DIRECTORS REPORT Dear Shareholders, We are pleased to present the annual report along with the audited accounts of your company for the year ended 31st March, 2015. Dividend Subject to the shareholders' and other requisite approvals, your Directors recommend payment of dividend of H0.10 per equity share of H1 each (10%) for the year ended 31 March 2015. Economic climate and our performance After almost three decades, we now have a Government with a firm mandate, which has generated renewed optimism and expectations for accelerated growth of the Indian economy. While expected results are not yet visible, we do believe that the Government is moving in the right direction. We are encouraged by the initiatives to promote 'Make in India' and the progress being made towards introduction of GST in a time bound manner. Early implementation of these proposals will positively lead our nation on the path of high GDP growth and welfare of all our citizens. However, many of these initiatives are still in the work-in-progress stage and the economy is in the process of a gradual turnaround. As a result, demand for most products remained subdued. In this background your company has taken concrete steps to prepare itself to take full advantage of the expected upturn. In this process we have invested time and money in building a new brand identity for our electric products which has been widely appreciated and has resulted into Orient being recognised as a 'Master brand'. While details of our performance in each of our businesses are shared in the Management discussion and analysis some of the major highlights have been: Increase in our market shares for almost all products; Improvements in our efficiencies and cost effectiveness; Strengthening of our organisation structure and human resources; However, our results for the year have been impacted by the substantial additional spend on brand promotion for the Electric business and continued pressure on margins being faced by the Indian paper industry as a whole. We are also happy to inform you that our new low voltage switchgear manufacturing plant at noida has started production in March and its products have been launched in April 2015. This is a new business segment with great potential for growth for our Electric division. All in all, we are working on fairly aggressive plans to grow both our Electric and Paper divisions and are confident of achieving higher volumes and substantially improved profitability. Sustainable Development and Environment We consider sustainable development and environment protection as integral parts of our management culture and philosophy. Significant work continues to be done in these areas on a consistent and sustainable basis. Details of our efforts and activities in this direction are provided in subsequent chapters in this report. Cash Flow Analysis In conformity with the provisions of Clause 32 of the Listing Agreement(s), the cash flow statement for the year ended 31 March 2015 is included in the annual accounts. Corporate Governance Your Company is in full compliance with the Corporate Governance requirements in terms of Clause 49 of the Listing Agreement(s). A report on Corporate Governance and a certificate from our auditors confirming compliance with the Corporate Governance requirements are attached and form part of this report. Share capital There was no change in the share capital of the Company during the financial year 2014-15. Deposits The Company has not accepted any deposit from public falling within the ambit of Section 73 of the Companies Act, 2013 and The Company's (Acceptance of Deposits) Rules, 2014. Particulars of Loans, Guarantee or Investments Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. Corporate Social Responsibility Pursuant to the requirement of Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) Committee was constituted. Details of the CSR activities as required under Section 135 of the Companies Act, 2013 are given in the CSR Report as Annexure I. Extract of Annual Return The extract of Annual Return in form MGT 9 is annexed herewith as Annexure II. Related Party Transactions Rll transactions entered into with Related Parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year were in the ordinary course of business and on arms length basis. All the Related Party Transactions are presented to the Audit Committee and the Board. Prior omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions are presented before the Rudit Committee and Board of Directors on quarterly basis specifying the nature, value and terms and conditions of the transactions. Particulars of contracts or arrangements with related parties referred to in sub-section (1) of Section 188 have been given in the prescribed form ROC -2 as Rnnexure VII. The Related Party transactions Policy as approved by the Board is uploaded in the Company's website www.orientpaperindia.com Directors and Key Managerial Personnel (i) Appointment Ms. Gauri Rasgotra (Diri:06862334) has been appointed as an Rdditional Director of the Company in the category of Independent Director with effect from 26th September 2014 and shall hold office