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To the Members,
Your Companys Directors have pleasure in presenting the Boards Report along with the Audited Financial Statements for the Financial Year ended March 31,2019.
Review of Operations
Your Companys performance during the Financial Year as compared with that during the previous Financial Year is summarized below:
|Year Ended March 31||Year Ended March 31|
|Revenue from Operations||2,143.99||1,986.32|
|Total Expenditure other than Finance Costs and Depreciation and Amortisation||1,738.90||1,749.51|
|Profit before Finance Costs, Depreciation and Amortisation and Tax||203.09||537.89|
|Depreciation and Amortisation Expense||54.30||68.58|
|Profit before Finance Costs and Tax||148.79||469.31|
|Finance Costs (net)||239.59||212.43|
|(Loss)/Profit before Tax||(90.80)||256.88|
|Provision for Current Tax||-||13.60|
|Provision for Deferred Tax||(0.07)||1.77|
|Other comprehensive income net of Tax||(0.60)||(0.28)|
|Surplus brought forward||723.10||541.87|
|Profit after Tax available for appropriation||631.77||783.10|
|Dividend on Equity Shares||58.87||58.85|
|Tax on Distributed Profit||1.78||1.15|
|Transfer to General Reserve||-||-|
|Surplus Carried Forward||571.12||723.10|
The Paid-up Equity Share Capital as on March 31, 2019 was र33,63,84,367/- (Rupees Thirty Three Crore Sixty Three Lakh Eighty Four Thousand Three Hundred Sixty Seven Only) divided into 33,63,84,367 (Thirty Three Crore Sixty Three Lakh Eighty Four Thousand Three Hundred Sixty Seven) Equity Shares of Face Value of र1/- (Rupee One Only) each. During the Financial Year under review, your Company has allotted 1,11,636 (One Lakh Eleven Thousand Six Hundred and Thirty Six) Equity Shares of Face Value of र1/- (Rupee One Only) each pursuant to exercise of Options by the employees under Godrej Industries Limited- Employee Stock Grant Scheme, 2011 (ESGS 2011).
The Board of Directors of your Company recommend a Final Dividend for the Financial Year 2018-19 at the rate of 1.15 (Rupee One Paise Fifteen Only) per Equity Share of Face Value of र1/- (Rupee One Only) each, subject to approval of the Members at the ensuing 31st (Thirty First) Annual General Meeting.
The Dividend will be paid to the Members whose names appear in the Register of Members of the Company as on Tuesday, August 6, 2019 and in respect of shares held in dematerialised form, it will be paid to Members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as the beneficial owners as on that date.
In terms of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the Dividend Distribution Policy of the Company is appended as Annexure A to this Report and the same is also made available on the website of the Company. The same can be accessed on http://www.godreiindustries.com/listing-compliance.aspx
Industry Structure and Development
As per The World Economic Outlook (WEO) update, global growth is now estimated to be at 3.6 percent in 2018 due to slowdown in the second half of 2018. This has led to downward revisions for several economies. The global economy is projected to grow at 3.3 percent in 2019 and 3.6 percent in 2020.
Growth in advanced economies is projected to slow from an estimated 2.2 percent in 2018 to 1.8 percent in 2019 and 1.7 percent in 2020. For the emerging markets and developing economy group, growth is expected to tick down to 4.4 percent in 2019 (from 4.5 percent in 2018), before improving to 4.8 percent in 2020.
The IMF estimates Indias economic growth at 7.1% in FY19, 7.3% in FY20 and 7.5% in FY21. According to the IMFs database, Indias contribution to world growth has risen from 7.6% during 2000-2008 to 14.5% in 2018.
The Indian economy decelerated at a faster pace than anticipated in Q3 FY19 to 6.6% the lowest in five quarters. The Central Statistics Office (CSO) also revised downward its full-year growth forecast for the current fiscal year to 7% from 7.2% estimated earlier. However, most international agencies project Indias growth to bounce back in the next fiscal year. According to rating agency Moodys, Indian economy is expected to grow at 7.3 per cent in fiscal year 2018-19.
With the Indian economy projected to slow down further in the fourth quarter of FY19, the central banks focus has shifted from inflationary concerns to sustaining the growth momentum. RBI effected two back- to-back rate cuts of 25 basis points each to boost growth. Of the high-frequency indicators of industry, growth in the manufacturing component of the index of industrial production slowed to 1.3% in January 2019. Growth of eight core industries remained sluggish at 2.1% in February 2019. Overall investment demand, as reflected by gross fixed capital formation, showed an improvement due to continuing government capital expenditure in roadways and affordable housing.
Financial Year 2018-19 was a tough year for the agriculture sector. Overall monsoon was lower than normal being 9% lower than long period average (LPA-measured for the trailing 10 year period) and the rainfall distribution was erratic and patchy. Nearly 38% of the districts of the country reported deficient rainfall and states of Gujarat, Maharashtra, West Bengal, Jharkhand, were the worst hit.
Agriculture sector has also been focus of the Government as multiple measures were announced in interim budget with a purpose of boosting farmer income. Budget aimed at bringing stability to farm incomes and provide relief to small farmers. Under major Agriculture and rural schemes an amount of around र1.2 trillion has been allocated and an additional र1.6 trillion has been allocated for agriculture and animal husbandry sector. Increase in allocation over last year is mainly due to the allocation made for Income support scheme amounting to र75,000 crore. These schemes and measures if implemented well, can bring lot of benefits to farmers and agriculture economy in the long run.
Demand for home & personal care looks robust and is driven by domestic consumption. Surfactants and specialty chemicals which is used by this segment is growing at healthy rate. Commodity fatty acid demand is majorly driven by automobile industry which is showing signs of slowdown for the last three to six months. However specialty fatty acid demands looks good and is growing. Glycerin demand looks healthy and its growth is driven by domestic consumption.
Real estate is a key sector of the Indian economy, contributing 6-7 per cent of Indias GDP. In addition, the sector employs a 52 million workforce and is expected to generate over 15 million jobs over the next five years. According to the survey conducted by KPMG in association with National Real Estate Development Council (NAREDCO) and Asia Pacific Real Estate Association (APREA), the Indian real estate sector is estimated to grow to USD 650 billion by 2025 and surpass USD 850 billion by 2028 to touch USD 1 trillion by 2030, becoming the third largest globally. Regulatory reforms, steady demand generated through rapid urbanization, rising household income and the emergence of affordable housing and nuclear housing are expected to be key drivers of growth for the real estate sector.
Central Budget announcements indicate the governments changing stand towards investment demand in real estate. Steps taken to increase flexibility on deployment of capital gains from property, increasing tax exemption period for unsold inventory and exemption from notional rent tax on second property are focused towards improving real estate investment demand. For affordable housing, the government has extended the time limit for availing tax deduction by one year.
In March 2019, GST council approved lower GST rates for real estate developers subject to certain terms and conditions. Affordable houses being constructed in ongoing projects under the existing central and state housing schemes presently eligible for concessional rate of 8% GST will be taxed at 1% GST. 5% GST will also be applicable on commercial apartments such as shops, offices etc. in a residential real estate project in which the carpet area of commercial apartments is not more than 15% of total carpet area of all apartments.
