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Dalmia Bharat Ltd.

BSE: 542216 Sector: Industrials
NSE: DALBHARAT ISIN Code: INE00R701025
BSE 00:00 | 24 Apr Dalmia Bharat Ltd
NSE 05:30 | 01 Jan Dalmia Bharat Ltd
OPEN 526.55
PREVIOUS CLOSE 532.40
VOLUME 1248
52-Week high 1219.90
52-Week low 406.00
P/E 97.81
Mkt Cap.(Rs cr) 10,078
Buy Price 521.00
Buy Qty 10.00
Sell Price 522.30
Sell Qty 200.00
OPEN 526.55
CLOSE 532.40
VOLUME 1248
52-Week high 1219.90
52-Week low 406.00
P/E 97.81
Mkt Cap.(Rs cr) 10,078
Buy Price 521.00
Buy Qty 10.00
Sell Price 522.30
Sell Qty 200.00

Dalmia Bharat Ltd. (DALBHARAT) - Director Report


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Company director report

Dear Members

Your Directors have pleasure in presenting their 6th Reportalongwith the financial statements of the Company and the highlights of the performance ofsubsidiaries associates and joint venture Companies (collectively referred to as"the Group") and their contribution to the overall performance of the Companyfor the financial year ended March 312019.

Financial Highlights

(H Crore)

Particulars

Standalone

Consolidated

FY-2018-19 FY-2017-18 FY-2018-19 FY-2017-18
Revenue from operations 164 125 9484 8827
Profit before interest depreciation and tax 125 102 2186 2295
Less: Interest and Financial Charges 2 4 551 693
Profit before depreciation and tax 123 98 1635 1602
Less: Depreciation 4 4 1296 1213
Profit before tax 119 94 339 389
Provision for current tax 29 21 112 108
Provision for deferred tax 3 1 (119) 17
Prior year tax charge (14) - (5) (28)
Deferred tax for earlier years - - 2 1
Profit / (Loss) after tax before share of profit in associates/ 101 72 349 291
joint ventures
Add: Share of Profit/ (Loss) in associates /joint ventures 0 0 0 0
Profit / (Loss) for the year after share of Profit / (Loss) in 101 72 349 291
associates / joint ventures
Less: Share of minority interest - - 41 (1)
Profit / (Loss) after tax 101 72 308 292
Other Comprehensive Income (11) 2 27 448
Total Comprehensive Income 90 74 376 739
Add: Surplus brought forward 123 82 2042 1242
Add: Amount transferred from debenture redemption reserve - - 62 131
Profit available for appropriation 213 156 2480 2112

State of the Company's affairs

(a) Status of Group restructuring

Your Directors have pleasure to report that the Group restructuringactivities have been completed and the Company is now the ultimate listed holding Companyof the Group and the manufacturing undertaking(s) inter-alia pertaining to cementrefractory and power have been consolidated into one operating Company namely DalmiaCement (Bharat) Limited wholly-owned subsidiary of the Company.

National Stock Exchange of India Limited ("NSE") and BSELimited ("BSE") have issued permission for listing and trading of equity sharesof the Company with effect from December 21 2018. The shares issued to the shareholdersof erstwhile OCL India Limited started trading with effect from that date. Subsequently onissue and allotment of shares to the shareholders of erstwhile Dalmia Bharat Limited NSEand BSE issued listing and trading permission for these shares with effect from January25 2019.

(b) Changes in the capital structure

Pursuant to the restructuring the following changes have taken placein the capital structure of the Company:

S. No. Capital Before restructuring (in Rs.) After restructuring (in Rs.)
1 Authorized share capital 1000000/- 3701000000/-
2 Issued share capital 500000/- 385917106/-
3 Subscribed share capital 500000/- 385917106/-
4 Paid up share capital 500000/- 385917106/-

Pursuant to the Scheme(s) of Arrangement and Amalgamation("Scheme") the Company had on October 27 2018 issued and allotted56900220 equity shares of Rs.10/- each to the shareholders of erstwhile OCL IndiaLimited and the Company got listed and started trading on BSE Limited and National StockExchange of India Limited with effect from December 21 2018. Out of said 56900220equity shares 265428 equity shares were allotted to the Investor Education andProtection Fund and the dividend accrued on the said shares amounting to 7451227.67 (@Rs.1.70 per share declared by the Company at its Annual General Meeting held on December312018) has also been transferred to Investor Education and Protection Fund.

Further Pursuant to the Scheme the share capital of the Company wasthen reduced on January 09 2019 to 14420947 equity shares of Rs.2/- each by reductionof face value of shares from Rs.10/- each to Rs.2/- each and cancellation of cross holdingof Dalmia Cement (Bharat) Limited. The said Shares of the Company post reduction gotlisted and trading commenced with effect from January 22 2019.

Further on January 09 2019 the Company had issued and allotted178306606 equity shares of Rs.2/- each to the shareholders of erstwhile Dalmia BharatLimited and the same got listed and trading commenced with effect from January 25 2019.

(c) Change of name of the Company

The name of the Company has been changed from Odisha Cement Limited toDalmia Bharat Limited with effect from April 15 2019.

