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Genus Power Infrastructures Ltd.

BSE: 530343 | NSE: GENUSPOWER | Series: NA | ISIN: INE955D01029 | SECTOR: Electricals

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Annual Report

For Year :
2018 2017 2016 2015 2014 2013 2012 2011 2010

Director’s Report

Dear members,

The directors have pleasure in presenting the 26th Annual Report on the business operations of Genus Power Infrastructures Limited (‘Genus’ or’ the company1), together with the audited financial statement for the financial year ended March 31,2018.

FINANCIAL RESULTS OFOPERATIONS

The financial results of operations of the company for the financial year ended March 31,2018 are as under

(Rs. in lakhs, except per share data)

Standalone

Consolidated

Particulars

Year ended March 31,2018

Year ended March 31,2017

Year ended March 31,2018

Year ended March 31,2017

Income

Revenue from operations

83,655.70

65,274.70

83,655.70

65,274.70

Other income

2,198.72

2,400.41

5,503.02

3,032.74

Total lncome

85,854.42

67,675.11

89,158.72

68,307.44

Expenses

Cost of raw materials and components consumed

58,967.82

39,844.38

58,967.82

39,844.38

(lncrease)/decrease in inventory of finished goods and work in progress

(1,471.71)

1,130.43

(1,471.71)

1,130.43

Excise duty

150.58

1,037.28

150.58

1,037.28

Employee benefit expenses

8,576.58

7,446.24

8,576.58

7,446.24

Other expenses

8,131.11

7,157.68

8,131.11

7,157.68

Depreciation and amortization expenses

1,714.14

1,534.56

1,714.14

1,534.56

Finance costs

2,276.60

2,487.21

2,276.62

2,487.21

Total expenses

78,345.12

60,637.78

78,345.14

60,637.78

Earnings before interest, tax, depreciation and amortization (EBITDA)

9,301.32

8,658.69

9,301.32

8,658.69

Profit before exceptional item and tax

7,509.30

7,037.33

10,813.58

7,669.66

Exceptional item

-

-

-

-

Profit before tax

7,509.30

7,037.33

10,813.58

7,669.66

Tax expense

2,354.82

1,246.23

2,354.82

1,246.23

Profit after tax before share of profit from associates for the period

5,154.48

5,791.10

8,458.76

6,423.43

Add: Share of profit from associates

-

-

(6.68)

27.54

Net profit for the period

5,154.48

5,791.10

8,452.08

6,450.97

Other comprehensive income (net of tax)

247.70

56.01

247.70

54.57

Total comprehenslve lncome

5,402.18

5,847.11

8,699.78

6,505.54

Paid-upequity share capital(FacevalueRe.1/ pershare)

2,572.29

2,571.83

2,572.29

2,571.83

Earnings per share (before and after extraordinary item) (of Re.1/- each) (not annualized) (amount in Rs)

- Basic earnings per share

2.00

2.25

3.68

2.81

- Diluted earnings per share

2.00

2.25

3.68

2.80

REVIEW OF STANDALONE FINANCIAL PERFORMANCE AND THE STATEOFCOMPANY’S AFFAIRS

- Revenue from operation (net of excise duty) increased in the FY 2017-18 by 30% to Rs.83505.12 lakhs from Rs.64237.42 lakhs reported in the previous year, led by improved order inflow and better execution of both Metering and ECC orders.

- Earnings before interest, tax, depreciation and amortization (EBITDA) increased by 7.42% to Rs.9301.32 lakhs in the FY 201718 from Rs.8658.69 lakhs in previous year on account of higher order execution, leading to better absorption of fixed cost. However, EBITDA margin declined to 11.14% in FY 2017-18 from 13.48% reported in the previous year, mainly due to increase in raw material costand imposition of GST.

- Finance cost reduced to Rs.2276.60 lakhs in the FY 2017-18 from Rs.2487.21 lakhs in the previous year led by optimum utilisation of available credit limits (bank borrowings) and current assets. The total debts slightly increased to Rs.23768.34 lakhs from Rs.21991.15 lakhs in the previous year on account of increased short-term working capital loans availed to execute higher amount of orders. The company continued to rely on short-term debt to meet its working capital requirements. The long-term debt was used largely to support the capital expenditure incurred towards expansion.

