THE MEMBERS POLYCAB INDIA LIMITED (FORMERLY POLYCAB WIRES LIMITED)
Your directors take pleasure in submitting the 23rd annual report of thebusiness and operations of your company (the company' or polycab') and theaudited financial. Statements for the financial. Year ended 31st march 2019.
1 FINANCIAL HIGHLIGHTS OF THE COMPANY
| || |
|Particulars ||Current year 31.03.2019 ||Previous year 31.03.2018 ||Current year 31.03.2019 ||Previous year 31.03.2018 |
|1 revenue from operations ||79105.53 ||69024.40* ||79559.83 ||69149.52* |
|Other income ||935.22 ||671.30 ||933.49 ||644.37 |
|Total income ||80040.75 ||69695.70 ||80493.32 ||69793.89 |
|2 profit before interest & depreciation ||10124.31 ||7909.57 ||10142.15 ||7934.22 |
|Less: i) interest ||1157.72 ||921.70 ||1167.06 ||936.80 |
|Ii) depreciation ||1400.71 ||1319.70 ||1414.45 ||1329.53 |
|3 profit before tax ||7565.88 ||5668.17 ||7560.64 ||5667.89 |
|Less: provision for taxation ||2551.49 ||2084.30 ||2557.58 ||2082.28 |
|4 profit after tax ||5014.39 ||3583.87 ||5003.06 ||3585.61 |
|Earnings per share (in ') || || || || |
|Basic ||35.51 ||25.38 ||35.39 ||25.35 |
|Diluted ||35.51 ||25.38 ||35.39 ||25.35 |
* consequent to the introduction of goods and services tax (gst) with effect from 1stjuly 2017 central excise value added tax (vat) etc. Have been subsumed into gst. Inaccordance with ind as 115 on revenue and schedule iii of the companies act 2013 unlikeexcise duties levies like gst vat etc. Are not part of revenue. Accordingly thefigures of the period up to 30th june 2017 are not strictly relatable to thosethereafter.
| || |
|Particulars ||Current year 31.03.2019 ||Previous year 31.03.2018 ||Current year 31.03.2019 ||Previous year 31.03.2018 |
|Revenue from operations ||79105.53 ||69024.40 ||79559.83 ||69149.52 |
|Less: excise duty on sale ||- ||1437.51 ||- ||1446.47 |
|Revenue from operations excluding excise duty (net revenue) ||79105.53 ||67586.89 ||79559.83 ||67703.05 |
2 OPERATIONS OF THE COMPANY
During the year your company achieved a standalone turnover of ' 79105.53 millions(17%) as against ' 67586.89 million in the previous year. The operating profit beforefinance costs depreciation and tax is ' 10124.31 millions as against ' 7909.57 millionsfor the previous year. Standalone profit after tax is ' 5014.39 millions as compared to '3583.87 millions of the preceding year.
On a consolidated basis the company achieved a turnover of ' 79559.83 millions (18%)as against ' 67703.05 millions in the previous year.the consolidated operating profitbefore finance costs depreciation and tax is ' 10142.15 millions as against ' 7934.22millions for the previous year. The consolidated profit after tax is ' 5003.06 millionsas compared to ' 3585.61 millions of preceding year.
3 AWARDS AND ACCOLADES
During the year under review polycab was honoured with:
A. Super brand awards in delhi on 20th september 2018; and
B. Acetech grand stand awards for stall design in delhi on 16th december2018.
4 GENERAL RESERVE
No amount has been transferred to the general reserve for the financial year 2018-19.
The directors of your company are pleased to recommend a dividend @ ' 3/- (30%) perequity share of the face value of ' 10/- each on 148645905 fully paid-up equity sharesfor the financial year ended 31st march 2019 subject to approval of theshareholders of the company at the ensuing annual general meeting. The total cash out rowon account of the dividend payment and dividend distribution tax would be ' 445937715/-(rupees forty four crores fifty nine lakhs thirty seven thousand seven hundred and fifteenonly) and ' 91663809/- (rupee nine crores sixteen lakhs sixty three thousand eighthundred and nine only) respectively.
