Directors` Report
To:
The Members of
Walchandnagar Industries Limited
Your directors have pleasure in presenting the 104th Annual Report with Audited
Statement of Accounts for the year ended September 30, 2012.
1. Performance for the Year in Retrospect:
|
Year ended |
Year ended |
|
30.09.2012 |
30.09.2011 |
|
Rs. in Lakhs |
Rs. in Lakhs |
| Income: |
89,246 |
96,431 |
| Profit before Depreciation, Interest, Exceptional Item and Exchange currency
fluctuations |
6,925 |
6,152 |
| Less: Interest |
2,229 |
1,486 |
| Depreciation |
1,798 |
1,589 |
| Exceptional Item |
529 |
- |
| Profit before Exchange |
|
|
| Currency fluctuations |
2,369 |
3,077 |
| Less: Exchange Currency |
|
|
| Fluctuations Loss/(Gain) |
678 |
1,382 |
| Profit before Tax |
1,691 |
1,695 |
| Less: Tax (Net) |
478 |
415 |
| Profit after Tax |
1,213 |
1,280 |
During the year under review, the revenue for the year 2011-12 declined by 7.5% as
compared to the previous year. However, there is a rise in the PBT margins largely on
account of the following:
Higher contribution on account of the reduction in the material costs and better value
additions Better realization on export sales
2. Current Year:
The orders on hand as on 30.09.2012 were at Rs. 1481 Crores as compared to Rs. 2205
Crores as on 30.09.2011.
3. Exports and Overseas Projects:
During the year under review, the Company achieved an export turnover of Rs. 298 Crores
as against Rs. 137 Crores, in the previous year. The export orders on hand as on
30.09.2012 are at Rs. 250 Crores. During the year, the Company executed orders for Sugar
& Boiler projects in Ethiopia and Colombia & Cement machinery in Tanzania and
Malavi.
4. Dividend:
Your Directors are pleased to recommend Dividend for the financial year 2011-2012 on
Equity Shares of Rs. 2/- each at Rs. 1 per share equivalent to 50% (50% in the
previous year) aggregating to Rs. 380.70 Lakhs. The Dividend Distribution Tax thereon
works out to Rs. 61.76 Lakhs.
5. Management Discussion & Analysis:
Detailed Management Discussion and Analysis is enclosed by way of Annexure
‘A’ to this report.
6. Finance & Accounts: (i) Fixed Deposits:
Your Company did not invite or accept deposits from the public during the year under
review. 3 deposits (pertaining to previous years) aggregating to Rs. 70,000/- remained
unclaimed as on September 30, 2012.
(ii) Income Tax Assessments:
The Company’s Income Tax and Wealth Tax Assessments are completed up to the
Assessment Year 2009-10. Assessment for the Assessment Year 2010-11 is under progress.
Various appeals before Appellate Authorities are being pursued.
7. Human Resources Development:
Your Company has been successful in implementing contemporary Human Resource practices
and policies with a view to make Walchandnagar Industries Limited a preferred employer in
the heavy engineering industry. Augmentation of critical skills and senior management
talent has been a thrust area to address immediate business needs and succession planning.
A new Performance Management System has been designed and implemented and the appraisal
process for the year has been completed. A number of initiatives towards employee
engagement and pride of belongingness has been taken up by strengthening the internal
communications process.
Learning & Development Capability:
The Company conducted almost 70 training programs involving both, workers and officers.
Feedback on these programs has been encouraging and the impact of trainings on employee
development and overall performance has been significant.
8. Directors’ Responsibility Statement:
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors confirm that: i.
In preparation of the Annual Report, the Accounting Standards laid down by the Institute
of Chartered Accountants of India have been followed. ii. Appropriate accounting policies
have been selected and applied consistently, reasonable and prudent judgment applied
consistently, and estimates have been made so as to ensure that the accounts give a true
and fair view of the state of affairs of your Company as at September 30, 2012 and the
profit of the Company for the year ended on that date.
iii. Proper and sufficient care has been taken for maintenance of appropriate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of your Company and for preventing and detecting frauds and other irregularities.
iv. The annual accounts have been prepared on a going concern basis.
9. Corporate Governance:
Your Company believes that Corporate Governance is the basis of stakeholder
satisfaction. The Company is committed to maintain the highest standards of
Corporate Governance and adhere to the Corporate Governance Requirements as set out by
SEBI. Your Company has obtained a certification from K. S. Aiyar & Co., Chartered
Accountants, Statutory Auditors, on compliance with clause 49 of the listing agreement.
The Report of Corporate Governance along with Certificate from the auditors of the Company
regarding compliance of conditions of corporate governance is enclosed by way of Annexure
‘B’ to this Report.
10. Social Responsibility:
Over the years, the Company has taken and continues to take several initiatives in
order to fulfill its corporate social commitments.
Health:
To create health awareness in the township and nearby villages, the Company continued
to organize various health schemes during the year. This year the Company organized a
general health check up camp for hazardous workers, ECG check up camp for employees above
50 years of age, undertook health related sessions for women and senior citizens and
organized a Blood Donation Camp.
Education:
The schools established by the Company continued to impart education up to Higher
Secondary grade to children staying in Walchandnagar and in nearby villages. The Company
currently provides education to 4880 children of which, 20% are children of employees of
the company and 80% are other children who reside in Walchandnagar & nearby villages.
Environment:
To maintain a pollution free atmosphere and to spread awareness about environment
protection, we have undertaken tree plantation and organized seminars on pollution control
& on disposal of hazardous waste.
