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BSE: 500730 | NSE: NOCIL |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE163A01018 | SECTOR: Petrochemicals

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Annual Report

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

Director’s Report


Dear Members,

The Directors are pleased to present their Report together with the Audited Accounts of the Company for the year ended 31 March 2018.


(Rs, In Crores)


For the year

For the year

31 March 2018

31 March 2017

Gross Revenues



Profit before Tax



Profit after Tax



Earnings per share of Face Value of Rs, 10/- each - Basic



- Diluted



Performance of the Company

Your Directors are pleased to inform you that the performance of your Company showed a substantial improvement for the year under review as compared to the previous year 2016-17. The performance is significant considering relatively low growth in global rubber consumption for most part of the year. Demand for rubber chemicals is a derived demand and is directly a function of Rubber consumption which saw a growth of about 3%. Against this backdrop, your company has posted Gross Revenues of Rs, 989 Crore as compared to Rs, 818 Crore for the previous year. It may be noted that for the second consecutive year, we achieved growth in sales volume of 12.5%.

Compliance audits and strict implementation of Pollution Control norms by China, resulted into closure of defaulting industries there and created a serious disruption in supply chain. Since over 70% of world''s rubber chemical requirement is met by China, this disturbance resulted into temporary shortage and price escalation. However, your company continued its ethical business strategy and all regular customers were served in a timely manner without abnormal price escalations. Chinese manufacturers have started corrective actions and market is expected to stabilize in near future. However, price bands of rubber chemicals could shift upward due to enhanced compliance costs.

Domestic Market

Your company has recorded a Net Domestic turnover of Rs,700 Crore as against Rs, 513 Crore for the previous year. The Company''s domestic sales volumes grew by 14% as compared to the previous Financial Year 2016-17 despite rubber consumption increasing by 3.5%. During the year, to meet sudden surge in requirement of rubber chemicals, the Company had to raise the production levels of all the products.

The Domestic tyre industry recorded a healthy growth occasioned by the growth in automobile sector and imposition of anti-dumping duty on radial Tyres. Higher capacity utilization by tyre industry resulted into higher demand of rubber chemicals for domestic sector. Some of the domestic non- tyre companies faced subdued industrial activity due to paucity of some article inputs. As a result, in certain segments of non-tyre industries, we could not achieve double digit growth.

Though China accounts for 70% of world''s rubber chemical production, it only consumes about 33-35% of the rubber consumption, resulting in its exports surplus, thereby occasioning the likelihood of dumping into the neighbourhood markets including India.


For the year under review, Export showed a growth of 8% in volume and 17% in revenue. Your company on the back of positive indicators in global rubber consumption coupled with the Company''s strength in specific application areas, recorded one of its best export performances over the years. The issues faced by the Chinese competitors because of the stricter Government measures, have created tightness in supply aspects at the market place. Owing to this, your Company could participate more aggressively in certain key customers accounts on a relatively level playing field. As a result, we have recorded an Export Turnover of Rs, 255 Crore as compared to Rs, 218 Crore in the previous year.

Your company strategically continues to promote some high quality and high value speciality products in the export market which contribute significantly to our export turnover. In case of other products, where competition is acute from China/Korea/EU and pricing unattractive, your company continues to maintain a limited presence in certain select key accounts, focusing on long term business strategy as well as to ensure better capacity utilisation.


The production of all products was undertaken with higher operating rate keeping in mind the market needs. On the input price front, crude Oil witnessed a volatile range of US $ 55 per barrel - US $ 70 per barrel for most part of the year. Benzene prices too witnessed sharp movement between US $ 750- US $ 1050 per M.T. This coupled with supply issues from China, resulted in increased prices of all inputs. Most critical input costs increased by 20% to 50% as compared to the prevailing levels at the beginning of the year. We have been procuring raw materials in a judicious manner and maintaining the inventories at appropriate levels. In few items, we have maintained adequate levels of inventory so as to mitigate the rising cost of production. This fortunately benefitted the Company in terms of higher EBIDTA margins for the 2nd half of the year.


It may be recalled that the Board of Directors of your company had approved a capital expenditure (capex) of Rs, 170 Crore in March 2017. In terms of the said plan, capex which was to be incurred at Navi Mumbai, shall be commissioned by the end of June 2018. Dahej expansion plans are progressing as scheduled and expected to commission during the 3rd quarter of the Financial Year 2018-19.

