2848.50 Crores during the previous financial year. The operating profit (EBITDA) before exceptional item was Rs. 316 crores as against Rs. 313.51 crores last year growing at 0.79 %. The Company is taking various measures to retain its market share and also to improve margins. Further during the year under review consolidated financial Turnover/Sales was Rs. 7515 Crores and Net Profit after Tax was Rs. 172.09 Crores. Earning Per Equity Share (Consolidated) was Rs. 43.22 Per Equity share against the Rs. 15.88 per equity Share of Previous year. DIVIDEND Your Directors are pleased to recommend a dividend of Re.1/- per equity share (10%) (Previous year Re.1/ per equity share) for the Financial Year 2014-15 for approval of the Members. The total dividend would absorb a sum of Rs.4.20 crores and tax thereon of Rs. 0.86 crores. The dividend will be free of tax in the hands of recipients. Total amount transferred to General Reserve Account is Rs. 25,00,00,000 (Rupees Twenty Five Crores). DEMERGER OF MANUFACTURING UNIT OF JINDAL PHOTO LTD. INTO JINDAL POLY FILMS LTD. During the year, Board of Directors of your Company had, at its meeting held on January 12, 2015 approved a scheme of arrangement ('the scheme') between Jindal Photo Limited ("Demerged Company") and Jindal Poly Films Limited ("Resulting Company") for demerger of the manufacturing division of the demerged Company , which is engaged in the business of manufacture, production, sale and distribution of photohraphic products ("Demerged Undertaking"), into the Resulting Company. As per the scheme, the Demerged Undertaking of Jindal Photo Limited will stand transferred to the Resulting Company with effect from 1st April 2014 which is the Appointed Date. It is expected that the scheme should be completed within this calender year. Your directors are hopeful that demerger of manufacturing division of Jindal Photo Limited into Jindal Poly Films Limited would be beneficial for your Company in the long term. MANAGEMENT DISCUSSION AND ANALYSIS The MD&A has been included in the annual report as a separate section. DIRECTORS • During the year, Mr. Rashid Jilani (DIN 0001064) and Mr. Jagdish Prasad Mohta (DIN 00006478) , Independent Directors, resigned from Directorship due to their preoccupation. The Board wish to place on record its appreciation of the valuable service rendered by these Directors during their tenure as Directors of your Company. • Mr. Suresh Dattatraya Gosavi (DIN: 07015202) has been appointed as Whole-time Director of the Company for a period of 3 (Three) years w.e.f. 14th November, 2014. The terms and conditions of his appointment and remuneration are subject to approval of the shareholders. • Mr. Sanjay Mittal (DIN: 01327274), Whole-time Director of the Company is liable to retire by rotation and being eligible, offer himself for re-appointment. Brief resumes of above directors, names of other company (ies) in which they hold directorship, membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders. PARTICULAR OF EMPLOYEES The information required pursuant to Section 197 read with Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Member interested in obtaining a copy thereof, may write to the Company Secretary in this regard. Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as per Annexure 'E'. CORPORATE GOVERNANCE The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditor's Report on its compliance. DIRECTORS' RESPONSIBILITY STATEMENT In terms of Section 134(3)(c) of the Companies Act, 2013, your Directors state that: a) in the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same; b) the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the profit of the Company for the year ended on that date; c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the Directors have prepared the Annual Accounts on a 'going concern' basis; e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS Jindal Film India Ltd.(Previously known as Jindal Metal & Mining Ltd.), Global Nonwovens Ltd. and M/s JPF Netherland B.V are Subsidiary Companies u/s 2(87) of the Companies Act, 2013. Further JPF USA Holding LLC, Jindal Films Americas LLC, Films Shawnee LLC, Films LaGrange LLC, Films Macedon LLC, Jindal Films Europe Virton LLC, Jindal Films Singapore Pte. Ltd., Jindal Films (Shanghai) Co. Ltd; JPF Dutch B V; Jindal Films Europe Brindsi Srl; Jindal Films Europe Kerkrade B.V.; Jindal Films Europe S.a.r.l; Jindal Films Europe Vinton S.p.r.l (Belgium) are stepdown subsidiaries of the Company and Rexor Holding SAS and Hindustan Powergen Limited are Associate Companies. In accordance with the General Circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Company will make