6 INITIAL PUBLIC OFFER (IPO)
The company successfully made its initial public offer (ipo') of 25022067equity shares @ ' 538/- (including a share premium of ' 528/-) per equity share ofRs. 10/-each (with a discount ofRs. 53/-to employees at an offer price ofRs. 485/- per share on175000 equity shares) which includes a fresh issue of 7440067 equity shares ofRs. 10/-each for raising funds for the company to the tune of ' 4000 million and an offer forsale by the selling shareholders of 17582000 equity shares of face value of ' 10/- eachof the company.
Subsequent to the completion of the ipo the paid-up equity share capital of thecompany has been increased from ' 1412058380/- to ' 1486459050/-. The company'sequity shares got listed on bse and nse on 16th april 2019 and are currentlyavailable for trading.
7 SHARE CAPITAL
The paid-up equity share capital as on 31st march 2019 was ' 1412058380/-divided into 141205838 equity shares of face value of ' 10/- each.
Subsequent to ipo the paid up equity share capital of the company has been increased to' 1486459050/- divided into 148645905 equity shares of face value of ' 10/- each.
8 EMPLOYEES' STOCK OPTION PLANS
Your company had instituted the esop plan 2018 ("esop2018"/"plan") for issue of up to 3530000 options to eligibleemployees.the company had granted 2147500 options to the eligible employees of thecompany vide esop performance scheme and 142250 options vide esop privilege scheme.
The details of the esop are as under:
STOCK OPTION DETAILS IF ANY AND WHETHER ISSUED AT A DISCOUNT AS WELL AS THE PERIODOVER WHICH ACCRUED AND OVER WHICH EXERCISABLE
(a) esop plan 2018
Pursuant to the resolution passed by our board on 30th august 2018 and byour shareholders on 30th august 2018 our company had instituted the esop plan2018 esop performance scheme and esop privilege schemefor issue of options to eligibleemployees. The esop plan 2018 will be administered by the nomination and remuneration(nrc) committee. The objectives of the esop plan 2018 includes attaining and exceedingperformance targets encourage retention of talent and loyalty to our company enablefundamental alignment to value creation align with shareholders' interest and
Encourage employee ownership in the company or its subsidiaries.
Under the esop plan 2018 the nrc committee is authorised to grant not exceeding3530000 options on a consolidated basis under esop performance scheme and esop privilegescheme to the eligible employees in one or more branches from time to time which inaggregate are exercisable into not more than 3530000 equity shares with each suchoption conferring a right upon the eligible employees to apply for one equity share inaccordance with the terms and conditions as may be decided under this plan.
(B) ESOP PERFORMANCE SCHEME
Our company / board / nrc committee shall grant the options to the eligible employeesin accordance with the terms and conditions of the esop performance scheme notified underthe esop plan 2018. The options granted shall vest not earlier than one year and not laterthan maximum vesting period of five years from the date of grant. All the grants shallvest in the following manner:
15% of options granted shall vest on the first anniversary from the date ofgrant
15% of options granted shall vest on the second anniversary from the date ofgrant
20% of options granted shall vest on the third anniversary from the date ofgrant
20% of options granted shall vest on the fourth anniversary from the date ofgrant and
30% of options granted shall vest on the fifth anniversary from the date ofgrant. The exercise period in respect of the option shall commence immediately on vestingand be subject to a maximum period of eight years from the date of grant.
The exercise price per option shall be ' 405.
(C) ESOP PRIVILEGE SCHEME
Our company / board / nrc committee shall grant the options to the eligible employeesin accordance with the terms and conditions of the esop privilege scheme notified underthe esop plan 2018. All the options granted shall vest at the end of one year from thedate of grant. The exercise period in respect of the option shall commence immediately onvesting and be subjectto a maximum period offive years from the date ofgrant.the exerciseprice per option shall be Rs.405
The schemes are in line with the sebi (share based employee benefits) regulations 2014(sbeb regulations'). The company has received a certificate from the auditors of thecompany that the schemes are implemented in accordance with the sbeb regulations and theresolutions passed by the members. The details as required to be disclosed under the sbebregulations and certificate from the auditors are placed on the website of the company atwww.polycab.com
9 CHANGE IN NATURE OF BUSINESS IF ANY
During the financial year there has been no change in the business of the company orin the nature of business carried by the company during the financial year under review.
10 MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
No material changes and commitments if any affecting the financial position of thecompany which have occurred between end of the financial year of the company to which thefinancial statements relate and the date of the report except the fund raised to the tuneofRs. 4000 million through the initial public offer (ipo) as mentioned above.