Encouraging young talents in the field of sports:
As a part of our commitment to the Society, your Company has been sponsoring All-India
Ranking National Tennis Tournaments in Pune for boys and girls below 16 years of age for
the past five years.
This year, the tournament was held in Pune from 5th November to 10th November 2012,
wherein prominent ranking tennis players from all over India participated. We have also
organized Cricket & Rugby tournaments at Walchandnagar.
11. Energy, Technology & Foreign exchange:
Pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules 1988,
information on conservation of energy, technology absorption, foreign exchange earnings
and out-go is given in the Annexure Rs.C’ to this Report.
12. Personnel:
Employee relations remained harmonious and satisfactory during the year and your Board
would like to place on record sincere appreciation for sustained efforts and valued
contribution towards growth initiative made by all the employees of the Company. The Wage
Settlement Agreement entered into with the Union in May, 2011 will remain in operation
upto 30.4.2014.
Information as per amended Section 217(2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules, 1975, forms part of this Report. As per the
provisions of Section 219(1)(b)(iv) of the Act, the Directors’ Report and accounts
are being sent to the shareholders excluding the statement giving particulars of employees
under Section 217(2A) of the Act.
The copy of the said statement is available at the Registered Office for inspection.
Any shareholder interested in obtaining a copy of the statement, may write to the Company
Secretary at the Registered Office of the Company.
13. Subsidiaries:
The Company does not have any subsidiary.
14. Directors:
In accordance with the provisions of Companies Act, 1956 and Article 149 of the
Articles of Association of the Company, Dr. P. K. Basu and Mr. Dilip J. Thakkar are due to
retire at the 104th Annual General Meeting and they being eligible offer themselves for
re-appointment.
During the year, the Board of Directors in their Meeting held on 13th August, 2012 (i)
appointed Mr. G. K. Pillai as an Additional Director of the Company w.e.f. 25-11-2012 and
appointed him as Managing Director & Chief Executive Officer of the Company, (ii)
accepted the request of Mr. J. L. Deshmukh, not to renew his term of appointment with the
Company and would like to relinquish his position of Managing Director & Chief
Executive Officer of the Company w.e.f. 25th November, 2012. However, he will continue as
a Director of the Company, liable to retire by rotation w.e.f. 25.11.2012 and (iii)
on completion of contractual terms, re-appointed Mr. Chirag C. Doshi as Managing
Director of the Company for a period of 5 years w.e.f. 25th November, 2012.
Brief profiles of the proposed appointees together with other disclosures in terms of
clause 49 of the Listing Agreement are part of the Corporate Governance Report
forming part of this Report.
15. Auditors:
M/s. K.S. Aiyar & Co., Chartered Accountants, Auditors of the Company will retire
at the ensuing Annual General Meeting and they being eligible have offered themselves for
reappointment. The members are requested to appoint the Auditors and authorize the Board
to fix their remuneration.
16. Cost Auditors and Cost Audit Report
Government of India, Ministry of Corporate Affairs, vide Order No. 52/26/CAB-2010 dated
30th June 2011 has mandated Cost Audit for companies engaged in the production,
processing, manufacturing or mining of the products falling under Chapter 72 or 73 of the
First Schedule to the Central Excise Tariff Act, 1985 which was further amended
vide Order No. 52/26/CAB-2010 dated 24th January, 2012 covering products falling under
Chapter 84 or 85 also of the First Schedule to the Central Excise Tariff Act, 1985.
Accordingly, M/s. S. R. Bhargave & Co., Pune., Cost Accountant Firm were appointed as
"Cost Auditor" to carry out Cost Audit for the Year ended 30.09.2012.
The Cost Audit Report in respect of the financial year ending 30.09.2012 will be filed
within the stipulated time i.e. on or before 31st March, 2013.
The Company has received certificate from M/s S. R. Bhargave & Co., Pune., Cost
Accountant Firm, to the effect that their reappointment for F.Y. 2012-2013, if made, would
be within the prescribed limits under Section 224(1B) read with Section 233B(2) of the
Companies Act, 1956 and that they are not subject to disqualifications specified in
Section 226 of the said Act. The Cost Auditors have further certified that they are
independent firm of Cost Accountants and are at arm’s length relationship with the
Company.
17. Acknowledgement:
Your Directors place on record their sincere appreciation of the assistance and
co-operation that the Company has been receiving from the banks from time to time.
Your Directors also would like to thank the customers, suppliers and the shareholders,
for their continued support and co-operation.
For & on behalf of the Board of Directors
Chakor L. Doshi
Chairman
Registered Office:
3, Walchand Terraces, Tardeo Road, Mumbai 400 034.
Date : 23rd November, 2012
Annexure "A" to the Directors’ report
MANAGEMENT DISCUSSION AND ANALYSIS
Economic Overview
The Indian economy continued to witness a slowdown during the year 2011-12 due to a
weakening demand for goods combined with a loss of investor confidence owing to fiscal
policies. Inflation continues to remain a concern and has added to the pressures on
pricing at the consumer level which in turn affected household consumption at various
levels. The capital goods sector was affected adversely making the climate for investment
in new projects less attractive. The Government has recently initiated some favourable
changes in the monetary policy, however, these changes are expected to yield positive
results only in the subsequent year.
