The Directors are pleased to present the thirty third annual report of
your Company together with the audited financial statements for the
financial year ended 31st March 2016.
SUMMARY FINANCIAL RESULTS
(Rs. in Lakhs)
Year Ended Year Ended
Particulars 31st March, 2016 31st March, 2015
Total Income 172942.98 167886.10
EBITDA 27462.91 28044.59
Finance Costs 3069.32 5859.98
Depreciation and amortisation
expense 8995.04 8766.03
Net Profit Before Tax (incl.
exceptional income item) 15398.55 13790.21
Tax Expense 5167.20 4667.87
Net Profit After Tax 10231.35 9122.34
Balance of Profit brought
forward 11484.12 7416.58
Interim Dividend on Equity
Shares 4562.17 3421.45
Tax on Interim Dividend 928.75 614.82
Transfer to General Reserve 1023.13 912.23
Transitional Adjustment on account
of change in Depreciation method - 106.30
Surplus carried to Balance Sheet 15201.42 11484.12
During the last year your Company earned revenues of Rs. 172942.98
lakhs as against previous year''s revenues of Rs. 167886.10 lakhs
depicting a growth rate of 3.01 ACU- and earned Profit before tax (PBT) of
Rs. 15398.55 lakhs. The corresponding PBT for the earlier year was Rs.
13790.21 Lakhs. Profit after Tax (PAT) for the year was Rs.10231.35
lakhs as against Rs.9122.34 of the previous year.
The Company''s Goods Transport Division achieved revenues of
Rs.135626.19 lakhs registering a growth rate of 5.08 ACU- as compared to
previous year. The Company earned revenues of Rs.31760.97 lakhs from
bus division and Rs. 2139.42 lakhs from the sale of power generated
through the windmills owned by the Company.
CHANGE IN NATURE OF BUSINESS OF THE COMPANY:
There is no change in nature of business of the Company. Your Company
continues to be one of the leading Logistics service providers in the
country. The service offering of the Company in the Logistics space are
Goods transport, Passenger transport and Courier services apart from
Air Chartering and Wind Power Generation business.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments that occurred subsequent
to the end of the financial year till the date of this report, which
affects the financial position of the Company.
During the Financial year 2015-16, the company has undertaken a capital
expenditure of Rs.10,127.75 lakhs. Out of the same, a sum of Rs.7754.75
lakhs was invested for fleet addition. Other capex components included
a sum of Rs.1382.38 lakhs towards Plant ACY- Office Equipments and
Furniture / Fittings, Rs.524 lakhs towards freehold land and Rs.202.26
lakhs towards Building improvement costs,. The said capex also included
a sum of Rs.264.36 lakhs expended on leasehold improvements.
During the Financial year 2015-16, your directors declared an Interim
Dividend at the rate of 50 ACU- amounting to Rs. 5.00 per equity share. The
Board recommends no further dividend and proposes that the interim
dividend so declared and paid be treated and declared as the final
dividend for the financial year 2015-16.
The Company has not accepted any deposits during the year, within the
meaning of Section 73 of the Companies Act 2013 and the rules made
SUCCESSFUL INITIAL PUBLIC ISSUE
The Company has successfully completed initial public offering (IPO)
during the year 2015-16 pursuant to applicable SEBI rules and
Regulations. The IPO of the Company received an overwhelming response
from the investors and was oversubscribed by more than 74 times thereby
making this IPO a historical one. Shares of the Company have been
listed with both BSE and NSE w.e.f 30th April 2015.
Consequently, the Company''s paid up capital increased from
Rs.85,53,61,620/- to Rs.91,24,34,950/- and Share premium increased from
Rs.10,889.32 lakhs to Rs.21313.09 lakhs. Fresh 5,707,333 equity shares
of Rs.10/- each were issued at a premium of Rs. 195/- per share.
Apart from the aforementioned fresh issue of shares, NSR PE Mauritius
LLC, a private equity investor offloaded 1.45.50.000 equity shares and
the promoters offered 25.66.000 equity shares held by them as a part of
the said public offering.
