REPORT OF THE DIRECTORS AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
for the year ended on December 31 2018
The Directors have pleasure in submitting their Annual Report together with the AuditedFinancial Statements for the year ended on December 31 2018.
| || || |
|Financial Results : ||Year ended 31.12.2018 ||Year ended 31.12.2017 |
|Revenue from Operations ||92507 ||94952 |
|Other Income ||2277 ||1322 |
|Total Revenue ||94784 ||96274 |
|Profit before Depreciation Interest & Tax (PBDIT) ||17018 ||17913 |
|Depreciation & Amortisation ||2781 ||2978 |
|Interest ||- ||- |
|Profit before exceptional items and Tax ||14237 ||14935 |
|Exceptional Items ||- ||444 |
|Profit before tax ||14237 ||14491 |
|Provision for Income Tax ||4985 ||5046 |
|Profit for the year after Tax ||9252 ||9445 |
|Other comprehensive income for the year net of tax ||88 ||54 |
|Total comprehensive income for the year ||9340 ||9499 |
|Transfer to Reserves : ||Nil ||Nil |
|Proposed Dividend : || || |
|Proposed Dividend || || |
|@ Rs 7/- per share ||1421 ||1370 |
|Basic & Diluted Earnings || || |
|Per Share : ||45.59 ||Rs 46.54 |
|Disclosures under || || |
|Regulation 34(3) read with Schedule V Clause B of SEBI (LODR) || || |
|(i) Debtors Turnover Ratio ||4.1 ||3.74 |
|(ii) Inventory Turnover Ratio ||7.40 ||8.20 |
|(iii) Interest Coverage Ratio ||N.A. ||N.A. |
|(iv) Current Ratio ||4.23 ||3.72 |
|(v) Debt Equity Ratio ||N.A. ||N.A. |
|(vi) Operating Profit Margin (%) ||13% ||14% |
|(vii) Net Profit Margin (%) ||10% ||10% |
|(viii) Return on Net Worth (%) ||16% ||20% |
Financial Year of the Company
The Company Law Board by an Order dated January 7 2016 has permitted the Company tohave the Financial Year to end on 31st December of each year.
Operating & Financial Performance Internal Control
This year the Company's revenue (excluding excise duty) from domestic sales increasedby over16% the previous year's domestic sales while exports were reduced to about 45% ofprevious year's exports.
Contribution to Government Exchequer 2018
How the Rupee was Spent
The Company was able to reduce its overall debts and the net receivables from the threecustomers against whom bankers had initiated insolvency proceedings under the Insolvencyand Bankruptcy Code 2016.
There is no change in the nature of the business of the Company. The Company has nosubsidiaries therefore disclosures in this regard are not provided in this Report of theDirectors. There were no significant passed by regulators or courts or tribunals impactingthe going concern status and Company's operations in future. In preparation of thefinancial statements there has been no treatment different from the Accounting Standards.
All four factories had been working efficiently year. Energy efficient installationshave been made at these factories. Safety measures and processes have been installed andimproved upon at all plants and work sites.
The Company has in place an established internal control system designed to ensureproper recording of financial and operational information and compliance of variousinternal controls and other regulatory and statutory compliances. Code on Internal Controlwhich require that the Directors review the effectiveness of internal controls andcompliance controls financial and operational risks risk assessment and managementsystems and related party transactions have been complied with. Self-certificationexercises are also conducted by which senior management certify effectiveness of theinternal control system their adherence to Code of Conduct and Company's policies forwhich they are responsible financial or commercial transactions if any where they havepersonal interest or potential conflict of interest. Internal Audit is conducted on a panIndia basis.
Company's Policies and the Code of Conduct and CORE Values and Behaviours applicable toDirectors and Employees of the Company have been complied with during the year. A list ofthese Policies which are available on the Company's website www.vesuviusindia.comis mentioned later in this Report of the Directors.
The Board of Directors are pleased to recommend a dividend of Rs 7/- per Equity Shareof nominal value of Rs 10/- each. The dividend together with dividend tax will entail acash outflow of Rs 1713 lakhs (previous year Rs 1649 lakhs). If declared by theShareholders at the forthcoming Annual General Meeting dividend will be deposited withthe bank within April 30 2019 and dividend will be paid within May 7 2019.
Vesuvius plc the ultimate holding company is listed on the London Stock Exchange andis a global leader in metal flow engineering principally serving industries.
