Report of the Directors For the Year Ended 31st March, 2015 Dear Members, 1. The Directors have pleasure in presenting the 39th Annual Report of the Company together with the Audited Accounts for the year ended 31st March, 2015. The summarised Financial Results are given below: 2. DIVIDEND We recommend a dividend of Rs. 2/- (Rupees Two Only) per equity share of Rs. 10/-each for the year ended 31st March, 2015. The total outgo in this respect will be Rs. 642.56 lacs including corporate dividend tax. 3. OVERALL PERFORMANCE The Performance of the Company has been comprehensively covered in the Management Discussion and Analysis Report which forms part of the Directors' Report. 4. MANAGEMENT DISCUSSION & ANALYSIS In term of the provision of clause 49 of the Listing Agreement, the Management discussion and analysis is set out in this Annual Report. 5. RENEWABLE ENERGY The Company owns 13 Wind Turbines with a total capacity of 13.65 MW. Total Generation from all the turbines together during the year was 178.25 lacs Kwh. 6. CAPTIVE THERMAL POWER PLANT With the increase in overall production capacity from 2 MTPA to 3.25 MTPA your Company has a present requirement of 33 MW of power and is 100% self-sufficient through its own generation. Total generation during the year was 1696.98 lacs Kwh. 7. NEW PROJECTS During the year, the Board of Directors approved the setting up of a New Grinding Unit at Aligarh with a capacity of 0.5 MTPA. 8. FINANCE To meet the fund requirements for the Aligarh projects, the Company has made arrangement for borrowing from banks amounting to Rs. 70.00 crores and the balance will be funded by internal accruals of the Company. 9. RISK MANAGEMENT Pursuant to the provisions of Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee, the details of which are given in the Corporate Governance Report. The Company has developed a risk management policy and identified risks and taken appropriate steps for their mitigation For more details, please refer to the Management Discussion and Analysis set out in this Annual Report. 10. CREDIT RATINGS Your Directors are pleased to inform you that Credit Analysis &Research Ltd (CARE) reaffirmed the rating of 'CARE AA-' (Double A minus) assigned for long term facilities. The 'CARE AA' rating is considered to offer a high degree of safety regarding timely servicing of financial obligations and indicates that such borrowings carry low credit risk. CARE assigns '+' or '-'signs to be shown after the assigned rating (wherever necessary) to indicate the relative position within the band covered by the rating symbol. Further, CARE has re-affirmed its 'CARE A1 +' (A one Plus) rating assigned to the Company's short term facilities. This is the highest rating for short term facilities and indicates a strong capacity for timely payment of short term debt obligations and carries the lowest credit risk. 11.INSURANCE Adequate insurance cover has been taken for the properties of the Company including buildings, plant and machinery and inventories. 12. EXTRACT OF THE ANNUAL RETURN The Extract of Annual Return as required under Section 134(3)(a) of the Companies Act, 2013 is set out at Annexure-1 which forms part of this report. 13. DETAILS OF BOARD MEETINGS The Board of Directors met 4 times in the year 2014-15. The details of the board meetings and the attendance of the Directors are provided in the Corporate Governance Report. 14. DIRECTORS Shri K. K. Mudgil, Independent Director of the Company passed away on 20th February, 2015. We place on record our deep appreciation for the valuable contributions made by him during his tenure. In accordance with the provision of Section 152 (6) and pursuant to the Article of Association of the Company, Shri A. V. Jalan, Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. The Board recommends his re-appointment. Details of the proposal for his appointment are given in the Notice of the Annual General Meeting. The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence prescribed under sub-section (6) of Section 149 of the Companies Act, 2013. The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibility in the Company, nature of the industry in which the Company operates and other related matters are put on the website of the Company at the link: http://www.mangalamcement.com/pdf/familiarisation_ programme.pdf 15. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirements of Section 134 of the Companies Act, 2013 and to the best of their knowledge & belief and according to the information and explanations obtained your Directors state that: a) in the preparation of the annual accounts, the applicable accounting standards have been followed and proper explanations provided relating to material departures, if any; b) such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period; c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the annual accounts have been prepared on a going concern basis; e) internal financial controls were followed by the Company and they are adequate and are operating effectively; and f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively. 16. KEY MANAGERIAL PERSONNEL The following employees were designated as whole-time key managerial personnel by the Board of Directors during the year under review: (i) Smt. Vidula Jalan, Executive Director (ii) Shri Anshuman Vikram Jalan, Executive Director (iii) Shri Anil Kumar Mandot, Chief Financial Officer; and (iv) Shri Swadesh Agrawal, Company Secretary 18. CORPORATE SOCIAL RESPONSIBILITY (CSR) Pursuant to Section 135 (4) and Rule 8 of the Companies (Corporate Social Responsibility Policy), Rules, 2014, a report on CSR containing particulars in the specified format is attached at Annexure-2. 19. AUDITORS' REPORT The Auditors' Report to the shareholders does not contain any qualification, reservation or adverse remark 20. STATUTORY AUDITORS M/s. Jain Pramod Jain & Co., Chartered Accountants, (Firm Registration No. 016746N), the auditors of the Company are due for retirement in accordance with the provisions of the Companies Act, 2013 at the ensuing Annual General Meeting and are eligible for reappointment. Your Directors recommend their re-appointment for the ensuing year. The Company has received a confirmation from them to the effect that their appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified from being appointed as the Statutory Auditors of the Company 21. COST AUDIT In terms of the provisions of Section 148 of the Companies Act, 2013, read with Companies (Cost Records and Audit) Rules, 2014, the Board of Directors of your Company have on the recommendation of the Audit Committee, appointed M/s. J. K. Kabra & Co., Cost Accountants, New Delhi as Cost Auditors, to conduct the cost audit of your Company. 