(d) Impact on profitability

As a result of amortisation of intangible assets and goodwill pursuantto the Schemes the profit/ (loss) before tax is lower/ (higher) by as under:

(Rs. in Crore)
Particulars

Year ended

31-03-2019 31-03-2018
Goodwill 420 417
Intangible assets 134 146
Total 554 563

(e) Material events related to Subsidiary Companies

1. During the financial year 2018-19 the Company's materialsubsidiary namely Dalmia Cement (Bharat) Limited ("DCBL") has given a bankguarantee of Rs.50 Crore to the Resolution Professional appointed for revival of MurliIndustries Limited (MIL) as per the Resolution Plan filed pursuant to the provisions ofInsolvency and Bankruptcy Code and recommended by the Committee of Creditors to theNational Company Law Tribunal Mumbai Bench for its approval. Following receipt ofrequisite approvals the Resolution Plan provides for payment of Rs.402 Crore to thecreditors of MIL. The matter is currently pending disposal at the NCLT Mumbai Bench.

2. During the financial year ended 31st March 2019 certain mutualfund units ("Securities") valued at Rs.344 Crore (value as on 31st December2018 and carried at same value) were illegally and fraudulently transferred by one of theDepository Participant ("DP") from demat accounts of its subsidiary companynamely DCBL. Based on the complaint filed by DCBL and after preliminary enquiry theEconomic Offences Wing Delhi (EOW) directed the Clearing Agent of DP (i.e. ISSL) not todeal with the Securities and also froze such Securities till further orders.

Likewise SEBI also directed the DP its promoters/ directors itsrelated associates and other noticees mentioned in the order not to dispose of alienateor encumber any assets except with the prior permission of SEBI / National StockExchange.

The matter is currently under investigation by SEBI and EOW and also byDCBL through an independent firm of Chartered Accountants.

DCBL is confident of recovering its Securities based on the legalopinion obtained in the matter to the effect that there is a strong chance of getting itsSecurities returned. Hence no provision is considered necessary to be made in the booksof accounts currently.

3. The Government of Assam has granted Mega Project status to one ofthe step down Subsidiary namely Calcom Cement India Limited ("COIL") under theIndustrial and Investment Policy of Assam 2014 for the investment done for establishmentof clinkerisation unit at Umrangshu (Assam). The said unit will be entitled to 100%reimbursement of net State Goods and Services Tax ("SGST") paid for a period of15 years from the date of commercial production. Accordingly 100% remission of SGST forthe period from July 01 2017 to March 31 2019 of Rs.51 crores has been recognized asincome on reasonable assurance during the year under review.

4. During the year under review the profitability of CCIL has improvedon account of better utilization of installed capacity increase in demand of cement andalso recognition of remission of SGST. The management based on the future profitabilityprojections and also profits earned during the financial year 2018-19 and the previousyear is confident that there would be sufficient profit in future to utilize theunabsorbed amount of depreciation and business losses etc. Accordingly CCIL hasrecognised deferred tax assets of Rs.51 crores during the current year under review.

5. The Cement manufacturing facility at one of the step down subsidiarynamely Dalmia DSP Limited has been commissioned on March 312019.

Operations and Business Performance

Your Company recorded net revenue of Rs.164 crores for the financialyear 2018-19 registering a growth of 31.20 % as compared to the net revenue of Rs.125crores in the financial year 2017-18. Earned profit before tax of Rs.119 crore during thefinancial year 2018-19 registering a growth of 26.60 % as compared to Rs.94 crores earnedin the last financial year 201718.

Your Directors have pleasure to announce that the Company has presentedthe current Annual Report prepared as per Integrated Reporting framework. The operationsand business performance of the Group is detailed in the Integrated Report being presentedto the members demonstrating the value created by the Group while operating within itseconomic social and environmental system being inclusive of all materially relevantcapitals connecting them to business risks decisions and outcomes in the short mediumand long term.

The performance of the Group during financial year 2018-19 is presentedin the consolidated financial statements. The gross revenue of the Group for the financialyear 2018-19 has increased by 7.44 % which is Rs.9484 crores as compared to Rs.8827 croresin financial year 2017-18 and the profit before tax for financial year 2018-19 hasdecreased by 12.85% which is Rs.339 crores as compared to Rs.389 crores in financial year2017-18 owing to increase in fuel slag and other input costs.

Management Discussion and Analysis for the year under review asstipulated in the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 giving detailed analysis of the performance ofthe Company and the Group is presented in a separate section forming part of this AnnualReport.

The Company continues to be engaged inter-alia in the business ofproviding management services. There have been no material changes and commitmentsaffecting the financial position of the Company between the end of the financial year andthe date of this report.

Dividend

Your Directors have recommended a dividend of Rs.2/- (100%) per equityshare of face value of Rs.2/- each for the financial year ended on March 312019 asagainst dividend of Rs.1.70/- (85%) per equity share paid in the immediately precedingfinancial year. The proposed dividend is based on the financial and non-financial factorsprevailing during the year under review in terms of the Dividend Distribution Policy ofthe Company and the same is posted on the Company's website www.dalmiacement.com.

The Register of Members and Share Transfer books will remain closedfrom August 24 2019 to August 30 2019 (both days inclusive) for the purposes of paymentof dividend for the financial year ended March 31 2019 and the Annual General Meeting.The Annual General Meeting is scheduled to be held on August 30 2019.

Transfer to reserves

Your Directors do not propose to transfer any amount to the GeneralReserve.

Credit rating

There are no borrowings in the Company. In connection with DalmiaCement (Bharat) Limited subsidiary of the Company and operating Company ICRA hasreaffirmed rating of [ICRA] AA and [ICRA]A1 + for the long term and the short termfacilities respectively availed by Dalmia Cement (Bharat) Limited. The said ratings areconsidered to have high degree of safety regarding timely servicing of financialobligations.

