REPORT OF THE DIRECTORS TO THE MEMBERS, The Directors are pleased to present their 31st Report along with the financial results of the Company for the year ended 31st March, 2016 Performance Overview The financial year 2015-16 witnessed the results of rEcent internal improvement programs and also reflected the positivity of the macro environment. The Company took significant strides in creating enhanced value for shareholders. The net turnover of the Company stood at Rs. 2,16,799 Lakhs in 2015-16 as against Rs. 2,05,721 Lakhs in 2014-15. Operating Profit has increased by 22.16% from Rs. 33,448 Lakhs in the previous year to Rs. 40,861 Lakhs in 2015-16. The Company posted a profit (PAT) of Rs. 9,727 Lakhs in 2015-16 against profit of Rs. 5,021 Lakhs in the previous year. A detailed analysis of Company's operations in terms of performance in markets, manufacturing activities, business outlook, risks and concerns forms part of the Management Discussion and Analysis, a separate section of this Annual Report. During the year under review, there has been no change in nature of business of the Company. Further, no material changes and commitments have occurred between the end of the financial year and the date of the report affecting the financial position of the Company. Subsidiaries and Associates Pursuant to section 129 and other applicable provisions, if any, of the Companies Act, 2013, a separate statement containing salient features of financial statements of all subsidiaries and associates of your Company forms part of the financial statements. The financial statements of the subsidiaries & associate Companies and related information are available for inspection by the Members at the Corporate office of AIS as well as Registered Office of respective subsidiary and associate companies during business hours on all days except Saturdays, Sundays and public holidays up to the date of Annual General Meeting (AGM) to any shareholder on demand in accordance with the provisions of Section 136 of Companies Act, 2013. The financial statements including the Consolidated financial statement, financial statements of subsidiaries and all other relevant documents required to be attached to this report have been uploaded on the website of the Company www.aisglass.com A report on the performance and financial position of each of the subsidiary and associate companies as per Companies Act, 2013 is provided as Annexure to the Consolidated financial statements. During financial year 2015-16, Vincotte International India Assessment Services Private Limited has ceased to be an associate of AIS. Apart from the above, none of the Companies have become or ceased to be subsidiary, joint venture or associate of the Company. Material Subsidiaries Pursuant to Listing Regulations, the Company has formulated a policy for determining material subsidiaries. This policy has been uploaded on the Company's website and may be accessed through the link <http://www.aisglass.com/policies>. Management Discussion and Analysis A separate chapter on Management Discussion and Analysis is given in this Annual Report. Dividend Your Directors are pleased to recommend a Final Dividend of Rs. 0.60 per equity share of face value of Rs. 1 each for the year ended 31st March, 2016 amounting to Rs. 1,459 Lakhs. The above dividend, subject to the approval of Members at the Annual General Meeting on 12th August, 2016, will be paid on or after 17th August, 2016 to those Shareholders whose names appear in the Register of Members as on 6th August, 2016. The total dividend for the financial year will be Rs. 1,459 Lakhs, including Dividend Distribution Tax of Rs. 297 Lakhs. Reserves The Board has proposed to carry an amount of Rs. 7 Lakhs to reserves. Public Deposits During the financial year 2015-16, your Company has not accepted any deposits within the meaning of Section 73 and 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and as such no amount of principal or interest was outstanding as on date of the Balance Sheet. Consolidated Financial Statements In accordance with the Companies Act, 2013 and the applicable Accounting Standards, the Consolidated Financial Statements of AIS are provided in the Annual Report. Corporate Governance A separate report on Corporate Governance along with the General Shareholders Information, as prescribed under the SEBI (Listing Obligations and Disclosure Requirements) REgulations, 2015, is annexed as a part of the Annual Report along with the Auditor's Certificate on Corporate Governance. Industrial Relations During the year under review, industrial relations in the Company continued to be cordial and peaceful. Extract of Annual Return The details forming part of the extract of the Annual Return in Form MGT-9, in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as "Annexure A" to this Report. Particulars of loans, guarantees or investments The details of loans, guarantees and investments under the provisions of section 186 of the Companies Act, 2013 are given at the notes no. 12& 36 of the Financial Statements. Meetings of the Board and Committees The details in respect of the number of Board and Committees meetings of your Company are set out in the Corporate Governance Report which forms part of this Report. Audit Committee Pursuant to the provisions of section 177 of Companies Act, 2013, the Audit Committee consists of three Independent Directors -Mr. Rahul Rana as Chairman and Mr. Gautam Thapar and Ms. Shradha Suri as members. Board of Directors of the Company has duly accepted the recommendations of Audit Committee during financial year 2015-16. Vigil Mechanism The Company has