Hindalco Industries Directors Report, Hindalco Reports by Directors

Hindalco Industries

BSE: 500440|NSE: HINDALCO|ISIN: INE038A01020|SECTOR: Aluminium
Oct 20, 10:54
3.65 (2.42%)
VOLUME 316,711
Oct 20, 10:54
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VOLUME 2,529,194
Directors Report Year End : Mar '15    « Mar 14
Dear Shareholder,
 The Directors have pleasure in presenting the 56th Annual Report and
 the audited standalone and consolidated financial statements of your
 company for the year ended 31st March, 2015.
                                                            Rs. Crore
                                       Standalone        Consolidated
                                    FY15      FY14      FY15      FY14
 Revenue from Operations          34,525    27,851  1,04,281    87,695
 Other Income                        882     1,124     1,105     1,017
 PBITDA                            4,299     3,616    10,049     9,303
 Depreciation                        837       823     3,591     3,553
 PBIT                              3,462     2,793     6,458     5,751
 Finance Cost                      1,637       712     4,178     2,702
 Profit before Exceptional 
 Items and Tax                     1,825     2,081     2,280     3,049
 Exceptional Items                   578       396     1,940       396
 Profit before tax                 1,247     1,685       340     2,653
 Tax Expenses                        322       272       256       525
 Profit before Minority 
 Interest and Share in
 profit/(loss) of                    925     1,413        84     2,128
 Minority Interest in Profit/
 (Loss)                                                 (596)       20
 Share in Profit/(loss) of 
 Associates                                              175        67
 Net Profit                          925     1,413       854     2,175 
 EPS (Basic) - Rs.                  4.48      7.09      4.14     10.91
 Note: Certain descriptions and /or fi gures of earlier periods have
 been changed/regrouped to conform to current practices
 The amounts proposed to be carried to reserves Standalone Accounts:
                                                      (Rs. Crore) 
                                           As at       As at
                                           31/03/2015  31/03/2014
 Surplus in the Statement of Profit
 and Loss
 Balance as at the                          750.00       750.00
 beginning of the year
 Add: Profit for the year                   925.16     1,413.33
 Less: Transferred to                      (150.00)     (150.00)
 Debenture Redemption
 Less: Dividend on Equity                  (206.52)     (206.46)
 Less: Dividend                             (39.29)       (0.90)
 Distribution Tax
 Less: Transferred to                            -    (1,055.97)
 General Reserve
 Balance as at the end of                 1,279.35       750.00 
 the year
 For the year ended 31st March,2015, the Board of Directors of your
 Company have recommended dividend of Re. 1 per share (Previous year
 Rs.1 per share) to equity shareholders aggregating to Rs. 246.11 crore
 (Previous year Rs. 241.55 Crore) including Dividend Distribution Tax.
 Equity shares that may be allotted upon exercise of Options granted
 under the Employee Stock Option Scheme before the Book Closure for
 payment of dividend will rank pari passu with the existing shares and
 shall also be entitled to receive the aforesaid dividend.
 Standalone results
 For the year ended March 31, 2015, net sales are up by 24% with Profi t
 before depreciation, interest and tax growth at 19%.
 Depreciation stood at Rs. 837 crore compared to Rs. 823 crore in the
 previous year, refl ecting a change in the manner of calculation of
 depreciation w.e.f. 1st April, 2014 by considering revised useful life
 of assets to bring it in line with Schedule II of the Companies Act,
 The increase in Finance cost from Rs. 712 crore in FY14 to Rs. 1,637
 crore in FY15 refl ects the lower capitalisation of finance charges in
 line with progressive commissioning of facilities.
 Profit before exceptional items at Rs. 1,825 crore was lower by 12%
 compared to FY14 resulting from higher interest.
 Exceptional Items (Net) of Rs. 578 crore include:
 (a) Rs. 563 crore towards additional levy of Rs. 295/- per MT on
 extracted coal for the period up to 30th September, 2014.
