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Asian Paints
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Download Annual Report PDF Format 2013 | 2012 | 2011 | 2010
Directors Report Year End : Mar '13    Mar 12
Dear Members,
 
 The Directors have pleasure in presenting the 67th Annual Report of
 your Company and the Audited Accounts for the financial year ended 31st
 March, 2013.
 
 FINANCIAL RESULTS
 
 The financial performance of your Company, for the year ended 31st
 March, 2013 is summarised below:
  
                                                    (Rs. in Crores)
 
                         Asian Paints Limited     Asian Paints Limited 
                                                  Group Consolidated
 
                 2012-13   2011-12   Growth   2012-13   2011-12   Growth
 
 Revenue from 
 Operations 
 (Net)          8,971.70  7,964.16    12.7%  10,970.74  9,632.24   13.9%
 
 EBITDA         1,673.42  1,493.24    12.1%   1,846.46  1,616.18   14.2%
 
 Less: Finance 
 Costs             30.56     30.82               36.65     40.97
 
 Less: 
 Depreciation     126.98     99.49              154.60    121.13
 
 Profit Before 
 Tax            1,515.88  1,362.93    11.2%   1,655.21  1,454.08   13.8%
 
 Less: Tax 
 expense          465.88    404.54              495.69    433.50
 
 Profit After 
 Tax            1,050.00    958.39     9.6%   1,159.52  1,020.58   13.6%
 
 Less: Minority 
 Interest              -        -                45.64     31.85
 
 Profit 
 attributable 
 to share
 holders of 
 the Company   1,050.00    958.39      9.6%   1,113.88    988.73    12.7%
 
 Opening 
 balance in 
 Statement of 
 Profit and 
 Loss            700.00    600.00               700.00    600.00
 
 AMOUNT 
 AVAILABLE 
 FOR 
 APPROPRIATION 1,750.00  1,558.39             1,813.88  1,588.73
 
 That the 
 Directors 
 recommend for
 appropriation 
 as under:
 
 Dividend - 
 Interim          91.13     91.13                91.13     91.13
 
 - Proposed 
 Final           350.10    292.56               350.10    292.56
 
 Tax on Dividend  74.29     62.24                74.29     62.24
 
 Transfer to 
 General Reserve 234.48    412.46               298.36    442.80
 
 Closing balance 
 in Statement 
 of Profit 
 and Loss      1,000.00    700.00             1,000.00    700.00
 
 CONSOLIDATED ACCOUNTS
 
 The Ministry of Corporate Affairs (MCA) by General Circular No.  2/2011
 dated 8th February, 2011, has granted an exemption to the companies
 from complying with Section 212 of the Companies Act, 1956, provided
 such companies fulfil conditions mentioned in the said circular. The
 Consolidated Financial Statements of your Company for the financial
 year 2012-13, are prepared in compliance with applicable Accounting
 Standards and applicable Listing Agreement as prescribed by the
 Securities and Exchange Board of India. The consolidated accounts have
 been prepared on the basis of audited financial statements received
 from subsidiaries and joint venture companies, as approved by their
 respective Boards.
 
 The annual accounts and financial statements of the subsidiary
 companies of your Company and related detailed information shall be
 made available to members on request and are open for inspection at the
 Registered Office of your Company. Your Company has complied with all
 the conditions as stated in the above circular and accordingly, has not
 attached the financial statements of its subsidiary Companies for the
 financial year 2012-13. A statement of summarised financials of all
 subsidiaries of your Company including capital, reserves, total assets,
 total liabilities, details of investment, turnover, etc., pursuant to
 the General Circular issued by Ministry of Corporate Affairs, forms
 part of this report.
 
 DIVIDEND
 
 During the financial year 2012-13, your Company declared an interim
 dividend of Rs. 9.50 (Rupees Nine and Paise Fifty only) per equity
 share in the month of October, 2012 and paid in the month of November,
 2012. In addition, your Directors recommend payment of Rs. 36.50
 (Rupees Thirty Six and Paise Fifty only) per equity share as the final
 dividend for the financial year 2012-13. If approved, the total
 dividend (interim and final dividend) for the financial year 2012-13
 will be Rs. 46 (Rupees Forty Six only) per equity share; Rs. 40 (Rupees
 Forty only) per equity share was paid as dividend for the previous
 year.
 
 TRANSFER TO RESERVES
 
 Your Company proposes to transfer Rs. 234.48 crores to the general
 reserve. An amount of Rs. 1000 crores is proposed to be retained in the
 profit and loss account.
 