11 SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
A. Subsidiary companies
As on 31st march 2019 your company has 3 (three) subsidiary companies outof which two companies i.e.tirupati reels private limited and dowells cable accessoriespvt. Ltd are registered in india and polycab wires italy srl is registered in italy.
I TIRUPATI REELS PRIVATE LIMITED
The subsidiary company in which the company holds 55% equity share capital is engagedin the business of inter-alia manufacturing exporting importing dealing anddistributing the reels drums pallets packaging material made of wood steel or anyarticles and its by-products.
During the year under review the following are the performance of the subsidiarycompany:
|Particulars ||Rs. In million |
|1 Revenue from operations ||590.74 |
|2 Profit before tax ||7.48 |
|3 Profit aftertax ||4.27 |
II DOWELLS CABLE ACCESSORIES PVT. LTD
The subsidiary company in which the company holds 51% equity share capital. isinvolved in the business of inter-alia manufacturing designing importing exporting ofcopper and aluminum terminals brass cable glands crimping tools cable sockets forelectrical wires connectors and accessories.
During the year under review the following are the performance of the company:
|Particulars ||Rs. In million |
|1 Revenue from operations ||246.75 |
|2 Profit before tax ||11.30 |
|3 Profit aftertax ||8.38 |
III POLYCAB WIRES ITALY SRL (MILANO ITALY)
The subsidiary company in which the company holds 100% equity share capital. isinvolved in the business of inter alia manufacturing engineering promotion developmentand marketing of electrical cabl.es and supply of services and consultancies to companiesin the sector of marketing.
During the year under review the following are the performance of the company
|Particulars ||Rs. In million |
|1 Revenue from operations ||22.95 |
|2 Profit before tax ||1.15 |
|3 Profit aftertax ||1.19 |
B joint venture
Your company has 2 (two) joint venture companies (50:50) ryker base pvt. Ltd and technoelectromech pvt. Ltd.
I RYKER BASE PVT. LTD (RYKER)
Ryker is involved in the business of inter alia manufacturing formulatingprocessing producing converting distilling refine making buying selling and dealingin conductors wires cables and rods made of ferrous and non-ferrous metals and theircompounds.
During the year under review the following are the performance of the joint venturecompany:
|Particulars ||Rs. In million |
|1 Revenue from operations ||0 |
|2 Profit before tax ||(82.00) |
|3 Profit aftertax ||(62.50) |
II TECHNO ELECTROMECH PVT. LTD. (TECHNO)
Techno is involved in the business of inter alia manufacturing of light emittingdiodes lighting and luminaires and led drivers.
During the year under review the following are the performance of the joint venturecompany:
|Particulars ||Rs. In million |
|1 Revenue from operations ||1672.19 |
|2 Profit before tax ||47.65 |
|3 Profit aftertax ||34.17 |
In accordance with section 136(1) of the companies act 2013 the annual. Report of thecompany containing therein its standalone and the consolidated financial statements hasbeen placed on the website of the company www.polycab.com.
Further as per the fourth proviso of the said section the audited annual accounts ofeach of the subsidiary companies have also been placed on the website of thecompanywww.polycab.com.
Shareholders interested in obtaining a copy of the audited annual accounts of thesubsidiary companies may write to the company secretary and compliance officer at thecompany's corporate office at 771 polycab house mogul lane mahim (west) mumbai - 400016
Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of thecompanies (accounts) rules 2014 a statement containing salient features of financialstatement of subsidiaries / joint ventures is annexed as annexure 1.
12 DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There was no significant and material order passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future.
13 CHANGE OF NAME OF THE COMPANY
With the approval of the members of the company the company was converted into apublic limited company with effect from 29th august 2018. Thereafter the nameof our company was changed from polycab wires limited'to polycab indialimited'with effectfrom 13th october 2018.