 (b) Rs. 258 crore towards provision for diminution in the carrying
 value of investments in Aditya Birla Minerals Limited, Australia, a
 subsidiary of the Company.
 (c) Reversal of Rs. 29 crore out of the liability provided for in the
 previous year on account of the UP Tax on Entry of Goods into Local
 Areas Act, 2007 (UP Entry Tax), following completion of assessment.
 (d) Foreign exchange gain of Rs. 361 crore in connection with Rs.1,394
 crore received from A V Minerals (Netherlands) N. V., a wholly owned
 subsidiary of the Company, towards return of capital by reducing
 nominal value of shares.
 (e) Rs. 147 crore liability provided towards Renewable Power
 Obligations (RPO) under the Electricity Act, 2003.
 Net profi t stood at Rs. 925 crore compared to Rs. 1,413 crore in
 previous year.
 Consolidated results
 The Consolidated Revenue and Profi t before Depreciation, Interest and
 Taxes grew by 19% and 8% respectively, in comparison to the last year''s
 corresponding figures.
 Net profi t was lower at Rs. 854 Crore, because of higher interest cost
 and exceptional items. The exceptional items (in addition to items
 included in standalone as mentioned above) mainly relate to a sinkhole
 incident at one of the subsidiary companies in Australia and change in
 macro-economic conditions. This has resulted in the impairment of fi
 xed assets, write down in value of inventories and expenses incurred
 towards restoration of operations.
 Novelis Inc. (a wholly owned subsidiary)
 Revenue of Fiscal 2015 increased 14% to .1 billion compared to .8
 billion in fi scal 2014. Revenue growth was driven by record shipments
 of rolled aluminium products of 3,050 kilotonnes in fi scal year 2015.
 Higher average metal prices in fi scal year 2015 also contributed to
 the increase in revenues.
 Novelis reported net income of 8 million for fi scal year 2015, a
 42% increase from 4 million reported in fi scal 2014. Excluding
 certain tax-effected items, net income increased four percent to 1
 million in fi scal 2015.
 Adjusted EBITDA grew 2% to 2 million in fi scal 2015 compared to the
 5 million reported in fi scal 2014. The increase was primarily
 driven by higher shipments, favourable product mix due to a strategic
 shift to grow automotive shipments and cost benefi ts from using a
 higher percentage of recycled metal inputs. Partially offsetting these
 gains were higher costs associated with the start-up and support of new
 capacity, lower pricing in some Asian markets, as well as unfavourable
 foreign exchange and metal price lag.
 The company reported free cash flow of  million for the year, an 
 million increase over the prior year. Novelis generated positive free
 cash fl ow for fi scal year 2015 as a result of strong operating
 results, lower capital spending, and structural reductions to working
 capital, despite volatile metal prices and higher working capital
 requirements as it ramped up new assets.
 At the end of the fi scal 2015, the company reported liquidity of .1
 Utkal Alumina International Limited (UAIL) (a wholly-owned subsidiary)
 The Alumina Refi nery at UAIL produced 1 million ton of Alumina in FY15
 compared to 0.2 million ton in FY14.  Of this, 288 kilotonnes of
 Alumina was exported, the balance was supplied to smelters at Hindalco.
 The cost of production of Alumina at UAIL is comparable to world
 benchmark cost of production.
 UAIL reported an EBITDA of Rs. 261 crore. Its Net loss stood at Rs. 496
 crore after interest charge of Rs. 519 crore and Depreciation of Rs.
 238 crore.
 Aditya Birla Minerals Limited (ABML) (a 51% subsidiary)
 Aditya Birla Minerals Limited, Australia reported a net loss of AUD
 219.7 million in FY15 compared to AUD 0.2 million in FY14. The sinkhole
 incident in March 2014 resulted in a cost of approximately m during
 the suspension period. Its Copper production volume after
 recommencement of operations was lower and Impairment charges of ~9
 million had an adverse impact on the Company''s fi nancials in FY15.