With NBFCs restraining their lending to cash strapped developers, there exists a huge opportunity for organized developers with strong balance sheets and execution track record to take over the projects of smaller developers at attractive valuations. The ongoing shake up in real estate sector is a pre-cursor to a transparent business environment driven by reforms such as RERA which is improving transparency and raising consumer activism on account of poor delivery by stressed developers. According to a CLSA report, the exit of weaker players will benefit will help organized developers to double their market share to 20% by FY24.
The Management Discussion and Analysis Report on the operations of the Company, as required under the Listing Regulations is appended as Annexure B to this Report.
Subsidiary and Associate Companies Godrej Agrovet Limited (GAVL)
Financial Year 2018-19 was a tough year for the agriculture sector. Overall monsoon was lower than normal, being 9% lower than the long period average rainfall (LPA-measured for the trailing 10 year period) and the rainfall distribution was erratic and patchy. Further, as per the latest estimates, agriculture and allied activities are estimated to have grown at a lower rate of 2.9% in 2018-19 as compared to 5% in the previous year.
Despite a difficult environment, Godrej Agrovet Limited, has been able to grow revenues and maintain profitability levels. For the Financial Year 2018-19, consolidated total income (excluding non-recurring income) grew by 12.6%. Revenue growth was supported by animal feed, vegetable oil and crop protection businesses. Profit before tax excluding non-recurring and exceptional items was र361 crore.
The profitability was impacted by high raw material prices, mainly in the animal feed segment.
For the Financial Year 2018-19, the animal feed segment achieved overall volume growth of around 14.2% largely anchored by volume growth in the layer feed segment. After arresting broiler feed volume de-growth in the previous year, this segment was successful in growing in double digits. Volume growth
and better price realisation in the second half of the year in the animal feed segment, led to a revenue growth of 18.3%. However, segment margins were adversely impacted by sharp increase in the prices of key raw materials such as maize, soybean, rice bran extraction, fish meal etc. The animal feed segment is focused on optimizing capital employed. Godrej Agrovet Limiteds joint venture with Advanced Chemical Industries Limited (ACI), Bangladesh, named ACI Godrej Agrovet Private Limited was adversely impacted by lower demand for feed and higher raw material prices in Bangladesh.
Crop Protection Business:
Financial Year 2018-19 was a relatively difficult year for the domestic crop protection business. The business posted revenue growth of 7.5% and profit growth of 12.4%. The business introduced products across categories with the objective of increasing the product offering.
In the vegetable oil segment, GAVL benefitted from increase in prices of crude palm oil which helped in increasing the revenues by 16%. The profitability was adversely impacted due to higher procurement prices being paid for Fresh Fruit Bunches (FFB) to the farmers to avoid spillover to the neighbouring state. New palm oil mill which was being set up in Chintampally, Andhra Pradesh, has become operational in the third quarter of current year and is expected to improve oil extraction ratio in the medium-term.
Astec LifeSciences Limited (Astec) & its Subsidiaries:
GAVLs subsidiary, Astec LifeSciences Limited, maintained its strong performance for the Financial Year 2018-19 as total income and profit before tax excluding exceptional items grew by 16.7% and 8.4%, respectively. Astec has successfully commissioned the backward integration plant in December 2018 which will help reduce its dependence on import of raw materials.
Creamline Dairy Products Limited (CDPL) & its Subsidiary:
In the dairy segment, GAVLs subsidiary-Creamline Dairy Products Limited launched new products in the Financial Year 2018-19 with the purpose of increasing product offering. New product launches included products like thick milk shakes in different flavours, premium range of ice-creams and yogurts in different flavours. All the new products have received encouraging response from consumers. While revenues were flat at र1161 crore in the Financial Year 2018-19, operating profitability improved by 21.5% in the current fiscal.
Joint Ventures (JVs) & Associates of GAVL:
Godrej Tyson Foods Limited:
In the Joint Venture Godrej Tyson Foods Ltd (GTFL), GAVL has increased its stake to 51% in March 2019. Tyson India Holdings Limited, a subsidiary of Tyson Foods Inc., U.S.A, currently holds 49% stake in GTFL. During the year, the business focussed on increasing the product portfolio in the Yummiez रproduct range and on growing the live bird business. As a result, GTFLs total income grew by 12.6% for the Financial Year 2018-19. However, operating margins were impacted by sharp increase in raw material prices compared to the previous year.
Godrej Maxximilk Private Limited:
GAVL has also increased its stake in Godrej Maxximilk Private Limited by acquiring an additional 2.16% of the Paid-up Equity Share Capital in March 2019. GAVL now holds 52.06% in Godrej Maxximilk Private Limited. Godrej Maxximilk Private Limited is engaged in in-vitro production of high-quality cows that aid dairy farmers in producing top-quality milk, thereby increasing their yield by a significant proportion.
Godrej Properties Limited (GPL)
Financial Highlights: For FY19, GPLs total income increased by 57% and stood at र3,236 crore, EBITDA increased by 111% to र597 crore, and net profit increased by 191% to र253 crore.
Sales Highlights: After posting the best ever sales performance in FY19, GPL started FY19 on a subdued note with bookings of र1,627 crore in H1 FY19. However H2 FY19 witnessed a complete turnaround in sales performance with bookings of र3,689 crore. This included the best ever quarterly residential sales performance in Q4 FY19 where the company sold real estate worth र2,161 crore. The total value of bookings in FY19 stood at र5,316 crore, which represents a YoY increase of 5%. GPL sold more than 1.1 million sq. ft. with a booking value of over र900 crore in each of the four focus markets viz. Mumbai, NCR, Bangalore and Pune. As a result, GPL is likely to emerge as the largest publicly listed developer in India by sales value in FY19. Given our exciting launch pipeline, the company remains confident of maintaining momentum in the sales performance in the year ahead.
Continued success in business development:
FY19 has also been the best ever year for business development in the history of GPL in terms of area added under development. GPL added 11 new projects with saleable area of 31 million sq. ft. This includes a portfolio deal of 25 million sq. ft. in the Pune market which has been GPLs largest ever deal and will dramatically enhance its presence in the Pune market. The availability of funds through private placement and low gearing ratio of 0.87 also give GPL an outstanding opportunity to disproportionately scale their project portfolio in FY20 and further build on the business development momentum.
Capital Raising: GPL raised र1,000 crore through a preferential allotment in June 2018. The company allotted 1,27,65,000 equity shares of र5 each to Gamnat Pte. Ltd., a GIC managed investment firm for र783.50/- per share. Post issue, Gamnat holds 5.57% equity stake in GPL.
This is a clear demonstration of the companys ability to successfully raise capital in tough macroeconomic conditions for the real estate sector. The company has used the proceeds to fund exciting growth opportunities across Indias leading real estate markets.