Vesuvius has developed close collaborative relationships with customers together withan extended global manufacturing network aligned with customer locations. Vesuvius focuseson gaining a fundamental understanding of customers' processes and delivering systems andproducts that are mission-critical for the demanding applications in which they are used.
Members of the Board of Directors of Vesuvius plc the ultimate holding company hadvisited the Kolkata Plant on October 23 2018 and had meaningful deliberations andinteractions with the local management team. They have a clear strategy on the potentialgrowth and capabilities of the Indian operations and have offered their support to theIndian operations. The Board Members have also visited and interacted with a majorcustomer in India which has international operations.
The Vesuvius strategy remains centered around the following five key executionpriorities designed to the achievement of the core strategic objective of delivering longterm sustainable and profitable growth :
Reinforce our technology leadership;
Increase penetration of value-creating solutions;
Capture growth in developing markets;
Improve cost leadership and margins; and
Build a Technical Services business
The Vesuvius Group has been extremely supportive of their Indian operations andcontinues to provide constant support in terms of technology research and developmentsystems manufacturing etc.
The Company's factories at Kolkata and Visakhapatnam have been certified ISO 9001:2015for Quality Management the steel and foundry Systems Standards.
The Company is primarily a manufacturer and trader of refractory and is managedorganizationally as a single unit. Accordingly the Company is a single business segmentcompany. Geographical (secondary) segment has been identified as domestic sales andexports. Details of segment reporting are available in the Annual Accounts.
Industry Structure & Developments Opportunities & Threats Outlook Risks& Concerns
India's 2018FY crude steel production stood at 106.5 million tons compared to 101.4million tons in 2017 a growth of 5% while consumption in India grew by 8%. Impact ofavailability and prices of raw materials reduction in export opportunities and initiationof Insolvency proceedings against three of our customers have had some adverse impact.Given the tight competitive and overall trading conditions full recovery of costincreases from our customers have not been possible. Customers have shelved theirexpansion projects and are looking forward to the outcome of the insolvency proceedingsagainst steel manufacturers.
Steel and foundry industry comprise the biggest group of our customers. These are alsocyclic in nature. Hence anything that affects the steel and foundry industry will have itsone off effect on our business.
There is a continuous process of risk identification and review which includes both atop-down and bottom-up process. Assessment of principal risks have been reviewed andconsidered against a further group of emerging risks and uncertainties. There has been nomaterial change in the principal risks and uncertainties during the year but a reflectionhas been made on certain emerging macro trends during the year. These include interruptionof supply of quality raw materials related challenges of instigating price increases asinput costs go up and ramifications of regulations like Insolvency and Bankruptcy Code.Risk may include demand volatility financial uncertainty complex and changing regulatoryenvironment business interruption failure to secure innovation attracting and retainingtalent and performance management and Quality Health & Safety. These are not the onlyones that the Company faces. Some risks are not yet known and some currently not deemed tobe material could become so.
Vesuvius reinforced its efforts to develop products and services helping customers toreduce their carbon footprint through improved service life of our products and reductionof waste in customers' manufacturing processes. At the same time we continued our effortsto reduce waste and energy consumption in our own manufacturing processes.
Board of Directors
Mr Tanmay Ganguly (DIN No.01272338) Director of the Company is due to retire byrotation at the ensuing Annual General Meeting. Mr Ganguly is the President-AdvancedRefractories of the Vesuvius Group and operates from the United Kingdom. Mr Ganguly hasconfirmed and declared that he is qualified to act as a Director of the Company and beingeligible has offered himself for re-appointment as a Director of the Company. The Board ofDirectors are also of the opinion that Mr Ganguly fulfils all the criteria specified inthe Companies Act 2013 and rules thereon and all the requirements of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 ["SEBI (LODR)" ]making him eligible to be re-appointed as Director. Mr Ganguly is not a Director of anyother company in India. He is a member of all the Committees of the Board of Directors. Hedoes not hold any shares of the Company and is not related to any Director or KeyManagerial Personnel of the Company. Additional information about Mr Ganguly and aresolution proposing his re-appointment are mentioned in the Notice convening the ensuingAnnual General Meeting of the Company.