In view of the overall market conditions, significant expansion plans of the tyre customers and the environmental measures affecting the production capabilities of Chinese competitors, the Board of Directors, after careful evaluation in December 2017/ January

2018, has approved further expansion of '' 255 Crore at the Company''s plants at Navi Mumbai & Dahej. The said expansion is expected to be commissioned during the first half of FY 2019-20. This will enhance the capacities of accelerators and anti-oxidants. In view of the company''s current liquidity position and the likely business scenario in the upcoming financial year, the board is confident that the said Capital Expenditure can be largely financed through internal accruals.

Finance and Rating

During the year under review, in view of optimum utilization of resources, the company generated cash profits and did not utilize any working capital facilities for the whole year. The Company as a result, incurred lower Finance cost for the year under review.

The Credit Ratings Agency CARE has reaffirmed ratings as CARE AA (Double A) (Stable) for long term Bank Facilities (Terms loan as well as Fund Based facilities) and CARE A1 (A One plus) rating for short term Non-Fund Bank facilities. Further, CARE has also reaffirmed CARE A1 rating for issue of Commercial Paper which has been carved out of the working capital facilities.

In addition to the above, the Company had also approached CRISIL Limited for credit ratings for the banking facilities. The said Agency has also assigned CRISIL AA for its Fund-based Bank Facilities and CRISIL A1 (stable) for its Non - Fund-based Bank Facilities


Your Directors are pleased to recommend payment of dividend of Rs, 2.50 per share of Rs,10/- each (25%), on the equity share capital of the Company [previous year Rs,1.80/- per share of Rs,10/- (18%)]. The dividend, together with the tax on Dividend, will absorb a sum of Rs, 49.15 crore (previous year Rs, 35.16 crore).

Transfer of Unpaid Dividend and corresponding Equity Shares to the Investor Education and Protection Fund (IEPF)

In terms of the provisions of Section 125 of the Companies Act, 2013 read with the Companies (Declaration and Payment of Dividend) Rules, 2014, all unclaimed / unpaid dividend up to FY 2009-10 has been transferred to the Investor Education and Protection Fund and unclaimed / un-encashed dividend for the FY 2010-11 paid on 27 July 2011 is due for transfer to IEPF on 2 September 2018.

The Ministry of Corporate Affairs (MCA) had vide its Notification dated 5th September 2016 notified the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (the Rules). In terms of the Rules, the Equity Shares in respect of which the Dividend has not been claimed for seven consecutive years or more, are also required to be transferred to the IEPF in the prescribed manner.

The said Rules were amended from time to time. As per the latest Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Second Amendment Rules, 2017, notified by MCA vide its Notification dated 13th October 2017, the due date for transfer of Equity Shares in respect of Dividend pertaining to the Financial Year 2009-10 was 31st October

2017. The Company had intimated individually to concerned shareholders and published necessary notice in the newspapers intimating the shareholders about the impending transfer and the modus operandi for the same.

In compliance with the Amended Rules, the Company has transferred 12,02,824 Equity shares to the designated demat account opened by IEPF Authority with NSDL through Punjab National Bank i.e. account no. IN300708 10656671, belonging to those shareholders holding shares both in dematerialized form as well as physical form, who had not encashed their Dividend for a period of 7 years or more beginning from the Financial Year 2009-10. The shares held in demat mode were transferred in November 2017 and those held in physical mode were transferred in December 2017.

The Company has also uploaded the details of the shareholders whose shares were liable to be transferred to IEPF on its website viz.,

Fixed Deposits

All the unclaimed fixed deposits/ unclaimed fixed deposit warrants have been transferred to Investor Education & Protection Fund, as required under Section 125 of the Companies Act, 2013. Since, the Company no longer accepts deposits from public, there are no outstanding/unclaimed deposits as at 31 March 2018.


The Company has taken all the necessary steps to insure its properties and insurable interests, as deemed appropriate and as required under the various legislative enactments.