Consolidated Financial Statements

In accordance with the provisions of the Companies Act 2013 read withthe Indian Accounting Standards (Ind AS) the Consolidated Financial Statements of theCompany and of all the subsidiaries and associate companies for the financial year 2018-19have been prepared in accordance with applicable accounting standards and form part of theIntegrated Annual Report.

Subsidiaries Associates and Joint Venture Companies

The Company has 30 subsidiaries and 2 joint venture

Companies as on March 31 2019. Dalmia Cement (Bharat) Limited is thematerial unlisted subsidiary of the Company in terms of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 as amended fromtime to time and the Company's Policy for determining material subsidiary. The saidPolicy may be accessed at the Company's website at www.dalmiacement. com

The changes in the subsidiaries joint venture Companies and associateCompanies during the financial year 2018-19 are as under:

S. No. Name of Company Status (subsidiary/joint venture/ associate) Added/Ceased as such Effective date
1 Dalmia DSP Limited Subsidiary Company Added July 10 2018
2 Hopco Industries Limited Subsidiary Company Added December 212018
3 Dalmia Renewables Energy Limited Associate Company Ceased May 30 2018

A statement containing the salient features of the financial statementof the Company's subsidiaries joint ventures and associate Companies for thefinancial year ended March 31 2019 in Form AOC-1 is attached and marked as Annexure -1 and forms part of this report. The contribution of the Company's subsidiariesjoint ventures and associates Companies to the overall performance of the Company duringthe period under report is given under the aforementioned financial highlights.

The Financial Statements of the Company/its Subsidiaries and theConsolidated Financial Statements of the Company including all other documents required tobe attached thereto are placed on the Company's website at www.dalmiacement. com.These documents will also be available for inspection on all working days during businesshours at the registered office of the Company and any member desirous of obtaining a copyof the same may write to the Company Secretary.

Board Meetings

The Board meetings are scheduled on quarterly basis and as and whenrequired. During the year under review the Board of Directors of the Company met sixtimes i.e. on May 15 2018 August 09 2018 October 15 2018 October 30 2018 February07 2019 and March 18 2019 out of which 1 meeting was held on October 30 2018 wasadjourned and concluded on October 31 2018. The Board meetings are conducted in duecompliance with and following the procedures prescribed in the Companies Act 2013Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 ("SEBI LODR Regulations") and applicable SecretarialStandards. Detailed information on the meetings of the Board is included in the report onCorporate Governance which forms part of this Annual Report.

Directors and Key Managerial Personnel

During the financial year 2018-19 pursuant to the implementation ofthe Schemes of Arrangement and upon increase in the paid up share capital and listing ofthe Company on BSE Limited and National Stock Exchange of India Limited the Board ofDirectors has been reconstituted in due compliance with the Companies Act 2013 SEBI LODRRegulations and the Nomination and Remuneration Policy of the Company.

Mr. Pradip Kumar Khaitan Mr. Jai Hari Dalmia Mr. Yadu Hari DalmiaMr. Gautam Dalmia Mr. Puneet Yadu Dalmia Mr. Nagarajan Gopalaswamy Mr. Virendra SinghJain Mrs. Sudha Pillai Mr. Dharmendar Nath Davar and Mr. Jayesh Doshi were appointed asAdditional Directors by the Board of Directors with effect from October 15 2018 and wereappointed as Directors by the shareholders at the Annual General Meeting held on December31 2018. Mr. Ganesh Jirkuntwar and Mr. Amandeep have resigned from the directorship witheffect from October 15 2018; and Mr. Ashwini Kumar Dalmia has resigned from thedirectorship with effect from October 16 2018.

Mr. Gautam Dalmia and Mr. Puneet Yadu Dalmia have been appointed asManaging Director(s) and Mr. Jayesh Doshi has been appointed as Whole Time Director andChief Financial Officer of the Company with effect from October 30 2018.

In accordance with the provisions of the Companies Act 2013 and theArticles of Association of the Company

Mr. Jai Hari Dalmia Mr. Yadu Hari Dalmia Mr. Dharmendar Nath Davarand Mr. Jayesh Doshi are liable to retire by rotation. Mr. Dharmendar Nath Davar shallretire by rotation at the ensuing Annual General Meeting he however has not offeredhimself for re-appointment.

Mr. Pradip Kumar Khaitan Mr. Nagarajan Gopalaswamy Mr. Virendra SinghJain and Mrs. Sudha Pillai being the Independent Directors have given theirdeclaration(s) of meeting the criteria of independence laid down in the Companies Act2013 and SEBI LODR Regulations.

Dr. Sanjeev Gemawat has been acting as the Company Secretary andCompliance Officer of the Company with effect from October 15 2018.

Committees of the Board

During the financial year 2018-19 pursuant to the implementation ofthe Schemes of Arrangement and in terms of the Companies Act 2013 and SEBI LODRRegulations the following committees of the Board have been constituted:

• Audit Committee

• Stakeholders' Relationship Committee

• Nomination and Remuneration Committee

• Corporate Social Responsibility Committee

• Risk Management Committee

• Group Governance Committee.

The details with respect to the compositions powers terms ofreference and other related matters of the committees are given in detail in the CorporateGovernance Report which forms part of this Annual Report.

Nomination and Remuneration Policy

The Nomination and Remuneration Policy of the Company lays down theconstitution and role of the Nomination and Remuneration Committee. The policy has beenframed with the objective -

(a) to ensure that appointment of directors key managerial personneland senior managerial personnel and their removals are in compliance with the applicableprovisions of the Companies Act 2013 and the SEBI LODR Regulations;

(b) to set out criteria for the evaluation of performance andremuneration of directors key managerial personnel and senior managerial personnel;

(c) to recommend to the Board the remuneration payable to seniormanagement;

(d) to adopt best practices to attract and retain talent by theCompany; and

(e) to ensure diversity of the Board of the Company.