On the recommendation of the Nomination and Remuneration Committee the Board ofDirectors at their meeting held on November 1 2018 had appointed Mr Jan Roel van derSluis (DIN No.08276227) a Director of the Company effective from November 1 2018 in thecasual vacancy caused by the resignation of Mr Francois Clement Wanecq. Mr van der Sluisa Dutch national is an Engineer and is presently President-Flow Control of the VesuviusGroup. Prior to this appointment in October 2017 Mr van der Sluis worked 6 years asPresident of Vesuvius China and North Asia. He now operates from Belgium. Mr van der Sluisjoined Foseco in 1997 as Marketing Director EMEA and held several executive functions withFoseco in different locations. Post-merger of Foseco with Vesuvius he joined the VesuviusGroup. Mr van der Sluis is not a Director of any other company in India and is not amember of any Committee in India. He does not hold any shares of the Company. The Board ofDirectors are of the opinion that Mr van der Sluis fulfils all the criteria specified inthe Companies Act 2013 and rules thereon and all the requirements of SEBI (LODR) makinghim eligible to be appointed a Director of the Company and also feel that the presence ofthe President-Flow Control on the Board of the Company would bring immense benefits to theIndian management and operations. Additional information about Mr van der Sluis and aresolution proposing his appointment are mentioned in the Notice convening the ensuingAnnual General Meeting of the Company.
Mr Ritesh Dungarwal (DIN No. 08136275) was appointed Managing Director of the Companyat the Board meeting held on December 19 2018 subject to the approval of the Membersfor a period of five years effective from January 1 2019. He is a Mechanical Engineer andholds a Master's degree in Aerospace Engineering from IIT Mumbai and an Executive MBA fromKelly School of Business Indiana University USA. Prior to joining Vesuvius India heheld key positions across various functions including engineering strategy salesdistribution and operation with Cummins for more than 15 years where in his last role hewas India Business Country Leader for Cummins Turbo Technologies. His appointment has beenrecommended by the Nomination and Remuneration Committee and the Board of Directors arealso of the opinion that Mr Dungarwal fulfils all the criteria specified in the CompaniesAct 2013 and rules thereon and all the requirements of SEBI (LODR) making him eligible tobe appointed Managing Director of the Company. Mr Dungarwal does not hold any shares inthe Company nor is he a Director of any other company. From January 1 2019 Mr Dungarwalis a member of the Corporate Social Responsibility Committee and the Share Transfer andStakeholders Grievance & Relationship Committee of the Company and in no otherCommittees.
An Agreement dated January 1 2019 has been executed between the Company and Mr RiteshDungarwal setting out the terms and remuneration payable to him subject to the limitprescribed in section 197 read with Schedule V of the Companies Act 2013. Additionalinformation about Mr Dungarwal and his remuneration and resolutions proposing hisappointment as Managing Director are mentioned in the Notice convening the ensuing AnnualGeneral Meeting of the Company.
After four years of dedicated service Mr Subrata Roy has stepped down as the ManagingDirector of Vesuvius India to pursue new responsibilities within the Vesuvius Group. TheBoard records its appreciation of the contributions and services rendered by Mr SubrataRoy during his term as Managing Director.
Mr Sudipto Sarkar had been appointed Independent Director of the Company for a periodof five consecutive years from April 29 2014 and his term of office as an IndependentDirector will cease on April 28 2019. Mr Sarkar is a renowned Barrister and holds B.Sc.(Maths- Hons) from Presidency College Kolkata; BA (Law Tripos) from Jesus CollegeCambridge UK; LL.M (International Law) from Jesus College Cambridge UK; M.A. (Law)from Jesus College Cambridge UK. He is also Barrister Gray's Inn London and AssociateMember 6 Pump Court Middle Temple London. He is presently practicing as a SeniorAdvocate. He was formerly a Director of Bombay Stock Exchange Limited and JSW SteelsLimited. The Board of Directors on the recommendation of the Nomination and RemunerationCommittee have recommended the re-appointment of Mr Sarkar as an Independent Director fora further period of five consecutive years from April 29 2019 as they feel that MrSarkar's contribution to the Board as an eminent Barrister would be of great benefit tothe management and the Company. The Board of Directors are also of the opinion that MrSarkar fulfils all the criteria specified in the Companies Act 2013 and rules thereon andall the requirements of SEBI (LODR) making him eligible to be appointed IndependentDirector of the Company for a further term. Mr Sarkar does not hold any shares in theCompany. Additional information about Mr Sudipto Sarkar his directorships and Committeememberships in other companies and a special resolution proposing his reappointment asIndependent Director are mentioned in the Notice convening the ensuing Annual GeneralMeeting of the Company.