Financial overview
Sales & Profitability
Following is the summary of sales & profitability for the fiscal 2011-12 compared
with previous year.
| Particulars |
FY 2011-12 |
FY 2010-11 |
| Total Income |
89,246 |
96,431 |
| EBIDTA (Before Exceptional |
6,925 |
6,152 |
| Items & Exchange Currency fluctuations) |
|
|
| EBIDTA (After Exceptional |
5,718 |
4,770 |
| Items & Exchange Currency fluctuations) |
|
|
| Profit Before Tax (PBT) |
1,691 |
1,695 |
| Profit After Tax (PAT) |
1,213 |
1,280 |
| Cash Profit |
3,011 |
2,869 |
| Fully diluted EPS |
3.19 |
3.36 |
All figures Rs. in lakhs except EPS, which is an absolute number
Although, the revenue for the year 2011-12 has shown a decline of 7.50% over the
previous year, there is a rise in the EBIDTA and PBT margin on account of the following:
Higher contribution on account of the reduction in the material costs and better value
addition. Better realization on export sales.
Order Book
The Company has been selective in booking orders during the year and has not
compromised on the quality of orders despite the subdued market conditions and intense
competition prevailing in the domestic market place in the sugar, boiler, cement, mineral
& bulk handling project sectors. The Company has expanded its geographical footprint
into the export market and has taken a number of initiatives which are expected to yield
good results in the forthcoming year. The Order Book of the Company remains at a
reasonable level with the outstanding orders at Rs. 1481 Crores as on September 30, 2012.
Following are the highlights of the order book:
• It includes order for steam generation package and process house equipments at
Tendaho Sugar Factory, Ethiopia which is under execution.
• It also includes order for 12 Co-Gen Power Projects aggregating to 183 MW and
Sugar plant modernization/ expansion from Tamilnadu State Electricity Board (TNEB), which
is under execution.
• The order book underlines the strong engagement of your Company in the Nuclear
Power sector with the orders for core machinery & components for 700 MW Nuclear Power
Projects of NPCIL.
Key events
Discussions with Atomenergomash, Russia
Pursuant to the MOU signed with M/S Atomenergomash (AEM) in 2011, discussions have
taken place at various levels during the course of the year, to explore the possibility of
manufacturing a number of Nuclear Power Plant (NPP) equipments in India. These discussions
are making good progress and a detailed business plan is being prepared jointly. Due to
the Fukushima incident and consequent activism against nuclear power, there has been some
slow down in this segment of business but the nuclear business is expected to gather
momentum soon.
Manufacturing – Missile Division
Your esteemed Company is involved in India’s program for development of one of the
most advanced surface to air missile systems in the world. In order to cater to this
requirement, a state of the art manufacturing facility has been established bringing all
operations under one roof.
The Company was entrusted with the manufacture of the Metallic
Motor Hardware for these missiles which was accomplished successfully by the Company.
The product went through many rigorous acceptance tests and initial production runs have
been completed with a high level of quality standard, consequent to which, the Company has
received repeat orders. The Company is planning to invest further to augment the existing
manufacturing capacity of this division as this segment holds very good potential for
growth.
Segment Review
Heavy Engineering
For the year under consideration, the Sales of the Heavy
Engineering Division decreased by 9% as compared to the previous year. The
profitability in the manufacturing sector is encouraging and is expected to continue but
the profit margins on the project business remains to be tight and extremely competitive.
The profitability margins however improved during the later part of the year due to better
realizations on export projects and because of reduction in material costs resulting from
better efficiencies in procurement.
Foundry
The business of Foundry Division is divided mainly into:
• Automotive sector where the division supplies the heavy grey and SG Iron dies
for the automotive industry.
• Industrial machinery and equipment.
Although the Foundry Division has made a loss during the year 2011-12, it has been able
to reverse the downward trend and achieved break even operating levels in the last quarter
of the year.
Precision Instrument Division
The Precision Instrument Division of the Company manufactures pressure and temperature
gauges and sector mechanisms required for a range of process industry applications as well
as automotive applications. The division grew at a rate of 12% and is on the pedestal of
high growth trajectory in the coming years. This was possible due to the efforts and
initiatives taken internally to improve the productivity to effectively use the available
infrastructure and capital and in house design & engineering effort.
Risk Management
Your Company follows a conservative Risk Management policy. Whilst the broad framework
of the risk remains more or less same, the priorities do change in line with the changing
business profile, economic scenario etc.
The business profile of your Company is evolving in line with current market trends and
conditions wherein the focus is more on turnkey project execution as against pure supply
of equipment with a thrust to expand the Company’s geographic footprint in overseas
markets.
The above risks are largely mitigated because the Company has a well established track
record of executing turnkey projects for the sugar, boiler and cement industry in the
domestic and overseas markets.
Project Management and contract performance
As mentioned above, your Company has started executing more projects on a turnkey
basis. The size of the projects is also increasing as compared to the past. This, on one
hand, enhances the opportunity to attain scale economies and other benefits, but it
exposes the Company to a larger value of retentions and guarantees. In such a scenario,
Contract Management and Performance Risk Management assume a much greater
significance, than any time in the past. This entails three primary things:
• Robust estimation process.
• Strong execution process encompassing engineering, procurement, manufacturing
and site installation.
• Effective Project and Contract Management.
The Company has strengthened the existing processes and increased the management
bandwidth in these areas.
Liquidity & Financial prudence
Management of liquidity assumes even more importance when the size of the projects
being handled goes up. This is to ensure adequate supply of funds for execution of the
projects and entails the complete management of net working capital. Your Company is
giving significant emphasis on this aspect with specific efforts to track receivables,
inventories and payment to supply base. Further, your Company firmly believes that
financial prudence is the key to survival in difficult times as well as sustained growth.
Despite all the constraints faced during the year, your Company has maintained key
financial parameters at a prudent level, where debt equity ratio is maintained at a
healthy ratio of 0.76.
The Company has free cash flow of Rs. 29.19 Crores on its books, which is invested in
safe instruments such as liquid/liquid plus mutual funds & fixed deposits of the
reputed banks.