 The suspension of operations for more than 4.5 months in FY15 resulted
 in signifi cantly lower operating performance compared to the previous
 year FY14. The Nifty Copper Sulphide Concentrator produced 12,698
 metric tonnes of copper in concentrate as compared to 44,071 metric
 tonnes of contained copper the previous year, a decrease of 71%. The
 management is now focussed on implementation of various cost
 optimisation initiatives and rationalisation of capex spending.
 ABML has resolved to undertake a review of the Company''s strategic
 options with a view to maximise value for all shareholders (Strategic
 Review). The Strategic Review will consider corporate and operational
 strategies, and include a review of ownership options available to the
 Business Reconstruction Reserve:
 The Company had formulated a scheme of fi nancial restructuring under
 Sections 391 to 394 of the Companies Act 1956 (the Scheme) between
 the Company and its equity shareholders approved by the High Court of
 judicature of Bombay to deal with various costs associated with its
 organic and inorganic growth plan. Pursuant to this, a separate reserve
 account titled as Business Reconstruction Reserve (BRR) was created
 during the year 2008-09 by transferring balance standing to the credit
 of Securities Premium Account of the Company for adjustment of certain
 expenses as prescribed in the Scheme. Accordingly the Company had
 transferred Rs. 8,647.37 crore from Securities Premium Account to BRR
 and till 31st March, 2014, Rs. 153.04 crore and Rs. 2,068.50 crore have
 been adjusted against BRR in standalone and consolidated accounts
 respectively. During the year, following expenses has been adjusted
 with BRR in both accounts:
 (a) Impairment loss of Rs. 62.29 crore (Net of deferred tax Rs. 32.97
 crore) arising on deteriorating operating performance in one of its
 cash generating unit of Aluminium Business.
 (b) Provision of Rs. 35.00 crore towards diminution in value of
 investment of Mahan Coal Limited, joint venture of the Company, and
 Tubed Coal Mines Limited, subsidiary of the Company, made following
 de-allocation of coal blocks by the Hon''ble Supreme Court.
 There are no signifi cant and material orders passed by the regulators
 or courts or tribunals impacting the going concern status of the
 The Supreme Court of India by its judgment dated 25th August, 2014 read
 with its Order dated 24th September, 2014 cancelled 204 coal blocks
 which had been allocated earlier for the purposes of mining coal for
 captive consumption. These include three Coal blocks allotted to your
 Company jointly with others, viz. Tubed Coal Block, Mahan Coal Block,
 Talabira II/III coal block and one Coal block allotted to your Company
 i.e Talabira I Coal block in Orissa. No mining activity had commenced
 at Tubed, Mahan and Talabira II & III Coal Blocks.
 Subsequent to the Supreme Court judgment, the Central Government
 promulgated Ordinances dated 21st October, 2014 and 26th December, 2014
 for allotment and auction of 204 coal blocks. The Ministry of Coal has
 also framed Rules u/s 29 of The Coal Mines (Special Provision)
 Ordinance, 2014 and notifi ed on 11th December, 2014 the auction and
 allotment of all the above mentioned coal blocks.  Your Company
 participated in the e-auction conducted by the Central Government for
 allocation of the coal blocks and has been awarded the Gare Palma IV/4
 and Gare Palma IV/5 coal mines situated in Chhattisgarh, which has
 about 11 Million Tonnes and about 41 Million Tonnes of coal reserve
 respectively, Kathautia Coal Mine in Jharkhand which has about 26
 Million Tonnes of coal reserve and Dumri Coal Mine in Jharkhand which
 has about 46 Million Tonnes of coal reserve.
 Commercial production from the mines is expected to commence in Q2 of
 FY16. The primary consideration for obtaining the mines is to ensure
 your Company''s coal security.