The company has utilised the issue proceeds as per the objects stated
in the prospectus and as of March 31, 2016 a sum of Rs. 2922.19 lakhs
remain unutilised which is expected to be fully utilised in the coming
CLOSURE OF NEPAL BRANCH:
Company had extended its business operations to Kathmandu, Nepal by
incorporating a branch under the extant provisions of the Laws
prevailing in Nepal with a view to provide quality logistics services
to the customers. However, owing to the disturbances and uncertain
conditions prevalent in Nepal, Management has decided to close its
operations in the said country. Requisite legal formalities to close
the branch office have been initiated and are expected to be completed
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
The company has not given any loans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013.
Details of investments made by the company are given in the notes to
the financial statements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The Board of the Company had
laid down policies, guidelines, procedures and structure to enable
implementation of appropriate internal financial controls across the
Company. These control processes enable and ensure the orderly and
efficient conduct of Company''s business, including safeguarding of
assets, prevention and detection of frauds and errors, the accuracy and
completeness of the Accounting records and timely preparation ACY-
disclosure of financial statements. These controls also identify the
risks and provides for means to minimize / mitigate the risks affecting
the business of the Company as a whole. Auditors, as required under the
Companies Act 2013, have also certified that these internal financial
controls are in order and efficient in mitigating the risks.
The Company''s internal audit department enables the Management to
mitigate the risks or prevent the non compliances of laws which would
affect the financial position of the Company. The scope and authority
of the Internal Audit function is well defined and to maintain its
objectivity and independence, the Internal Audit function reports to
the Chairman of the Audit Committee of the Board as well as directly to
the Chairman ACY- Managing Director. The Internal Audit Department
monitors and evaluates the efficacy 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 audit function, process owners
undertake corrective action in their respective areas and thereby
strengthen the controls. Significant audit observations and
recommendations along with corrective actions thereon are presented to
the Audit Committee of the Board.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
As required under the provisions of the section 135 of the Companies
Act 2013, the Company has constituted the Corporate Social
Responsibility Committee which monitors and oversees various CSR
initiatives and activities of the Company. Composition, terms and
functions of the said committee are provided in the Corporate
Governance report forming part of this Annual Report.
The Company has set up a trust - VRL Foundation under the aegis of
which the Company conducts its CSR activities. Amongst others Health
and Education are the focus areas for the trust. A detailed report of
CSR activities including the amount spent / unspent for CSR activities
is annexed to this report as Annexure A to this report.
CSR policy of the Company is available on the Company''s website and can
be accessed thru the following link.
http://vrlgroup.in/investor AF8-download/CSR ACU-20POLICY.pdf TRANSFER TO
The Company has transferred an amount of Rs.1023.13 lakhs to the
General Reserve out of current year''s profits.
TRANSFER OF UNPAID AND UNCLAIMED AMOUNT TO IEPF:
Pursuant to section 125 of the Companies Act 2013, dividend and refund
of Share Application Money due for refund which remains unpaid for
seven years from the date of its transfer to unpaid dividend /
unclaimed account is required to be transferred by the Company to
Investor Education and Protection Fund (IEPF) established by the
Government. During the year, no amount was due for transfer to IEPF.
During the year under review, your Company experienced cordial
relationship with employees at all levels, throughout the year.
SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND
DISCLOSURE REQUIREMENTS) REGULATIONS, 2015
During the year, your Company executed the Uniform Listing Agreement in
accordance with the requirements of SEBI Circular DCS/ COMP/12/2015-16
dated October 13, 2015, with BSE Limited and National Stock Exchange of
India Limited (NSE). The Company''s Equity Shares are listed on the BSE
and NSE and it has paid its Annual listing fee to these stock exchanges
for the Financial Year 2016- 2017. The Company has formulated the
following Policies as required under Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements) Regulations,
1. ''Policy for Preservation of Documents'' under Regulation 9 of
Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015.
The said policy can be accessed at the following link:
http://vrlgroup.in/vrl AF8-investor AF8-desk.aspx7display policies
2. ''Policy on Criteria for determining Materiality of
Events/Information'' under Regulation 30 of SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015
The said policy can be accessed thru the following link:
http://vrlgroup.in/vrl AF8-investor AF8-desk.aspx?display AD0- policies
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Number of Meetings of the Board:
During the year five Board Meetings were convened and held, details of
which are provided in the Corporate Governance Report. The intervening
gap between the Meetings was in compliance with the provisions
contained in the Companies Act, 2013.