Foreign exchange risk Management
Your Company’s fundamental policy on the exchange risk management still continues
to be conservative where the Company does not enter into any exotic, leveraged or
embedded, long term structures of hedging. The only instrument, if used for hedging, is a
Forward contract strictly against the underlying asset or liability. Further, your Company
has created significant natural hedge between the exports outstanding and import and loan
liability in the US Dollar terms.
Technology up-gradation
The key to sustained competitiveness is the availability of contemporary technologies.
Your Company, over the years, has entered into collaboration arrangements with some of the
world’s renowned technology providers in its core field of activities. These included
ongoing technology inputs as well as project specific technology support.
Demand cyclicality
Demand cyclicality is a generic risk applicable almost across the spectrum. In case of
your Company, this risk assumes significance since most of the end users of your Company
follow an economic cycle of their own. This results in variation in the revenue drawn from
different end user segments from year to year. Your Company’s approach to mitigate
this risk continues to be:
• Technology up-gradation and moving up the value chain.
• Diverse yet synergistic revenue model.
• Focus on core & less cyclical industries such as Nuclear Power, Aerospace,
Missiles and Defence.
• Growing focus on overseas business.
Internal Control & Audit
The internal audit function of the Company can be broadly divided into the following:
• Risk Based Internal Audit (RBIA) wherein the focus is given on End to End
processes and control points from the point of view of Systems, Processes and awareness of
people.
• Transaction audit covering all individual transactions on a granular basis to
check the accuracy, accounting, propriety and controls.
• Audit of various sub processes in SAP. This entails identification of process
gaps in SAP and correcting them from time to time.
• The findings of the audit are discussed in each audit committee meeting as well
as in the internal meetings at a regular interval.
Outlook & Conclusion
Revenue
While the revenues of the Company declined by 7.50% in the year 2011-12 over the
previous year, the Company looks to be poised for good growth in the next year because of
the following:
• Adequate order book as on September 30, 2012, which stands at Rs. 1481 Crores.
• Strong business outlook in the Aerospace, Missiles, Defense and Nuclear power
segment. This business lends long term sustainability to the revenue model of the Company.
• A number of initiatives for developing the export market were made during the
year 2011-12 which are expected to yield good results in the coming year.
• Since the US Dollar is becoming strong, value of Rupee realisation from exports
is expected to be remunerative and Company will be giving thrust for export market.
• Continued focus & efforts to build on the current order book position of the
Company.
Further, your Company has strong fundamentals for a sustainable growth:
• Well diversified yet synergistic business model.
• Strong manufacturing capability.
• In house design engineering capability.
• Project management capability.
• Technology tie-ups in critical areas.
This would augur well for your Company’s long term sustainable growth.
Profitability
The profitability margins in the year 2011-12 have improved as compared to the previous
year because of improved efficiencies in the procurement chain combined with better
realization on export orders. Your Company is also taking steps to bring about further
improvement in profitability for which following progressive steps are planned:
• Attain scale of economies to effectively absorb overheads and expenses.
• Significant focus on cost reduction & resource optimization.
• Focus on the quality of orders & sectors.
Long Term Competitiveness
Your Company believes that it has taken steps to attain long term growth and
competitiveness and has significant resilience to sustain through the periods of economic
cyclicality and adversities. The key to this lies in the conservative, synergistic and
technology focussed strategies adopted by your Company.
Cautionary Statement
This management discussion and analysis may contain Forward looking statements within
the meaning of the applicable laws, rules and judicial pronouncements, relating to the
business strategies, prospects, financial performance etc. The actual results may vary
significantly or materially than those contemplated/implied in the analysis for various
reasons including but not limited to the Government policy, macro economic situation,
Business cycles, Financial & liquidity situation, demand slowdown, performance risk,
material costs, interest costs, exchange rates etc. The Company does not undertake to make
any declarations/pronouncements of any such eventuality.
ANNEXURE "B" TO DIRECTORS’
REPORT REPORT ON CORPORATE GOVERNANCE:
(1) A brief statement on Company’s philosophy on Code of Governance:
The Company’s commitment for effective Corporate Governance continues and the
Company has always been at the forefront of benchmarking its internal systems and policies
within accepted standards so as to facilitate the creation of long term value for its
shareholders. The Company has Audit Committee, Shareholders’ Grievance Committee,
Remuneration Committee, Finance Committee, Allotment Committee, Committee of Directors for
Capital Issue, Corporate Strategic Planning Committee and these Committees report to Board
of Directors about the tasks assigned to them.
The Board adopted Code of Conduct for all Board Members and Senior Management of the
Company vide Circular Resolution No. 01 dated 1st March, 2005. The said Code of Conduct is
posted on the Website of the Company (www.walchand.com).
(2) Board of Directors:
As on September 30, 2012, the Board of Directors comprised of a Non-Executive Chairman,
a Managing Director & CEO, a Managing Director and 5 other Non-Executive Directors.
The Listing Agreement requirement of at least one-half of the Board to be of independent
Directors, where the Non-Executive Chairman is a promoter of the Company is met by
the Company in view of 4 directors being Independent Directors out of total 8 Directors as
on September 30, 2012. The Non-Executive Directors are professionals and have vast
experience in the field of industry, finance, law and management bringing a wide range of
expertise and experience to the Board.
As required under the Listing Agreement, the Directors’ Report includes the Report
on "Management Discussion and Analysis" as Annexure ‘A’ to
Directors’ Report. The Board Members are presented with proper notes along with the
Agenda papers well in advance before the meeting. Information covering the matters listed
as per Annexure-1 to Clause 49 is provided to the Board as a part of Agenda papers.