- Profit after tax (PAT) declined by 11% to Rs.5154.48 lakhs from Rs.5791.10 lakhs in the previous year mainly due to higher tax led by higher deferred tax provision because of accrued income on investments and units situated in tax exempted area.

- Earnings per share (basic & diluted) for the year ended March 31, 2018 stood at Rs.2.00 per share.

- Net worth increased to Rs.74539.36 lakhs in the FY 2017-18 as compared to Rs.70121.62 lakhs in the previous year.

- During the year under review, the company has written-off liquidated damages and bad debts of Rs.1340.56 lakhs, which were mainly arisen due to liquidated damages and deductions by indenting agencies as per the terms of the contract of supplies.

- Company’s liquidity is supported by the treasury shares arisen as a result of the scheme of arrangement between the company, Genus Paper Products Limited and Genus Paper and Boards Limited as approved by the Hon’ble Allahabad High Court in FY 2013-14. The treasury shares is comprised of 275.44 lakhs equity shares of the company and 475.44 lakhs equity shares of Genus Paper & Boards Limited, which together had a market value of Rs.19823.94 lakhs and carried a book value of Rs.5995.08 lakhs.

OPERATIONS AND BUSINESS PERFORMANCE

The operationaland business performances of the company have been appropriately described in the report on management discussion and analysis, which form part of this report.

CHANGEINTHENATUREOF BUSINESS

During the year under review, there was no change in the nature of business of the company.

ORDER BOOKING POSITION

During the year under review, we have witnessed a good traction of domestic orders and we have received orders for smart meters, DT metering, LT, CT&HT metering and a few others.

DIVIDEND

Pursuant to the dividend distribution policy of the company as approved by the board, the board in its meeting held on May 11,2018 has recommended a dividend of Re.0.41 (i.e. 41%) per equity share on equity shares of the face value (FV) of Re.1 each for the FY 2017-18 to members for their approval at the ensuing annual general meeting. Amount to Rs.1054.64 lakhs in addition to Rs.216.78 lakhs by way of dividend distribution tax. The dividend distribution policy, as approved by the board, is available on the website of the company.

SHARE CAPITAL

The paid up equity share capital of the company increased to Rs.2572.29 lakhs consisting of25,72,29,331 equity shares of Re.1 each from Rs.2571.84 lakhs consisting of 25,71,84,714 equity shares of Re.1 each, due to issue of shares upon exercise of employee stock options during the FY 2017-18. During the year under review, the company issued 45,617 equity shares of face value of Re.1 each upon exercise of stock options under the Employees’ Stock Option Scheme-2012 (ESOS-2012) of the company. The company has neither issued shares with differentialvoting rights, nor issued sweat equity shares.

TRANSFERTO RESERVES

The company has not proposed to transfer any amount to the general reserve out of the amount available for appropriation.

PARTICULARS OFLOANS,GUARANTEES ANDINVESTMENTS

Loans, guarantees and investments covered under section 186 of the Companies Act, 2013, form part of the financial statements provided in this annual report.

FIXED DEPOSITS

During the FY 2017-18, the company has not accepted any deposits within the meaning of section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. As such, no amount of deposit or interest thereon is outstanding.

EMPLOYEES’ STOCK OPTION SCH EME

During the year under review, no fresh options were granted to employees of the company in terms of the Employees’ Stock Option Scheme-2012 (ESOS-2012) CESOP Scheme’). During the year, 45,617 options were exercised by the employees after vesting. Accordingly, the company has made allotments of 45,617 equity shares on August 11, 2017 against the options exercised by the employees.

During the year under review, there has been no change in the ESOP Scheme of the company. The ESOP Scheme is administered by the nomination and remuneration committee and it is in compliance with the applicable SEBI’s Regulations. The applicable disclosures as stipulated under regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 with regard to ESOP Scheme of the company are provided in ‘Annexure-A’ to this report.

The equity shares issued against the exercise of options does not affect the statement of profit and loss, as the exercise is made at the market price prevailing as on the date of the grant plus taxes as applicable. Voting rights on the shares issued to employees under the ESOP Scheme are either exercised by them directly or through their appointed proxy.

The company has received a certificate from the auditors of the company that the ESOP Scheme has been implemented in accordance with the SEBi’s Guidelines/Regulations in this regard and the resolution passed by the shareholders. The certificate shall be placed at the ensuing annualgeneralmeetingforinspection by shareholders.