Global recognition for sustainability initiatives:
GPL was ranked 4th in Asia & 8th globally by GRESB (Global Real Estate Sustainability Benchmark)-An industry-driven organization which assesses Environmental, Social and Governance (ESG) performance of real estate assets globally. GRESB is committed to rigorous and independent evaluation of the sustainability performance of real assets across the globe. GRESB data is used by more than 200 institutional investors, listed property companies and fund managers and is backed by all leading international real estate associations and industry bodies. It provides investors the tools to benchmark their investments against each other based on property type, country and regional peer groups. GRESB is widely recognized as the global standard for portfolio-level ESG reporting and benchmarking in the real asset sector.
Outlook: After a year of disruptions, the Indian economy is consolidating the gains from recent reforms. Never in the history of Indian real estate have so many significant events taken place within such a short period of time. While the initial days of the new regulatory environment saw Indian real estate going through a phase of transition, we now see an opportunity for disproportionate growth. The sales performance has strengthened significantly in H2 FY19. The company expects to further scale the sales momentum in FY20, given the exciting launch pipeline across the country which has been significantly enhanced by new project additions. Given the liquidity situation in the sector, which has become even more apparent in light of the NBFC crisis, the visibility on business development is the strongest ever witnessed and the company hopes to have numerous positive portfolio enhancement announcements in the coming Financial Year. GPL believe the companys national presence, strong brand, and robust project portfolio leave them well placed to capitalize on this opportunity.
Natures Basket Limited (NBL)
Natures Basket Limited recorded a revenue of 365 Cr for the Financial Year 2018-19, with a sales growth of 20% over the previous year. The brand continues to win awards in forums like Food & Grocery forum, Franchise India Retail Award for Omni Chanel performance, TRRAIN awards for Customer service etc.
NBLs overall customer base increased by over 18% in the current year and also the frequency of the most loyal customers increased by over 4%. Overall revenue from loyal customers contribute nearly 80% of overall revenue. We have seen 72% positive response in our customer surveys in the past Nine months. The online business clocked a sale of र17.4 Cr in FY 19. It contributed to 6% of the overall sales. NBL continues to improve its website and App experience through regular updates and improvements.
Godrej Consumer Products Limited
Godrej Consumer Products (GCPL), an associate of your Company, has continued to grow ahead of the overall FMCG sector, as well as the home and personal care categories that it participates in, despite a challenging macroeconomic environment. On a consolidated basis, GCPL reported total sales of र10,221 crore during fiscal year 2018-19 as compared to र9,866 crore in the previous year. Its net profit for fiscal year 2018-19 grew by 43% at र2,342 crore as compared to र1,634 crore in fiscal year 2017-18.
GCPL is a leading emerging markets company. As part of the over 122-year young Godrej Group, GCPL is fortunate to have a proud legacy built on the strong values of trust, integrity and respect for others. At the same time, we are growing fast and have exciting, ambitious aspirations.
Today, our Group enjoys the patronage of 1.15 billion consumers globally, across different businesses. In line with our 3 by 3 approach to international expansion at Godrej Consumer Products, we are building a presence in 3 emerging markets (Asia, Africa, Latin America) across 3 categories (home care, personal care, hair care). GCPL ranks among the largest household insecticide and hair care players in emerging markets. In household insecticides, GCPL is the leader in India and Indonesia and are expanding its footprint in Africa. GCPL is also a leader in serving the hair care needs of women of African descent, the number one player in hair colour in India and Sub-Saharan Africa, and among the leading players in Latin America. GCPL ranks number two in soaps in India, are the number one player in air fresheners in India and Indonesia, and a leader in wet tissues in Indonesia.
But for us, it is very important that besides our strong financial performance and innovative, much-loved products, we remain a good company. GCPL is also bringing together our passion and purpose to make a difference through our Good & Green रapproach to create a more inclusive and greener India.
At the heart of all of this, is our talented team. GCPL takes much pride in fostering an inspiring workplace, with an agile and high-performance culture. GCPL is also deeply committed to recognising and valuing diversity across our teams.
Godrej International Limited (GINL) is incorporated in the Isle of Man and is a wholly owned subsidiary of your Company.
Godrej International Trading & Investments Pte. Ltd. (GITI) is registered and located in Singapore and trades in palm and soya oil as well as in by products.
The year 2018-19 was marked by substantial increase in production of vegetable oils, led by palm oil. As stocks built up, prices came under severe pressure from September 2018 onwards and that pressure only lifted marginally towards January 2019. Despite larger production and consumption of palm bio diesel, prices were soft for most of the year. This helped margins at processors and consumers of vegetable oil but hit margins of producers and traders. Despite these adverse factors, both GINL and GITI held their own and improved profits marginally. GINL & GITI also continued to enjoy a high reputation in the industry for their market research and their frequent Market Outlook releases.
Ensemble Holdings & Finance Limited (EHFL), a wholly owned subsidiary of your Company, is a Non-Banking Finance Company. The total income of EHFL for FY19 was र2.22 crore as compared to र0.62 crore in the previous year
The Net Debt Position at the end of the Financial Year stands at र2,679 crore as compared to र2,629 crore for the previous year. The Net debt equity ratio is 1.64 as compared to 1.47 in the previous year. Your Company continues to hold the topmost rating of [ICRA] A1+ from ICRA for its commercial paper program (र1000 crore) (previous year र1000 crore). ICRA has reaffirmed an [ICRA] A1+ rating for its short term debt instruments/other banking facilities (र800 crore) (previous year र800 crore). This rating of ICRA represents highest-credit quality carrying lowest- credit risk. ICRA also reaffirmed [ICRA] AA rating with stable outlook for long-term debt, working capital and other banking facilities ( र1340 crore) (previous year र1340 crore). In addition to the ICRAs rating for commercial paper programme, CRISIL has also assigned a rating of "CRISIL A1+" to the commercial paper programme of र1000 crore. Instruments with these ratings are considered to have very strong degree of safety regarding timely payment of financial obligations.
Report on Performance and Financial Position of Subsidiary Companies:
Report on Performance and Financial Position of each of the Subsidiaries, Associates, Joint Venture companies in Form AOC-1, forms a part of the consolidated Financial Statments.
Loans, Guarantees & Investments
As required to be reported pursuant to the provisions of Section 186 and Section 134(3)(g) of the Companies Act, 2013, the particulars of loans, guarantees or investments by the Company under the aforesaid provisions during the Financial Year 2018-19 have been provided in the Notes to the Standalone Financial Statements.
Related Party Transactions
In compliance with the Listing Regulations, the Company has a policy on Materiality of Related Party Transactions and dealing with Related Party Transactions (RPT Policy). The RPT Policy can be accessed on the website of the Company, viz. http://www.godreiindustries.com/listing- compliance.aspx.
All Related Party Transactions entered into by your Company during the Financial Year 201819 were on an arms length basis and were in the ordinary course of business. There were no materially significant Related Party Transactions entered into by the Company with Promoters, Directors, Key Managerial Personnel or other related parties which may have a potential conflict with the interest of the Company. Requisite prior approval of the Audit Committee of the Board of Directors was obtained for Related Party Transactions. Therefore, disclosure of Related Party Transactions in Form AOC-2 as per the provisions of Section 134(3)(h) and Section 188 of the Companies Act, 2013 read with the Rule 8(2) of the Companies (Accounts) Rules, 2014 is not applicable. Attention of Members is also drawn to the disclosure of transactions with related parties set out in Note No. 40 of Standalone Financial Statements, forming part of the Annual Report. None of the Directors had any pecuniary relationships or transactions vis-avis the Company. Further, the Company has not entered into any transactions with any person or entity belonging to the promoter/promoter group which hold(s) 10% or more shareholding in the Company during the Financial Year 2018-19.