established a Vigil Mechanism/Whistle Blower Policy. The purpose of this mechanism is to provide a framework to report concerns about unethical behavior, actual or suspected fraud or violation of the Company's code of conduct or ethics policy and provide adequate safeguards against victimization of the person availing this mechanism. The Policy is available on the Company's website www.aisglass.com/policies and has been appropriately communicated within the organization and is effectively operational. The policy provides mechanism whereby whistle blower may send protected disclosures directly to the Chairman of Audit Committee or Ethics Officer. Risk Management The Company has developed and implemented a Risk Management Policy to identify and mitigate key risks that may threaten the existence of the Company. Internal Financial Controls Your Company has put in place adequate internal financial controls with reference to financial statements. Such System has been designed to provide for: • Adoption of accounting policies in line with applicable accounting standards. • Uniform accounting treatment is prescribed to the subsidiaries of your Company. • Proper recording of transactions with internal checks and reporting mechanism. • Compliance with applicable statutes, policies, management policies and procedures. The management of your Company periodically reviews the financial performance against the approved plans across various parameters and takes necessary action, wherever necessary. Your Company has its own internal audit department which carries out periodic audits of all locations and functions. Internal audit reports are periodically reviewed and its executive summary along with corrective action plans, if any, are submitted to top management and Audit Committee for review, comments and directions. Directors and Key Managerial Personnel Appointments, Re-appointments and Resignations During the financial year 2015-16, Ms. Shradha Suri was appointed as an Additional Director w.e.f. lst April, 2015 in the capacity of Independent (Woman) Director to hold office up to 5 (five) consecutive years. During the year under review, Dr. Surinder Kapur ceased to be Director of your Company due to his sad demise on 30thJune, 2015. In accordance with the provisions of Section(s) 149, 152 and other applicable provisions, if any, of the Companies Act, 2013, read with Companies (Appointment and Qualification of Directors) Rules, 2014, Mr. B. M. Labroo (DIN: 00040433) and Mr. M. Takeda (DIN: 07058532), Directors, are liable to retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. Mr. Kenichi Ayukawa (DIN: 02262755) resigned w.e.f. lst June, 2016. Pursuant to his rEsignation and in terms of the provisions of Section(s) 152, 161 and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014 and Article 73 of the Articles of Association, Mr. Toshiaki Hasuike (DIN: 01948291) was appointed as an Additional Director w.e.f. lst June, 2016, and is proposed to be appointed/ confirmed as a Non-Executive director of the Company, liable to retire by rotation at the ensuing Annual General Meeting. Declaration of Independence Your Company has received declaration from all the Independent Directors confirming that they meet the criteria of Independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules made there under as well as Regulation 26 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details of the familiarization programme along with format of the letter of appointment provided to the Independent Directors at the time of appointment outlining his/ her rôle, functions, duties and responsibilities have been uploaded on the website of the Company and may be accessed through the link: <http://www.aisglass.com/policies>. Directors' Responsibility Statement Pursuant to Section 134(3)(c), the Directors hereby state and confirm that : (a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (b) directors have selected such accounting policies and applied them consistently and made judgements 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 and loss of the company for that period; (c) 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; (d) directors have prepared the annual accounts on a going concern basis; (e) directors have 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) directors have devised proper Systems to ensure compliance with the provisions of all applicable laws and that such Systems were adequate and operating effectively. Statement indicating the manner in which formal annual evaluation has been done Innermost provisions of Companies Act, 2013 and Regulation 17 of the Listing Regulations, the Board has carried out an annual Evaluation of its own performance and that of its Directors individually. The Evaluation criteria as laid down by the Nomination & Remuneration Committee, included various aspects of functioning of the Board such as composition, process & procedures including adequate & timely information, attendance, delegation of responsibilities, decision-making, roles & responsibilities including monitoring, benchmarking, feedback, stakeholder relationship and Committees. The performance of individual Directors including the Chairman was evaluated on various parameters such as knowledge & experience, interest of stakeholders, time devoted etc. The Evaluation of Independent Directors was based on aspects like participation in & contribution to the Board decisions, knowledge & experience and judgment Particulars of Remuneration The information as required in accordance with Section 197(12) of the Companies Act, 2013, read with Rule 