upto the date of the ensuring Rnnual General Meeting. The Company has received a notice as per the provisions of Section 160(1) of the Companies Act, 2013, from a member proposing her appointment as Director. (ii) Appointment of Independent Directors In terms of the provisions of Section 149 of the Companies Act, 2013 and Listing Rgreement, the Board on the recommendation of the nomination and Remuneration Committee, appointed Shri Basant Kumar Jhawar (DIri:00086237), Shri Rmitabha Ghosh (DIi:00055962), Mr. Michael Bastian (DIi:00458062) and Shri iarendra Singh Sisodia (DIi: 06363951) as Independent Directors of the Company for a term of 5 years w.e.f. 22nd July 2014. The shareholders by Postal Ballot conducted by the Company approved their appointment on 10th December 2014. All the Independent Directors have given their declaration that they meet the criteria of independence in terms of Section 149(6) of the Companies Act, 2013. (iii) Retirement by rotation In accordance with the provisions of Section 152 of the Companies Act, 2013, Shri C K Birla (DIi: 00118473), Director of the Company, retires by rotation and is eligible for re-appointment. (iv) Board Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Rgreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the various Committees of the Board. The manner in which the evaluation has been carried is explained in the Corporate Governance Report. (v) Board Meetings The details of meetings of the Board and its various committees are given in the Corporate Governance Report. Key Managerial Personnel In compliance with the provisions of Section 203 of the Companies Act, 2013, the Company has appointed Shri Manohar Lal Pachisia (DIi:00065431), Managing Director, Shri Pradeep Kumar Sonthalia, Chief Financial Officer (FCR 051030) and Shri Ram Prasad Dutta (RCS 14337), Company Secretary as the Key Managerial Personnel of the Company. Auditors (I) Statutory Auditors The Shareholders of the Company at their Rnnual General Meeting held on 22nd August, 2014 appointed M/s. S. R. Batliboi & Co LLP, Chartered Rccountants as the Ruditors of the Company for a period of 3 years subject to ratification of the appointment by the Members at every Rnnual General Meeting. Accordingly, members are requested to ratify appointment of M/s. S. R. Batliboi & Co LLP, Chartered Accountants, the Auditors of the Company to hold office from the conclusion of the ensuring Annual General Meeting till the conclusion of the next Annual General Meeting of the Company. The Auditors has 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. (II) Cost Auditors Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, Shri Somnath Mukherjee, Cost Accountant (Membership no. M/5343) was appointed for the financial year ending 31st March 2015 to conduct cost audit for the products covered under the said rule. (III) 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 Company has appointed Shri A. K. Labh, Company Secretary in Practice to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Report of the Secretarial Auditor is annexed to this report as Annexure III. Conservation of energy, technology absorption, foreign exchange earnings and outgo The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure IV. Directors' responsibility statement Directors' responsibility statement pursuant to section 134(3)(c) of the Companies Act, 2013 are given in Annexure V to the annual report. note no. 35 appearing in notes to Financial Statements referred to in the Auditors' Report is self-explanatory. Information of employees The prescribed information of Employees required under Section 134(3)(q) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached herewith as Annexure VI . Remuneration Policy The Board has, on the recommendation of the nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Key Managerial Personnel and Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. Risk Management Pursuant to Section 134 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Company has adopted a risk management policy. The policy comprises of a robust business risk management framework to identify and evaluate of business risks. The business risk framework defines the risk level including documentation and reporting. Whistle Blower Policy The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. In line with these objectives the Company has adopted a Vigil Mechanism named Whistle Blower Policy to deal with instance of fraud and mismanagement. Details of the Whistle Blower Policy are stated in the Corporate Governance Report. Significant and Material Orders Passed by the Regulators or Courts There are no significant material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its future operation. Acknowledgements Your Directors place on record their sincere gratitude to the shareholders, customers, bankers, financial institutions, government agencies, supply chain partners and the employees for their valuable contribution, cooperation and support in the Company's endeavours to achieve continuous growth and progress. By Order of the Board C. K. Birla Chairman Place “ new Delhi, date : 11th May, 2015 |