Your Company has manufacturing units at Ambernath, Valia, Wadala and Dombivali.
Ambernath factory recently certified by all new ISO standard in 2018-19 i.e. ISO 9001:2015 (QMS), ISO 14001:2015 ( EMS) & ISO 45001:2018 (OHSMS). We are first in India and few across globe for getting certified by ISO 45001:2018 (Safety Standard). Recently Ambernath factory is awarded first prize in "Industrial Safety & Health" organized by Directorate of Safety and Health, Government of Maharashtra. Ambernath factory also won Godrej Group 2019 Safety award.
The Valia factory is ISO-9001:2015, ISO 14001:2015 and ISO 18001:2007 cerified. Majority of the finished products are Kosher certified and some are also REACH registered to meet the EU regulation. We are also a member of RSPO (Roundtable for Sustainable Palm Oil).
We are already GMP + B2 certified for Palmitic acid and this year we also got HALAL certification for it. The factory has FDA, FSSAI certification for Glycerin and USP NF certification for fatty alcohol. We are also planning for FDA certification for Sodium Lauryl Sulfate (SLS) Powder which will help us to label our product as per IP/BP/USP. In new product domain, we have started commericial production for Bio God (biosurfactant), Ethyl Hexyl Palmitate and Tridecyl Salicylate.
Vegoils Division (Wadala), is state of art vegetable oil refining facility in Mumbai for manufacturing edible oils and Vanaspati. It is 100 TPD continuous refinery to process vegetable oils like Sunflower oil, Groundnut oil and Vanaspati. Factory is ISO 22000-2005 certified and also possess Kosher and Halal certificate. This Factory also produces and sells Pharmaceutical grade refined Groundnut oil (Arachis oil) to Pharmaceuticals Company for their application. This Factory produces and packs variety of edible oils (Sesame oil, Sunflower oil, Groundnut oil, Ricebran oil, Palmolein oil and Vanaspati) in various pack sizes.
The Dombivali unit has flexibility of producing multiple value added products, mainly fatty esters and amide, used in personal and home care products.
Research and Development (R&D)
During the year under consideration, R&D has continued its quest for the innovation in existing processes/product ranges and also came up with many new concept ingredients majority of which are derived from Oleo sources mainly and have applications in Home, Personal care, Animal Nutrition and Agricultural fields. Some of them are under field trials at external laboratories and research labs. Fatty acids blends for the Fuel lubricity and Polymer applications were designed and further optimized so as to expand the market and applications areas for the fatty acids business.
Parallel to all the above projects, R&D continues its efforts in developing improved and customized specialty surfactants, biosurfactants and home & personal care ingredients and their blends, through inhouse and external consultation routes. The list of new specialty ingredients being developed are scouted and obtained through interactions of our R&D with various customers, R&Ds and their requirements and suggestions. Our current emphasis for the new development is "Go Green" and accordingly we are focusing more and more on the totally biodegradable ingredients/Blends replacing the chemicals ingredients.
Human Resource Development and Industrial Relations
During the year under review, industrial relations at all plant locations remained harmonious.
Your Company emphasizes on the safety & engagement of people working in its premises. Structured safety meetings & recognition events were held through the year. The total number of persons employed in your Company as on March 31, 2019 were 1,123.
Business Responsibility Report
The Business Responsibility Report highlighting your Companys sustainability initiatives is appended as Annexure C. This Report describes the initiatives taken by the Company from an environment, social and governance perspective.
Employee Stock Grant Scheme 2011 (ESGS)
The details of the grants allotted under Godrej Industries Limited-Employee Stock Grant Scheme, 2011 (ESGS 2011), as also the disclosures in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, have been uploaded on the website of the Company at www.goreiindustries.com.
The Nomination and Remuneration Committee of the Board of Directors administers and monitors the ESGS 2011. The Board of Directors confirm that the ESGS 2011 has been implemented in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and the resolution passed by the Members. The Board further confirms that there have been no changes in the ESGS 2011 Scheme during the Financial Year 2018-19. The Certificate, obtained from M/s. BSR & Co. LLP, Statutory Auditors in this regard, shall be kept open for inspection by the Members at the ensuing 31st (Thirty First) Annual General Meeting.
The details of deposits covered under Chapter V of the Companies Act, 2013, i.e., deposits within the meaning of Rule 2(1 )(c) of the Companies (Acceptance of Deposits) Rules, 2014 during the Financial Year 2018-19 are as follows:
|Sr. No.||Particulars||Details (रCrore)|
|(i)||Deposits accepted during the Year||Nil|
|(ii)||Deposits remained unpaid or unclaimed during the Year:|
|Matured Deposits with the Company||0.48|
|(iii)||Whether there has been any default in repayment of deposits or payment of interest thereon during the Year and if so, number of such cases and total amount involved:|
|a. At the beginning of the Year:||Nil|
|b. Maximum during the Year:||Nil|
|c. At the end of the Year:||Nil|
|(iv)||Details of deposits which are not in|
|compliance with the requirements of Schedule V of the Companies Act||Nil|
Your Company is currently not accepting public deposits and has not accepted any deposits from its Directors during Financial Year 2018-19.
(a) Re-appointment of Whole Time Directors
Upon recommendation of the Nomination and Remuneration Committee of the Board of Directors and as approved by the Board of Directors at their Meetings held on May 23, 2018, Ms. Tanya Dubash (DIN: 00026028) and Mr. Nitin Nabar (DIN: 06521655) were re-appointed as the Whole Time Directors of your Company for a period of 3 (Three) years starting from April 1, 2019 upto March 31, 2022, on the terms and conditions which were approved by the Members at the 30th (Thirtieth) Annual General Meeting (AGM) held on August 13, 2018.
(b) Appointment of Independent Directors
Upon recommendation of the Nomination and Remuneration Committee and as approved by the Board of Directors through Circular Resolution passed dated March 12, 2019 and March 13, 2019 respectively, Ms. Rashmi Joshi (DIN: 06641898) was appointed as the "Additional (Non-Executive Independent) Director" on the Board of Directors of your Company for a term of 5 (Five) years starting from March 15, 2019 upto March 14, 2024, which is subject to approval of the Members at the ensuing 31st (Thirty First) AGM.
Further, upon recommendation of the Nomination and Remuneration Committee and as approved by the Board of Directors at their Meetings held on May 13, 2019, Mr. Mathew Eipe (DIN: 00027780) and Dr. Ganapati Yadav (DIN: 02235661) were appointed as the "Additional (Non-Executive Independent) Directors" on the Board of Directors of your Company for a term of 5 (Five) years starting from May 13, 2019 upto May 12, 2024, which is subject to approval of the Members at the ensuing 31st (Thirty First) AGM.