5(1) the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, as amended is set out in "Annexure A" to this Report. However, as per the provision of Section 136 of the Companies Act, 2013, the Report and the Accounts are being sent to all members of the Company excluding the aforesaid information. Any member interested in obtaining such information may write to the Company Secretary at the registered office or the corporate office of the Company. Board Diversity The Company recognizes and embraces the importance of a diverse Board in its success. We believe that a truly diverse Board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us to retaining our competitive advantage. Your Board comprises of experts in the field of Finance, Corporate Governance, Management and Leadership skills. Your Company has also appointed a Woman Director on the Board. Nomination and Remuneration Policy The Nomination & Remuneration Policy as approved by the Board on the recommendation of the Nomination & Remuneration Committee is attached as "Annexure B". Corporate Social Responsibility The Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board with Mr. G. S. Talwar as its Chairman and Mr. B. M. Labroo and Mr. Sanjay Labroo as its members. The CSR Committee has adopted a CSR Policy in accordance with the provisions of Section 135 of the Companies Act, 2013 and rules made there under. The details of the CSR initiatives undertaken by the Company during the financial year 2015-16 in the prescribed format are annexed as "Annexure C". Internal Complaints Committee (Anti-Sexual Harassment Policy) During the period under review, no complaints were received by the Internal Complaints Committee established under the Policy for Prohibition, Prevention and Redressed of Sexual Harassment of Women at Workplace. Related party transactions Transactions entered by the Company with related parties during financial year 2015-16 were in the ordinary course of business and on arms' length basis. The Company hasformulated a policy on Related Party Transactions which is available at the link <http://www.aisglass.com/policies> on website of the Company. In terms of Section 134(3)(h) of the Companies Act and rules made thereunder, during the year under review, the Company has not entered into any contract arrangement/ transaction with related parties in section 188(1) of the Companies Act, 2013, which could be considered material. The details of the related party transactions entered during the year are provided in the accompanying financial statements. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed as "Annexure D" to this Report. Auditor and Auditor's Report Statutory Auditors M/s Jagdish Sapra & Co., Chartered Accountants, were appointed as Statutory Auditors of the Company in the 29th Annual General Meeting of the Company to hold office for three consecutive years subject to ratification at every Annual General Meeting. Your Company has received confirmation from abovementioned firm regarding consent and eligibility under Section 139 and 141 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 for ratification of appointment as the Statutory Auditors of the Company. As required under Regulation 33 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. The Audit Committee and the Board of Directors recommended the ratification of appointment of M/s Jagdish Sapra & Co., Chartered Accountants as the Auditors of your Company for the financial year 2016-17 till the conclusion of the next AGM. The observations of the Auditors in the Auditor's Report are explained, wherever necessary, in the appropriate Notes to the Accounts. Cost Auditor The Board had appointed M/s. Ajay Ahuja & Associates, Cost Accountants, as the Cost Auditor of your Company for financial year 2015-16 to conduct the audit of the cost records of the Company. Cost Audit Report for the financial year 2015-16 has been filed with Ministry of Corporate Affairs. As per Section 148 and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, the Board of Directors of your company on the recommendation of the Audit Committee has appointed M/s. Ajay Ahuja & Associates, Cost Accountants as the Cost Auditor of the Company for the financial year 2016-17. Your Company has received consent from M/s. Ajay Ahuja & Associates, Cost Accountants, to act as the Cost Auditor of your Company for the financial year 2016-17 along with a certificate confirming their independence. Secretarial Audit In accordance with the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed Mr. Sundeep Kumar Parashar, FCS, Company Secretary in Practice and proprietor of M/s. SKP & Co., Company Secretaries, to conduct the Secretarial Audit of your Company for financial year 2016-17. The Secretarial Audit Report for financial year 2015-16 is annexed herewith as "Annexure E" to this Report. The Secretarial Audit Report does not contain any qualifications, reservations or adverse remark. Significant and Material Orders of Regulators or Courts or Tribunals No significant and material order was passed by Regulators or Courts or Tribunals during the year under review impacting the going concern status of your Company and its future operations. Acknowledgements The Board hereby places on record its sincere appreciation for the continued assistance and support extended to the Company by its collaborators, customers, bankers, vendors, Government authorities and employees. Your Directors acknowledge with gratitude the encouragement and support extended by our valued Shareholders. On behalf of the Board of Directors Asahi India Glass Ltd., B. M. Labroo Chairman DIN: 00040433 Dated : 24th May, 2016 Place : Gurgaon |