MATERIAL CHANGES AND COMMITMENTS, AFFECTING THE FINANCIAL POSITION OF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR ANDTHE DATE OFTHIS REPORT

In terms of section 134(3X0 of the Companies Act, 2013, except as disclosed elsewhere in this Report, no material changes and commitments, affecting the financial position of the company, have occurred between the end of the financial year and the date of this Report.

SU BSIDIARI ES, JOI NT VENTU RES AN D ASSOCIATE COMPANIES

As on March 31,2018, the company has no subsidiary company.

During the year under review, the following company has become an associate of the company due to increase of shareholding above 20 percent, in term of the provisions of the Companies Act, 2013:

- Greentech Mega Food Park Limited

As on March 31, 2018, the company has the following associate companies:

- M.K.J. Manufacturing Pvt. Ltd.

- Greentech Mega Food Park Limited

In terms of the provisions of section 129(3) of the Companies Act, 2013, a statement containing performance & salient features of the financial statements of company’s subsidiaries/associate/joint venture companies in the prescribed Form AOC-1 is attached as ‘Annexure-B’ to this report.

The policy for determining material subsidiaries as approved by the board may be accessed on the company’s website and its web link is http://beta.genuspower.com/wp-content/uploads/2017/04/ Material-Subsidiaries-Policy_1.pdf.

CONSOLIDATED FINANCIAL STATEMENT

Pursuant to the applicable provisions of Companies Act, 2013 including the Accounting Standard on Consolidated Financial Statements and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (the “Listing Regulations’), the audited consolidated financialstatement is provided in this Annual Report.

The consolidated from operation (net of excise duty) revenue stood at Rs.83505.12 lakhs and the consolidated net profit stood at Rs.8458.76 lakhs in the FY 2017-18.

A statement containing the salient feature of the financial statements of each of the subsidiary/associates/joint venture in the prescribed Form AOC-1 is attached as ‘Annexure-B’ to this report.

In compliance with the provisions of section 136 of the Companies Act, 2013, the financial statements of the subsidiary/associates/joint venture companies are kept for inspection by the shareholders at the registered office of the company. The company shall provide free of cost, the copy of the financial statements of its subsidiary/associates/ joint venture companies to the shareholders upon their request. The statements are also available on the website of the company.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All related party transactions in the financial year under review were in the ordinary course of business and on an arm’s length basis. All these transactions were approved by the audit committee prior to the transaction made. There were no materially significant related party transactions that may have potential conflict with the interests of company at large. There are no transactions that are required to be reported in form AOC-2. For further details of the related party transactions, please refer to Note 47 to the standalone financial statement, which sets out related party disclosures.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the board can be accessed on the company’s website and its web link is http:// beta.genuspower.com/wp-content/uploads/2017/04/Related-Party-Transaction-Policy_0.pdf.

CORPORATE SOCIAL RESPONSIBILITY

Genus has in place a corporate social responsibility (CSR) policy, prepared in line with Schedule VII of the Companies Act, 2013. The company’s CSR policy is prepared by the CSR committee and approved by the board. As per the policy, the company continues to give preference to the local areas where it operates, for spending the amount earmarked for corporate social responsibility activities. The focusareas of the company’s CSR programs/initiatives are as follows:

- Animal welfare

- Promotion of healthcare:

- Eradication of hunger and poverty

- Environmental sustainability and ecological balance

- Promotion of education

The CSR policy is posted on the company’s website and its web link is http://beta.genuspower.com/wp-content/uploads/2017/04/CSR-Policy_Genus.pdf. The statutory disclosures, with respect to the CSR committee and an annual report on CSR activities, form part of this report as’Annexure-C’.

RISK MANAGEMENT AND INTERNAL FINANCIAL CONTROL SYSTEMS

Genus has in place a comprehensive risk management policy and adequate internal financial control system, formulated by the risk management committee and reviewed by the board of the company. The details of the risk management committee, risk management policy and internal financial control systems are provided in the report on ‘management discussion and analysis’ and the ‘corporate governance report’, forming part of this report.

INSURANCE

We believe that insurance is an importance tool of managing uncertainties and risks such as fire, earthquake, storm, tempest, flood, inundation, riot strike, malicious damage, etc. During the year under review, we have insured our assets and projects sufficiently to cover most risks. Some of the key insurance policies, taken by the company are as follows:

- ’Consequential Loss (Fire) Policy” to insure the profit affected during the interruption/cessation of the business operations due to exigency.