The policy specifies the manner of effective evaluation of performanceof Board its Committees and individual Directors to be carried out either by the Boardby the Nomination and Remuneration Committee or by an independent external agency andreview its implementation and compliance. The Nomination and Remuneration policy of theCompany can be accessed at www.dalmiabharat.com

Performance Evaluation

The annual evaluation of the performance of the Board its committeesand individual Directors was carried by the Independent Directors the Nomination andRemuneration Committee and the Board of Directors in compliance with the Companies Act2013 and SEBI LODR Regulations during financial year 2018-19.

An indicative criteria of evaluation was circulated to the Directors tofacilitate such evaluation. Based on the feedback of the Directors and on duedeliberations of the views and counter views the evaluation was carried out in terms ofthe Nomination and Remuneration Policy and such indicative criterion.

Directors' Responsibility Statement

Your Directors state that:

(a) In preparation of the annual accounts for the year ended March 312019 the applicable accounting standards have been followed and there are no materialdepartures from the same;

(b) The Directors have selected such accounting policies and appliedthem consistently and made judgements and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for that period;

(c) The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities;

(d) The Directors have prepared the annual accounts on a going concernbasis;

(e) The Directors have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and wereoperating effectively;

(f) The Directors have devised proper system to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.

Particulars of Remuneration of Directors Key Managerial Personnel andEmployees

The details relating to the ratio of the remuneration of each directorto the median employee's remuneration and other prescribed details in terms of Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is attached and marked as Annexure -2 and forms part of this Report.

A statement showing the names of the top ten employees in terms ofremuneration drawn and other employees drawing remuneration in excess of the limits setout in Rules 5(2) and other particulars in terms of Rule 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached and markedas Annexure-2A and forms part of this report.

Employees' Stock Option Scheme

The Board of Directors of the Company has in its meeting held onOctober 30 2018 adopted DBEL ESOP Scheme 2011 of erstwhile DBL with a new name "DBLESOP Scheme 2018" having the same terms and conditions.

In terms of and as an integral part of the Scheme of Arrangement inlieu of every 1 (one) ESOP under DBEL ESOP Scheme 2011 the Company has granted 2 (Two) newstock options aggregating to 2272000 ESOPs under the DBEL ESOP Scheme 2018 to theeligible employees and the existing 1136000 ESOPs pending to be allotted / granted underthe DBEL ESOP Scheme 2011 stand cancelled. The New Options entitle the eligible employeesto purchase 1 (one) equity share of the Company for each New Option.

The BSE Limited and National Stock Exchange of India Limited had issuedin-principal approval for further listing of 2272000 equity shares of Rs.2/- each onallotment of ESOPs.

During the year 231000 stock options were vested into eligibleemployees against which 231000 equity shares of Rs.2/- each were allotted upon exerciseof stock options by the employees.

In terms of the provisions of the SEBI (Share Based Employee Benefits)Regulations 2014 the details of the Stock Options granted under the Scheme are availableon the Company's website at www.dalmiacement.com.

A certificate from the Statutory Auditors of the Company onimplementation of the Company's Employees Stock Option Scheme will be placed at theensuing Annual General Meeting for inspection by the members.

Corporate Governance Report

Your Directors are committed to achieving the highest standards ofethics corporate governance and continue to comply with the Code of Conduct. Theendeavour is to enhance the reputation of the Company as a responsible and sustainablecompany in order to attract as well as retain talents customers suppliers investors andto maintain fulfilling relationships with the communities.

The strong corporate governance and zeal to grow has helped the Groupto deliver the best value to the stakeholders. We have always been positively cautiousabout the near term and optimistic about the medium and long term in view of the improvedmacro indicators for the economy significant growth in public spending and focusedexecution plans.

The Corporate Governance Report for the financial year 201819 asrequired under SEBI LODR Regulations of the Company is attached hereto and forms part ofthis Report. The requisite certificate(s) from the Secretarial Auditor of the Companyconfirming compliance with the conditions of Corporate Governance and from CompanySecretary in practice that none of the Directors of the Company have been debarred ordisqualified from being appointed or continuing as Directors of the Company by Secruitiesand Exchanged Board of India/ Ministry of Corporate Affairs or any such authority isattached to the Corporate Governance Report.

Business Responsibility Report

The Business Responsibility Report as stipulated under Regulation 34(2) (f) of SEBI LODR Regulations describing the initiatives taken by the Company fromenvironment social and governance perspective forms part of this Annual Report preparedas per the Integrated Reporting framework.

Extract of Annual Return

In terms of the provisions of Section 92(3) of the Companies Act 2013read with the Companies (Management and Administration) Rules 2014 the extract of annualreturn of your Company for the financial year ended March 31 2019 has been uploaded atthe Company's website www. dalmiacement.com.

Corporate Social Responsibility (CSR)

The Group has been following the concept of giving back and sharingwith the under privileged sections of the society for more than seven decades. TheCorporate Social Responsibility of the Group is based on the principal of GandhianTrusteeship. For over seven decades the Group has addressed the issues of health care andsanitation education rural development women empowerment and other social developmentissues. The prime objective of our Corporate Social Responsibility policy is to hastensocial economic and environmental progress. We remain focused on generating systematicand sustainable improvement for local communities surrounding our plants and projectsites.