Nomination and Remuneration Policy
The Board has, on the recommendation of the Nomination ACY- Remuneration
Committee, framed a policy for selection and appointment of Directors,
Senior Management and their remuneration including criteria for
determining qualifications, positive attributes and other matters
provided under sub section (3) of section 178 of the Companies Act
2013. The Remuneration Policy is stated in the Corporate Governance
Report and also annexed to this report as Annexure B. The said policy
alternatively can be accessed on the website of the Company at the
http://vrlgroup.in/investor AF8-download/Nomination AF8-
Declaration by Independent Directors
All independent directors have given due declarations that they meet
the criteria of independence as laid down under section 149(7) of the
Companies Act, 2013 and under extant provisions of the SEBI (Listing
Obligations and Disclosure) Requirements) Regulations 2015.
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure) Requirements) Regulations 2015, the Board
has carried out an evaluation of its own performance, the directors
individually as well as the evaluation of the working of its
Committees. The manner in which the evaluation has been carried out has
been explained in the Corporate Governance Report.
A diverse Board enables efficient functioning through differences in
perspective and skill and also fosters differentiated thought processes
at the back of varied industrial and management expertise, gender and
knowledge. The Board recognizes the importance of a diverse composition
and has adopted a Board Diversity policy which sets out the approach to
diversity. The said policy can be accessed thru the following link.
http://vrlgroup.in/vrl AF8-investor AF8-desk.aspx?display AD0-policies
Dr. Ashok Shettar, was appointed as Non-Executive Director in the AGM
held on 8th August, 2015, in the place of Retiring Director, Mr. Darius
Pandole (the representive of NSR) who had not sought reappointment from
the Board. The Board wishes to place on record, the immense
contribution made by Mr. Darius Pandole in his capacity as a Director.
Mr. S R Prabhu, Non-Executive Director and Mr. Raghottam Akamanchi,
Non-Executive Director, retire by rotation and being eligible, offer
themselves for reappointment.
DIRECTOR''S RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act, 2013, the directors
would like to state that:
i) In the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
ii) The directors have selected such accounting policies and applied
them consistently and made judgments and estimates that were 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 or
loss of the Company for that period.
iii) The directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual accounts on a going concern
v) The directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
vi) The directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such system were
adequate and operating effectively.
Based on the framework of internal financial controls established and
maintained by the Company, reviews performed by the Management in
concurrence with the Audit Committee, your Board is of the opinion that
the Company''s internal controls were adequate and effective as on March
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the
financial year were on arm''s length basis and were in the ordinary
course of the business. There are no materially significant related
party transactions made by the company with Promoters, Key Managerial
Personnel or other designated persons which may have potential conflict
with interest of the company at large.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board of Directors
of the Company can be viewed on the website of the Company thru the
http://vrlgroup.in/investor AF8-download/RPT ACU-20Policy.pdf
There were no material significan trelated party transactions entered between the Company, Directors, management, or their relatives except for those disclosed in the financial statements. All the contracts/arrangements/transactions entered into by the Company with the related parties during the financial year 2015-16 were in the ordinary course of business and on an arm''s length basis. In our opinion there were no ACI-material ACI- transactions that warrant a disclosure in this report.
Accordingly, particulars of contracts or arrangements with related
parties referred to in Section 188(1) along with the justification for
entering into such contract or arrangement in Form AOC-2 does not form
a part of this report.
The Company does not have any subsidiary.
