DIRECTORS' REPORT Your Directors have pleasure in presenting their Report for the financial year ended March 31, 2015 Your Directors are pleased to report that after two years of disappointing performance, the company has made a modest net profit of Rs 890.01 lakhs during the year under review. This was mainly because there has been a turnaround in the cement industry in the region from the last Quarter of the year under review. The Boards Division and Energy Division also recorded a satisfactory performance, and contributed to the turnaround. Your Directors are further pleased to report that the improved performance of the company continued during the current financial year. Your Company has been able to clear all the arrear dues to the lenders, and also wipe out most of the accumulated losses. If the trend continues, your Directors are optimistic about the future prospects, with the indications of accelerated investment in the infrastructure sector. Material changes and commitments if any affecting Financial position of the company There are no adverse material changes or commitments occurring after 31st March, 2015 which may affect the financial position of the company or may require disclosure. Dividend Members will appreciate that with the CDR mechanism still in place, most of the surpluses had to be used for clearing the arrear liabilities to lenders, and wiping out the previous years' losses. Hence your Directors regret that they are unable to recommend any dividends for the year under review. Corporate Debt Re-structure As reported in the last annual report, Corporate Debt Re-structure proposal of the company with the lenders to ease the pressure on resources was sanctioned by the lenders and implemented. Payments to Institutions/banks are as per schedule and paid up to date. Preferential Allotment Clearance was received from SEBI for the preferential allotment of shares to the Promoters to comply with the CDR stipulations which was approved by the shareholders on 2nd April 2014 The shares were accordingly allotted to the Promoters on 26th May 2015 subject to the lock-in provisions as per SEBI (ICDR) Regulations. DIRECTORS' RESPONSIBILITY STATEMENT In accordance with the provisions of Section 134 (3)(c) of the Companies Act, 2013, and on the basis of the information furnished to them by the concerned accounting professionals, your Directors confirm that I. All applicable accounting standards have been followed in the preparation of annual accounts and that there are no material departures II. The Directors selected such accounting policies and applied them consistently and made judgments 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. III. The Directors have taken proper and sufficient care 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. IV. The Directors prepared the Annual Accounts on a going concern basis. V Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. VI Appropriate systems devised to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. DIRECTORS AND KEY MANAGERIAL PERSONS(KMP) Independent Directors The Company has three Independent Directors who meet the criteria stipulated by Section 149(6) of the Companies Act, 2013, namely Mr. R Anand, Mr. M. Kanna Reddy and Mr. Kamlesh Gandhi. Out of them, Mr.M.Kanna Reddy is due to retire by rotation at the ensuing Annual General Meeting. A separate Resolution under Special Business is being proposed for reappointment of Mr. M.Kanna Reddy as an Independent Director for a fresh tenure of five years. Your Board recommends the reappointment of Mr. M.Kanna Reddy as an Independent Director. In the Board meeting held on 11th August, 2015, Lt.General Trevor Aloysius DCunha, PVSM (Retd) and Dr.Kalidas Raghavapudi have been appointed as Independent Directors. Separate resolutions are being proposed at the ensuing Annual General Meeting to appoint Lt.General Trevor Aloysius DCunha and Dr.Kalidas Raghavapudi as Independent Directors. The Company has received declarations from all the Independent Directors of the Company confirming that they continue to meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. Executive Directors At its meeting held on 30 May 2015, the Board appointed Mr. N.V.Suvarna as an Additional Director and Executive Director. A resolution is being proposed at the ensuing Annual General Meeting appointing Mr.N.V.Suvarna as a Director and Executive Director. Mr.P.N.Raju resigned as Executive Director of the company w.e.f. 2nd July, 2015 due to his other preoccupations. However, he continues as a Non Executive Director. The board records its profound appreciation of the contribution made by Mr.P.N.Raju as an Executive Director of the company. Mr. P.N.Raju retires by rotation at the ensuing Annual General Meeting, and is eligible for reappointment. The necessary resolution for the re-appointment of Mr.P.N.Raju has been included in the Notice convening the ensuing AGM. Particulars of Directors whose appointment/ reappointment is sought are given in Annexure A-1 to this Report, as part of the Report on Corporate Governance under Clause 49 of the Listing Agreement. BOARD MEETINGS During the year under review, five board meetings were held on 30th May, 2014, 14th August, 2014, 29th September, 2014, 14th November, 2014, and 31st January, 2015.The maximum time-gap between any two consecutive meetings was within the period prescribed under the Companies Act, 2013. Committees of the Board The Board has constituted various committees as required under the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges. The details of such Committees are given in Annexure - A as a part of the report on Corporate Governance. Key Managerial Personnel During the year under review, Mr.N.G.V.S.G. Prasad President (F&A) resigned from the company with effect from the close of business hours of 31st March, 2015. The Board of Directors at its meeting held on 31st January, 2015 appointed Mr.N.Krishnan as President & CFO. Plans for Orderly Succession for