- Group Gratuity Insurance Scheme, under which a sum equal to gratuity payable in respect of the entire service (actualand future) is paid in the event of premature/unfortunate death of employee.

- Group Mediclaim Policy for its permanent employees covering theirspouse and dependent children.

- ’Personal Accident Policy (Group)’ for insuring its employees and giving coverage like disability cover, permanent disability cover and death cover due to accident.

CREDIT RATING

During the FY 2017-18, India Ratings and Research (Ind-Ra) has upgraded Genus’s Long-Term Issuer Rating to ‘IND A ’from ‘IND A’. The Outlook is Stable.

The instrument-wise rating actions are as follows:-

Instrument Type

Size of Issue (million)

Rating/Outlook

Rating Action

Fund-Based Limits

INR 2,000

(reduced from INR 2,140)

INDA /Stable/INDA1

Long-term rating upgraded; Short-term rating affirmed

Non-Fund-Based Limits

INR 6,370

INDA /Stable/INDA1

Long-term rating upgraded; Short-term rating affirmed

Commercial Paper Programme (within the fund based working capital limits)

INR 1,000

INDA1

Affirmed

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Pursuant to regulation 34(2) of the Listing Regulations, a report on ‘management discussion and analysis’ is appended to this report as ‘Annexure-D’.

CODEOFCONDUCT

Pursuant to regulation 26(3) of the Listing Regulations, all board members and senior management personnel have affirmed compliance with the ‘company’s code of conduct for directors and senior management’ on an annual basis. The code of conduct is also placed on company’swebsite, www.genuspower.com.

CORPORATEGOVERNANCE

Your company has always followed good Corporate Governance practices in pursuit of its objective of serving society through industry. The corporate governance report along with a certificate of the auditors of the company regarding compliance of the conditions of corporate governance as stipulated under the Listing Regulations is attached as ‘Annexure-E’ to this report.

WHISTLEBLOWER POLICY AND VIGILANCEMECHANISM

Your company has in place a whistleblower policy and vigil mechanism as required under Section 177(9) of the Companies Act 2013. It is formulated with a view to provide mechanism for directors and employees to report genuine concern of unethical behaviour, actual or suspected fraud or violation of the company’s code of conduct. The audit committee reviews the existence and effectiveness of the vigil mechanism from time to time. The above policy & mechanism have been appropriately communicated within the company across all sections and have been displayed on the company’s internal HR management system as well as on the company’s website and its web link is http://beta.genuspower.com/wp-content/uploads /2017/04/Whistle-Blower-Policy-and-Vigil-Mechanism_0.pdf. The audit committee affirmed that no personnel have been denied access to the audit committee during theyear under review.

PREVENTION OF INSIDERTRADING PRACTICES

Your company has in place a ‘code of conduct for prevention of insider trading’ and a ‘code of practices and procedures for fair disclosure of unpublished price sensitive information’ in compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015. The above codes prevent insiders from procuring, communicating, providing or allowing access to unpublished price sensitive information unless required for discharge of duties. The above codes also prohibit the insider to trade in securities, when in possession of unpublished price sensitive information and during the period when the trading window is closed. However, an insider is entitled to formulate a trading plan for dealing in securities of the company in line with the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015 and submit the same to the compliance officer for approval and public disclosure.

EXTRACTOFANNUALRETURN

Pursuant to the provisions of section 134(3)(a) and section 92(3) of the Companies Act 2013, read with rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of annual return as on March 31, 2018, in the prescribed form (i.e. MGT-9), forms part of this report and attached as’Annexure-F.

DIRECTORS

During the FY 2017-18, there was no change (appointment or cessation) in the board members.

In compliance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rajendra Kumar Agarwal and Smt. Sharmila Agarwal, directors of the company, retire by rotation at the ensuing annual general meeting, and they being eligible, have offered themselves for re-appointment. A brief resume of the directors proposed to be re-appointed, the nature of their expertise in specific functional areas, names of companies in which they have held directorships, committee memberships/ chairmanships, their shareholding etc., are furnished in the Annexure to the notice of the ensuing AGM, and the corporate governance report forming part of this report.