 SUB-DIVISION OF SHARES
 
 The Board of Directors considered and approved the sub-division of the
 Equity Shares of your Company whereby 1 (One) Equity Share having a
 nominal face value of Rs. 10 (Rupees Ten only) will be sub-divided into
 10 (Ten) Equity Shares of nominal face value of Rs. 1 (Rupee One) each.
 Consequent amendment to the capital clauses of the Memorandum and
 Articles of Association of the Company were also approved by the Board,
 subject to approval of the shareholders at the ensuing Annual General
 Meeting.  The record date for the same shall be determined subsequent
 to the approval of the shareholders at the ensuing general meeting and
 subject to all other statutory approvals, as may be applicable. The
 necessary resolutions form part of the Notice for the ensuing Annual
 General Meeting, as a part of the Annual Report.
 
 MANAGEMENT DISCUSSION AND ANALYSIS
 
 A detailed review of operations, performance and future outlook of your
 Company and its businesses is given in the Management Discussion and
 Analysis, which forms part of this Report.
 
 CORPORATE GOVERNANCE
 
 Your Company is compliant with the requirements of Clause 49 of the
 Listing Agreement. Necessary disclosures have been made in this regard
 in the Corporate Governance Report. A certificate from the Joint
 Statutory Auditors of your Company regarding compliance with the
 requirements of Corporate Governance as stipulated under Clause 49 of
 the Listing Agreement is attached to this report. The report on
 Corporate Governance is included and forms part of this report.
 
 BUSINESS RESPONSIBILITY REPORT
 
 As per Clause 55 of the Listing Agreement with the Stock Exchanges, the
 Business Responsibility Report forms part of this Annual Report.  It is
 also available on the website of the Company.
 
 SECRETARIAL AUDIT
 
 Dr. K.R. Chandratre, Practicing Company Secretary conducted Secretarial
 Audit pursuant to provisions of Section 383A of the Companies Act,
 1956, for the financial year 2012-13. Dr. K.R.  Chandratre has
 submitted the Report confirming compliance with the applicable
 provisions of Companies Act, 1956 and other rules and regulations
 issued by SEBI/other regulatory authorities for corporate law.
 
 JOINT VENTURE WITH PPG INDUSTRIES INC., USA
 
 As informed in the last year''s Annual Report, your Company had filed a
 Composite Scheme for Merger and Demerger under Sections 391-394 of the
 Companies Act, 1956 and other applicable provisions with the Hon''ble
 High Court of Judicature of Bombay, for merger of AP Coatings Ltd (100%
 subsidiary of your Company) and a wholly owned Indian subsidiary of PPG
 Industries Securities LLC., USA (PPG) i.e. PPG Coatings India Private
 Limited into PPG Asian Paints Private Limited (PPG- AP), 50:50 joint
 venture between your Company and PPG and thereafter, demerger of
 certain businesses into Asian Paints PPG Private Limited (AP-PPG), new
 50:50 joint venture between your Company and PPG.
 
 During the year, the Order sanctioning the aforesaid Scheme was passed
 by the Hon''ble High Court of Judicature at Bombay on 6th July, 2012.
 The said Order was filed by the respective companies with the Registrar
 of Companies, Maharashtra at Mumbai on 1st August, 2012, making the
 Order effective.
 
 During the year under review, the Board also approved infusion of funds
 equivalent to Rs. 16,00,00,258 by investing in 6,08,366 equity shares
 of Rs. 10 each in AP-PPG and Rs. 16,00,00,060 by investing in 14,54,546
 equity shares of Rs. 10 each in PPG-AP, along with PPG making the same
 amount of investment in both the Joint Venture Companies. The
 investment was made on 10th April, 2013.
 
 FORAY INTO HOME IMPROVEMENT
 
 During the year, the Company as part of its strategic initiative to
 explore Home Improvement, decided to enter into the modern kitchen
 space. Necessary amendments were carried out to the Object Clause of
 the Memorandum of Association of the Company for entering into the
 businesses relating to Home Improvement & Decor.
 
 Further, the Board of Directors at its meeting held on 19th March,
 2013, granted in-principle approval for entering into an arrangement
 with the promoters of the Sleek Group for acquiring a 51% stake in the
 Sleek Group, subject to due diligence, necessary approvals and
 documentation. Necessary work in this regard is being carried out.
 Sleek Group is engaged in the business of manufacturing, selling and
 distribution of kitchens and kitchen components including wire baskets,
 cabinets, appliances, accessories, etc., with pan India presence. Your
 Company strongly believes that this acquisition will offer significant
 opportunities and synergy to your Company.
 
 INSURANCE
 
 All the insurable interests of your Compa ny including inventories,
 buildings, plant and machinery and liabilities under legislative
 enactments are adequately insured.
 
 CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
 
 The information on Conservation of Energy and Technology Absorption by
 the Company as per Section 217(1)(e) of the Companies Act, 1956 read
 with the Companies (Disclosure of particulars in the report of the
 Board of Directors) Rules, 1988, are given as Annexure to this report.
 
 FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 Details of expenditure and earnings in foreign currencies are given
 under Note 34 and 35 to the financial statements.
 
 PERSONNEL
 
 In terms of the provisions of Section 217 (2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975 as
 amended, names and other particulars of employees are required to be
 attached to this report. However, as per the provisions of Section
 219(1)(b)(iv) of the Companies Act, 1956, the Report and Annual
 Accounts of your Company sent to the shareholders do not contain the
 said annexure. Any member desirous of obtaining a copy of the said
 annexure may write to the Company Secretary at the Registered Office of
 the Company.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors
 hereby confirm that:
 
 In preparation of the annual accounts, the applicable accounting
 standards have been followed;
 
 The accounting policies have been selected and applied consistently and
 the judgements and estimates made, are reasonable and prudent, so as to
 give a true and fair view of the state of affairs of the Company as on
 31st March, 2013 and of the profit and loss of the Company for that
 period;
 
 Proper and sufficient care has been taken for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956, for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities; and
 
 The annual accounts have been prepared on a going concern basis.
 
 DIRECTORS
 
 The Board appointed Mr. K.B.S. Anand as an Additional Director in
 accordance with Section 260 of the Companies Act, 1956 with effect from
 1st April, 2012 and as Managing Director & CEO with effect from 1st
 April, 2012 to 31st March, 2015.
 
 During the year 2012-13, the Board appointed Mr. M.K. Sharma as an
 Additional Director with effect from 25th October, 2012.  Mr. M.K.
 Sharma is being appointed as the Director of your Company at the
 ensuing Annual General Meeting. Your Directors recommend his
 appointment as a Director of your Company.
 
 In accordance with the provisions of the Companies Act, 1956 and the
 Articles of Association of the Company, Mr. Mahendra Choksi, Ms.
 Tarjani Vakil, Mr. Mahendra Shah and Mr. S. Ramadorai retire by
 rotation at the ensuing Annual General Meeting. Ms. Tarjani Vakil does
 not wish to seek re-appointment at the ensuing Annual General Meeting
 and wishes to retire as Director of the Company. Her contribution to
 the Audit Committee as the Chairperson of the Committee as well as to
 the Board and the Remuneration Committee has been immensely valuable
 and has significantly contributed to the growth of your Company. The
 Board places on record its appreciation for her outstanding
 contribution to the Company as a Director during her association with
 the Company.
 
 Mr. Mahendra Choksi, Mr. Mahendra Shah and Mr. S. Ramadorai, being
 eligible for re-appointment, seek re-appointment at the ensuing Annual
 General Meeting. Appropriate resolutions for their re-appointment are
 being placed before you for your approval at the ensuing Annual General
 Meeting. The brief resume of the aforesaid Directors and other
 information have been detailed in the Notice. Your Directors recommend
 their re-appointment as Directors of your Company.
 
 AUDITORS
 
 M/s. Shah & Co., Chartered Accountants and M/s. B S R & Associates,
 Chartered Accountants, Joint Auditors of your Company are due for
 retirement at the ensuing Annual General Meeting and are eligible for
 re-appointment. Your Directors recommend their re-appointment for the
 ensuing year. The Statutory Auditors of your Company have submitted a
 certificate to your Company that they have subjected themselves for the
 peer review process of the Institute of Chartered Accountants of India.
 
 COST AUDITOR
 
 Pursuant to the direction from the Ministry of Corporate Affairs for
 appointment of Cost Auditors, your Company had appointed Ms. Ketki
 Visariya, as the Cost Auditor of the Company for the financial year
 2012-13 to conduct the audit of the cost records of the Company. Ms.
 Ketki Visariya has resigned as the Cost Auditor of your Company for the
 financial year 2012-13.
 
 Accordingly, it is proposed to appoint the Cost Auditor for the
 financial years 2012-13 as well as 2013-14. Your Company''s Audit
 Committee and Board of Directors have approved the appointment of M/s.
 RA & Co., Cost Accountants as the Cost Auditor to conduct the audit of
 the cost records of the Company for the financial years 2012-13 and
 2013-14, subject to approval of the Central Government.
 
 The Cost Audit report for the financial year 2011-12 was filed within
 the due date. The due date for submission of the Cost Audit Report for
 the year 2012-13 is within 180 days from 31st March, 2013.
 
 APPRECIATION
 
 Your Directors wish to convey their gratitude and place on record their
 appreciation for all the employees at all levels for their hard work,
 valuable contribution and dedication during the year.  Your Directors
 sincerely convey their appreciation to customers, shareholders,
 vendors, bankers, business associates, regulatory and government
 authorities for their consistent support.
 
                                  For and on behalf of the Board
 
                                                   Ashwin Choksi    
 
                                                        Chairman
 
 Mumbai 9th May, 2013
Source : Dion Global Solutions Limited
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