Health, Safety and Environment

Highest HSE standard is a competency parameter for your company and all policies and activities are directed towards setting up benchmarks in safety and environment standards. Safety standards of the company at all locations ensures safety of the employees, visitors, contractors and community around the locations. A dedicated cell in our research Centre directs its efforts to develop new environmental strategies to achieve highest sustainability in the business.

Your Company operates its facilities in a manner consistent with all the applicable HSE laws and regulations, adheres to well laid down policies, systems and procedures, safety awareness and training to maintain the workplace free of any significant incidents and risk to safety and health of all stakeholders.

The Company has in place a very effective Emergency Handling Procedure to provide very prompt and effective response to any emergency situations arising within its premises as well as in the neighborhood.

The Company is very pleased to inform you that we are now certified for ‘RESPONSIBLE CARE’ with effect from 1st December 2017. Responsible Care evaluates safety and environmental impact of products from inception, through manufacture and distribution, to ultimate reuse, recycle and disposal, and involves all the stakeholders in the decision-making process. Various programs and studies have been undertaken related to Safety, Health and Environment and are being implemented as a part of this journey.

Your Company actively participates in the Mutual Aid Group, CETP and solid waste disposal management in the Thane Belapur Industrial Area and has earned the reputation amongst the industry members and statutory authorities for prompt technical support and help during any emergency situations.

Health of employees is of utmost importance. Regular check-up of all employees is done to monitor their health. Work area monitoring to check concentration of chemicals, noise level, Illumination levels and quality of ambient air is regularly done to ensure safe and healthy work environment.

HSE performance of the Company is reviewed by your Board every quarter and guidance and valuable suggestions made by the Board are incorporated to further strengthen HSE practice of the Company.

Total Quality Management

Total quality management in your company is an integrated effort by all functions, from supply chain to application support at customer end, to improve quality performance at each level with a focus on continuous improvement. TQM is a focused objective for your company and management commitment is demonstrated through continuous participation in TQM initiatives.

TQM implementation has strengthened your company''s competitive position. It has improved your company''s adaptability to emerging market conditions particularly in the areas of environmental impact and national and international regulations.

Your company is certified for ISO 9001:2015, IS0 14001:2015, OHSAS 18001:2007 and IATF 16949: 2016 which has a positive impact in terms of customer satisfaction and long-term customer retention. Quality Assurance laboratory of your company is accredited in accordance with ISO 17025:2005 standard.

Dahej location has adopted 5S culture to create an international operating standard.

TQM will continue to contribute in organizational development resulting into enhanced shareholder and stakeholder value.

Research & Development

The research team of your company continues to focus innovative initiatives which will yield long term benefits to the Rubber Chemical business and society at large.

Research & Development is at the core of our continuous improvement Strategy. It is the major enabling factor to fulfil our vision to be a World Class, Customer focused, Innovative organization in the field of rubber chemicals. In view of strengthening R&D, your Board has regularly encouraged investments in R&D and substantial efforts are consistently on to increase talented Manpower pool & to provide necessary Resources & infrastructure for modernization.

The Company''s R & D team have made significant contribution in development of several indigenous Process technologies and new products & one of the major being successful commercialization of novel & greener intermediate technology & further improvement at Dahej. These efforts culminated in growth of the company and improving the bottom line.

The Company''s Research center focuses on the following key areas:

> Enhancement of plant capacities by employing different strategies and continuous improvement in process efficiency and Product quality to satisfy the needs of the National & International customers.

> Development of Niche products using innovative technologies & Green chemistry concepts.

- Adopting various innovative environmental technologies for sustainability.

- Development of new generation environmentally sustainable processes for growth.

These initiatives resulted in de-bottlenecking of plant capacities to cater to the growing market requirements and environmental needs. Research initiatives of your company are recognised by national and international customers and the company enjoys a privileged status as a technology-oriented organization. Novel green initiatives of the company in the field of environmental strategies are appreciated by authorities, setting a benchmark as an environmentally friendly chemical business.

Your board is pleased to inform that your company has also received approval of extension of the Company''s in -house R & D facility from the Ministry of Science and Technology, New Delhi.