Pursuant to the provisions of section 134(3)(d) of the Companies Act, 2013, with respect to statement on declaration given by independent directors under section 149(6) of the Companies Act, 2013, the board hereby confirms that all the independent directors of the company have given a declaration, confirming that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013.

Familiarization programs

Pursuant to regulation 25(7) of the Listing Regulations, Genus organises familiarization programs for the independent directors to provide them an opportunity to have a clear understanding of their roles, rights and responsibilities. This also makes possible for independent directors to understand the company’s business model, operational systems, nature of the industry and other relevant information thoroughly. The company’s actions in this regard have been disclosed on the website of the company and the web link thereto is given in the corporate governance report, which forms part of this report.

Policy on directors’ appointment and remuneration and other details

In compliance with the provisions of section 134(3)(e) and section 178(3) of the Companies Act, 2013, the policy on selection of directors and determining directors independence (criteria for board membership) and the policy on remuneration of directors, KMP and other employees are attached as ‘Annexure-G & H’ respectively, which forms part of this report. For further details relating to directors, please refer to the corporate governance report, which forms part of this report.

BOARD EVALUATION

In compliance with the provisions of the Companies Act, 2013 and the Listing Regulations, the nomination and remuneration committee (NRC committee) has set down the evaluation criteria for performance evaluation of the board, board’s committee, directors and chairperson as a whole and also at individual director leveL The company undertakes annual evaluation in accordance with financial year. The NRC committee has developed a structured questionnaire, covering most facets of the performance of the board, its committee, chairperson and individual director. Our board evaluation process comprises of both assessment and review. This includes analysis of how the board and its committees are functioning, the time spent by the board considering matters and whether the terms of reference of the board committees have been met, besides compliance of the provisions of the Companies Act, 2013.

Evaluation of the Board

The broad parameters for reviewing the performance of the board, inter alia, contain the following:

- Development of suitable strategies and business plans at appropriate time and its effectiveness;

- Implementation of robust policies and procedures;

- Size, structure and expertise of the board;

- oversight of the financial reporting process, including internal controls;

- Willingness to spend time and effort to learn about the company and its business; and

- Awareness about the latest developments in the areas such as corporate governance framework, financial reporting, industry and market conditions.

The independent directors at their separate meeting also assess the quality, quantity and timeliness of flow of information between the company management and the board that is necessary for the Board to effectively and reasonably perform their duties.

Evaluation of Individual Director(s)

(i) Evaluation of managing director/whole time director/ executive director - The performance evaluation of managing director, executive director of the company is done by all the directors, the broad parameters for reviewing the performance of managing director/executive directorate:

- Achievement of financial/business targets prescribed by the board;

- Developing and managing / executing business plans, operational plans, risk management, and financial affairs of the organization;

- Display of leadership qualities i.e. correctly anticipating business trends, opportunities, and priorities affecting the company’s prosperityand operations;

- Development of policies, and strategic plans aligned with the vision and mission of company and which harmoniously balance the needs of shareholders, clients, employees, and other stakeholders;

- Establishment of an effective organization structure to ensure that there is management focus on key functions necessary for the organization to align with its mission; and

- Managing relationships with the board, management team, regulators, bankers, industry representatives and other stakeholders.

(ii) Evaluation of non-executive directors - The broad parameters for reviewing the performance of non-executive directors are as follows:

- Participation at the board/committee meetings;

- Commitment (including guidance provided to senior management outside of board/ committee meetings);

- Effective deployment of knowledge and expertise;

- Effective management of relationship with stakeholders;

- Integrity and maintaining of confidentiality;

- Independence of behaviour and judgment; and

- Impacts influence.

(iii) Evaluation of Independent Directors - The performance evaluation of independent directors is done by the entire Board of Directors (excluding the director being evaluated). In addition to the parameters laid down for Directors, which is common for evaluation to both independent and non- executive directors, an independent director is also evaluated on the following parameters:

- Exercise of objective independent judgment in the best interest of Company;

- Ability to contribute to and monitor corporate governance practice; and

- Adherence to the code of conduct for independent directors. Evaluation of the Committees

The performance of the committees is evaluated by the Directors, on the basis of the terms of reference of the committee being evaluated. The broad parameters of reviewing the performance of the committees, inter alia, are as follows:

- Discharge of its functions and duties as per its terms of reference;

- Process and procedures followed for discharging its functions;

- Effectiveness of suggestions and recommendations received;