Further, upon recommendation of the Nomination and Remuneration Committee and as approved by the Board of Directors at their Meetings held on May 13, 2019, Mr. Keki Elavia (DIN: 00003940) was re-appointed as the "Non-Executive Independent Director" on the Board of Directors of your Company for his second term starting from August 9, 2019 upto March 31,2021 and Mr. Kavas Petigara (DIN: 00066162) was re-appointed as the "Non-Executive Independent Director" on the Board of Directors of your Company for his second term starting from August 9, 2019 upto July 8, 2023, both are subject to approval of the Members at the ensuing 31st (Thirty First ) AGM.
(c) Directors liable to retire by rotation
In accordance with the provisions of Section 152(6) of the Companies Act, 2013 and the Companys Articles of Association, Mr. Jamshyd Godrej (DIN: 00076250) and Ms. Tanya Dubash (DIN: 00026028), Directors of the Company are liable to retire by rotation at the ensuing 31st (Thirty First) AGM, and being eligible, have offered themselves for re-appointment.
(d) Resolutions to be passed at the ensuing AGM
Appropriate resolutions for appointment/reappointment of Ms. Rashmi Joshi, Mr. Mathew Eipe, Dr. Ganapati Yadav, Mr. Keki Elavia, Mr. Kavas Petigara as the "Non-Executive Independent Directors" and for re-appointment of Mr. Jamshyd Godrej and Ms. Tanya Dubash as the Directors of the Company liable to retire by rotation, are being moved at the ensuing 31st (Thirty First) AGM, which the Board recommends for your approval.
(e) Composition of Board of Directors
As on the date of this Boards Report, i.e., as on May 13, 2019, your Companys Board of Directors comprises of the following Directors:
|Name of the Director||Director Identification Number (DIN)||Category|
|Mr. Adi Godrej||00065964||Chairman and Non-Executive Non-Independent Director|
|Mr. Jamshyd Godrej||00076250||Non-Executive Non-Independent Director|
|Mr. Nadir Godrej||00066195||Managing Director|
|Mr. Saleem Ahmadullah||00037137||Non-Executive Independent Director|
|Mr. Amit Choudhury||00557547||Non-Executive Independent Director|
|Mr. Aspy Cooper||00026134||Non-Executive Independent Director|
|Mr. Vijay Crishna||00066267||Non-Executive Non-Independent Director|
|Mr. Kersi Dastur||00050199||Non-Executive Independent Director|
|Mr. Mathew Eipe||00027780||Non-Executive Independent Director|
|Mr. Keki Elavia||00003940||Non-Executive Independent Director|
|Ms. Rashmi Joshi||06641898||Non-Executive Independent Director|
|Mr. Kavas Petigara||00066162||Non-Executive Independent Director|
|Ms. Tanya Dubash||00026028||Executive Director & Chief Brand Officer|
|Mr. Nitin Nabar||06521655||Executive Director & President Chemicals|
|Dr. Ganapati Yadav||02235661||Non-Executive Independent Director|
(f) Declaration of Independence from Independent Directors
Your Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. In terms of provisions of Section 134(3)(d) of the Companies Act, 2013, the Board of Directors of your Company have taken note of these declarations of independence received from all the Independent Directors after undertaking due assessment of the veracity of the same.
(g) Board Meetings
The Meetings of the Board of Directors are prescheduled and intimated to all the Directors in advance to order to help them plan their schedule. However, in case of special and urgent business needs, approval is taken either by convening meetings at a shorter notice with consent of the Directors or by passing resolutions through circulation.
The Board of Directors of your Company met 5 (Five) times during the Financial Year 2018-19 (i.e. on May 23, 2018, August 13, 2018, November 12, 2018, January 14, 2019 and February 13, 2019). The maximum gap between two Board Meetings did not exceed 120 (One Hundred and Twenty) days. The details of Board Meetings and the attendance record of the Directors are provided in the Report on Corporate Governance section of the Annual Report.
(h) Performance Evaluation of the Board of Directors, its individual members, and its Committees
In terms with the Policy for Evaluation of the Performance of the Board of Directors of the Company, we conducted a formal Board Effectiveness Review, as part of our efforts to evaluate the performance of our Board and identify areas that need improvement, in order to enhance the effectiveness of the Board, its Committees, and Individual Directors. This was in line with the requirements of the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Corporate HR team of Godrej Industries Limited and Associate Companies (GILAC) worked directly with the Chairperson and the Nomination and Remuneration Committee of the Board to design and execute this process. It was later adopted by the Board. Each Board Member completed a confidential online questionnaire, sharing vital feedback on how the Board currently operates and how its effectiveness could be improved. The survey comprised of below sections and compiled feedback and suggestions on:
Board Processes (including Board composition, strategic orientation and team dynamics);
Individual Board Members;
the Chairman; and
Declaration of independence from Independent Directors
The criteria for Board processes included Board composition, strategic orientation and team dynamics. Evaluation of each of the Board Committees covered whether they have well-defined objectives, the correct composition, and whether they achieved their objectives. The criteria for Individual Board Members included skills, experience, level of preparedness, attendance, extent of contribution to Board debates and discussion, and how each Director leveraged their expertise and networks to meaningfully contribute to the Company. The criteria for the Chairpersons evaluation included leadership style and conduct of Board Meetings.
The following reports were created as part of the evaluation:
Board Feedback Report;
Individual Board Member Feedback Report;
Chairmans Feedback Report
Further, the performance evaluation criteria for Independent Directors included a check on their fulfilment of the independence criteria and their independence from the management.
The overall Board Feedback Report was facilitated by Mr. Adi Godrej, Chairman with Independent Directors. The Directors were not only vocal regarding the Board functioning effectively but also identified areas that showed scope for improvement. Feedback from the Committees and Individual Board Members was shared with the Chairman. Following his evaluation, a Chairmans Feedback Report was compiled.
(i) Nomination and Remuneration Policy:
The Companys Nomination and Remuneration Policy for Directors, Key Managerial Personnel, and other employees can be accessed on the Companys website at http://www.godreiindustries.com/ listing-compliance.aspx. The Companys total rewards framework aims at holistically using elements such as fixed and variable compensation, long-term incentives, benefits and perquisites, and noncompensation elements (career development, work-life balance, and recognition). The Non-Executive Directors receive sitting fees in accordance with the provisions of the Companies Act, 2013.
On the recommendation of the Nomination and Remuneration Committee, the Board had framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The details of the Board Appointment Policy are stated below:
Board Appointment Policy-Godrej Industries Limited (the "Company")
The Company is committed to equality of opportunity in all aspects of its business and does not discriminate on the grounds of nationality, race, colour, religion, caste, gender, gender identity or expression, sexual orientation, disability, age or marital status.
The Company recognises merit and continuously seeks to enhance the effectiveness of its Board. The Company believes that for effective corporate governance, it is important that the Board has the appropriate balance of skills, experience and diversity of perspectives.
Board appointments will be made on merit basis and candidates will be considered against objective criteria with due regard for the benefits of diversity on the Board. The Board believes that such merit-based appointments will best enable the Company to serve its stakeholders.