14 DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
|. Name of director ||Designation ||Appointment date ||Resignation date |
|1 Inder t. Jaisinghani ||Chairman and managing director ||20th december 1997 ||- |
|2 Ajayt. Jaisinghani ||Whole-time director ||27th april 2006 ||- |
|3 Ramesh t. Jaisinghani ||Whole-time director ||10th january 1997 ||- |
|4 Shyam lai bajaj ||Cfo and whole-time director ||15th december 2016 ||- |
|5 R. S. Sharma ||Additional director (independent director) ||20th september 2018 ||- |
|6 T. P. Ostwal ||Additional director (independent director) ||20th september 2018 ||- |
|7 Pradeep poddar ||Additional director (independent director) ||20th september 2018 ||- |
|8 Hiroo mirchandani ||Additional director (independent director) ||20th september 2018 ||- |
|9 S. S. Narayana ||Company secretary ||14th december 2012 ||- |
|10 #r. Ramakrishnan ||Joint managing director ||01st april 2012 ||23rd may 2018 |
|11 @michel lemaire ||Director ||08th march 2010 ||21st august 2018 |
As on 31st march 2019 the following were the whole-time directors and keymanagerial personnels of the company as per section 203 of the companies act 2013and therules made thereunder:
inder t. Jaisinghani - chairman & managing director;
ramesh t. Jaisinghani - whole-time director
shyam lal bajaj- cfo and whole-time director &
s. S. Narayana - company secretary.
The board of directors at its meeting held on 20th september 2018 hadapproved the appointment of t. P. Ostwal (din:00821268) r. S. Sharma (din: 00013208)pradeep poddar (din: 00025199) and hiroo mirchandani (din:06992518) as additionaldirectors (non-executive independent) and recommends the same forthe approval by theshareholders of the company at the ensuing annual general meeting. Necessary resolutionsseeking their appointment forms part of the annual general meeting notice.
It may also be noted that pursuant to the provisions of section 152 of the companiesact 2013 ramesh t. Jaisinghani (din:00309314) is liable to retire by rotation at theensuing annual general meeting and being eligible offers himself for re-appointment. Theboard recommends his appointment as a director liable to retire by rotation at the ensuingannual general meeting of the company.
The tenure of inder t.jaisinghani (din: 00309108)as managing directorajayt.Jaisinghani (din: 00276588) & ramesh t. Jaisinghani (din: 00309314)as whole-timedirectors of the company would lapse on 27th august 2019and are eligible forre-appointment. The board of directors on the basis of the recommendation of thenomination and remuneration committee and the audit committee has proposed theirre-appointment subject to approval of the members of the company at the ensuing annualgeneral meeting for further period of 5 years commencing from 28th august 2019to 27th august 2024. Necessary resolutions seeking re-appointment andremuneration payable to the managing & whole-time directors form part of the agmnotice.
The details of directors being recommended for appointment/re-appointment as requiredunder sebi (listing obligations and disclosure requirements) regulations 2015 arecontained in the accompanying notice convening ensuing annual general meeting of thecompany. Appropriate resolution(s) seeking your approval to the re-appointment ofdirectors is also included in the notice.
# r. Ramakrishnan had resigned from the company as the joint managing director anddirector of the company with effect from 23rd may 2018. The board takes onrecord his contributions to the business of the company during his tenure as the jointmanaging director of the company.
@ michel lemaire had resigned from the company as the director of the company witheffect from 21st aug 2018. The board takes on record his contributions to thebusiness of the company during his tenure as the director of the company.
15 MEETINGS OF THE BOARD OF DIRECTORS
During the year under review 11 meetings of the board of directors of the company wereheld which are as under:
| ||Date of board meeting |
|1 ||28th may 2018 |
|2 ||03rd july 2018 |
|3 ||08th august 2018 |
|4 ||30th august 2018 |
|5 ||20th september 2018 |
|6 ||25th september 2018 |
|7 ||09th october 2018 |
|8 ||24th october 2018 |
|9 ||20th december 2018 |
|10 ||05th february 2019 |
|11 ||25th march 2019 |
The composition of the board and other details relating to the board meetings have beenprovided in the corporate governance report. The gap between two board meetings didn'texceed 120 days as per section 173 of the companies act 2013.
The company has duly constituted the following mandatory committees in terms of theprovisions of the companies act 2013 read with rules framed thereunder viz..
I) audit committee;
Ii) nomination and remuneration committee;
Iii) stakeholders' relationship committee; and
Iv) corporate social. Responsibility committee.
The composition of all such committees number of meetings held during the year underreview brief terms of reference and other details have been provided in the corporategovernance report which forms part of this annual report. All the recommendations made bythe committees were accepted by the board.