- Size, structure and expertise of the committee; and

- Conduct of its meetings and procedures followed in this regard. Evaluation of Chairperson of the Board

The performance of the chairperson is linked to both the functioning of the board as a whole as well as the performance of each director. Independent directors review the performance of the chairperson of the company taking into account the views of the executive directors and non-executive directors. All the directors of the board of the company thereof contribute in evaluating the performance of the chairperson of the board. The broad parameters for reviewing the performance of chairperson of the board areas follow:

- Managing relationship with the members of the board and management;

- Demonstration of leadership qualities;

- Relationship and communication within the board;

- Providing ease of raising of issues and concerns by the board members;

- Promoting constructive debate and effective decision making at the board;

- Relationship and effectiveness of communication with the shareholders and other stakeholders;

- Promoting shareholder confidence in the board and

- Personal attributes i.e. integrity, honesty, knowledge, etc.

For the financial year under review, the company has received the requisite evaluation papers and response with regard to evaluating the entire board, respective committees and individual directors, including chairman of the board. The independent directors had met separately on March 31,2018 without the presence of non-independent directors and the members of management and reviewed & assessed, inter-alia, the performance of non-independent directors and board as a whole and the performance of the chairman of the company after taking into consideration, the views of executive and non-executive board members. The NRC committee has also carried out evaluation of performance of every director. The performance evaluation of all the independent directors has been done by the entire board, excluding the director being evaluated. The board was satisfied about the evaluation process carried out.

KEY MANAGERIAL PERSON N EL

During the year under review, Mr. Rakesh Kumar Agarwal ceased to be a Chief Financial Officer of the company on account of resignation with effect from February 05, 2018. Mr. Nathu Lai Nama, Chartered Accountant, has been appointed as Chief Financial Officer of the company with effect from May 11,2018.

In terms of the provisions of section 2(51) and 203 of the Companies Act, 2013, the following personnel are key managerial personnel (KMP) of the company:

- Mr. Rajendra Kumar Agarwal, Managing Director & Chief Executive Officer(MDSCEO)

- Mr.Jitendra Kumar Agarwa Joint Managing DirectorCJMD)

- Mr. Rakesh Kumar Agarwal, Chief Financial Officer (CFO) (Upto 04.02.2018)

- Mr. Nathu Lai Nama Chief Financial Officer (CFO) (w.e.f. 11.05.2018)

- Mr.Ankit Jhanjhari. Company Secretary(CS)

MEETINGS OFTH E BOARD

During the year under review, six meetings of the board were held. For further details thereof, kindly refer to the corporate governance report, which forms part of this report.

COMM ITTEES OFTH E BOARD

The company has the following committees of the board:

(a) Audit Committee

(b) Nomination and Remuneration Committee

(c) Stakeholders’ Relationship Committee

(d) Risk Management Committee

(e) Corporate Social Responsibility Committee

(f) Finance Committee

(g) Sales Committee

The details of the compositions, powers, roles, terms of reference, etc. of the said committees are provided in the corporate governance report, which forms part of this report.

DIRECTORS’RESPONSIBILITY STATEMENT

Pursuant to the provisions of section 134(5) of the Companies Act 2013, the directors confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures from the same;

(b) they had selected such accounting policies and applied them 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 and of the profit of the company forthat period;

(c) they had 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 and for preventing and detecting fraud and other irregularities;

(d) they had prepared the annual accounts on a ‘going concern’ basis;

(e) they had Laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

(f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

AUDITORS AND AUDITORS’REPORT

Statutory Auditors

M/s. D. Khanna & Associates, Chartered Accountants and M/s. S. R. Batliboi & Associates LLP, Chartered Accountants were appointed as statutory auditors of the Company at the annual general meeting held on September 29, 2014 for a term of 5 consecutive years. In accordance with the Companies (Amendment) Act 2017, enforced on 07th May, 2018 by the Ministry of Corporate Affairs, the appointment of statutory auditor is not required to be ratified at every annual general meeting. Accordingly the appointment of M/s. D. Khanna & Associates, Chartered Accountants and M/s. S. R. Batliboi & Associates LLP, Chartered Accountants of the Company is not placed for ratification by the shareholders of the company in the ensuing annual general meeting. There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their audit report that may call for any explanation from the directors. Further, the notes to the financial statements referred to in the auditor’s report are self-explanatory.