Mr Biswadip Gupta Mr Sudipto Sarkar and Miss Nayantara Palchoudhuri IndependentDirectors of the Company had a separate meeting on November 1 2018 to conduct anevaluation of the performance of Independent Directors individual directors the Boardand its Committees and assess the quality quantity and timeliness of flow of informationfrom the Company management to the Directors as well as an oversight of successionplanning risk management internal controls and prioritization of strategic objectivesand Board efficiency. The Board also conducted a similar evaluation exercise. Mr SudiptoSarkar and Miss Nayantara Palchoudhuri met separately to evaluate and review theperformance of the Chairman. The evaluation concluded that the Board remained of highcaliber and was functioning well with open and challenging debate and transparentinformation flow and continued to deliver robust challenge to management of financialmatters and helped guide the management through disruptions brought in by Insolvency andBankruptcy Code and economic upheavals to the steel industry. The Directors have receivedbriefings and updates on key financial legal and governance issues impacting theorganization and have furthered their knowledge and familiarisation by undertaking visitsto the Visakhapatnam plants. The Independent Directors have ensured governance and goodconduct adherence to laws mitigating risks and growth. Assessment of individualDirectors concluded that they contributed effectively and proactively in debates at allmeeting and devoted adequate time. Committees have also operated effectively with theNomination and Remuneration Committee effectively overseeing successful transitions andthe Audit Committee in reviewing the effectiveness of internal controls includingfinancial operations and compliance controls and risk management systems.
The Independent Directors have confirmed and declared that they are not disqualified toact as an independent director in compliance with the provisions of section 149 of theCompanies Act 2013 and the Board is also of the opinion that the Independent Directorsfulfill the independence criteria and all the conditions specified in the Companies Act2013 and SEBI (LODR) making them eligible to act as Independent Directors.
All Directors Key Managerial Personnel and senior management of the Company haveconfirmed compliance with the Code of Conduct applicable to the Directors and employees ofthe Company and the declaration in this regard made by the Managing Director is attachedas Annexure IX which forms a part of this Report of the Directors. The Code ofConduct is available on the Company's website www.vesuviusindia.com. All Directorshave confirmed compliance with provisions of section 164 of the Companies Act 2013.
The details of number and dates of meetings held by the Board and its Committeesattendance of Directors and remuneration paid to them is given separately in the attachedCorporate Governance Report (Annexure I) which forms a part of this Report of theDirectors.
Directors' Responsibility Statement
The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of section 134(3) (c) read with section 134(5) of the Companies Act 2013 andprovisions of SEBI (LODR) and in the preparation of the annual accounts for the year endedon December 31 2018 and state that :
a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;
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 the end of the financial year and ofthe profit of the Company for that
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) there is a proper system to ensure compliance with the provisions of all applicablelaws and that such systems are adequate and operating effectively.
Key Managerial Personnel
The following persons have been appointed as Key Managerial Personnel of the Company incompliance with the provisions of section 203 of the Companies Act 2013:
a) Mr Subrata Roy Managing Director upto 31.12.2018
b) Mr Ritesh Dungarwal Managing Director with effect from 1.1.2019
c) Mr Taposh Roy Company Secretary upto 26.02.2019
d) Mr Vikram Singh Company Secretary with effect from 27.2.2019
e) Mr Sanjoy Dutta Chief Financial Officer
Remuneration and other details of the persons who were the Key Managerial Personnelupto the year ended on December 31 2018 are mentioned in the Extract to the Annual Returnin Form MGT-9 which is attached as Annexure V and forms a part of this Report ofthe Directors.
The Company has in place the SEBI regulations pertaining to Corporate Governance. underRegulation 17(8) read with During the year under consideration the Company had a sevenmember Board of Directors consisting of three independent directors three non-executivedirectors representing the holding company and the Managing Director. under Regulation34(3) read with Part
The non-executive Directors representing the holding company have waived theircommission on profits for the year and have not received any sitting fees for attendingthe meetings of the Directors. The Managing Director does not receive sitting fees forattending the meetings of the Board or any Committee thereof nor any commission onprofits. The sitting fees paid to the Directors are within the limits prescribed under theCompanies Act 2013 and Rules thereon.
The Corporate Governance Report for the year ended on December 31 2018 giving thedetails as required under Regulation 34(3) read with Clause C of Schedule V of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 ["SEBI(LODR)"] is given separately as Annexure I and forms part of this Reportof the Directors. The Corporate Governance Certificate on December 31 2018 issued by MrAnjan Kumar Roy of M/s Anjan Kumar Roy & Co Practicing Company SecretariesSecretarial Auditor of the Company is also attached as Annexure II and forms apart of this Report of the Directors.