The details of composition of the Board, the attendance at the Board Meetings during
the financial year and at the last Annual General Meeting, number of Directorships,
remuneration paid to/provided for Directors during 2011-2012 are given in the
following table:
Information on Board of Directors
| Name of Director |
Director Identifica- tion Number (DIN) |
Status |
No. of Board Meetings held |
No. of Board Meetings attended |
Attend- ance at last AGM |
No. of other Director- ship in other Public Ltd. Cos.# |
Chairmanship/ Membership of Committees in other Public
Ltd. Cos. $ |
Remuneration paid/payable to Directors (Rs. in
Lakhs) |
|
|
|
|
|
|
|
Chairman- ship |
Member- ship |
Sitting Fees |
Salaries & Perquisites |
Commi- ssion |
Total |
| Mr. Chakor L. Doshi |
00210949 |
C-NED |
4 |
4 |
YES |
2 |
None |
None |
3.20 |
- |
- |
3.20 |
| Dr. P.K. Basu |
01293663 |
NED-I |
4 |
4 |
YES |
Nil |
None |
None |
2.00 |
- |
- |
2.00 |
| Mr. Dilip J. Thakkar |
00007339 |
NED-I |
4 |
4 |
YES |
12 |
4 |
5 |
3.20 |
- |
- |
3.20 |
| Mr. A. U. Rijhsinghani |
00177091 |
NED |
4 |
3 |
YES |
Nil |
None |
None |
0.60 |
- |
- |
0.60 |
| Dr. Anil Kakodkar |
03057596 |
NED-I |
4 |
4 |
YES |
1 |
None |
None |
1.20 |
- |
- |
1.20 |
| Mr. G. N. Bajpai |
00946138 |
NED-I |
4 |
4 |
YES |
14 |
5 |
8 |
2.20 |
- |
- |
2.20 |
| Mr. J. L. Deshmukh |
00267467 |
MD & CEO |
4 |
4 |
YES |
1 |
None |
None |
- |
84.04 |
16.00 |
100.04 |
| Mr. Chirag C. Doshi |
00181291 |
MD |
4 |
4 |
YES |
1 |
None |
None |
- |
73.04 |
16.00 |
89.04 |
| Notes: |
1. |
"C-NED" |
Chairman – Non Executive Director |
"MD" |
Managing Director |
|
|
"NED-I" |
Non Executive Director – Independent |
"MD & CEO" |
Managing Director & Chief Executive Officer |
|
|
"NED" |
Non Executive Director |
|
|
2. The Board meets at least once in a quarter to review the financial results and other
items on the agenda, which are distributed to all the Directors in advance. During the
Financial Year 2011-2012, 4 Board Meetings were held on 22.11.2011, 09.02.2012, 04.05.2012
& 13.08.2012 and the maximum gap between the two Board meetings did not exceed four
months.
3. Sitting fees paid to Directors include fees paid for attending the Board Meetings
and all Sub-Committees thereof during the Financial Year.
4. During the year, the professional fees amounting to Rs. 128.80 Lakhs & Rs. 33.71
Lakhs were paid to Mr. Chakor L. Doshi, Chairman and Mr. A.U. Rijhsinghani, Director
respectively, in accordance with the approvals granted by the Shareholders. There were no
other pecuniary relationships or transactions of Non-Executive Directors vis-a-vis the
Company.
# Excludes Directorship in Private Limited Companies which are not subsidiaries of
Public Limited Companies, Foreign Companies and Companies under Section 25 of the
Companies Act.
$ Figures includes Committee positions in Audit & Shareholders/Investors Grievance
Committee only.
Except Mr. Chirag C. Doshi, Managing Director, son of Mr. Chakor L. Doshi, Chairman,
no other directors have any inter-se relationship with the other Directors of the Company.
Code of Conduct:
The Company has formulated, adopted and implemented the Code of Conduct for all its
Board Members and Senior Management Personnel of the Company as required under Clause
49(I)(D) of the Listing Agreement. The Code is posted on the Company’s website:
www.walchand.com All Board members and Senior Management personnel have affirmed
compliance with the Code on an annual basis and a declaration to this effect by Mr. J. L.
Deshmukh, Managing Director and CEO is attached to this report.
CEO/Head of Finance Certification:
As required under Clause 49(V) of the Listing Agreement with the Stock Exchanges, the
Managing Director & CEO and Head of Finance have certified to the Board the financial
statements for the year ended September 30, 2012.
The information regarding details of Directors being appointed/re-appointed is given
below pursuant to Clause 49(IV)(G) of the Listing Agreement.
(i) Mr. G. K. Pillai is an alumnus of Birla Institute of Technology & Science
(B.I.T.S.) Pilani and started his career with Instrumentation Ltd., a Government of India
Enterprise, in Palakkad, Kerala. After a successful career there for 21 years, he moved on
to join a private sector company M/s. Fisher Sanmar Ltd. as Vice President and rose to
become its Chief Executive. Having had successful stint in both Public sector and private
sector industries, he was selected to head HEC Ltd., an ailing PSU at Ranchi as Chairman
cum Managing Director. At HEC, Mr. G. K. Pillai anchored the ‘Turn-around’ of a
sick PSU to a profitable company during his 5 year term. Upon superannuating from
HEC, he joined the Company on 27th February, 2012 as Chief Operating Officer. The Board of
Directors in their Meeting held on 13th August, 2012 appointed Mr. G. K. Pillai as
an Additional Director of the Company w.e.f. 25.11.2012 and approved his
appointment as Managing Director & Chief Executive Officer and is seeking to be
elected as Managing Director and CEO not liable to retire by rotation.