appointments to Board etc Your Board of Directors is fully satisfied that plans are in place for orderly succession for appointments to the Board and to senior management positions. CORPORATE GOVERNANCE A separate Report of compliance with the provisions relating to Corporate Governance as required by Clause 49 of the Listing Agreement with the Stock Exchanges is enclosed as Annexure-A to which forms part of this Report. Risk Management The company has a system of constantly identifying and monitoring the risks that the company may be exposed to. A Risk Management Committee headed by Executive Director along with other technical and non technical executives periodically reports to the Board about the risks identified and steps taken to manage the risks. The Board is of the opinion that there are no elements of risks that may threaten the existence of the Company. Particulars of Loans , Guarantees, or Investments under section 186 of the Companies Act, 2013 The company has not granted any loans, given any guarantees or made any investments during the year which would be covered under section 186 of the Companies Act,2013. Related Party Transactions Pursuant to Section 134 of the Companies Act,2013 read with Rule 8(2) of the Companies (Accounts)Rules,2014, the particulars of contracts or arrangements entered in to by the company with related parties have been done at arm's length and are in the ordinary course of business. The details of the Related Party Transactions are contained in the Audited Financial Statements (See Note 2.31b in Notes on Account) Management Discussion and Analysis Report The Management Discussion & Analysis Report is annexed as Annexure-B to this Report. Litigations During the year under review, no significant or material orders were passed by any regulatory/statutory authorities or courts/tribunals against the company imparting its going concern status and operations in future. Corporate Social Responsibility (CSR) Activities In view of the losses in the previous years, the provisions of Section 135 of the Companies Act, 2013 were not applicable to the company. However, your Directors are glad to report that even before the provisions were introduced in the Statute, your company has been engaged in CSR activities on a voluntary basis. The details of the CSR activities during the year under review are listed in Annexure-C to this Report. The company will comply with the provisions relating to CSR as and when they become applicable to it. Subsidiaries Your Company has no subsidiaries, Associates or Joint Ventures as on the date of the Report. Investor Education & Protection Fund The Company has transferred Rs.20.71 Lakhs relating to unpaid Dividend for the Financial Year 2006-07 (Final dividend) to the Investor Education & Protection Fund. Fixed Deposits The details relating to Fixed Deposits are as follows: As on 31st March 2015, Rs 3129.66 Lakhs of Public Deposits are outstanding. The Company has repaid all the matured deposits that have been claimed, and there have been no defaults in payment of interest or repayment of principal. Particulars of Employees The details of employees who have been in receipt of the remuneration envisaged by Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial personnel) is annexed as Annexure-D to this Report. Auditors M/s Venugopal & Chenoy, Chartered Accountants, have been appointed as the statutory auditors of the Company for a period of five years w.e.f 29th September,2014 subject to ratification at ensuing Annual General Meeting. Cost Audit Mr. R. Srinivasa Rao, Cost Accountant, the Cost Auditor of the Company has been re-appointed to conduct the cost audit pertaining to the Cement Division as well as the RMC Division of the company for the year 2015-16. The due date for filing the cost audit reports in XBRL mode for the financial year ended March, 31st,2014 was 27th September,2014.and the Cost audit reports were filed with Ministry of corporate Affairs on 19th September,2014. Secretarial Audit The Secretarial Audit Report pursuant to the provisions of Section 204 of the Companies Act, 2013 and the response of the Board to the observations made therein are attached as Annexure-E to this Report. Disclosure under the sexual harassment of women at work place (Prevention , Prohibition and Redressal ) Act, 2013. During the year under review, there were no cases filed pursuant to the aforesaid Act. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo Your Company continues to be conscious of the need for conservation of energy, and wherever feasible, effective steps for energy conservation are taken. There were no significant investments or developments in this regard during the year under review. The technology procured for the fields of operation has been fully absorbed. There was no significant expenditure in Research & Development warranting a special mention in this Report. The details of Foreign Exchange Earnings and outgo are as follows: Earnings : Rs. 266.83 Lakhs Outgo : Rs. 110.39 Lakhs Extract of Annual Return Pursuant to the provisions of Section 92 of the Companies Act, 2013 and rules framed there under, the extract of the Annual Return in form MGT-9 is annexed herewith as Annexure-F to which is forms part of this Report. Acknowledgements Your Directors wish to place on record their appreciation of the support and co-operation extended by IREDA, SBH, OBC, Axis Bank, Corporation Bank, Canara Bank, State Bank of Mysore, Central Bank of India, IDBI Bank and Central and State Government Departments, Dealers, Stockiests, Consumers and Depositors. Your Directors also wish to place on record their appreciation of the enthusiastic support received from the shareholders. Your Directors have pleasure in acknowledging the excellent co-operation received from the team of dedicated executives and employees who have contributed handsomely to the operations of the company. For and on behalf of the Board R. ANAND Chairman Place: Hyderabad Date : 11th August, 2015 |