The Corporate Social Responsibility Policy of the Company may beaccessed at the Company's website www.dalmiacement.com. Pursuant to the said Policy theCompany has spent aggregating to Rs.95 Lakhs towards corporate social responsibilityactivities during the financial year 2018-19. The said amount spent was more than 2% ofaverage net profits of the Company made during three immediately preceding financialyears post giving effect to the Scheme(s). The annual report on corporate socialresponsibility activities is attached and marked as Annexure - 3 and forms part ofthis Report.

Related Party Transaction Policy and Transactions

Your Company has formulated a policy on related party transactions anddealing with related party transactions duly approved by the Board of Directors and samemay be accessed at the Company's website at www.dalmiacement. com

Prior omnibus approval is obtained for related party transactions whichare of repetitive nature and entered in the ordinary course of business and at anarms' length basis. All related party transactions are placed before the AuditCommittee for review and approval.

All related party transactions entered during the financial year2018-19 were the ordinary course of the business and on an arms' length basis. Theparticulars of material contracts or arrangements or transactions entered into with therelated parties at arm's length basis are provided in prescribed Form AOC-2 which isattached and marked as Annexure - 4 and forms part of this Report.

Risk Management

Your Company has a Risk Management Committee which monitors and reviewsthe risk management plan / process of your Company. The Company has adequate riskmanagement procedures in place. The major risks are assessed through a systemic procedureof risk identification and classification. Risks are prioritised according to significanceand likelihood. The Risk Management Committee oversees the risk management process. Thereare no elements of risk which in the opinion of the Board may threaten the existence ofthe Company.

Adequacy of Internal Financial Controls

Internal financial controls are an integrated part of the riskmanagement process. Your Company has in place adequate internal control systemscommensurate with the size of its operations and the policies and procedures adopted byyour Company ensures the orderly and efficient conduct of business the safeguarding ofassets the prevention and detection of frauds and errors the adequacy and completenessof the accounting records and the timely preparation of reliable financial information.The entire system is complemented by external auditing of selected functions such as theSAP - IT ERP system and IT general controls.

The internal auditors of the Company conduct regular internal audits asper approved plan and the Audit Committee reviews periodically the adequacy andeffectiveness of internal control systems and takes steps for corrective measures wheneverrequired. There are established Cause-Effect-Action (CEA) systems and escalation matricesto ensure that all critical aspects are addressed well in time.

The Statutory Auditors in their report on Consolidated FinancialStatements have made certain observations regarding internal financial controls of DalmiaCement (Bharat) Limited subsidiary of the Company in respect of mutual fund investmentsin demat accounts; and the Company has since attached the issue and taken measures tostrengthen the internal controls. (refer clarifications on statutory auditors reportmentioned herein below).

Whistle Blower Policy and Vigil Mechanism

The Company has in place the Whistle Blower Policy and Vigil Mechanismfor Directors employees and other stakeholders which provides a platform to them forraising their voice about any breach of code of conduct financial irregularities healthsafety environmental issues. Adequate safeguards are provided against victimization ofstakeholders who use such mechanism and direct access to the Chairman of the AuditCommittee in appropriate cases is provided. The Whistle Blower Policy and Vigil Mechanismmay be accessed on the Company's website at www.dalmiacement.com.

Disclosure under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013

Your Company is committed to ensuring that all are treated with dignityand respect. The Human Resource and the Legal & Secretarial department incollaboration with other functions ensure protection against sexual harassment of womenat workplace and for the prevention and redressal of complaint in this regard.

In line with the requirements of the Sexual Harassment of Women at theWorkplace (Prevention Prohibition & Redressal) Act 2013 an Anti-Sexual HarassmentPolicy has been put in place and Internal Complaints Committee (ICC) has been set up toredress complaints received regarding sexual harassment. During the financial year2018-19 no complaint has been received by ICC.

Loans Guarantees Security and Investments

Your Company has given loans and guarantees provided security and madeinvestments within the limits with the necessary approvals and in terms and accordancewith the provisions of Section 186 of the Companies Act 2013. The particulars of suchloans and guarantees given securities provided and investments made are provided in theStandalone Financial Statements at note nos. 6 7 9 10 40 and 41.

Energy Conservation Technology Absorption and Foreign ExchangeTransactions

The particulars of energy conservation and technology absorption arenot applicable to the Company as it is not engaged in any manufacturing activity.

The total foreign exchange earned by the Company during the financialyear 2018-19 is Nil and the total foreign exchange used by the Company during thefinancial year 2018-19 is Rs.3.93 crores.

Cost records

Your Company is not required to maintain the cost records as specifiedby the Central Government under sub section (1) of section 148 of the Companies Act 2013.

Statutory Auditor and their report

M/s. S. S. Kothari Mehta & Company the Statutory Auditors of theCompany hold office as such till the conclusion of eighth Annual general Meeting of theCompany to be held in 2021. They have confirmed that they are eligible to continue as theStatutory Auditors of the Company and that they hold a valid certificate issued by thePeer Review Board of the Institute of Chartered Accountants of India.

There is no qualification reservation or adverse remark in theirreport on Standalone Financial Statements. The notes on financial statements referred toin the Auditors' Report are self-explanatory and do not call for any comments andexplanation. The Auditors have not reported any matter under Section 143 (12) of the Actduring the year under review.