 Several innovative people - focused initiatives have been instituted at
 the Group level, and these are translated into action at all of the
 Group Companies.  Our basic objective is to ensure that a robust talent
 pipeline and a high-performance culture, centred around accountability
 is in place. We feel this is critical to enable us retain our
 competitive edge.
 Your Company''s Research & Development (R&D) activities are focused on
 providing innovative, cost-effective and sustainable solutions to
 support consistent growth of business.
 The R&D activities of your Company include process, product and
 application development, to develop short term as well as long term
 solutions to the issues faced by nonferrous sector, such as raw
 material quality, cost effective management of waste generated during
 processing, recovery of value from by product as well as any waste
 products, developing better understanding of the science of processes,
 reducing the specifi c energy consumption and carbon footprint etc.
 Specifi c programs have also been initiated to foster better
 understanding of the requirement of existing and prospective customers,
 and to provide a better service through application development, so as
 to increase your company''s market share in the chosen market space.
 Technical competencies developed by your company will go a long way in
 terms of quick absorption of technologies, enabling pushing boundaries
 of our processes, so as to increase the economic performance and
 improve our new product/ new application pipeline to address the
 impending market opportunities.
 Your company already operates two Hindalco Innovation Centres (HIC),
 one HIC-Alumina at Belgaum working on R&D of bauxite, alumina and
 specialty alumina products, and one HIC-SemiFab located at Taloja, near
 Mumbai, working in the area of aluminium fabricated products. In
 addition, your company engages the Aditya Birla Group''s corporate
 research and development centre, Aditya Birla Science and Technology
 Company Private Limited (ABSTCPL), for conducting R&D in select areas
 of work through chartered R&D projects.  These are based on the domain
 expertise and R&D facilities available in ABSTCPL. The engagement has
 resulted into some patent applications, which have been and will be
 assigned to your company on the grant of the patent. ABSTCPL''s forte of
 having multi-disciplinary teams of technical experts, scientists and
 engineers, enables your company to develop building competencies in
 select areas, as a long term value to business.
 Several accolades have been conferred upon your Company, in recognition
 of its contribution in diverse fi elds. A selective list:
 1.  Aditya Aluminium wins Kalinga Safety Award for Best Practices in
 Safety & CSR, presented at the Odisha State Safety Conclave.
 2.  Utkal Alumina International Limited wins the Think Media Best CSR
 Case Study Award 2014 on the theme of Access to Quality Health Care
 3.  Hirakud wins Greentech CSR Silver Award 2014 for its initiatives in
 Sustainable Livelihood in and around the unit location.
 4.  Hirakud Smelter wins CII Easter Region Quality Award 2014-15
 (Certifi cate of Appreciation) in the large scale category.
 5.  Birla Copper Dahej wins Greentech CSR Silver Award 2014 for
 Education Upliftment in 85 surrounding Government schools.
 6.  Birla Copper Dahej wins Greentech Environment Gold Award 2014 for
 continual sustainable development approach.
 7.  Birla Copper Dahej wins Greentech CSR Silver Award 2014 for
 outstanding achievement in Safety Management System.
 8.  Birla Copper Dahej wins 2nd Runners Up Award & Advocacy Award at
 the All India Kaizen Competition organized by Baroda Productivity
 9.  Taloja wins Greentech Safety Silver Award 2014 for excellence in
 Fire & Safety Management.
 10.  Taloja wins Greentech Environment Silver Award 2014 for continual
 sustainable development approach.
 11.  Taloja wins CII-EXIM Bank Award (Commendation Certifi cate) 2014,
 for Strong Commitment to Excel.
 12.  Mouda Works received First Prize for Best Safety Practice in a
 Competition organized by the National Safety Council, Vidharba Action
 Centre in collaboration with Directorate, Industrial Safety & Health -
 Government of Maharashtra.
 13.  Maliparbat Mines wins awards in Training, OHS, Welfare &
 Amenities, Safety Performance & Consciousness during the Odisha
 Metalliferrous Mines Safety Week programme.