The Company has in place an Insider Trading Code for compliance with the Securities andExchange Board of India (Prohibition of Insider Trading) Regulations 2015. The CompanySecretary is the Compliance Officer responsible for compliance with the Insider Tradingprocedures. Details of securities transaction by insiders are placed before the Board ofDirectors of the Company and notified to the Stock Exchanges. The Company Secretary isalso the Nodal Officer for the purpose of compliances relating to Investor Education andProtection Fund.
The Managing Director and the Chief Financial Officer have given their certificatePart B of Schedule II of SEBI (LODR) regarding the annual financial statements for theyear ended on December 31 2018 to the Board of Directors. The Managing Director has Dgiven his certificate of Schedule V of SEBI (LODR) regarding compliance with the Code ofConduct of the Company for the year ended on December 31 2018 which is attached as AnnexureIX and forms a part of this Report of the Directors.
The Audit Committee was constituted on October 24 2000. The Committee as on December31 2018 comprises Mr Biswadip Gupta as Chairman and Mr Tanmay Ganguly Miss NayantaraPalchoudhuri and Mr Sudipto Sarkar as Members. The Company Secretary is the Secretary ofthe Committee. The Managing Director and Chief Financial Officer are permanent invitees tothe meeting. The Internal Audit reports financial statements and details of all relatedparty transactions are placed periodically before the Audit Committee. During the yearthere were no instances where the Board had not accepted the recommendations of the AuditCommittee. The Company has in place a vigil mechanism details of which are available onthe Company's website www.vesuviusindia.com. All persons have been given directaccess to the Chairman of the Audit Committee to lodge their grievances. No personnel havebeen denied access to the Audit Committee to lodge their grievances.
The Audit Committee has also been delegated the responsibility for monitoring andreviewing risk management assessment and minimization procedures implementing andmonitoring the risk management plan and identifying reviewing and mitigating all elementsof risks which the Company may be exposed to.
The details of terms of reference of the Audit Committee number and dates of meetingsheld attendance of the Directors and remuneration paid to them during the year ended onDecember 31 2018 are given separately in the attached Corporate Governance Report.
Corporate Social Responsibility Committee
A Corporate Social Responsibility Committee was constituted on April 29 2014. TheCommittee as on December 31 2018 comprises Mr Biswadip Gupta as Chairman and Mr TanmayGanguly Miss Nayantara Palchoudhuri Mr Subrata Roy and Mr Sudipto Sarkar as Members. MrRitesh Dungarwal has replaced Mr Subrata Roy as a Member of this Committee effective fromJanuary 1 2019. The Managing Director was the Secretary of this Committee upto February26 2019. Effective from February 27 2019 the Company Secretary is the Secretary of thisCommittee.
The Corporate Social Responsibility Policy is available on the Company's website www.vesuviusindia.com
The terms of reference of the Corporate Social Responsibility Committee number anddates of meetings held attendance of the Directors and remuneration paid to them duringthe year ended on December 31 2018 are given separately in the attached CorporateGovernance Report.
The Annual Report on Corporate Social Responsibility is attached as Annexure VIII.The Company believes that CSR projects should be sustainable and with the long termpurpose of improving the quality of living for the less privileged and for increasingsocial assets. The funds should be carefully spent on CSR so that they result in theultimate objectives meted out in the Company's CSR Policy. Meetings have been held withagencies in locations where the Company's factories are located and with those havingpan-India presence to provide CSR support to CSR projects. Employees at customer siteshave also been made aware of opportunities for undertaking CSR projects locally and theirCSR projects are being reviewed. The Company had spent about Rs 44 lakhs on CSR during theyear. The Company is in the process of further increasing its portfolio of projects. Therehas been some delay in execution of CSR projects in the past on account of due diligenceprocess to ensure that the benefit reaches the targeted recipient. However the Companyremains committed and is better prepared to meet its obligations related with CSR spendduring the next financial year 019.
Nomination and Remuneration Committee
A Nomination and Remuneration Committee was constituted on April 29 2014 and themembers as on December 31 2018 are Mr Sudipto Sarkar as Chairman and Mr Biswadip GuptaMr Tanmay Ganguly and Miss Nayantara Palchoudhuri as Members. The Company Secretary is theSecretary of this Committee. The Managing Director is invited to attend all the meetingsof this Committee.