Cost Auditorsand Cost Audit Report

Pursuant to the provisions of section 148(1) of the Companies Act, 2013 read with rules framed thereunder, the Company is required to maintain the cost records as specified and accordingly such accounts and records are made and maintained by the Company. M/s. K. G. Goyal & Associates, Cost Accountants, were appointed as cost auditors for conducting cost audit of cost records for the financial year 2017-2018. The remuneration of cost auditors has been approved by the board on the recommendation of audit committee. The requisite resolution for ratification of remuneration of cost auditors by members of the company has been set out in the notice of ensuing annual general meeting. The cost audit report for the financial year 2016-17, issued by M/s. K. G. Goyal & Associates, Cost Auditors, was filed with the ministry of corporate affairs (MCA) on October 24,2017.

Secretarial Auditor and SecretarialAudlt Report

Pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, secretarial audit for the FY 2017-18 has been carried out by M/s. C. M. Bindal & Company, Company Secretaries & Corporate Consultant. The secretarialaudit report submitted by them in the prescribed form (i.e. MR-3) is attached as ‘Annexure-I’ and forms part of this report. There are no qualifications or observations or adverse remarks or disclaimer of the secretarial auditors in the report issued by them forthe FY 2017-18, which callforany explanation from the board.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Pursuant to the provisions of section 134 of the Companies Act, 2013 read with rule 8(3) of the Companies (Accounts) Rules, 2014, the details of conservation of energy, technology absorption, foreign exchange earnings and outgo are attached as Annexure-J’ to this report and forms part of this report.

PARTICULARS OF EMPLOYEES AND OTHER RELATED DISCLOSURES

The disclosure as required under the provisions of section 197 of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company, will be provided upon request. As per first proviso to section 136(1) of the Companies Act 2013, the annual report excluding the aforesaid information is being sent to the members and others entitled thereto. The said information is available for inspection by the members at the registered office of the company during business hours on working days of the company up to the date of ensuing annual general meeting. Any member interested in obtaining a copy thereof, may also write to the company secretary of the company.

BUSI NESS RESPONSI Bl LITY REPORT (BRR)

At Genus, fulfillment of environmental, social and governance responsibility is an integral part of the way of doing business. As stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI Notification dated December 22,2015, the Business Responsibility Report describing the initiatives taken by the company from environmental, social and governance perspective is attached as Annexure-K’ to this Report, a copy of which will also be available on the company’s website www.genuspower.com

OTHER DISCLOSURES

The directors confirm that during the year under review,

(a) the company has not received any significant or material orders passed by any regulatory authority, court or tribunal which shall impact the going concern status and company’s operations in future.

(b) the company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and RedressaO Act, 2013. The company has not received any complaint regarding sexual harassment in terms of the provisions of the ‘Sexual Harassment of Women at Workplace (Prevention, Prohibition and RedressaO Act, 2013’. Genus has in place a defined policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and RedressaO Act, 2013. The said policy covers all employees with no discrimination between individuals at any point on the basis of race, colour, gender, religion, political opinion, social origin, sexual harassment or age. Genus also has an internal committee (which includes a woman member) to monitor the behavior of all employees and to redress complaints, if any.

(c) neither the managing director nor the whole-time directors of the company receive any remuneration or commission from any of its subsidiary/associate/joint venture.

(d) the statutory auditors or cost auditors or secretarial auditors of the company have not reported any frauds to the audit committee or to the board under the provisions of section 143(12) of the Companies Act, 2013, including rules made thereunder.

(e) the company maintained healthy, cordial and harmonious industrial relationsat all levels.

(f) The company has complied with applicable secretarial standards issued by the Institute of Company Secretaries of India.

ACKNOWLEDGMENTS

Directors wishes to places on record their sincere appreciation for continued support received during the year under review from the Central Government, State Governments, Tax Authorities, Reserve Bank of India, Ministry of Corporate Affairs, Ministry of Power, Ministry of Finance, State Electricity Boards, SEBI, BSE, NSE, Depositories and other connected authorities/departments. The board also wishes to place on record its keen appreciation to all investors, vendors, dealers, business associates and employees, whose enthusiasm, dedication and cooperation have made company’s excellent performance possible.

For and on behalf of the Board of Directors

Ishwar Chand Agarwal

Chairman

DIN: 00011152

Jaipur, August 10,2018

Director’s Report