The Board will review this Policy on a regular basis to ensure its effectiveness.
Talent Management and Succession Planning
Your Company has the talent management process in place with an objective of developing a robust talent pipeline for the organisation which includes the senior leadership team.
As part of our Talent Management Process called Total Talent Management, we identify critical positions and assess the succession coverage for them annually. During this process, we also review the supply of talent, identify high potential employees and plan talent actions to meet the organisations talent objectives. We continue to deploy leadership development initiatives to build succession for key roles.
Total Rewards Philosophy
The policy of your Company on Directors appointment and remuneration of the Directors, Key Managerial Personnel and other employees including criteria for determining qualifications, positive attributes, independence of a director, is stated below:
TOTAL REWARDS PHILOSOPHY GODREJ INDUSTRIES LIMITED (the "Company")
Our Total Rewards Framework aims at holistically utilising elements such as fixed and variable compensation, long-term incentives, benefits and perquisites and non-compensation elements (career development, work life balance and recognition).
The rewards framework offers you the flexibility to customise different elements, basis need. It is also integrated with our performance and talent management processes and designed to ensure sharply differentiated rewards for our best performers.
The total compensation for a given position is influenced by three factors: position, performance and potential. As a broad principle, for our high performers and potential employees, we strive to deliver total compensation at the 90th percentile of the market.
The total compensation has three components:
1. रFixed Compensation रcomprises of basic salary and retirement benefits, like provident fund and gratuity
2. Flexible Compensation रis a fixed pre-determined component of the compensation.
3. Variable Compensation (Performance Linked Variable Remuneration) रrewards one for delivering superior business results and individual performance. It is designed to provide a significant upside earning potential without cap for over achieving business results. It has a Collective रcomponent, which is linked to the achievement of specified business results, measured by Economic Value Added or other related metrics, relative to the target set for a given Financial Year and an Individual रcomponent, based on the performance, as measured by the performance management process.
Long Term Incentives (Employee Stock Grant Scheme)
This scheme aims at driving a culture of ownership and focus on long-term results. It is applicable to senior managers. Under this scheme, performance based stock grants are awarded on the basis of performance.
(j) Familiarisation Programmes
Familiarisation programmes for the Independent Directors were conducted during the Financial Year 2018-19. Apart from this, there were quarterly business presentations by Mr. Clement Pinto, Chief Financial Officer of the Company. The details of familiarization programmes pursuant to Regulation 25(7) of the Listing Regulations is uploaded on the Companys website, viz. http:// www.godreiindustries.com/listing-compliance. aspx
Key Managerial Personnel
Ms. Nilufer Shekhawat resigned from the position of the "Company Secretary" of your Company due to personal reasons with effect from October 31, 2018. Upon recommendation of the Nomination and Remuneration Committee and as approved by the Board of Directors at their Meetings held on November 12, 2018, Ms. Tejal Jariwala was appointed as the "Company Secretary & Compliance Officer" of your Company with effect from November 12, 2018.
Details of Directors/Key Managerial Personnel who were appointed or have resigned during the Financial Year 2018-19
i. Ms. Tanya Dubash was re-appointed as the Whole Time Director with effect from April 1, 2019 upto March 31, 2022;
ii. Mr. Nitin Nabar was re-appointed as the Whole Time Director with effect from April 1, 2019 upto March 31, 2022;
iii. Ms. Nilufer Shekhawat had resigned from the position of Company Secretary with effect from October 31, 2018;
iv. Ms. Tejal Jariwala was appointed as the Company Secretary & Compliance Officer with effect from November 12, 2018;
v. Ms. Rashmi Joshi was appointed as the Additional Non-Executive Independent Director with effect from March 15, 2019.
Auditors and Auditors रReport Statutory Auditors
M/s. BSR & Co. LLP, Chartered Accountants (Firm Registration Number: 101248W/W-100022) have been appointed as the Statutory Auditors of the Company at the 29th (Twenty Ninth) Annual General Meeting (AGM) of the Members held on August 11, 2017, pursuant to Sections 139 to 144 of the Companies Act, 2013 and Rules 3 to 6 of the Companies (Audit And Auditors) Rules, 2014, for a term of 5 (Five) years, to hold office from the conclusion of the 29th (Twenty Ninth) AGM, till the conclusion of the 34th (Thirty Fourth) AGM, on a remuneration as may be decided by the Board of Directors. Their appointment was subject to ratification by the Members at every subsequent AGM held after the AGM held on August 11, 2017. Pursuant to the amendments made to Section 139 of the Companies Act, 2013 by the Companies (Amendment) Act, 2017, effective from May 7, 2018, the requirement of seeking ratification of the Members for the appointment of the Statutory Auditors was withdrawn from the statute. In view of the same, the Members of the Company at the 30th (Thirtieth) AGM held on August 13, 2018 had approved ratification of appointment of M/s. BSR & Co. LLP as the Statutory Auditors of the Company for the remaining period, i.e. from the conclusion of 30th (Thirtieth) AGM held on August 13, 2018 upto the conclusion of the 34th (Thirty Fourth) AGM. Therefore, the approval of the Members for continuance of their appointment at this AGM is not being sought. The Statutory Auditors Report on the Financial Statements for the Financial Year ended on March 31, 2019 does not contain any qualification, reservation, adverse remark or disclaimer.
M/s. R. Nanabhoy & Co., Cost Accountants, Mumbai (Firm Registration No.: 000010) were appointed by the Board of Directors as the Cost Auditors of the Company for all the applicable products pursuant to the provisions of Section 148 of the Companies Act, 2013 and the Companies (Cost Records and Audit) Rules, 2014, for the Financial Year 2018-19. They are required to submit the report within 180 (One Hundred and Eighty) days from the end of the accounting year.
Further, upon recommendation of the Audit Committee, the Board of Directors at their Meetings held on May 13, 2019 have approved re-appointment of M/s. R. Nanabhoy & Co., Cost Accountants, being eligible, as the Cost Auditors of the Company for the Financial Year 2019-20 at a remuneration of र3,04,000/- (Rupees Three Lakh Four Thousand Only) plus applicable taxes and out of pocket expenses, subject to ratification of the said remuneration by the Members at the ensuing 31st (Thirty First) Annual General Meeting pursuant to Section 148 of the Companies Act, 2013.
The Company has maintained the necessary accounts and records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 pertaining to Cost Audit.
Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Companys Board of Directors had appointed M/s. A. N. Ramani & Co., Practicing Company Secretaries (Certificate of Practice No. 9577), to conduct Secretarial Audit of the Company for the Financial Year 2018-19.
The Secretarial Audit Report issued by M/s. A. N. Ramami & Co., Secretarial Auditors for the Financial Year ended March 31, 2019 is annexed herewith marked as Annexure D रto this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Vigil Mechanism/Whistle Blower Policy
Your Company is focused to ensure that integrity and ethics continue to be the bedrock of its corporate operations. It is committed to conducting its business in accordance with the highest standards of professionalism and ethical behavior.