 14.  Teams from Renukoot, Renusagar, Hirakud, Dahej win at the National
 level Quality Circle Conventions.
 15.  Belur participant wins First Prize under Trade Electrician at the
 National level Work Skills Competition.
 The Consolidated Financial Statements have been prepared by your
 Company in accordance with the provisions of the Companies Act, 2013,
 read with the Companies (Accounts) Rules, 2014, applicable Accounting
 Standards and the provisions of the listing agreement with the Stock
 Exchanges and forms part of the Annual Report.
 ESOS - 2006
 During the year ended 31st March, 2015, the Company has allotted
 373,666 fully paid-up equity share of Rs. 1/- each of the Company
 (Previous year 4,800) on exercise of options under ESOS 2006 for which
 the Company has realised Rs. 3.83 crore (Previous year Rs. 0.05 crore)
 as exercise money. The weighted average share price at the exercise
 date was Rs. 168.73 per share (Previous yearRs. 115.20).
 ESOS - 2013:
 During the year ended 31st March, 2015, the Company has allotted 18,848
 fully paid-up equity share of Rs. 1/- each of the Company (Previous
 year Nil) on exercise of options under ESOS 2013 for which the Company
 has realised Rs. 0.22 crore (Previous year Nil) as exercise money. The
 weighted average share price at the exercise date was Rs. 154.54 per
 share (Previous year NIL).
 The details of Stock Options and Restricted Stock Units granted under
 the above mentioned Schemes are available on your Company''s website
 viz. www.
 A certificate from the statutory auditor on the implementation of your
 Company''s Employees Stock Option Schemes will be placed at the ensuing
 Annual General Meeting for inspection by the members.
 Your Directors reaffi rm their continued commitment to good corporate
 governance practices. Your Company fully adheres to the standards set
 out by the Securities and Exchange Board of India for Corporate
 Governance practices and has implemented all of its stipulations.
 As required by Clause 49 of the Listing Agreement of Stock Exchanges, a
 separate section on Corporate Governance, together with a certifi cate
 from your Company''s statutory auditors, forms part of this Annual
 As stipulated in Section 134(3)(c) of the Companies Act, 2013 the
 Act, your Directors subscribe to the Directors'' Responsibility
 Statement and confi rm that:
 a) in the preparation of the annual accounts, applicable accounting
 standards have been followed along with proper explanations relating to
 material departures;
 b) the accounting policies selected have been applied consistently and
 judgments and estimates have been made that are reasonable and prudent
 so as to give a true and fair view of the state of affairs of the
 company as at 31st March,2015 and of the profi t of your company for
 that period;
 c) proper and suffi cient care has been taken for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Act for safeguarding the assets of your company and for preventing and
 detecting fraud and other irregularities;
 d) the annual accounts of your Company have been prepared on a going
 concern basis;
 e) your Company had laid down internal fi nancial controls and that
 such internal fi nancial controls are adequate and were operating
 f) your Company has devised proper system to ensure compliance with the
 provisions of all applicable laws and that such systems were adequate
 and operating effectively.
 The information on conservation of Energy, Technology Absorption and
 Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m)
 of the Companies Act, 2013, read with Companies (Accounts) Rules,2014
 is set out in Annexure-I to this Report.
 In accordance with the provisions of Section 197(12) of the Companies
 Act,2013 the Act read with the Companies (Appointment and
 Remuneration of Managerial Personnel) Rules, 2014, the names and other
 particulars of employees are to be set out in the Directors'' Report, as
 an addendum thereto. However, in line with the provisions of Section
 136(1) of the Act, the Report and Accounts as set out therein, are
 being sent to all Members of your Company excluding the aforesaid
 information about the employees. Any Member, who is interested in
 obtaining these particulars about employees, may write to the Company
 Secretary at the Registered Offi ce of your Company.
 Disclosures pertaining to remuneration and other details as required
 under section 197(12) read with Companies (Appointment and Remuneration
 of Managerial Personnel) Rules, 2014 are attached as Annexure-II.