The Company's Remuneration Policy prepared in accordance with section 178 of theCompanies Act 2013 is available on the Company's website www.vesuviusindia.com.The details of terms of reference of the Nomination and Remuneration Committee number anddates of meetings held attendance of the Directors and remuneration paid to them duringthe year ended on December 31 2018 are given separately in the attached CorporateGovernance Report which forms a part of this Report of the Directors.
Share Transfer and Stakeholders Grievance & Relationship Committee
The Share Transfer Committee was constituted on January 1 1993 and was renamed TheShare Transfer and Investor Grievance Committee on February 12 2001. To comply with therequirements of the Companies Act 2013 the name of the Committee was changed to ShareTransfer and Stakeholders Grievance & Relationship Committee effective from April 292014. The Members of the Committee as on December 31 2018 are Mr Biswadip Gupta asChairman Mr Tanmay Ganguly Miss Nayantara Palchoudhuri Mr Subrata Roy and Mr SudiptoSarkar as Members. Mr Ritesh Dungarwal has replaced Mr Subrata Roy as a Member of thisCommittee effective from January 1 2019. The Company Secretary is the Secretary of thisCommittee. The Committee has delegated the responsibility for share transfers and otherroutine share maintenance work to the Company Secretary and to M/s C B Management Services(P) Ltd the Registrars and Share Transfer Agents of the Company. All valid requests fordematerialisation and rematerialisation of shares transfer or transmission of shares andother share maintenance matters are completed within 15 days of receipt of valid andcomplete documents. Minutes of the Committee meetings are circulated to all Directors anddiscussed at the Board meetings. The Committee also reports to the Board on mattersrelating to the shareholding pattern shareholding of major shareholders insider tradingcompliances movement of share prices redressal of complaints reports on SCORES of SEBIreports and certificates from
Secretarial Auditor and quarterly submissions to the stock exchanges electronicfilings with Ministry of Corporate
Affairs compliances related to Investor Education and Protection Fund and all othercompliances under the
Companies Act 2013 and SEBI (LODR). Details of the number and dates of meetings ofthis Committee which were held during the year ended on December 31 2018 attendance ofthe Directors and remuneration paid to them are given separately in the attached CorporateGovernance Report.
The shares of the Company are listed on the Bombay and National Stock Exchange. TheCompany's shares are compulsorily traded in the dematerialized form. The ISIN numberallotted is INE 386A01015. The details of shareholding pattern distribution ofshareholding and share prices are mentioned separately in the attached CorporateGovernance Report. Only 300070 shares i.e. 1.48% of share capital are held in physicalmode by 2087 Shareholders as on December 31 2018.
An application for delisting of the shares of the Company from BSE Limited had beenmade in May 2016 but delisting has not been completed by BSE Limited.
Investor Education and Protection Fund
A sum of Rs 463364/- being the dividend lying unclaimed for seven consecutive yearsout of the fourteenth dividend declared by the Company for the year ended on December 312010 at the Annual General Meeting held on April 19 2011 was transferred to the InvestorEducation and Protection Fund of the Central Government in June 2018 after giving severalnotices and reminders to the concerned shareholders.
Dividend which remains unclaimed out of the fifteenth dividend declared by the Companyfor the year ended on December 31 2011 at the Annual General Meeting held on April 262012 will be transferred to the Investor Education and Protection Fund ("IEPF")of the Central Government byJune 2019 pursuant to the provisions of section 124 and 125of the Companies Act 2013. Thereafter no claim shall lie on the Company for theseunclaimed dividend. Shareholders will have to make their claims with the IEPF Authorityfollowing the appropriate rules in this regard. Individual notices have already been sentto the shareholders concerned on January 16 2019.
5994 Equity shares in respect of 35 folios corresponding to the dividend for the yearended on December 31 2010 which remained unclaimed for seven consecutive years has alsobeen transferred to the IEPF Authority in compliance with Section 124 of the CompaniesAct 2013 read with rule 6 of the Investor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2017 after giving individual notices to concernedShareholders and advertisements in newspapers.
Equity Shares corresponding to the dividend declared for the year ended on December 312011 and remaining unclaimed for seven consecutive years will also be transferred to theIEPF if the dividend is not encashed within May 29 2019. Individual notices datedFebruary 14 2019 have been sent to the concerned Shareholders and advertisements made inthe newspapers on February 20 2019 in this regard. The advertisement is available on thewebsite of the Company.