17 DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to section 134(5) of the companies act 2013 the directors to the best oftheir knowledge hereby state and confirm that:
A) in the preparation of the annual accounts for the financial year ended 31stmarch 2019 the applicable accounting standards have been followed and there are nomaterial departures.
B) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at 31st march 2019 and of theprofit of the company forthe year ended as on that date;
C) the directors have taken proper and sufficient care forthe maintenance of adequateaccounting records in accordance with the provisions of companies act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
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 thecompany and such internal financial controls are adequate and are operating effectively;and
F) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
18 DECLARATION BY INDEPENDENT DIRECTORS
All the independent directors have submitted their disclosures to the board that theyfulfill all the requirements as stipulated under section 149(6) of the companies act2013.
There has been no change in the circumstances affecting their status as independentdirectors of the company so as to qualify themselves to be appointed as independentdirectors under the provisions of the companies act 2013 and the relevant regulations.
SEPARATE MEETING OF INDEPENDENT DIRECTORS
In terms of requirements of schedule iv of the companies act 2013 the independentdirectors of the company met separately on 29th march 2019 to inter aliareviewthe performance of non-independent directors (including the chairman) the entireboard and the quality quantity and timeliness of the row of information between themanagement and the board.
19 COMPANY'S POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS
The company has been following a policy with respect to appointment and remuneration ofdirectors key managerial personneland senior management personnel.the appointment ofdirectors on the board is subject to the recommendation of the nomination and remunerationcommittee (nrc). Based on the recommendation of the nrc the remuneration of executivedirector is fixed in accordance with the provisions of the companies act 2013 whichcomprises of basic salary perquisites allowances and commission. The remuneration ofnon-executive directors comprises of sitting fees and commission in accordance with theprovisions of companies act 2013.
The criteria for appointment of board of directors and remuneration policy of yourcompany are placed on the website of the companywww.polycab.com
20 BOARD EVALUATION
Pursuant to the provisions of the companies act 2013 and sebi (listing obligations anddisclosure requirements) regulations 2015 the board has carried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its audit nomination & remuneration and othercommittees. The details of performance evaluation has been mentioned in the corporategovernance report.
21 EXTRACT OF THE ANNUAL RETURN
The details forming part of extract of the annual. Return in form mgt-9 in accordancewith section 92(3) of the companies act 2013 read with the companies (management andadministration) rules 2014 has been annexed with this report as annexure 2
M/s. Srbc &co. Llp chartered accountants mumbai (icai firm registrationno.324982e/e300003) were appointed as the statutory auditors of the company at theannual. General. Meeting (agm) of the company held on 20th september 2014 for aterm of 5 consecutive years to hold office till the conclusion of the ensuing annualgeneral meeting.
M/s. Srbc &co. Llp have been the auditors of the company since financial year2009-2010.
As per the provisions of section 139 of the act no listed company can appoint orre-appoint an audit firm as auditors for more than two terms of five consecutive years.
Taking into consideration the above provisions of the act m/s. S r b c & co. Llpcan continue as the statutory auditors of the company only up to the conclusion of theensuing annual general meeting.
Hence based on the recommendation of the audit committee it is proposed to appointm/s. B s r & co. Llp chartered accountants (firm registration no: 101248w/w-100022)as the statutory auditors of the company in place of m/s.s r b c & co. Llp. charteredaccountants mumbaifor a term of five consecutive years commencing from the conclusion of23rd annual general meeting till the conclusion of 28th annualgeneral meeting to be held in f.y. 2023-2024.
The approval of shareholders of the company is sought for the appointment of andremuneration to m/s. B s r & co. Llp chartered accountants (firm registration no:101248w/w-100022)as the statutory auditors of the company.
23 STATUTORY AUDITORS' REPORT
The auditors' report on standalone and consolidated financial statements for thefinancial year 2018-19 issued by m/s. S r b c & co. Llp chartered accountants doesnot contain any qualification observation disclaimer reservation or adverse remark.
24 COST AUDITORS
Your company is maintaining the cost records as specified by the central governmentunder sub-section (1) of section 148 of the companies act 2013 and have appointed m/s. N.Ritesh & associates cost accountants as cost auditors to issue cost audit reportfor the financial year 2019-20 at a professional fee of ' 300000/- (rupees three lakhsonly) plus applicable taxes and out of pocket expenses at actual.