Your Company has a vigil mechanism named Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. This initiative was taken to encourage employees to report irregularities in operations, besides complying with the statutory requirements under Companies Act, 2013. All employees of the Company can avail this mechanism. If the whistle blower is not satisfied with the actions taken, necessary steps to escalate the same can be taken. Through the process, the mechanism considers and extends complete protection to the whistle blower and direct access to the Chairman of the Audit Committee in appropriate or exceptional cases.
Committees of Board of Directors
Pursuant to the provisions of Section 177(8) of the Companies Act, 2013, Rule 6 of the Companies (Meetings of Board & its Powers) Rules, 2014 and Regulation 18 read with Part C of Schedule II of the Listing Regulations, your Company has constituted an Audit Committee of the Board of Directors.
The composition of the Audit Committee during the Financial Year 2018-19 was as under:
|Name of the Member||Designation|
|Mr. Kersi Dastur||Chairman (Independent Director)|
|Mr. Saleem Ahmadullah||Member (Independent Director)|
|Mr. Kavas Petigara||Member (Independent Director)|
|Mr. Amit Choudhury||Member (Independent Director)|
The Statutory Auditors, Internal Auditors and Chief Financial Officer attend the Audit Committee Meetings as invitees. The Company Secretary and Compliance Officer acts as Secretary to the Audit Committee. All observations and recommendations made by the Audit Committee to the Board of Directors, were duly noted and accepted by the Board.
There were 4 (Four) Meetings of the Audit Committee held during the Financial Year 2018-19 (i.e., May 23, 2018, August 13, 2018, November 12, 2018 and February 13, 2019).
Risk Management Committee
Pursuant to the provisions of Regulation 21 of Listing Regulations, your Company has constituted a Risk Management Committee of the Board of Directors.
The composition of the Risk Management Committee during the Financial Year 2018-19 was as under:
|Name of the Member||Designation|
|Mr. Nadir Godrej||Chairman (Managing Director)|
|Ms. Tanya Dubash||Member (Executive Director & Chief Brand Officer)|
|Mr. Nitin Nabar||Member (Executive Director & President Chemicals)|
There were 4 (Four) Meetings of the Risk Management Committee held during the Financial Year 2018-19 (i.e., May 10, 2018, July 9, 2018, November 1, 2018 and January 29, 2019).
Your Company had formed a Risk Management Committee consisting of the Managing Director and the Whole time Directors. The Committee identifies and evaluates business risks and opportunities. This Committee has formulated and implemented a policy on risk management to ensure that the companys reporting system is reliable and that the company complies with relevant laws and regulations. The Board of Directors of your Company are of the opinion that, at present, there are no elements of risks which may threaten the existence of the Company.
The Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013
Your Company is committed to creating and maintaining an atmosphere in which employees can work together without fear of sexual harassment, exploitation or intimidation. The Board of Directors of your Company has constituted Internal Complaints Committees (ICCs) at Head Office as well as regional levels pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder.
The Company has formulated and circulated to all the employees, a policy on prevention of sexual harassment at workplace, which provides for a proper mechanism for redressal of complaints of sexual harassment. Since there were no complaints received by the ICCs during the calendar year 2018, the Committee filed a NIL रcomplaints report with the concerned authority(ies), in compliance with Section 22 of the aforementioned act.
Directors रResponsibility Statement
The Board of Directors have laid down Internal Financial Controls within the meaning of the explanation to Section 134(5)(e) ("IFC") of the Companies Act, 2013. The Board believes the Company has sound IFC commensurate with the nature and size of its business. Business is however dynamic. The Board is seized of the fact that IFC are not static and will evolve over time as the business, technology and possibly even fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There might therefore be gaps in the IFC as Business evolves. Your Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps might have a material effect on the Companys operations.
Pursuant to the provisions contained in sub-sections (3)(c) and (5) of Section 134 of the Companies Act, 2013, the Directors of your Company, based on the representation received from the Operating Management and after due enquiry confirm the following:
a) In the preparation of the annual accounts for the Financial Year 2018-19, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b) The Directors have selected such accounting policies and applied consistently, and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year (i.e. March 31, 2019) and of the profit and loss of the Company for that period (i.e. the Financial Year 2018-19);
c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company, for preventing and detecting fraud and other irregularities;
d) The Directors have prepared the annual accounts for the Financial Year ended March 31, 2019 on a going concern basis;
e) The Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; and
f) The Directors have devised proper systems to ensure compliance of all laws applicable to the Company and such systems are adequate and operating effectively.
As required by the existing Regulation 34(3) read with Schedule V of the Listing Regulations, a detailed report on Corporate Governance is included in the Annual Report.
M/s. A. N. Ramani, Practicing Company Secretaries have certified the Companys compliance of the requirements of Corporate Governance in terms of Regulation 34(3) read with Schedule V of the Listing Regulations and their compliance certificate is annexed to the Report on Corporate Governance.
Conservation of Energy, Technology absorption and Foreign Exchange Earnings and Outgo
The information in respect of matters pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act, 2013 and Rule 8(3) of the Companies (Accounts) Rules, 2014 is appended as Annexure E to this Report.
In compliance with provisions of Section 134(3)(a) of the Companies Act, 2013, the Annual Return as per Section 92(3) of the Companies Act, 2013 has been hosted on the website of the Company, viz. www.godreiindustries.com.
Managerial Remuneration and Remuneration Particulars of Employees
The remuneration paid to Directors and Key Managerial Personnel and the employees of the Company during the Financial Year 2018-19 was in accordance with the Nomination and Remuneration Policy of the Company.
Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure F to this Report.
The information required pursuant to Section 197 of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of your Company is available for inspection by the Members at Registered Office of the Company during all days expect Saturdays, Sundays and public holidays from 10.00 a.m. to 4.00 p.m. on working days upto the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary, at the Registered Office of the Company, whereupon a copy would be sent.
Material changes and commitments since the Financial Year end
There have been no material changes and commitments affecting the financial position of the Company which have occurred between the March 31, 2019 and the date of this Boards रReport (i.e. May 13, 2019).
There have been no instances of frauds reported by the Auditors under Section 143(12) of the Companies Act, 2013 and the Rules framed thereunder, either to the Company or to the Central Government.
(a) Scheme of Amalgamation of Vora Soaps Limited, erstwhile Holding Company with Godrej Industries Limited ("the Company")
The Honble National Company Law Tribunal, Mumbai Bench had sanctioned the Scheme of Amalgamation of Vora Soaps Limited (VSL) with the Company vide its Order dated December 14, 2018. The said Scheme was made effective on December 24, 2018 post filing of the Order with Registrar of Companies. Pursuant to the Scheme, 19,39,04,681 Equity Shares have been allotted to Shareholders of VSL on January 14, 2019, and accordingly, 19,39,04,681 Equity Shares held by VSL in the Company were cancelled. Pursuant to this, VSL stands amalgamated with your Company. Post allotment/cancellation of Equity Shares, the Promoter Shareholding in the Company now stands at 61.33%.