Notices dated January 16 2019 have also been sent to all Shareholders concernedreminding them to encash their unclaimed dividend.
List of Shareholders whose dividend remain unclaimed till date of Annual GeneralMeeting held on April 10 2018 have been uploaded in the website of the Company www.vesuviusindia.comunder heading "Investor Information" => "Dividend&Disclosures". Shareholders are requested to check their unclaimed dividend fromthis list and contact the Registrars and Share Transfer Agents to encash these unclaimeddividends.
Messrs Price Waterhouse Chartered Accountants LLP (Firm Registration No : 012754N /N500016) Auditors of the Company have submitted their Independent Auditors Report on thefinancial statements of the Company for the year ended on December 31 2018 and they havemade no qualification reservation or adverse remark or disclaimer in their Report.Ratification of their appointment every year is no more required pursuant to the revisedprovisions of Section 139 of the Companies Act 2013. The Auditors have confirmed thatthey comply with all the requirements and criteria are otherwise qualified to continue toact as Auditors of the Company. No frauds have been reported by the Auditors under section143(12) of the Companies Act 2013.
Secretarial Audit as required under section 204 of the Companies Act 2013 andregulation 24A of SEBI (LODR) was conducted by the Secretarial Auditor Mr Anjan KumarRoy FCS of M/s Anjan Kumar Roy & Co. Practicing Company Secretaries in accordancewith the provisions of section 204 of the Companies Act 2013. The Secretarial AuditReport is attached as Annexure III and the Secretarial Compliance Report isattached as Annexure IV and these form a part of this Report of the Directors.There are no qualifications or observations or adverse remarks made the SecretarialAuditor in his Reports.
M/s Jithendra Kumar & Co Cost Accountants had been appointed the Cost Auditors ofthe Company for the financial years ended on December 31 2017 and December 31 2018 atthe Board meeting held on February 15 2018 and for the financial year ended on December31 2019 at the Board meeting held on February 27 2019. The Cost Audit Report for thefinancial year ended on December 31 2017 has been submitted to the Ministry of CorporateAffairs on May 29 2018 and the Cost Audit Report for the financial year ended on December31 2018 will be submitted within June 2019. The remuneration payable to the Cost Auditorsis required to be approved by the Members of the Company hence an appropriate resolutionfor approval of the remuneration of the Cost Auditors has been proposed in the Noticeconvening the ensuing Annual General Meeting. Maintenance of cost records as specifiedunder section 148 of the Companies Act 2013 is required by the Company and accordinglysuch accounts and records are made and maintained.
The Company has not accepted any deposits from the public and as such there are nooutstanding deposits in terms of the Companies (Acceptance of Deposits) Rules 2014.
Loans guarantees and investments
It is the Company's policy not to give loans directly or indirectly to any person(other than to employees under contractual obligations) or to other body corporates orgive any guarantee or provide any security in connection with a loan to any other bodycorporate or person. The Company also does not make any investment in securities of anyother body corporate. The Company has not taken or given any loan or advances in thenature of loan to its holding company. The Company has no investments.
Information pursuant to section 134(3) of the Companies Act 2013
Related Party Transactions : Vesuvius plc is the ultimate holding company ofthe Company and therefore all subsidiaries of Vesuvius plc are treated as related partiesof the Company. Such related party transactions including those with the holding companyand chain holding companies who hold 55.57% shares of the Company which have been heldduring the current year and the previous year are mentioned in the Annual Report inaccordance with the Indian Accounting Standards 24 on Related Party Disclosures notifiedby the Companies (Indian Accounting Standards) Rules 2015 as amended and are notrepeated in this Report of the Directors. All these related party transactions are in theordinary course of business and are at arm's length and hence the restrictive provisionsof section 188(1) are not attracted to these transactions.
In compliance with the provisions of Regulation 34(3) read with Schedule V(A) of SEBI(LODR) read with section 134(3)(h) it is confirmed that no loans or advances in the natureof loans have been received or paid to the holding company or any associate company or anyDirector or to any firms or companies in which a director is interested and no investmentshave been made in the shares of the parent / holding companies or any of its subsidiaries.The Company does not have any subsidiaries. The Company has no investments. The prescribedForm AOC-2 is therefore not applicable to the Company.
There were no material changes and commitments affecting the financial position of theCompany occurring between December 31 2018 and the date of this Report of the Directors.The prescribed particulars of Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo required under section 134(3)(m) read with Rule 8(3) of theCompanies (Accounts) Rules 2014 is attached as Annexure VI and forms a part ofthis Report of the Directors.