 Board constitution and changes:
 The Board of Directors of the Company had appointed existing
 Independent Directors viz. Mr. M.M. Bhagat, Mr. N.J. Jhaveri, Mr. K.N.
 Bhandari, Mr. Jagdish Khattar and Mr. Ram Charan as Independent
 Directors under the Companies Act, 2013 for a term of fi ve years which
 was also approved by the members in the Annual General Meeting held on
 24th September, 2014.
 All Independent Directors have given declarations that they meet the
 critera of Independence as laid down under Section 149(6) of the
 Companies Act,2013 and Clause 49 of the Listing Agreement.
 At the same Annual General Meeting Mr. A.K. Agarwala and Smt. Rajashree
 Birla were reappointed as the Directors of the Company.
 In the Financial Year 2014-15, our Independent Director Mr. C.M. Maniar
 passed away, hence ceased to be a Director w.e.f 29th June, 2014.
 Mr. Kumar Mangalam Birla and Mr. Satish Pai retire from offi ce by
 rotation, and being eligible, offer themselves for reappointment. Brief
 resumes of the directors being reappointed form part of the notice of
 the ensuing Annual General Meeting.
 Policy on appointment and remuneration of Directors and Key Managerial
 The Nomination and Remuneration Committee has formulated the
 remuneration policy of your company which is attached as Annexure-III
 to this Report.
 Meetings of the Board:
 The Board of Directors of your Company met 8 times during the year
 details of which are given in the Corporate Governance Report forming
 part of Annual Report.
 Annual Evaluation:
 Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
 the Listing Agreement, the Directors has carried annual performance
 evaluation of Board, Independent Directors, Non Executive Directors,
 Executive Directors, Committee and Chairman of the Board. The
 Nomination and Remuneration Committee approved the evaluation framework
 and during the year, the fi rst evaluation cycle was completed by the
 The evaluation framework focused on various aspects of the Board and
 Committees such as review, timely information from management etc.
 Also, the performance of individual directors was divided into
 Executive, Non Executive and Independent Directors and based on the
 parameters such as contribution, attendance, decision making, action
 oriented, external knowledge etc.
 Board members were requested to evaluate Independent Directors, Non
 executive Directors, Executive Directors, Committee and Chairman of the
 Board. The results of evaluation were shared with the Board of
 The Audit Committee comprises of Mr. M.M. Bhagat, Mr. K.N. Bhandari,
 Mr. N.J. Jhaveri, Independent Directors of your Company. Mr. D.
 Bhattacharya: Managing Director, Mr. Satish Pai: Deputy Managing
 Director and Mr. Praveen Kumar Maheshwari: Chief Financial Offi cer are
 the permanent invitees.  Further details relating to the Audit
 Committee are provided in the Corporate Governance Report forming part
 of this Annual Report.
 In terms of provisions of Section 203 of the Companies Act,2013, Mr. D.
 Bhattacharya: Managing Director, Mr. Satish Pai: Deputy Managing
 Director, Mr. Praveen Kumar Maheshwari : Chief Financial Offi cer and
 Mr. Anil Malik: Company Secretary are the Key Managerial Personnel of
 your Company.
 Your Company has in place a vigil mechanism for directors and employees
 to report concerns about unethical behaviour, actual or suspected fraud
 or violation of your Company''s Code of Conduct.  Adequate safeguards
 are provided against victimisation to those who avail of the mechanism
 and direct access to the Chairman of the Audit Committee in exceptional
 cases is provided to them.
 The vigil mechanism is available on your Company''s website viz.
 Statutory Auditors
 Pursuant to provisions of Section 139 of the Companies Act, 2013 read
 with the Companies (Audit and Auditors) Rules, 2014,, M/s Singhi & Co,
 Chartered Accountants were appointed as Statutory Auditors of the
 Company from the conclusion of fi fty fi fth Annual General Meeting
 held on 24th September,2014, until the conclusion of fi fty-eighth
 Annual General meeting to be held in the calendar year 2017, subject to
 ratifi cation of their appointment at every Annual General Meeting.