Risk Assessment and Management

Your Company has a well-defined Risk Management System in place, as a part of its good Corporate Governance practices. Your Company has assigned the ownership of key risks to various Risk Owners and has made the concerned departments and officials responsible for mitigation plans and review of these risks from time to time. The risks are identified at various departmental levels and suitable mitigation measures are thereafter adopted. These are further subjected to a quarterly review by the Risk Co-ordination Committee as well as the Board. The Business plans are devised and approved by the Board keeping in mind risk factors which can significantly impact the performance of the business. All major capital expenditure commitments are subjected to thorough scrutiny by the Board and investments are permitted only on being satisfied about their return or utility to the Company. Expansion projects are subject to detailed risk assessment and sensitivity tests and approved only after found to pass eligibility criteria.

Internal Control Systems and their Adequacy

Adequate internal controls, systems, and checks are in place, commensurate with the size of the company and the nature of its business. The management exercises financial control on the company''s operations through a well-defined budget monitoring process and specifying standard operating procedures. Your Company has appointed an external professional agency M/s. Aneja Associates, Chartered Accountants, to conduct the internal audit, and the findings and recommendations of the Internal Auditors are placed before the Audit Committee of your Board regularly.

The Internal Auditors monitor and evaluate the efficacy and adequacy of internal controls 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 management undertakes corrective action in the respective areas and thereby further strengthens the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. The Audit committee of the Board ensures that necessary corrective actions suggested are put in place. In addition, during the year under report, the Audit Committee and the Board have specifically reviewed the Internal Control and Financial Reporting process prevalent in the Company. On a periodical basis, the Board also engages the services of professional experts in the said field to ensure that adequate financial controls and systems are in place. At the end of a period, the CEO/CFO gives a declaration in the prescribed format to certify that the financial statements prepared are accurate and complete in all aspects and that there are no significant issues that can impair the financial performance of the Company.

Vigil Mechanism / Whistle Blower Policy

The company has a Vigil Mechanism Policy to deal with an instance of fraud or mismanagement, if any. The details of the Policy are explained in the Corporate Governance Report and are also posted on the website of the Company.

Policy on Sexual Harassment of Women at Workplace

As per the requirement under the provisions made under section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal), Act, 2013, an appropriate Committee has been formed to attend to the complaints of the sexual harassment at workplace, if any, made by female employees. The committee of 4 members consists of two female employees, Vice President-Human Resource and a practicing Advocate in the field of labour laws and regulations. During the year under review, no complaints were received. Wide publicity continues to be given with respect to the policy to all employees and the policy is also displayed on the company''s website.


- Number of Board Meetings

During the year the Board of Directors met eight times as per details stated in the report on Corporate Governance.

- Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulations 17 and 25 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, of individual Directors as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The various criteria considered for evaluation of Whole Time / Executive Directors included qualification, experience, knowledge, commitment, integrity, leadership, engagement, transparency, analysis, decision making, governance etc. The Board commended the valuable contributions and the guidance provided by each Director in achieving the desired levels of growth.

- Declaration of Independent Directors

As required under Section 149(7) of the Companies Act, 2013, the Independent Directors have placed the necessary declaration in terms of the conditions laid down under Section 149(6) of the Companies Act, 2013 in the Board Meeting held on 4th May 2018.

- Familiarization Programme to Independent Directors

The company provides suitable familiarization programme to Independent Directors to familiarize themselves with the nature of the industry in which the company operates and business model of the company in addition to regular presentation on Expansion plans and their updates, technical operations, marketing and exports and financial statements. In addition to the above, Directors are periodically advised about the changes effected in the Corporate Law, Listing Regulations about their roles, rights and responsibilities as Directors of the company. The details of the familiarization programme have been disclosed and updated from time to time on the company''s website and its web link is: http://www.

Directors’ Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3)(c) of the Companies Act, 2013:

(a) That in the preparation of the annual financial statements for the year ended 31st March 2018, the Indian Accounting Standards (Ind AS), the provisions of the Companies Act, 2013, as applicable and guidelines issued by the Securities and Exchange Board of India (SEBI) have been followed along with proper explanations relating to material departures, if any;

(b) That such accounting policies as mentioned in Note 1 forming part of the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent to give a true and fair view of the of the Company as at 31 March 2018.

(c) That proper and sufficient care has been taken 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) That the annual financial statements have been prepared on a going concern basis;

(e) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

(f) That system to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

The above assessment of the Board was further strengthened by periodic review of internal controls by both internal as well as external auditors.