The prescribed particulars of Employees required under section 134(3)(q) read with Rule5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isattached as Annexure VII and forms a part of this Report of the Directors.
The Annual Return for the year ended December 31 2017 which was electronically filedwith the Ministry of Corporate Affairs on April 26 2018 is available on the website ofthe Company www.vesuviusindia.com under heading "Investor Information =>Dividend & Disclosures."
Prevention of Sexual Harassment
In compliance with The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 the Company had constituted a Prevention of Sexual HarassmentCommittee with three employees and a reputed NGO representative and Miss NayantaraPalchoudhuri Director as an Adviser to the Committee. The Prevention of SexualHarassment Policy is available on the Company's website www.vesuviusindia.com. Allemployees specially women employees were made aware of the Policy and the manner inwhich complaints could be lodged. The Committee submitted their fourth Annual Report whichhas been received and approved by the Board.
The following is reported pursuant to section 22 of The Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 and regulation 34(3) read withsub-clause 10(l) of Clause C of Schedule V of SEBI (LODR) :
a. Number of complaints of sexual harassment received/ filed during the yea r : Nil
b. Number of complaints disposed off during the year : Nil
c. Number of complaints pending for more than ninety days : Nil
d. Number of complaints pending as on end of financial year : Nil
e. Number of workshops or awareness programmes against sexual harassment carried out :One
f. Nature of action taken by the employer or District Officer : Not Applicable
Business Responsibility Report
The Business Responsibility Report was not applicable for the Company for the financialyear ended on December 31 2018 and hence no such report is submitted.
Annexures forming a part of this Report of the Directors
The Annexures referred to in this Report and other information which are required to bedisclosed are annexed herewith and form a part of this Report of the Directors :
|Annexure ||Particulars |
|I ||Corporate Governance Report |
|II ||Certificate on Corporate Governance |
|III ||Secretarial Audit Report |
|IV ||Secretarial Compliance Report |
|V ||Extract of the Annual Return in Form MGT-9 |
|VI ||Prescribed particulars of Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo |
|VII ||Particulars of Employees |
|VIII ||Annual Report on Corporate Social Responsibility |
|IX ||Managing Director's Certificate on compliance of Code of Conduct |
The following Policies of the Company are available on the Company's website www.vesuviusindia.comunder the heading Investor "Information=>Policies & Disclosures" andwhile framing these Policies all the requirements and criteria prescribed under theCompanies Act 2013 and SEBI (LODR) have been considered
a) Remuneration Policy
b) Corporate Social Responsibility Policy
c) Terms and conditions of Appointment of Independent Director
d) Related Party Transactions Policy
e) Speak Up and Incident Reporting (Whistle Blowing) Policy
f) Dividend Distribution Policy
g) Policy on Preservation of Documents
h) Anti-Bribery and Corruption Policy
i) Risk Management Policy
j) Insider Trading Code
k) Insider Trading Code for Fair Disclosure
l) Quality Policy
m) Health Safety & Environment Policy
n) Code of Conduct
o) CORE values and Behaviours
Human Resources Management & Health Safety and Environment
Vesuvius has various programmes on a continuous basis to train employees to provideprofessional skills to them for better talent management and development needs of theorganization as well as to develop mid-level managers apart from its key areas of focuswhich are to ensure leadership bench-strength and managing succession.
CORE Values and Behaviours was launched in 2018 - 8 Leadership team members attendedthe communication at time of launch. These Values have been rolled out and communicated invarious communication forums to employees.
The Company strictly adheres to the prescribed norms and practices regarding healthsafety and environment.
The Company had 439 employees as on December 31 2018. The continuous leadership andtechnical training courses in India and abroad give employees the opportunity to improvetheir skills maximize personal potential and develop careers within the Company and theGroup while adhering to Vesuvius values. All management staff of the Company haveundergone training on Anti-Bribery and Anti-Corruption Policy of the Company.
Your Directors record their sincere appreciation of the dedication and commitment ofall employees in achieving and sustaining excellence in all areas of the business. YourDirectors thank the Shareholders customers suppliers and bankers and other stakeholdersfor their continuous support to the Company.
| ||For and on behalf of the Board of Directors |
| ||Vesuvius India Limited |
| ||Biswadip Gupta |
|Place: Kolkata ||Chairman |
|Date: February 27 2019 ||(DIN : 00048258) |