The Report submitted by the Statutory Auditors on the consolidatedfinancial statements of the Company do not contain any qualification reservation oradverse remark or disclaimer. However the Statutory Auditors in their report on theconsolidated financial statements included matters of emphasis regarding (a) disputebetween minority shareholders of CCIL and DCBL which is under adjudication before theArbitral Tribunal. Pending final disposal of the disputes no adjustments are considerednecessary in these financial statements (b) current investments valued at Rs.344 crores ason December 312018 (carried as current investments as on March 312019 at same value)appearing in the books of DCBL have been fraudulently and unauthorisedly transferred bythe depository participant. DCBL is fully confident of recovering its Securities based onthe legal opinion obtained in the matter to the effect that there is a strong chance ofgetting its Securities returned hence no provision is made in it's books of accounts(c) amortisation of goodwill as per the provisions of Scheme(s) of arrangement andamalgamation. The said Emphasis of Matters have been explained and clarified in note no.44 note no. 49 and note no. 3(e) of the notes to accounts to the Consolidated FinancialStatements of the Company for the year ended March 31 2019 which are self explanatoryand do not call for any further comments and explanation.

The Statutory Auditors in their report on consolidated financialstatements with respect to Report on the Internal Financial Controls under clause (i) ofsub section 3 of section 143 of the Companies Act 2013 reported their qualified opinionwith regard to the internal control system of Dalmia Cement (Bharat) Limited("DCBL") wholly owned subsidiary of the Company for existence and verificationof investments in Mutual Fund Units maintained in Demat Accounts were not operatingeffectively during the current financial year to detect the lapses on timely basis whichcould potentially result in material misstatement of carrying value of such investments.

In this connection DCBL has since taken all necessary steps tostrengthen the internal controls to plug any further risk in this regard. The StatutoryAuditors of DCBL and the Company have also verified and confirmed that necessary remedialmeasures have since been taken to strengthen the controls. The clarification andexplanations mentioned here as well as in the note no 49 of the notes to the ConsolidatedFinancial Statement are self-explanatory and do not call for any further comments andexplanation.

Secretarial Auditor and their Report

The Board of Directors has appointed Mr. R. VenkatasubramanianPractising Company Secretary as Secretarial Auditors of the Company for the financialyear 2018-19.

The Secretarial Audit report in Form MR 3 for financial year 2018-19 isattached and marked as Annexure - 5 and forms part of this Report. There is noqualification reservation or adverse remark in the Secretarial Audit Report.

Your Company is in compliance with all the Secretarial Standards issuedby the Institute of Company Secretaries of India and having become effective.

Public Deposits

No public deposits are accepted by the Company.

Orders passed by Regulators

There are no significant and material orders passed by the regulatorsor courts or tribunals impacting the going concern status and Company's operations infuture.

Acknowledgement

The Board of Directors would like to express their sincere appreciationfor the assistance and co-operation received from the Government authorities financialinstitutions banks customers vendors and members during the year under review. TheBoard of Directors also wish to place on record its deep sense of appreciation for thecommitted services by the Company's executives staff and workers.

For and on behalf of the Board
P.K. Khaitan
Place: New Delhi Chairman
Dated: May 09 2019 DIN-0004821

AOC-1

Salient features of financial statements of Subsidiary / Associates /Joint Ventures as per Companies Act 2013 All amounts stated in H are in H Crores exceptwherever stated otherwise Statement pursuant to section 129 (3) of the Companies Act 2013related to Associate Companies and Joint Ventures

PART - A : Subsidiaries

Sl. no. Name of the subsidiary Reporting Currency Share capital Reserves & Surplus Total Assets Total Liabilities Invest ments Turnover Profit before taxation Provision for taxation Profit after taxation Proposed Dividend % of sharehold ing
Subsidiary
i Dalmia Cement (Bharat) Limited INR 314 8851 18177 9012 984 8312 98 18 80 - 100.00%
2 Dalmia Power Limited INR 1 182 1009 826 1001 13 (14) (0) (14) - 100.00%
Step down Subsidiaries
3 D.I. Properties Limited INR 1 1 2 0 - - (0) - (0) - 100.00%
4 Shri Rangam Properties Limited INR 1 9 11 0 - - (0) - (0) - 100.00%
5 Dalmia Minerals & Properties Limited INR 1 52 52 0 13 - (0) (0) - 100.00%
6 Sri Shanamugha Mines & Minerals Limited INR 1 8 9 0 - - (0) - (0) - 100.00%
7 Sri Subramanya Mines & Minerals Limited INR 0 6 6 0 - - (0) - (0) - 100.00%
8 Ishita Properties Limited INR 0 (2) 1 3 0 0 0 0 0 - 100.00%
9 Hemshila Properties Limited INR 1 6 7 0 0 - (0) 0 (0) - 1 00.00%
10 Geetee Estates Limited INR 1 7 7 (1) - - (0) - (0) - 1 00.00%
11 Sri Swaminatha Mines & Minerals Limited INR 0 3 4 0 - - (0) - (0) - 1 00.00%
12 Sri Trivikrama Mines & Properties Limited INR 0 6 7 0 - - (0) - (0) - 100.00%
13 Sri Madhusudana Mines & Properties Limited INR 0 7 7 0 - - (0) - (0) - 100.00%
14 Sri Dhandauthapani Mines & Minerals Limited INR 0 0 0 0 - 0 0 0 0 - 100.00%
15 Golden Hills Resort Private Limited INR 1 0 2 1 - - (0) - (0) - 100.00%
16 Rajputna Properties Private Limited INR 0 (0) 3 3 - 4 (0) - (0) - 100.00%
17 Sutnga Mines Private Limited INR 2 0 2 0 2 0 (0) 0 (0) - 100.00%
18 Cosmos Cements Limited INR 13 (1) 50 37 - 0 (0) 0 (0) - 100.00%
19 Calcom Cement India Limited INR 409 396 1530 725 73 882 162 (51) 213 - 76.00%
20 RCL Cements Limited INR 4 5 38 30 31 1 (4) - (4) - 100.00%
21 SCL Cement Limited INR 3 45 4 (43) - 0 (9) - (9) - 100.00%
22 Vinay Cement Limited INR 19 (157) 136 274 53 13 (25) - (25) - 97.21%
23 Bangaru Kamakshi Amman Agro Farms Private Limited INR 0 4 4 0 - - (0) - (0) - 100.00%
24 Jayevijay Agro Farms Private Limited INR 0 3 4 0 - - (0) - (0) - 100.00%
25 OCL Global Limited USD 0 80 85 4 28 175 22 - 22 - 100.00%
26 OCL China Limited RMB 24 22 61 15 - 145 6 1 5 - 90.00%
27 Alsthom Industries Limited INR 19 12 180 149 14 216 22 3 19 - 99.99%
28 Chandrasekara Agro Farms Private Limited INR 0 2 2 0 - - (0) - (0) - 100.00%
29 Hopco Industries Limited INR 0 0 0 0 - - - - - - 100.00%
30 Dalmia DSP Limited INR 150 (138) 445 433 - - (0) - (0) - 100.00%