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is
applicable to the Members of the Board and specified employees in the
course of day to day business operations of the company. The Company
believes in ACI-Zero Tolerance ACI- against bribery, corruption and unethical
dealings / behaviour in any form and the Board has laid down certain
directives to counter such acts. Such code of conduct has also been
placed on the Company''s website. The Code lays down the standard
procedure of business conduct which is expected to be followed by the
Directors and the designated employees in their business dealings and
in particular on matters relating to integrity in the work place, in
business practices and in dealing with stakeholders. The Code gives
guidance on the expected behaviour from an employee in a given
situation and the reporting structure. All the Board Members and the
Senior Management personnel have confirmed compliance with the Code.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a Vigil Mechanism Policy to deal with instances of
fraud and mismanagement, if any. Staying true to our core values being
committed to high standards of Corporate Governance and stakeholder
responsibility, the said policy ensures that strict confidentiality is
maintained in respect of whistle blowers whilst dealing with concerns
and also specified that no discrimination will be meted out to any
person for a genuinely raised concern and also provides a direct access
to the Chairman of the Audit Committee. During the year under review
none of the personnel has been denied access to the Chairman of Audit
The Vigil Mechanism policy is available on the website of the Company
and can be accessed at the following link.
http://vrlgroup.in/investor AF8-download/vigil AF8-Mechanism.
PREVENTION OF INSIDER TRADING:
The Company has adopted a Code of Internal Procedures and Conduct for
Regulating, Monitoring and Reporting of Trading by Insiders with a view
to regulate trading in securities by the Directors and certain
designated employees of the Company. The Code requires pre- clearance
for dealing in the Company''s shares and prohibits the purchase or sale
of Company shares by the Directors and designated employees while in
possession of unpublished price sensitive information in relation to
the Company and during the period when the Trading Window is closed.
The Board is responsible for implementation of the Code. All Board
Directors and the designated employees have confirmed compliance with
The said code is available on the website of the Company and can be
accessed at the following link.
http://vrlgroup.in/vrl AF8-investor AF8-desk.aspx?display AD0-policies
BUSINESS RISK MANAGEMENT:
Pursuant to section 134 (3) (n) of the Companies Act, 2013 ACY- Regulation
21 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015, the company has constituted a risk management
committee. The details of the committee and its terms of reference are
set out in the corporate governance report forming part of the Boards
report. The identification of material risks affecting Company along
with related mitigation measures are elaborated in the Risk Management
Policy of the Company which has been hosted on the website of the
Company and can be accessed at the following link.
http://vrlgroup.in/investor AF8-download/Risk ACU-20 Management ACU-20Policy.pdf
The Audit Committee comprises of 4 directors and all of them are
Independent Directors. The Audit Committee met five times during the
year. Further details such as terms of reference, powers, functions,
meetings, attendance of directors etc are dealt with in Corporate
Governance Report forming part of this Annual report.
Board has accepted all recommendations made by the Audit Committee
during the year.
In accordance with Section 139 of the Companies Act, 2013 and Rules
made thereunder, Members at the 32nd Annual General Meeting of the
Company approved the appointment of Joint Statutory Auditors, M/s
Walker Chandiok ACY- Co LLP, Chartered Accountants, Mumbai and M/s H K
Veerbhaddrappa ACY- Co., Chartered Accountants, Hubballi for a period of 5
years and 2 years respectively. The said appointment was subject to
ratification by members every year.
The Company has received a resignation letter from M/s H K
Veerbhaddrappa ACY- Co, Chartered Accountants, Hubballi, one of the Joint
Statutory Auditors of the Company. The Board at the meeting held on
August 01, 2016, on the recommendation of the Audit Committee, approved
the same. As the said firm is associated with your Company as Statutory
Auditors since inception and considering their long association as also
their in-depth knowledge and expertise w.r.t. the business operations
of your Company, the Board is considering their appointment as Internal
Auditors of the Company to strengthen the Internal Audit functions of
the Company in the days to come.
As such, M/s Walker Chandiok ACY- Co LLP, Chartered Accountants, Mumbai,
the other Joint Statutory Auditor of the Company would continue as the
sole Statutory Auditor till the conclusion of their tenure. Board
recommends the ratification of their appointment as required under
Section 139 of the Companies Act 2013, for approval by the members.
Section 148 of the Companies Act 2013 read with Rules made thereunder
mandates every Company belonging to category prescribed in the Rules to
undertake a Cost Audit. Cost Records of Wind Power Division of the
Company need to be audited as it is covered in the category prescribed.
In compliance with said provision, Company had appointed M/s S.K.