(ii) Mr. Chirag C. Doshi, Managing Director of the Company has been working with the
Company since 1998. He is B.A. (Economics) from University of Michigan, USA, and M.B.A.
from the world-renowned ‘INSEAD INSTITUTE’ Paris. He has extensively worked on
business strategies, various growth initiatives, market research, business development and
exploring new business ventures for the Company and risen to the position of President and
Managing Director of the Company. He is also on the Board of Bombay Cycle & Motor
Agency Ltd. The term of Service Contract of Mr. Chirag C. Doshi, Managing Director
of the Company expires on 24th November, 2012 and is seeking to be re-elected as Managing
Director not liable to retire by rotation at the ensuing Annual General Meeting of the
Company.
(iii) Dr. P.K. Basu is B.A. Eco TRIPOS (CANTAB) MA (CANTAB), CBIM (London), PH.D
(Business Administration), who initially joined Company as a Nominee Director of ICICI and
continued as such till 20-08-1996 and then became a Director of the Company liable
to retire by rotation. Dr. P.K. Basu was Secretary to Govt. of India, Ministry of Steel
& Mines. He is having vast experience in the field of Business Administration in
general.
(iv) Mr. Dilip J. Thakkar is a Practising Chartered Accountant since last 51 years and
is a Partner of M/s. Jayantilal Thakkar & Co. and Jayantilal Thakkar Associates,
Chartered Accountants, Mumbai. Mr. Thakkar is having vast experience in the fields of
Accounts, Finance, Taxation, FEMA etc. He is also on the Board of 12 other Public Limited
Companies namely: Poddar Developers Ltd., Panasonic Energy India Co. Ltd., Essar Oil Ltd.,
The Ruby Mills Ltd., PAE Ltd., Himatsingka Seide Ltd., Indo Count Industries Ltd., Garware
Polyester Ltd., Essar Ports Ltd., Modern India Ltd., Premier Ltd., Magus Estates &
Hotels Ltd. and 8 Private Limited Companies. He is also a Trustee of HSBC Mutual Fund. Mr.
Thakkar is a Chairman of Audit Committees of Panasonic Energy India Co. Ltd., Essar Oil
Ltd., PAE Ltd. and Himatsingka Seide Ltd., besides Walchandnagar Industries Ltd. He is
also a Member of Investors Relations Committee of Essar Oil Ltd.
(3) Audit Committee:
The Audit Committee of the Board comprises of 3 Non-Executive Directors namely
Dr. P. K. Basu, Mr. Dilip J. Thakkar and Mr. Chakor L. Doshi, out of which two are
independent Directors including Mr. Dilip J. Thakkar, the Chairman of the Committee and
the requirement of Section 292A of the Companies Act, 1956 and Clause 49(II)(A) of the
Listing Agreement have been complied with. The Committee was re-constituted on 13.08.2012
by appointing Mr. Dilip J. Thakkar as a Chairman of the Committee. The Committee is
authorised by the Board in the manner as envisaged under Clause 49(II)(C) of the Listing
Agreement.
The Committee has been assigned task as listed under Clause 49(II)(D) of the
Listing Agreement. The Committee reviews the information as listed under Clause 49(II)(E)
of the Listing Agreement.
Attendance of Directors at the Audit Committee Meeting held during the Financial Year:
| Name of Director |
No. of Meetings held |
No. of Meetings attended |
| Dr. P. K. Basu |
4 |
4 |
| Mr. Dilip J. Thakkar |
4 |
4 |
| Mr. Chakor L. Doshi |
4 |
4 |
Four Audit Committee Meetings were held during the year 2011-2012 on 22.11.2011,
09.02.2012, 04.05.2012, & 13.08.2012.
The necessary quorum was present for all the meetings.
Dr. P. K. Basu, Chairman of the Audit Committee was present at the Annual General
Meeting held on 09.02.2012.
Managing Director & CEO, Managing Director, Sr. President, President (Finance &
Commercial), Statutory Auditors and Vice President (Internal Audit) are the permanent
invitee of the Audit Committee. Internal Independent Auditor and other members of the
Senior Management have attended when invited to the meetings. Mr. G. S. Agrawal, Vice
President (Legal & Taxation) & Company Secretary attended the meetings as
Secretary of the Committee. All the members of the audit committee are financially
literate and possess the requisite accounting and related financial management
expertise.
(4) Remuneration Committee:
The Remuneration Committee comprises of Mr. Chakor L. Doshi and four Independent
Directors viz., Dr. P. K. Basu, Mr. Dilip J. Thakkar, Mr. G. N. Bajpai and Dr. Anil
Kakodkar. Dr. P. K. Basu is the Chairman of the Committee. Mr. G. S. Agrawal,
Vice President (Legal & Taxation) & Company Secretary acts as Secretary to the
Remuneration Committee. The Remuneration Committee of the Company reviews the remuneration
of Managing/Executive Directors. The Chairman of the Remuneration Committee was present at
the Annual General Meeting held on 09.02.2012.
Remuneration Policy: The remuneration of Managing/Whole-Time Directors is approved by
the Remuneration Committee based on criteria such as industry benchmarks, Company’s
performance vis--vis industry performance/track record of the Managing/Whole Time
Director/appointee and is reported to the Board of Directors.
The Non-Executive Directors do not draw any remuneration from the Company except as
mentioned in Item No. 2 above. The total amount of sitting fees paid to Non-Executive
Directors during the year was Rs. 12.40 Lakhs.