Necessary resolution has been recommended to be passed by the shareholders in theensuing annual general meeting to ratify the remuneration of the cost auditors for thef.y. 2019-20
25 SECRETARIAL AUDITORS
Pursuant to the provisions of section 204 of the companies act 2013 read with thecompanies (appointment and remuneration of managerial personnel) rules 2014 m/s. Dilipbharadiya & associates were appointed as the secretarial auditors of the company toissue the secretarial audit for the year ended 31st march 2019.
SECRETARIAL AUDIT REPORT
The secretarial audit report for the financial year ended 31st march 2019 isannexed to this report. (annexure - 3)
The secretarial audit report does not contain any qualification reservation or adverseremark or disclaimer.
26 PARTICULARS OF LOAN GIVEN INVESTMENTS MADE GURANTEE GIVEN AND SECURITIES PROVIDEDUNDER SECTION 186 OF THE ACT
The details of loans given guarantee given and investment made under section 186 ofthe act read with companies (meeting of the board and its power) rules 2014 are asfollows:
A) LOAN GIVEN
I. Dowells cable accessories pvt. Ltd - ' 4.60 million (repaid loan ' 10.76 million)(repayment includes loan taken in earlier year)
Ii. Technoelectromechpvt. Ltd - nil (repaid loanRs. 24.89 million)
Iii. Tirupati reels private limited - ' 40.00 million (repaid loan ' 40.00 million)
B) DETAILS OF INVESTMENTS:
|Name of the company ||Amount (Rs. Million) |
|1. Dowells cable accessories pvt. Ltd . (51% subsidiary) ||39.27 |
C) guarantee given by the company during the year
|Guarantee ||Business entities ||Amount (Rs. Million) |
|Shortfall undertaking ||Ryker base pvt. Ltd ||Usd 4.5 |
27 PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Alltransactions entered by the company with related parties during the financial year2018-19 as defined under section 2 (76) of the companies act 2013 read with the companies(specification of definitions details) rules 2014 were in the ordinary course of businessand at arm's length pricing basis. There were no materially significant transactions withrelated parties during the financial year 2018-19 which were in conflict with theinterest of the company. Suitable disclosures as required under ind as - 24 have been madein the notes to the financial statements.
The form aoc - 2 pursuant to section 134(3)(h) of the companies act read with rule 8(2)of the companies (accounts) rules 2014 is set out as annexure - 4 to this reportdepicting the details of related party transactions as required under ind as 24 and as persection 188 of the companies act 2013. The policy on related party transaction can beaccessed on the website of the company www.polycab.com .
During the year under review the company has not accepted any deposit from publicwithin the meaning of section 73 of the companies act 2013 read with companies(acceptance of deposits) rules 2014. The company has no unclaimed / unpaid matureddeposit or interest due thereon.
29 CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your company believes that corporate social responsibility is an integral part of itsbusiness. It seeks to operate its business in a sustainable manner which would benefit thesociety at large in alignment with the interest of its stakeholders.as per therequirements of section 135 of the companies act 2013 pertaining to corporate socialresponsibility ("csr") your company has duly constituted a corporate socialresponsibility committee ("csr committee").
The csr policy of the company framed under the provisions of section 135 of thecompanies act 2013 read with the companies (corporate social responsibility policy)rules 2014 is available on the company's website www.polycab.com.the company was requiredto spend ' 92.01 million on csr activities. The company has so far spent ' 34.94 millionand has initiated necessary steps to identify further suitable projects to spend thebalance amount in the near future. The company is sincerely committed in its corporatesocial responsibility to ensure the required participation in the nation's building.
Csr activities for the financial year ended 31st march 2019 along with thecomposition of csr committee is marked as annexure - 5 and forms part ofthisreport.
30 RISK MANAGEMENT
The company has a risk management frame work for identification assessment andmitigation of risks. This frame work essentially creates transparency and minimizes therisk and adverse impact on the business objectives and enhances
The company's competitive edge. This frame work consists of various risk models helpingin identifying risk risk trends exposure and potential influence analysis separatelyfor various business segments and at various levels of the company. Business planning andforecasting encompasses inter alia the risk management of the company.
Based on the operations of the company new risks if any are identified appropriatesteps are taken to mitigate them.