Names of subsidiaries which are yet to commence operation

Hapco Industries Limited

PART - B : Associates and Joint Ventures

Statement pursuant to section 129 (3) of the Companies Act 2013related to Associate Companies and Joint Ventures

Shares of Associate/Joint Ventures held by the company at the year end

Sl. no. Name of Associate/Joint Venture Latest audited Balance Sheet Date No. of shares Amount of Investment in Associate/ Joint Venture Extend of Holding % Networth attributable to Shareholding as per latest audited Balance Sheet Profit / Loss for the year considered in consolidation Profit / Loss for the year not considered in consolidation Description of how there is significant influence Reason why the associate/ joint venture is not consolidated
Joint Venture
i Khappa Coal Company Private Limited 31-Mar-19 1836500 2 36.73% 1 - - - -
2 Radhikapur (West) Coal Mining Private Limited 31-Mar-19 7348000 4 14.70% 4 0 - - -

Annexure - 2

Details pertaining to remuneration as required under Section 197(12) ofthe Companies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 for the financial year 2018-19.

1. Details of the ratio of remuneration of each Director to the medianremuneration of the employees of the Company for the financial year 2018-19 and thepercentage increase in remuneration of each Director Chief Financial Officer and CompanySecretary during the financial year 2018-19 are as under:

Name of the Director/KMP and Designation Remuneration of Director/KMP for the F.Y. 2018-19 (H in Crore) Ratio of remuneration of each Director to median remuneration of employees of the Company * % increase in the remuneration in the F.Y. 2018-19#
Mr. PK. Khaitan Chairman 0.45 4.5 Not Applicable
Non-Executive Independent
Mr. Jai Hari Dalmia 0.02 0.2 Not Applicable
Non-Executive
Mr. Yadu Hari Dalmia 0.02 0.2 Not Applicable
Non-Executive
Mr. Gautam Dalmia 6.24 62.4 Not Applicable
Managing Director
Mr. Puneet Yadu Dalmia 7.78 77.8 Not Applicable
Managing Director
Mr. N. Gopalaswamy 0.16 1.6 Not Applicable
Non-Executive Independent
Mr. V.S. Jain 0.27 2.7 Not Applicable
Non-Executive Independent
Mrs. Sudha Pillai 0.15 1.5 Not Applicable
Non-Executive Independent
Mr. Dharmendar Nath Davar 0.22 2.2 Not Applicable
Non-Executive
Mr. Jayesh Doshi 6.13 61.3 Not Applicable
Whole-time Director & CFO
Dr. Sanjeev Gemawat 1.66 16.6 Not Applicable
Company Secretary

Note: * The median remuneration of employees of the Company during thefinancial year 2017-18 was Rs.10.44.159/-

# The Directors and KMPs were appointed in the Company from October 15.2019 hence figures of increase in remuneration is not available/ applicable.

1. The Company did not have any permanent employee during the lastfinancial year hence maiden remuneration for last financial year is NIL / not availablehence percentage increase in the median remuneration of employees in the financial yearwas not available.

2. The number of permanent employees on the rolls of the Company at theend of the financial year was 315.

3. The average percentage increase in the salaries of employees otherthan the managerial personnel and managerial personnel during the financial year 2018-19is not available since the Company had nil employee during last financial year 2017-18.

4. It is hereby affirmed that the remuneration paid to Directors. KeyManagerial Personnel and senior management personnel is as per the Nomination &Remuneration Policy of the Company.

Statement of Pariculars of Employees pursuant to Rules 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of