Shareholding of Non-Executive Directors:
Mr. Chakor L. Doshi holds 55,930 equity shares of the Company including 6,680 equity
shares held by his HUF. No other Non-Executive Director holds any shares in the
Company.
Attendance of Directors at the Remuneration Committee Meeting held during the Financial
Year:
| Name of Director |
No. of Meetings held |
No. of Meetings attended |
| Dr. P. K. Basu |
2 |
2 |
| Mr. Dilip J. Thakkar |
2 |
2 |
| Mr. Chakor L. Doshi |
2 |
2 |
| Mr. G. N. Bajpai |
2 |
2 |
| Dr. Anil Kakodkar |
2 |
2 |
During the year under review, two Remuneration Committee Meetings were held on
04.05.2012 and 13.08.2012.
The details of remuneration paid/provided for Mr. J. L. Deshmukh for the financial year
ended September 30, 2012 is as follows: Amount paid/payable (Rs. in lakhs)
| Details |
Mr. J. L. Deshmukh |
|
Managing Director & CEO |
| Salary |
41.56 |
| Perquisites |
29.24 |
| Contribution to P.F. and Superannuation |
11.22 |
| Gratuity |
2.02 |
| Commission |
16.00 |
| Total |
100.04 |
The additional information in respect of Mr. J. L. Deshmukh, Managing Director &
CEO is as under:
| Service Contract |
: Five years. |
| Notice Period |
: Six Months. |
| Severance fees |
: Not Applicable. |
| Stock options |
: Not Applicable. |
The term of Mr. J. L. Deshmukh, as Managing Director & CEO of the Company will be
expiring on 24th November, 2012. The Remuneration Committee in their Meeting held on 13th
August, 2012 considered the request of Mr. J. L.
Deshmukh, not to renew his term of appointment with the Company as Managing Director
& CEO and appointed Mr. G. K. Pillai as Managing Director & CEO w.e.f. 25th
November, 2012.
The details of remuneration paid/provided for Mr. Chirag C. Doshi for the financial
year ended September 30, 2012 is as follows:
Amount paid/payable (Rs. in lakhs)
| Details |
Mr. Chirag C. Doshi |
|
Managing Director |
| Salary |
35.10 |
| Perquisites |
26.73 |
| Contribution to P.F. and Superannuation |
9.48 |
| Gratuity |
1.73 |
| Commission |
16.00 |
| Total |
89.04 |
The additional information in respect of Mr. Chirag C. Doshi, Managing Director is as
under:
| Service Contract |
: Five years. |
| Notice Period |
: Six Months. |
| Severance fees |
: Not Applicable. |
| Stock options |
: Not Applicable. |
The term of Mr. Chirag C. Doshi, as Managing Director of the Company will be expiring
on 24th November, 2012. The Remuneration Committee in their Meeting held on 13th August,
2012 considered the renewal of his term of appointment with the Company as Managing
Director w.e.f. 25th November, 2012.
The Remuneration Committee also acts as Selection Committee by co-opting a suitable
expert from respective field to consider and approve cases falling under Section
314 of the Companies Act, 1956 and the Directors’ Relatives (Office or Place of
Profit) Rules, 2003.
(5) Shareholders’ Grievance Committee:
Shareholders’ Grievance Committee comprises of 2 Non-Executive Directors namely
Mr. Chakor L. Doshi and Mr. Dilip J Thakkar. Mr. Chakor L. Doshi is the Chairman of
the Committee. The composition of the Committee meets the requirement of the Clause 49 of
the Listing Agreement.
Mr. G. S. Agrawal, Vice President (Legal & Taxation) & Company Secretary and
Compliance Officer acts as a Secretary of the Committee Meeting. The Committee is
authorised to redress the Shareholder’s and Investor’s Complaints.
During the financial year 2011-12, 73 complaints were received from shareholders and
were resolved as per details given hereunder:
| Sr. No. |
Nature of query/ Complaint |
Pending as on 01.10.11 |
Received during the year |
Redressed during the year |
Pending as on 30.09.12 |
| 1. |
Non Receipt of S.C. – Transfer |
- |
8 |
8 |
- |
| 2. |
Non Receipt of Dividend/ Interest/ Redemption Warrant |
- |
44 |
44 |
- |
| 3. |
Non Receipt of Annual Report |
- |
2 |
2 |
- |
| 4. |
Non Receipt of rejected DRF |
- |
2 |
2 |
- |
| 5. |
Non Receipt of Exchanged Cert |
- |
6 |
6 |
- |
| 6. |
Non Receipt of Bonus Certificate(s) |
- |
5 |
5 |
- |
| 7. |
Non Receipt of Rep/Spl/Con/Dup |
- |
1 |
1 |
- |
| 8. |
Others |
- |
5 |
5 |
- |
|
TOTAL |
- |
73 |
73 |
- |
Attendance of Directors at the Shareholders’ Grievance Committee Meeting held
during the financial year are as under:
| Name of Director |
No. of Meeting held |
No. of Meeting attended |
| Mr. Chakor L. Doshi |
1 |
1 |
| Mr. Dilip J. Thakkar |
1 |
1 |
During the year under review, One Shareholders Grievance Committee Meeting was held on
22.11.2011. The necessary quorum was present at the meeting. Mr. G. S. Agrawal, Vice
President (Legal & Taxation) & Company Secretary attended the meeting as Secretary
of the Committee.