By aligning operating controls with the mission and vision of the company this riskmanagement frame work fully supports company managementto meet its objectives.
Polycab india limited being a large player its business no doubt are exposed tovarious risks. Polycab realizes the importance of identifying and taking steps to managethe risk faced by the company.
Our internal control encompasses various managements systemsstructures oforganization standard and code of conduct which all put together help in managing therisks associated with the company. In order to ensure the internal controls systems aremeeting the required standards it is reviewed at periodical intervals. If any weaknessesare identified in the process of review the same are addressed to strengthen the internalcontrols which are also revised at frequent intervals.
31 AUDIT COMMITTEE
As of 31st march 2019 the audit committee of the board of directors of thecompany comprises of 4 (four) members namely:
A. T.p. Ostwal- audit committee chairman (independent director);
B. R.s. Sharma- member(lndependent director);
C. Pradeep poddar- member (independent director); and
D. Shyam lal bajaj- member (non- independent cfo & whole-time director).
The board accepted the recommendations of the audit committee whenever made by thecommittee during the year.
32 DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS
The company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. It includes policies and procedures that:
1) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition useor disposition of the company's assets that could have amaterial effect on the financial statements.
2) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
3) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company.
33 DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES
Your company is committed to highest standards of ethical moraland legal conduct ofits business. In order to ensure that the activities of the company and its employees areconducted in a fair and transparent manner by adoption of highest standard ofprofessionalism honesty integrity and ethical behaviour the company has adopted acomprehensive vigil mechanism / whistle blower policy in compliance with the provisions ofsection 177 (9) and (10) of the companies act 2013 and regulation 22 of the sebi (listingobligations and disclosure requirements) regulations 2015.
The vigil mechanism / whistle blower policy is available on the website of the companywww.polycab.com.
34 SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)
The directors state that applicable secretarial standard have been followed during thefinancial year 2018-19.
35 DETAILS PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT 2013
The details of remuneration as required under section 197(12) of the companies act2013 read with rule 5(1) forms part ofthis reportare annexed herewith as annexure-6.
Pursuant to the provisions of the first proviso to section 136(1) of the companies act2013 the disclosure under section 197(12) of the companies act 2013 read with rule 5(2)will be sent to the members of the company on request.
Further the said information is available for inspection at the registered office ofthe company during working hours and any member interested in obtaining such informationmay write to the company secretary at the corporate office of the company.
36 DISCLOSURES UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
The company has in place anti sexual harassment policy in line with the requirements ofthe sexual harassment of women at the workplace (prevention prohibition & redressal)act 2013. All employees (permanent contractual temporary trainees) are covered underthis policy. The company has provided a safe and dignified work environment for employeewhich is free of discrimination. The objective ofthis policy is to provide protectionagainst sexual harassment of women at workplace and for redressal of any such complaintsof harassment. Internal complaints committee (icc) has been set up to redress thecomplaints received if any.
Pursuant to the requirements of section 22 of sexual harassment of women at workplace(prevention prohibition and redressal) act 2013 read with the rules thereunder it ishereby declared that the company has not received any complaint of sexual harassmentduring the year under review.
The company has complied with the provisions relating to the constitution of internalcomplaints committee under the sexual harassment of women at workplace (preventionprohibition and redressal) act 2013.
37 CREDIT RATINGS
During the year under review the credit ratings of the company has been upgraded forbank facilities as follows:
A. Rating & research (fitch group) : from aa- to aa;
B. Crisil limited: aa.
38 CORPORATE GOVERNANCE
A report on corporate governance along with a certificate from the statutory auditorsof the company confirming of corporate governance requirements as stipulated underregulation 27 of sebi (lodr) regulations forms part of this annual report.
39 CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO AS STIPULATED UNDER SECTION 134(3)(M) OF THE COMPANIES ACT 2013 READ WITH RULE 8 OFTHE COMPANIES (ACCOUNTS) RULES 2014
The details of conservation ofenergy technology absorption foreign exchange earningsand outgo comprise:
A) CONSERVATION OF ENERGY:
A) STEPS TAKEN OR IMPACT ON CONSERVATION OF ENERGY;
Energy preservation measure (epm) for environmental sustainability is prime importancefor our company. Technology up gradation modernization and the introduction of controlinstrumentation are practiced realizing the full potential of energy conservation in ourorganization. Our company emphasis on the establishment of a system of collectionanalysis and reporting of parameters vital for energy conservation for long termsustainability. Our main energy management strategies are conservation and efficiency.