Managerial Personnel) Rules 2014 for the financial year 2018-19

SI. no. Name Age Designation Qualification Experience (years) Date of Commencement of Employment* Date of leaving Name of the Company (last employment) Designation (last employment) Remuneration received (? in Crore) Whether related to a Director
A. Employed throughout the year
NIL- there was no employee in the Company prior to implementation of the Scheme of Arrangement and Amalgamation on October 30 2018.
B. Employed for part of the Year
1 SAN JAYS MITRA 57 SENIOR EXECUTIVE DIRECTOR B.COM (HONS.) F.C.A. 35 YEARS 12/07/83 - DALMIA BHARAT SUGAR & INDUSTRIES LIMITED SR. EXECUTIVE DIRECTOR 1.03 No
2 R K AGRAWAL 61 EXECUTIVE DIRECTOR CA CS(INTER) B.COM 42 YEARS 01/09/97 - DALMIA INDUSTRIES LIMITED DEPUTY GENERAL MANAGER # 1.41 No
3 SURATH KR. MUKHERJEE 50 EXECUTIVE DIRECTOR A.C.A A.I.C.W.A 24 YEARS 29/08/08 - DALMIA BHARAT SUGAR & INDUSTRIES LIMITED ASSISTANT EXECUTIVE DIRECTOR 1.39 No
4 SAMEER NAG PAL 49 CHIEF EXECUTIVE OFFICER - REFRACTORY BE MECHANICAL PGDBM 29 YEARS 03/08/15 - SHALIMAR PAINTS MANAGING DIRECTOR & CEO 1.63 No
5 REENAVERMA BHASIN 46 EXECUTIVE DIRECTOR CFA - AIMR LONDON 23 YEARS 01/12/16 ARPWOOD EXECUTIVE DIRECTOR -(MERGERS AND ACQUISITION) 1.66 No
6 SANJEEVGEMAWAT 49 EXECUTIVE DIRECTOR GRADUATE IN LAWS; GRADUATE IN COMMERCE; CS; CA; DOCTORATE OF PHILOSOPHY; ICWAI; 25 YEARS 01/01/16 DALMIA CEMENT (BHARAT) LIMITED EXECUTIVE DIRECTOR 1.74 No
7 AMITGARG 51 EXECUTIVE DIRECTOR PGDM - MARKETING AND FINANCE 25 YEARS 21/11/16 - HINDUSTAN TIMES EXECUTIVE DIRECTOR 1.96 No
8 B B MEHTA 65 CHIEF EXECUTIVE OFFICER- SUGAR BUSINESS BOOM (HONS.) A.C.A 42 YEARS 01/02/93 - DALMIA BHARAT SUGAR & INDUSTRIES LIMITED SR. EXECUTIVE DIRECTOR 2.53 No
9 AJITMENON 54 SENIOR EXECUTIVE DIRECTOR B.S.C B.B.A 22 YEARS 31/08/12 DDB MUDRA PRIVATE LIMITED EXECUTIVE DIRECTOR (ORGANIZATION DEVELOPMENT) 5.72# No
10 JAYESH NAGINDAS DOSHI 54 WHOLE TIME DIRECTOR & CFO B.COM L.L.B A.C.A. 27 YEARS 01/02/13 - PANCHSHIL REALTY GROUP DIRECTOR - STRATEGY & FINANCE 6.21# No
11 HARISH CHANDER SEHGAL 61 GROUP GENERALCOUNCEL BOOM (H) LLB 38 YEARS 10/08/09 - DALMIA BHARAT SUGAR & INDUSTRIES LIMITED GROUP GENERAL COUNSEL 3.95 No
12 PUNEETYADU DALMIA 46 MANAGING DIRECTOR B. TECH. AND MBA 22 YEARS 31/10/18 - DALMIA CEMENT (BHARAT) LIMITED MANAGING DIRECTOR 7.81** Yes**
13 GAUTAM DALMIA 51 MANAGING DIRECTOR B.SC M.S.IN ELECTRICAL ENGINEERING COLUMBIA UNIVERSITY 27 YEARS 31/10/18 DALMIA CEMENT (BHARAT) LIMITED MANAGING DIRECTOR 6.3** Yes**

* Date of commencement of employment of all the employees except Mr.Gautam Dalmia and Mr. Puneet Yadu Dalmia is in the erstwhile Daimia Bharat Limited. Ailthese employees were employees of erstwhile Daimia Bharat Limited and became employees ofthe Company pursuant to the Scheme of Arrnagement and Amalgamation.

** Mr. Gautam Daimia and Mr. Puneet Yadu Dalmia are sons of Mr. J.H.Dalmia and Mr. Y.H. Dalmia respectively. Mr. J.H.Dalmia and Mr. Y.H. Dalmia are brothersand accordinlgy all the four Directors are related to each other.

# The remuneration includes perquisite value of shares alloted underESOP scheme of erstwhile DBL.

Notes: 1. None of the employees held 2% or more of the equityshares of the Company by himself or alongwith his spouce and dependent children.

2. Mr. Gautam Dalmia and Mr. Puneet Yadu Dalmia have been appointed asthe Managing Director(s) of the Company for a period of five years.

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Actand Rule 8(2) of the Companies (Accounts) Rules 2014)

Form for disclosure of particulars of contracts/arrangements enteredinto by the company with related parties referred to in sub-section (1) of section 188 ofthe Companies Act 2013 including certain arms' length transactions under third provisothereto

1. Details of contracts or arrangements or transactions not atarm's length basis None

2. Details of material contracts or arrangements or transactions atarm's length basis

1
(a) Name(s) of the related party and nature of relationship Dalmia Cement (Bharat) Limited Wholly owned Subsidiary Company
(b) Nature of contracts/ arrangements/ transactions Receipt of Corporate Service charges
(c) Duration of the contracts / arrangements/ transactions entered by erstwhile Dalmia Bharat Limited 10 years effective 1-4-2010
(d) Salient terms of the contracts or arrangements or transactions including the value if any: Allocation of all expenses for availing corporate office services with mark up of 15% on basis of value added. Direct expenses on project supervision costs on time spent besides direct costs at actuals.
Value: Rs.149.61 crores for the financial year ended March 31 2019.
(e) Date(s) of approval by the Board if any: Approved by Audit Committee /Board of erstwhile Dalmia Bharat Limited on November 15 2010 and February 3 2016 and by Audit Committee and the Board of the Company on October 30 2018.
(f) Amount paid as advances if any: NIL