22. SECRETARIAL AUDIT Pursuant to Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Company had appointed M/s. P. Pincha & Associates, Company Secretaries, Jaipur as Secretarial Auditor of the Company for the Year 2014-15. In accordance with the section 204 of the Act they have submitted their report in prescribed format and the same has been attached at Annexure-3. The report so submitted is self-explanatory and does not call for any further explanation(s) / comment(s). 23. LOANS, GUARANTEES OR INVESTMENT Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes forming part of the financial statements. 24. PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTIES All the related party transactions are entered into at arm's length in the ordinary course of business and are in compliance with the applicable provisions of the Act and the Listing Agreement. There are no material significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc. which may have a potential conflict with the interests of the Company. The Related Party Transaction Policy as approved by the Board is uploaded on the Company's website at the web link: http://www.mangalamcement.com/pdf/policy/ related_party_transaction_policy.pdf 25. PARTICULARS OF EMPLOYEES The information required under Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the name and other particulars of employees are to be set out in the Directors' Report as an addendum or annexure thereto. However, in line with the provisions of Section 136(1) of the Act, the Report and Accounts as set out therein, are being sent to all Members of your Company and others entitled thereto, excluding the aforesaid information about the employees. Any Member who is interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. 26. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO A Statement containing the information required by Section 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014, is set out in the statement at Annexure-4 hereto and forms part of this Report. 27. CORPORATE GOVERNANCE Your Directors reaffirm their continued commitment to good corporate governance practices. During the year under review, your Company was in compliance with the provisions of Clause 49 of the Listing Agreement with the stock exchanges relating to corporate governance. A report on Corporate Governance is enclosed at Annexure-5 hereto and forms part of this Annual Report. The Auditors certificate on compliance with the provision of Clause 49 of the Listing Agreement is annexed to the Report on Corporate Governance. 29. VIGIL MECHANISM The Company has formulated a Whistle Blower Policy to establish a vigil mechanism for Directors and employees of the Company to report concerns about unethical behaviour, actual or suspected fraud or violation of the Company's code of conduct or ethics policy. The mechanism under the policy has been appropriately communicated within the organisation. The Whistle Blower Policy is available on the website of the Company. 30. PERFORMANCE EVALUATION Pursuant to Clause 49 of the Listing Agreement read with provisions of the Companies Act, 2013, the Board has carried out an evaluation of its own performance and that of the individual Directors. The evaluation criteria, inter-alia, covered various aspects of the Board's functioning including its composition, execution and performance of specific duties, obligations and governance. The performance of individual directors was evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders, time devoted, etc. The Directors expressed their satisfaction with the evaluation process. 31. KEY PARAMETERS FOR APPOINTMENT OF DIRECTORS KEY MANAGERIAL PERSONNEL The Nomination and Remuneration Committee has formulated a detailed policy for appointment of directors and key managerial personnel which is designed to attract, motivate and retain best talent. This policy applies to directors, senior management including its Key Managerial Personnel (KMP) and other employees of the Company. The compensation strategy revolves around getting the "best talent in the market". The remuneration of the Executive Directors and KMPs of the Company is recommended by the Nomination and Remuneration Committee based on the Company's remuneration structure taking into account factors such as level of experience, qualification and suitability. The Company generally pays remuneration by way of salary, perquisites and allowances (fixed component), incentive remuneration and/or commission (variable components). Remuneration by way of commission to the Non-Executive Directors is decided by the Board as permitted by the Companies Act, 2013 in line with the approval granted by shareholders. 32. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND The Company has transferred a sum of Rs. 4,91,770/- during the financial year 2014-15 to the Investor Education and Protection Fund established by the Central Government for the unclaimed dividends for the financial year 200607, in compliance with section 125 of the Companies Act, 2013. The said unclaimed dividends were lying with the Company for a period of 7 years from their respective due dates of payment. 33. PUBLIC DEPOSITS Your Company has neither invited not accepted any deposits from the public within the meaning of section 2(32) and 74 of the Companies Act, 2013 during the year and as such, no amount of principal or interest on deposit was outstanding as of the balance sheet date. 34. CASH FLOW ANALYSIS In conformity with the provision of clause 32 of the Listing Agreement(s), a cash flow statement for the financial year ended 31st March, 2015 forms part of the audited accounts. 35. AWARDS Your Directors are pleased to inform that the Company has received the following awards during the year 2014-15; National Safety Award (Mines) 2011[1st Prize] given by the Hon'ble President of India on lowest injury frequency rate. Rajasthan State Energy Conservation Award (2nd Prize in Cement Sector) - Awarded the Second prize in Cement Sector for improvement in Energy Efficiency CFBP (Council for Fair Business Practices) Jamnalal Bajaj Uchit Vyavahar Puraskar - Awarded by Former Hon'ble President of India Dr. A. P. J Abdul Kalam, for excellent work done in the field of CSR activities, Customer Satisfaction, Customer Communication, Employees motivation and Environmental Protection etc. 36. ACKNOWLEDGEMENTS Your Directors wish to convey their gratitude and place on record their appreciation for all the employees at all levels for their hard work, solidarity, cooperation and dedication during the year. Your Directors sincerely convey their appreciation to customers, shareholders, vendors, bankers, business associates, regulatory and government authorities for their continued support. Amal Ganguli, Director Aruna Makhan, Director N.G. Khaitan, Director Gaurav Goel, Director K.C. Jain, Director Vidula Jalan, Executive Director A.V. Jalan, Executive Director New Delhi May 04, 2015 |