Within our organization the company does a continual improvement for optimumutilization of resources to ensure minimize consumption of energy water naturalresources & c02 emission while maximizing production volumes in ecofriendlymanner.
During the year approximately the company has undertaken various projects to reduceenergy consumption. Some of the projects undertaken & sustained every year are:
installation of variable frequency drive (vfd) in motor.
replacing of existing metal halide (mh) lights and installation of led light innew projects resulting 20% of energy saving in lighting.
vfd hydro pumping panel in pumps to save 20% of power in energy.
plants & street lights are equipped with timer which results in 20% powersaving.
vrf system is set to auto controlled air conditioning to save energy.
during the year approximately we had undertaken various projects to reducewater consumption. The project undertaken & sustained every year is:
installation of stp & etp plant.
In addition to energy & water saving we are concerned to reduce pollution byeffective waste disposal plan. Some of the projects undertaken & sustained every yearare:
e waste disposal system.
hazardous waste disposal system.
B) ADDITIONAL INVESTMENT
Following are additional proposals which are initiated for implementation during fy18-19
additional solar power generation of 200 kw.
waste water recycling capacity increase.
improving recovery of drinking water ro plant.
C) IMPACT OF THE MEASURES AT (A) AND (B) ABOVE FOR REDUCTION OF ENERGY CONSUMPTION ANDCONSEQUENT IMPACT ON THE COST OF PRODUCTION OF GOODS
Within the company there are continuous efforts towards improving operationalefficiencies minimizing consumption of energy and water.
As a result within couple of years the company had reduced energy per ton drastically.With implementation of 87% leds by replacing mhlthe company had reduced 20% saving inlight wind energy contributes to about 22% out of total (polycab-halol) energyconsumption.
D) THE STEPS TAKEN BY THE COMPANY FOR UTILISING ALTERNATE ENERGY SOURCES;
(i) polycab has 05 wind mills (03 nos. Of 1.5 mw and 02 nos. Of 1.8 mw) 20 % oftotal energy consumed in manufacturing unit (polycab - halol) are compensated by renewablesources.
(iii) the capital investment in energy conservation equipment
|A) led lights ||:' 10.2 million |
|B) stp andetp plant ||:' 4.3 million |
|C) vrfsystemfor airconditioner ||:' 10.6 million |
|D) solar system ||: '7.1 million |
B TECHNOLOGY ABSORPTION:
I. The efforts made towards technology absorption: nil
Ii. The benefits derived like product improvement cost reduction product developmentor import substitution: nil
Iii. In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year)
A. The details oftechnology imported: nil
B. The yearofimport:nil
C. Whether the technology been fully absorbed: nil
D. If not fully absorbed areas where absorption has not taken place and the reasonsthereof: nil
C foreign exchange earnings & outgo:
The following are the details as enumerated below:
|. Particulars ||Rs. In million |
|A Earning in foreign exchange ||2436.53 |
|B CIF value of import ||35176.88 |
|C Expenditure of foreign currency ||342.45 |
D RESEARCH AND DEVELOPMENT
During the year under review the research & development activities carried out bythe company is given in annexure 7
40 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management discussion and analysis report for the financial year under review asstipulated under regulation 34 of sebi (lodr) regulations is presented in a separatesection forming part of the annual report
41 Fraud Reporting
During the year under review no fraud has been reported by auditors under sub-section(12) of section 143 of the companies act 2013.
42 CAUTIONARY STATEMENT
Statements in the annual report including those which relate to management discussionand analysis describing the company's objectives projections estimates andexpectations may constitute forward looking statements' within the meaning ofapplicable laws and regulations. Although the expectations are based on reasonableassumptions the actual results might differ.
The directors wish to convey their appreciation to all employees for their enormousefforts at the individual level as well as their collective contribution to the company'sperformance. The directors would also like to thank the shareholders customers dealerssuppliers bankers government and all the other business associates for the continuoussupport given by them to the company and their confidence in its management.
For and on behalf of the board of polycab india limited
Inder t. Jaisinghani
Chairman & managing director
Date: 14th may 2019