(b) Scheme of Arrangement (Demerger) entered into between Ensemble Holdings & Finance Limited, Wholly Owned Subsidiary and Godrej Industries Limited ("the Company")
The Board of Directors of your Company approved the Scheme of Arrangement (Demerger) between Ensemble Holdings & Finance Limited, Wholly Owned Subsidiary and the Company and their respective Shareholders (Scheme) at their Meeting held on February 13, 2019. The Scheme is subject to the approval of the Honble National Company Law Tribunal (NCLT), shareholders and/ or creditors and such other competent authority as may be directed by the Honble NCLT. Accordingly, the Scheme has been filed with the Stock Exchanges and the company will proceed with other necessary formalities in this regard.
Policies of the Company
Listing Regulations have mandated the formulation of certain policies for all listed companies. As per provisions of Listing Regulations, certain Policies are hosted on the Companys website viz; www.godreiindustries.com.
The key policies that have been adopted by the Company pursuant to the provisions of the Companies Act, 2013 and the Rules framed thereunder, the Listing Regulations and other applicable laws are as follows:
|Name of the Policy||Brief Particulars of the Policy|
|Risk Management Policy||The Company has in place, a Risk Management Policy which is framed by the Board of Directors of the Company. This Policy deals with identifying and assessing risks such as operational, strategic, financial, security, property, regulatory, reputational and other risks and the Company has in place an adequate Risk Management infrastructure capable of addressing these risks.|
|Corporate Social Responsibility Policy||The Corporate Social Responsibility (CSR) Committee has formulated and recommended to the Board and the Board has approved a Corporate Social Responsibility Policy (CSR Policy), which outlines the Companys strategy to bring about a positive impact on society through various CSR activities and programmes.|
|Policy for determining Material Subsidiaries||This Policy is used to determine the material subsidiaries and material non-listed Indian subsidiaries of the Company in order to comply with the requirements of Regulation 16(1 )(c) and Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Company has the following Material Subsidiaries as on March 31,2019:|
|1) Godrej Properties Limited (Listed Subsidiary)|
|2) Godrej Agrovet Limited (Listed Subsidiary)|
|Name of the Policy||Brief Particulars of the Policy|
|Nomination and Remuneration Policy||This Policy formulates the criteria for determining qualifications, competencies, positive attributes and independence of a Director (Executive/Non-Executive) and also the criteria for determining the remuneration of the Directors, Key Managerial Personnel and other Senior Management Employees.|
|Whistle Blower Policy/Vigil Mechanism||Your Company has a Vigil Mechanism/Whistle Blower Policy which provides adequate safeguards against victimization of persons who use Whistle Blower mechanism and make provision for direct access to the Chairman of the Audit Committee, in appropriate or exceptional cases.|
|Policy on Prevention of Sexual Harassment at Workplace||Your Company has in place, a Policy on Prevention of Sexual Harassment at Workplace, which provides for a proper mechanism for redressal of complaints of sexual harassment and thereby encourages employees to work together without fear of sexual harassment, exploitation or intimidation.|
|Policy on Materiality of Related Party Transaction and dealing with Related Party Transaction||This Policy regulates all transactions between the Company and its Related Parties.|
|Code of Conduct for the Board of Directors and Senior Management Personnel||Your Company has in place, a Code of Conduct for the Board of Directors and Senior Management Personnel which reflects the legal and ethical values to which your Company is strongly committed.|
|Code of Conduct for Insider Trading||This Policy sets up an appropriate mechanism to curb Insider Trading in accordance with Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.|
|Policy on Criteria for determining Materiality of Events||This Policy applies to disclosures of material events affecting the Company. This Policy warrants disclosure to investors and has been framed in compliance with the requirements of Regulation 30 of the Listing Regulations.|
|Policy for Maintenance and Preservation of Documents||The purpose of this Policy is to specify the type of documents and time period for preservation thereof based on the classification mentioned under Regulation 9 of the Listing Regulations. This Policy covers all business records of the Company, including written, printed and recorded matter and electronic forms of records.|
|Archival Policy||This Policy is framed pursuant to the provisions of the Listing Regulations. As per this Policy, your Company is required to disclose on its website, all such events or information which have been disclosed to the Stock Exchanges where the securities of the Company are listed. Further, such disclosures shall be hosted on the website of the Company for a minimum period of 5 (five) years and thereafter as per Archival Policy of the Company.|
|Dividend Distribution Policy||This Policy is framed by the Board of Directors in terms of the Listing Regulations. The focus of the Company is to have a Policy on distribution of dividend so that the investor may know as to when and how much dividend they may expect.|
Disclosures as per the Companies (Accounts) Rules, 2014
|Change in nature of business, if any||None|
|Names of Companies which have become or have ceased to be its Subsidiaries, Joint Ventures or Associate Companies during the Financial Year 2018-19||None|
|Details of Significant and Material Orders passed by the Regulators or Courts or Tribunals, impacting the going concern status and the Companys operations in future||During the Financial Year 2018-19, there were no significant and material orders passed by the regulators or Courts or Tribunals which can adversely impact the going concern status of the Company and its operations in future|
Your Company is in compliance with the Secretarial Standards on Meetings of the Board of Directors (SS- 1) and Secretarial Standards on General Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI).
Transfer to Investor Education and Protection Fund
In terms of the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001, र6,84,338/- (Rupees Six Lakh Eighty Four Thousand Three Hundred Thirty Eight Only) unpaid/unclaimed dividends were transferred during the Financial Year 201819 to the Investor Education and Protection Fund (IEPF).
The Company has appointed a Nodal Officer under the provisions of IEPF, the details of which are available on the website of the Company. The same can be accessed on www.godreiindustries.com.
The Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on August 13, 2018 (date of last AGM) on the Companys website which can be accessed on www.godreiindustries.com and of the Ministry of Corporate Affairs website at www.iepf.gov.in.
Your Companys Equity Shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As of March 31, 2019, 99.87% of the Equity Shares of your Company were held in demat form.
The Equity Shares of your Company are listed at the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The applicable annual listing fees have been paid to the Stock Exchanges before the due dates.
The Equity Shares of your Company were not suspended from trading on BSE and NSE at any point of time during the Financial Year 2018-19.
The additional information required to be given under the Companies Act, 2013 and the Rules framed thereunder, has been laid out in the Notes attached to and forming part of the Accounts. The Notes to the Accounts referred to the Auditors रReport are self-explanatory and therefore do not call for any further explanation.
The Consolidated Financial Statements of your Company form a part of this Annual Report. Accordingly, this Annual Report of your Company does not contain the Financial Statements of its Subsidiaries. The Audited Annual Accounts and related information of the Companys Subsidiaries will be made available upon request. These documents will also be available for inspection during all days expect Saturdays, Sundays and public holidays during business hours at the Companys Registered Office. The Subsidiary Companies रdocuments are also available on the Companys website, viz., www.godreiindustries.com.
Your Directors thank the Union Government, the Governments of Maharashtra and Gujarat as also all the Government Agencies, Banks, Financial Institutions, Shareholders, Customers, Fixed Deposit Holders, Vendors and other Business Associates, who, through their continued support and co-operation, have helped as partners in your Companys progress. Your Directors also express their warm appreciation to all the employees of the Company for their unstinted commitment and continued contribution to the growth of the Company.
For and on behalf of the Board of Directors of
Godrej Industries Limited
May 13, 2019.