Remuneration policy

During the Financial Year 2014-15, based on the recommendations of the Nomination & Remuneration committee, the Board of Directors approved a Policy for selection and appointment of Directors, Senior Management and their remuneration. There has been no change in the said Policy for the year under review. The Salient features of Remuneration Policy are given in the Corporate Governance Report and criteria for remuneration to independent directors / non-executive directors is also available on the Company''s website.

Investments in Navin Fluorine International Limited and Mafatlal Industries Limited

Your Company in terms of the Board approval, undertook sale and purchase transactions of Equity Shares in Navin Fluorine International Limited (NFIL) and Mafatlal Industries Limited (MIL) respectively in the previous year. These transactions were from time to time disclosed to the Stock Exchanges as per the SEBI Regulations.

The Company has disposed of its entire balance shareholding in NFIL. The cash surplus generated by the Company on sale of shares of NFIL (net of acquisition costs of MIL''s shares) aggregating Rs, 115 Crore has been re-invested by the Company in suitable short-term investments. This income has been routed through the Other Comprehensive Income (OCI), as per the Indian Accounting Standards (Ind AS).

Related Party Transactions

All related party transactions that were entered into during the financial year were at an arm''s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, and Key Managerial Personnel, subsidiary company or other designated persons which may have a potential conflict with the interest of the company at large except as stated in the Financial Statements / Directors'' Report.

As per the Related Party Transactions Policy, approved by the Board of Directors of the Company, during the year under review, the Company has entered into related party transactions based upon the omnibus approval granted by the Audit Committee. On quarterly basis, the Audit Committee reviewed such transactions for which omnibus approval was given.

Particulars of contracts or arrangements with related parties as referred to in Section 188(1) of the Companies Act, 2013 in the prescribed form for FY 2017-18 are given in Annexure “G”.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website and its weblink is

Loans, Guarantees or Investments

Particulars of loans, guarantees or investments under Section 186 of the Companies Act, 2013, are given in the Notes forming part of Financial Statements for the year ended 31st March 2018.

Extract of Annual Return

Extract of Annual Return for the Financial Year ended on 31 March 2018 as required by Section 92 (3) of the Companies Act 2013, is annexed as Annexure “E”.

Subsidiary Company

PIL Chemicals Limited, (PIL) has recorded a Turnover of Rs, 14.63 Crores and Profit before Tax of Rs, 1.96 Crores, for the year under review. The Board of Directors of PIL recommended a Dividend of Re.0.60/-per share.

The Company does not have any material subsidiary, however, the company has formulated a policy for determining material subsidiary(ies) and such policy has been disclosed on the company''s website and its weblink is fckeditor/file/Policy-on-Material-Subsidiaries.pdf

Pursuant to the requirements of Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the details of Loans /Advances made to and investments made in the subsidiary have been furnished in Notes forming part of the Accounts.

A statement containing the salient features of the financial statement of the Company''s subsidiary under the provisions of section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 has been annexed in prescribed form AOC -1.

The audited accounts of the subsidiary company are placed on the Company''s website and the members interested in obtaining copy of annual report of the subsidiary company are requested to get in touch with the Office of the Company Secretary.

Consolidated Financial Statements

Consolidated Financial Statements are prepared by your Company in accordance with the applicable Indian Accounting Standards (Ind AS) issued by the Ministry of Corporate Affairs and the same together with Auditors'' Report thereon form part of the Annual Report. The financial statements have been prepared as per Division II of Schedule III issued by the Ministry of Corporate Affairs vide its Notification dated 6th April 2016.


The relations, during the year, between the employees and the management of your Company continued to be cordial.

Your Directors wish to thank all the employees for their continued support and co-operation during the year under review.

Stock Options

In terms of your approval, read with the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, the details required to be provided under the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, are set out in Annexure “C” to this Report.

Particulars of Employees

The information required under section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 in respect of employees of the Company is provided in Annexure “F”.

Appointment/Reappointment of Directors and Key Managerial Personnel

During the year under review, Mr. C. R. Gupte superannuated as Managing Director w.e.f. 31st July 2017. He was associated with the Company for 41 years and has been instrumental in achieving substantial growth for the company both domestic as well overseas. The Board takes the opportunity to sincerely thank Mr. C. R. Gupte for the excellent contribution made as Managing Director and wish him very healthy and peaceful retired life.