Tikare ACY- Co., Cost Accountants, Dharwad to audit the cost records for
FY 2015-16. The Cost Auditor has submitted the Cost Audit report for FY
2015-16 and the same is annexed as Annexure C to this report.
Pursuant to the recommendation of the Audit Committee, the Board of
Directors have re-appointed M/s S K Tikare ACY- Co., Cost Accountants,
Dharwad as the Cost Auditors for FY 2016-17 at a fixed remuneration of
Rs.50,000/-, the latter subject to approval by the members at the
ensuing Annual General Meeting of the Company.
Board recommends the approval of the said remuneration payable to the
Cost Auditor in accordance with Section 148 of the Companies Act 2013
and the Rules made thereunder.
Pursuant to provisions of section 204 of the Companies Act, 2013 and
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 the company has appointed Mr. R Parthasarathi, Company
Secretary in practice to undertake the Secretarial Audit of the Company
for FY 2015-16. The Secretarial Audit report is annexed herewith as
Annexure D. Pursuant to the recommendation of the Audit Committee, the
Board of Directors have re-appointed Mr. R Parthasarathi, Company
Secretary in Practice to conduct the Secretarial Audit for FY 2016-17
at its meeting held on May 23, 2016.
BOARD''S RESPONSE ON THE REMARKS MADE BY STATUTORY AUDITORS, COST
AUDITORS AND SECRETARIAL AUDITORS
There were no qualifications, reservations and adverse remarks made by
the statutory auditors in their Audit Report and by the Cost Auditors
in their Cost Audit Report. Response to the comment made by the
secretarial auditor that the company has not fully spent the CSR
expenditure as per section 135 of the Companies Act 2013 is given in
Annual Report on CSR activities - Annexure A.
EXTRACT OF ANNUAL RETURN:
Extract of the Annual Return in form MGT-9 is annexed herewith as
DETAILS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO
The particulars regarding Conservation of Energy, Technology Absorption
and Foreign Exchange Earnings and Expenditure are annexed hereto as
Annexure F and forms part of this Report.
PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with rule 5 (1)
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 in respect of employees of the Company, forms of this
report and annexed herewith as Annexure G.
A statement containing the names of every employee who is in employment
of the Company throughout the year and is in receipt of annual
remuneration of Rs. 60 lakhs or more or employed for a part of year and
in receipt of Rs.5 lakh or more per month needs to be disclosed in the
Board''s report. As such the information is annexed as Annexure G to
The Company is committed to maintain high standards of corporate
governance and adhere to the corporate governance requirements set out
under extant law. The Report on corporate governance as stipulated
under Regulation 34 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015 read with Schedule V thereto forms part
of this Report. The requisite certificate from the Auditors of the
Company confirming compliance with the conditions of corporate
governance as stipulated under the aforesaid Regulations, as also the
related certificate from CEO/ CFO are attached to the Report on
MANAGEMENT''S DISCUSSION AND ANALYSIS REPORT
Management''s Discussion and Analysis Report for the year under review,
as stipulated under Regulation 34 of SEBI (Listing Obligations and
Disclosure Requirements) Regulations 2015 read with Schedule V thereto,
is presented in a separate section forming part of the Annual Report.
SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulators
or courts or tribunals impacting going concern status and company''s
operations for a foreseeable future.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITION AND REDRESSAL) ACT 2013
During the year under review, there were no cases reported pursuant to
the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
None of the Directors of your Company are disqualified as per
provisions of Section 164(2) of the Companies Act, 2013. Your Directors
have made necessary disclosures, as required under various provisions
of the Companies Act, 2013 and Listing Regulations.
FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the auditors under Section.143(12) of
the Companies Act, 2013
ACKNOWLEDGMENTS AND APPRECIATION
The Directors take this opportunity to thank the Company''s customers,
shareholders, Investors, suppliers, bankers, financial institutions and
Central ACY- State Governments for their consistent support to the
Company. The Directors also wish to place on record their appreciation
to employees at all levels for their hard work, dedication and
For and on behalf of the Board
Dr. Vijay Sankeshwar
Chairman ACY- Managing Director
Date: August 01, 2016