 Resolution seeking your ratifi cation is included in the Notice
 convening the Annual General Meeting. The observation made in the
 Auditor''s Report are self explanatory and therefore, do not call for
 any further comments under Section 134(3)(f) of the Act.
 Cost Auditors
 In terms of the provisions of Section 148 of the Companies Act, 2013
 read with the Companies (Cost Records and Audit) Amendment Rules, 2014,
 the Board of Directors of your Company have on the recommendation of
 the Audit Committee, appointed M/s. Nanabhoy & & Co., Cost Accountants,
 Mumbai as Cost Auditors, to conduct the cost audit of your Company for
 the fi nancial year ending 31st March, 2016, at a remuneration as
 mentioned in the Notice convening the Annual General Meeting. As
 required under the Act, the remuneration payable to the cost auditor is
 required to be placed before the Members in a general meeting for their
 ratifi cation. Accordingly, a resolution seeking Member''s ratifi cation
 for the remuneration payable to Cost Auditors forms part of the Notice
 of the ensuing Annual General Meeting.
 Secretarial Auditors
 Pursuant to provisions of Section 204 of the Companies Act,2013 read
 with the Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014, the Company has appointed BNP& Associates,
 Company Secretaries, Mumbai as Secretarial Auditor for conducting the
 Secretarial Audit of your Company for the financial year ended 31st
 March,2015. The Report of the Secretarial Auditors is annexed herewith
 as Annexure-IV.
 The Secretarial Audit Report does not contain any qualification,
 reservation or adverse remark.
 Your Company is committed to sustainable development. A separate
 chapter in this report deals at length with your Company''s initiatives
 and commitment to environment conservation.
 Details of Loans, Guarantees and Investments covered under the
 provisions of Section 186 of the Companies Act, 2013 read with
 Companies (Meetings of Board and its Powers) Rules, 2014 are given in
 the notes to Financial Statements.
 In terms of the provisions of Section 135 of the Companies Act, 2013
 (the Act) read with Companies (Corporate Social Responsibility
 Policy) Rules, 2014, the Board of Directors of your Company has
 constituted a Corporate Social Responsibility (CSR) Committee which
 is chaired by Mrs. Rajashree Birla.
 The other Members of the Committee are Mr. N.J.  Jhaveri, Independent
 Director, Mr. A.K. Agarwala, Non Executive Director and Mr. D.
 Bhattacharya, Managing Director. Dr. Pragnya Ram, Group Executive
 President, Corporate Communication & CSR is a permanent invitee to the
 Committee. Your Company also has in place a CSR Policy and the same is
 available on your Company''s website viz. The
 Committee recommends to the Board activities to be undertaken during
 the year.
 Your Company is a caring corporate citizen and lays significant
 emphasis on development of the communities around which it operates.
 Your Company has identified several projects relating to Social
 Empowerment & Welfare, Infrastructure Development, Sustainable
 Livelihood, Health Care and Education during the year and initiated
 various activities in neighbouring villages around plant locations.
 The Annual Report on CSR activities is attached as Annexure-V forming
 part of this report.
 Pursuant to the requirement of Clause 49 of the Listing Agreement, the
 Company has constituted Risk Management Committee, which is mandated to
 review the risk management plan/process of your company.
 Risk evaluation and management is an ongoing process within the
 Organization. Your Company has comprehensive risk management policy
 which is periodically reviewed by the Risk Management Committee.
 During the fi nancial year, your Company entered into related party
 transactions which were on arm''s length basis and in the ordinary
 course of business.  There are no material transactions with any
 related party as defi ned under Section 188 of the Act read with
 Companies (Meetings of Board and its Powers) Rules, 2014. All related
 party transactions have been approved by the Audit Committee of your
 The policy on Related Party Transactions as approved by the Audit
 Committee and the Board is available on your Company''s website viz.