available the Annual Accounts of the subsidiary companies and the related information to any member of the Company, who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company. The Consolidated Financial Statements presented by the Company include the financial results of its Subsidiary Companies & Associate Companies. Financial position of the each of the Subsidiaries is provided in a separate statement attached to the Financial Statement pursuant to first proviso to Section 129(3) of the Companies Act, 2013. SHARE CAPITAL The paid-up equity share capital as on 31st March, 2015 was Rs.42.05 Crores. During the year under review, the Company has neither issued Shares with Differential Voting Rights nor granted Stock Options nor Sweat Equity. As on 31st March, 2015 none of the Directors of the Company held shares or convertible instruments of the Company except Ms Sumita Dhingra, Whole-time Director who are holding 100 equity shares. FIXED DEPOSITS The Company has not any deposit during financial year ended on 31st March, 2015. Further No fresh/renewal of deposits were accepted during the financial year 2014-2015, so there were no unclaimed deposits as at March 31, 2015. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability, accuracy, fairness and timeliness of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company has adequate internal control system and procedures, to ensure optimal use of Company's resources. The Company has appointed Internal Auditor and they do regular audit of various operational and financial matters to derive findings as a comparison for targets achieved and observations for further action to be taken. The audit committee of the board of directors periodically reviews and discusses the audit observations STATUTORY AUDITORS M/s Kanodia Sanyal & Associates, Chartered Accountants (FRN 008396N) retire and being eligible, offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Company's Auditors, pursuant to Section 139 of the Companies Act, 2013. COST AUDITORS During the year under review (F.Y 2014-15) Cost Audit was not applicable on the Company., However this is applicable for the Financial year 2015-16 and the Board has appointed M/s. R.J. Goel & Company, Cost Accountants (FRN 000026) New Delhi as Cost Auditors of the Company for the financial year 2015-16. INTERNAL AUDITORS. Pursuant to the provisions of Section 138 of the Companies Act, 2013, the Board has appointed M/s. B.K. Shroff & Co., Chartered Accountants (FRN 302166F) as Internal Auditors for conducting the Internal Audit of the Company for the financial year 2015-16. SECRETARIAL AUDITORS The Board had appointed M/s DMK Associates, Practicing Company Secretaries, New Delhi, Practicing Company Secretaries, Delhi as Secretarial Auditor pursuant to the provisions of Section 204 of the Companies Act, 2013. The Report of the Secretarial Auditor is annexed to the Report as per Annexure 'A'. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EARNING & OUTGO Information in accordance with the provisions of section 134 (3) m of Companies Act, 2013 read with Rule 8 made thereof regarding conservation of Energy, technology absorption, foreign exchange earnings and outgo is given in the 'Annexure "B" forming part of this report. CORPORATE SOCIAL RESPONSIBILITY Pursuant to the provision of Section 135 of the Companies Act, 2013 the Board has constituted the Corporate Social Responsibility (CSR) Committee on 20th Sept, 2014. The said Committee formulated and recommended to the Board its approval for policy on Corporate Social Responsibility. The Board of Directors at its meeting held on 14th November, 2014 approved the policy on Corporate Social Responsibility. The said policy as required under Section 135 (4) (a) has been uploaded in the Company's website at the web link: <http://www.jindalpoly.com/investor-relations.html>. The Company's policy on CSR envisages expenditure in areas falling within the preview of Schedule VII of the Companies Act, 2013. The Annual Report on CSR activities is attached as 'Annexure 'C'' which forms part of this report. DISCLOSURE UNDER COMPANIES ACT, 2013 I. Extracts of Annual Return The details forming Part of the Extracts of Annual Return is annexed as per Annexure 'D'. II. Meetings During the year, 13 (thirteen) Board Meetings and 10 (Ten) Audit Committee Meetings were held as per details given in Corporate Governance Report. III. Composition of Audit Committee The Board has constituted an Audit Committee, which comprises of Mr. Radha Krishna Pandey as the Chairman and Mr. Sanjay Mittal and Mr. Anil Kumar Goel as the Members. More details about the Committee are given in the Corporate Governance