Mr. S.R. Deo, who was Deputy Managing Director took over as Managing Director of the Company effective from 1st August 2017. Mr. Deo earlier served as the Deputy Managing Director and Executive Director & President (Operations). Mr. Deo is M. Tech in Chemical Engineering from the Indian Institute of Technology,

Kanpur. He has contributed significantly to improve the plant efficiencies, product quality, Health, Safety and Environment (HSE) standards in the company, Human Resources strategy to meet the future business challenges, creating strong technical team of Research and Technology for indigenous development of technologies and its implementation. The Board takes the opportunity to wish him success in all his future endeavors.

Pursuant to Section 152(6) of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Priyavrata H. Mafatlal, Director retires by rotation at the forthcoming Annual General Meeting. Being eligible, he offers himself for re-appointment.


Pursuant to the requirement of Section 139(1) of the Companies Act, 2013, at the Annual General Meeting held on 27th July 2017, the Members had accorded their approval for the appointment of M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants, Mumbai as the Statutory Auditors of the Company to examine and audit the accounts of the Company for the Financial Years 2017-18 to 2021-22. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for re-appointment as Auditors of the Company. As required under Regulation 33(1) (d) of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. As required by Section 139(1) of the Companies Act, 2013, the appointment of Statutory Auditors is placed before the Members for ratification.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company are required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s Kishore Bhatia & Associates to audit the cost accounts of the Company for the financial year 2018-19 on a remuneration of '' 6.50 lakhs.

The Cost Auditors have given a Certificate to the effect that the appointment, if made, will be within the prescribed limits specified under section 141 of the Companies Act, 2013.

The Audit Committee has obtained a certificate from the Cost Auditor certifying their independence and arm''s length relationship with the Company. The Cost Audit Report in respect of F.Y. 2016-17 was filed on 17th August 2017 and the Report for the Financial Year 2017-18 will be filed on or before the due date i.e. 27th September 2018.

As required under the Companies Act, 2013, the remuneration payable to the cost auditor is placed before the Members for their ratification.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed M/s. Makarand M. Joshi & Co., Company Secretaries, a firm of Company Secretaries in Practice to carry out the Secretarial Audit of the Company for FY 2017-18. The Report of the Secretarial Audit is annexed herewith as Annexure “B”.

Report on Corporate Governance

As per Regulation 34 read with Schedule V (C) of SEBI (Listing Obligation and Disclosure Requirements), Regulations, 2015, a separate section on Report on Corporate Governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance is attached.

Report on Management Discussion and Analysis

As required under Regulation 34 read with Schedule V (B) of SEBI (Listing Obligation and Disclosure Requirements), Regulations,2015, report on “Management Discussion and Analysis” is attached and forms a part of this Report.

Corporate Social Responsibility

In line with the provisions of the Companies Act, 2013 and the rules framed there under with respect to the Corporate Social Responsibility (CSR), your company has formulated a Policy on CSR and has also constituted a CSR Committee to recommend and monitor expenditure on CSR. The details of CSR Expenditure are given in the prescribed format and forms part of this Report. The same is annexed as Annexure “A”.

The company continues to actively support deserving social causes for improvement and upliftment of various sections of the society as has been its practice for past several years.

Other Particulars

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required to be disclosed in terms of section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules 2014 is set out in Annexure “D” and forms a part of this Report.

Green Initiative

Your Directors would like to draw your attention to Section 20 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, as may be amended from time, which permits paperless compliances and also service of notice/ documents (including annual report) through electronic mode to its members. To support this green initiative of the Central Government in full measure, we hereby once again appeal to all those members who have not registered their e-mail addresses so far are requested to register their e-mail address in respect of electronic holdings with their concerned depositary participants and / or with the Company.


Your Directors would like to acknowledge the continued support and co-operation from its Bankers, Government Bodies, and Business Associates which has helped the company to sustain its growth during the year.

For and on behalf of the Board of Directors

Place : Mumbai Hrishikesh A. Mafatlal

Date : 4 May 2018 Chairman

Director’s Report