 In terms of the provisions of Section 92 (3) of the Companies Act, 2013
 (the Act) read with the Companies (Management and Administration)
 Rules, 2014, an extract of the Annual Return of your Company for the fi
 nancial year ended 31st March, 2015 is given in Annexure-VI to this
 As per Clause 55 of the Listing Agreement with the Stock Exchanges, a
 separate section of Business Responsibility Report forms part of this
 Annual Report.
 Your Company has an Internal Control System, commensurate with the
 size, scale and complexity of its operations. The scope and authority
 of the Internal Audit (IA) function is defi ned by the Audit Committee.
 The Internal Audit Department monitors and evaluates the effi cacy and
 adequacy of internal control system in the Company, its compliance with
 operating systems, accounting procedures and policies at all locations
 of the Company.
 Based on the report of internal auditors, the process owners undertake
 corrective action in their respective areas and thereby strengthen the
 controls. Signifi cant audit observations and corrective actions
 thereon are presented to the Audit Committee of the Board.
 Your directors confi rm having laid down internal fi nancial controls
 and that such internal fi nancial controls are adequate and were
 operating effectively
 The fi nancial statements of your Company''s subsidiaries and related
 information have been placed on the website of your Company viz.
 www.hindalco.  com and also available for inspection during business
 hours at the registered offi ce of your Company. Any Member, who is
 interested in obtaining a copy of fi nancial statements of your
 Company''s subsidiaries, may write to the Company Secretary at the
 Registered Offi ce of your Company.
 In accordance with the provisions of the section 129 (3) of the Act,
 read with the Companies (Accounts) Rules, 2014, a report on the
 performance and fi nancial position of each of the subsidiaries,
 associates and Joint Venture is attached as Annexure-VII to this
 The names of Companies which have become or ceased to be subsidiaries,
 Joint Ventures and associates are also provided in the aforesaid
 — There were no material changes and commitments affecting the fi
 nancial position of your Company between end of fi nancial year and the
 date of report.
 — Your Company has not issued any shares with differential voting.
 — There was no revision in the fi nancial statements.
 — Your Company has not issued any sweat equity shares.
 — Mr. D. Bhattacharya and Mr. Satish Pai are directors on the Board of
 Novelis Inc, wholly owned subsidiary. They are in receipt of annual fee
 of US$ 1,55,000 and US$ 1,50,000 respectively in the calendar year
 — There was no change in the nature of business.
 — During the year under review, your Company has not accepted any fi
 xed deposits from the public falling under Section 73 of the Act read
 with the Companies (Acceptance of Deposits) Rules, 2014. Thus, as on
 March 31, 2015, there were no deposits which were unpaid or unclaimed
 and due for repayment.
 Further, as the Company had not accepted any deposit under Section 58A
 of the Companies Act, 1956 read with Companies (Acceptance of Deposits)
 Rules, 1975, in the previous year(s) and as there were no deposits
 which were unclaimed and due for repayment, as on March 31, 2014, there
 has been no default in repayment of deposits or payment of interest
 thereon during the year under review.
 Your Directors place on record their sincere appreciation for the
 assistance and guidance provided by the Hon''ble Ministers, Secretaries
 and other offi cials of the Ministry of Mines, Ministry of Coal, the
 Ministry of Chemicals and Fertilizers and various State Governments.
 Your Directors thank the Financial Institutions and Banks associated
 with your Company for their support as well.
 Your Company''s employees are instrumental in your Company scaling new
 heights, year after year. Their commitment and contribution is deeply
 Your involvement as Shareholders is greatly valued.  Your Directors
 look forward to your continuing support.
                                      For and on behalf of the Board
 Mumbai                                         Kumar Mangalam Birla
 Dated : 28th May, 2015                                     Chairman
                                                      (DIN: 00012813)
Source : Dion Global Solutions Limited
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