Report. IV. Related Parties Related Party Transactions All contracts / arrangements / transactions entered into by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year under review, your Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. The Related Party Transactions Policy as approved by the Board is uploaded on the Company's website <http://www.jindalpoly.com/investor-relations.html>. The details of the transactions with Related Parties are provided in the accompanying financial statements. Details of related party transactions are given elsewhere in the Annual Report as per Accounting Standard AS-18. Your Directors draw attention of the members to Note 30 (A & B) to the financial statement which sets out related party disclosures. V. Particulars of Loans, Guarantees and Investments During the year under review the company has not given any Loan, Guarantee, however Investments have been made. Details of Investments covered under the Provisions of Section 186 of the Companies Act, 2013 are given in the accompanying Financial Statements. VI. Risk Management. The Company has laid down procedures to inform Board members about the risk assessment and minimisation procedures. These procedures are periodically reviewed to ensure that executive management controls risk through means of a properly defined framework. However the Formal Risk Management Committee was constituted on 13th August, 2015. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant, material orders passed by the Regulators or Courts, which would impact the going concern status of the Company and its future operations. NOMINATION AND REMUNERATION COMMITTEE AND POLICY As per the requirements of the above provisions of the Companies Act, 2013, a Nomination and Remuneration Committee of directors was formed by the Board of Directors consisting of: 1 Mr. R.K Pandey, Chairman (Non-Executive - Independent) 2. Mr. Hemant Sharma- Member, (Non-Executive) 3. Mr. Anil Kumar Goel -Member (Non-Executive - Independent) The said committee has been empowered and authorised to exercise the power as entrusted under the provisions of Section 178 of the Companies Act, 2013. The Company has a policy on directors' appointment and remuneration including criteria for determining qualification, positive attributes, independence of a director and other matters provided under sub-section (3) of section 178. DECLARATION BY INDEPENDENT DIRECTORS. The Independent Directors have submitted disclosures to the Board that they fulfill the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed/continue as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. VIGIL MECHANISM AND WHISTLE BLOWER POLICY The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and details whereof is available on the Company's website at <http://www.jindalpoly.com/investor->relations.html During the year under review, there were no complaints received under this mechanism. EVALUATION OF BOARD'S PERFORMANCE On the advice of the Board of Directors, the Nomination and Remuneration Committee has formulated the criteria for the evaluation of the performance of Independent Directors, Non-Independent Directors and the Chairman of the Board. The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results and evaluation have been communicated to the Chairman of the Board of Directors. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 The Company has constituted a Committee internal Complaint Committee at organization level to deal the issues relating to any complaint regarding Sexual Harassment of Women at Workplace and During the year 2014- 15, no complaint was received before the committee. However As per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressed) Act, 2013, the Company has constituted formal Committee on 13th August, 2015 in the Company. MATERIAL CHANGES There is no material change or commitments after closure of the financial year till the date of this report. Matters as may be prescribed ACKNOWLEDGEMENT Your Directors would like to express their gratitude to financial institutions, Banks and various State and Central Government authorities for the co-operation extended to the Company. Directors also take this opportunity to thank the shareholders, customers, suppliers and distributors for the confidence reposed by them in the Company. The employees of the Company contributed significantly in achieving the results. Your Directors take this opportunity to thank them and hope that they will maintain their commitment to excellence in the years to come. For and on behalf of Board of Directors Sanjay Mittal Whole-time Director Sumita Dhingra Whole-time Director Place : New Delhi Date : 13th August, 2015 |