(6) Share Transfer Matters:
In order to ensure prompt service to Shareholders, the Board of Directors has given
authority to Managing Director & CEO and Managing Director of the Company together
with Link Intime India Pvt. Ltd., the Registrar & Share Transfer Agent of the Company
to approve matters concerning share transfer/transmission, consolidation of shares etc.
and all other functions as delegated to Shareholders Grievance Committee except
replacement of lost/stolen/ mutilated share certificates which is only approved by the
Board of Directors of the Company. These matters are subsequently ratified by the Board of
Directors. The Company did not have any Share Transfer application pending as on
September 30, 2012.
In addition to above committees, the Board has constituted four more committees namely;
Finance Committee, Allotment Committee, Committee of Directors for Capital Issue and
Corporate Strategic Planning Committee. The composition, functions and attendance of
members of the Committees are listed below:
(7) Finance Committee:
The Board of Directors formed Finance Committee to consider and approve borrowing
proposals referred to it by the Board. During the financial year 2010-2011, the powers and
responsibilities of Finance Committee were extended in respect of (i) Opening of new Bank
Accounts and/or Closure of the Bank Accounts; (ii) Authorizing executives of the company
to operate the bank accounts; (iii) Revision in Authorized Signatories to operate existing
Bank Accounts of the company; (iv) Availing Internet Banking facilities including
e-commerce and/or closure of Internet banking facilities, authorizing executives of the
company to operate the said facilities and revision in authorized signatories for
operating the said facilities; (v) Authorizing executives of the company for dealing in
Forward Contracts on behalf of the Company and authorize the executives for executing the
documents under Common Seal of the Company for availing the said facilities, from time to
time. The Committee comprises of four Directors viz. Mr. Chakor L. Doshi, Mr. Dilip J.
Thakkar, Mr. G. N. Bajpai and Mr. J. L. Deshmukh. Mr. Chakor L. Doshi is Chairman
of the Committee. During the financial year 2011-12 under review, five meetings of Finance
Committee were held on 22.11.2011, 09.02.2012, 04.05.2012, 13.08.2012 and 30.08.2012.
Attendance of Directors at the Finance Committee Meeting held during the financial year
are as under:
| Name of Director |
No. of Meetings held |
No. of Meetings attended |
| Mr. Chakor L Doshi |
5 |
5 |
| Mr. Dilip J. Thakkar |
5 |
5 |
| Mr. G. N. Bajpai |
5 |
5 |
| Mr. J. L. Deshmukh |
5 |
4 |
Mr. G. S. Agrawal, Vice President (Legal & Taxation) & Company Secretary
attended the meetings as Secretary of the Committee.
(8) Allotment Committee:
The Board of Directors constituted Allotment Committee for the purpose of allotment of
equity shares on conversion of warrants to specified allottees as approved by the
shareholders by passing Special Resolution.
The Committee comprises of three Directors viz. Mr. Dilip J. Thakkar, Mr. G. N. Bajpai
and Mr. Chakor L. Doshi. Mr. Dilip J. Thakkar is Chairman of the Committee. During the
financial year 2011-12 under review, no meeting of the Allotment Committee was held.
(9) Committee of Directors for Capital Issue:
The Board of Directors had constituted ‘Committee of
Directors for Capital Issue’ (‘Committee’) with regard to create, offer,
issue and allot in one or more tranch(es), in one or more foreign markets or domestic
markets, to persons and entities whether such persons and/or entities are shareholders of
the Company or not, including to Qualified Institutional Buyers, as defined in the
Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009, as may be amended from time to time, ("SEBI Regulations"),
(collectively "Investors"). The Committee comprises of four Directors viz. Mr.
Chakor L. Doshi, Mr. Dilip J. Thakkar, Mr. J. L. Deshmukh and Mr. Chirag C. Doshi. Mr.
Chakor L. Doshi is Chairman of the Committee. During the financial year 2011-12 under
review, no meeting of the Committee of Directors for Capital Issue was held.
(10) Corporate Strategic Planning Committee:
The Board of Directors had constituted ‘Corporate Strategic
Planning Committee’ for overseeing and facilitating the development and
implementation of the Company’s corporate strategy including Long and Short term
plans. TheCommitteecomprisesoffiveDirectorsviz.Dr.AnilKakodkar, Mr. G. N. Bajpai, Mr.
Chakor L. Doshi, Mr. J. L. Deshmukh and Mr. Chirag C. Doshi. Dr. Anil Kakodkar is
Chairman of the Committee. During the financial year 2011-12 under review, no meeting of
the Corporate Strategic Planning Committee was held.
(11) General Body meetings:
(i) Location and time, where last three AGMs held:
| Year |
Venue |
Date |
Time |
| 2008-09 |
Walchand Hirachand Hall, IMC Building, Churchgate, Mumbai - 400 020 |
20.01.2010 |
03.00 p.m. |
| 2009-10 |
Walchand Hirachand Hall, IMC Building, Churchgate, Mumbai - 400 020 |
10.02.2011 |
04.00 p.m. |
| 2010-11 |
Walchand Hirachand Hall, IMC Building, Churchgate, Mumbai - 400 020 |
09.02.2012 |
04.00 p.m. |
(ii) Location and time, where Extra Ordinary General Meetings were held in last three
years:
| Year |
Venue |
Date |
Time |
| 2009-10 |
Walchand Hirachand Hall, IMC Building, Churchgate, Mumbai - 400 020 |
25.11.2009 |
12.00 Noon |
(iii) Special resolutions passed in the previous three AGMs:
• ? 2008-09
(a) Resolution Number 6, Resolution under Section 314 of the Companies Act, 1956 to
accord consent of the shareholders of the Company to Mr. Chakor L. Doshi, Chairman of the
Company to continue to provide professional service as Advisor/Consultants to the Company.
(b) Resolution Number 7, Resolution under Section 314 of the Companies Act, 1956 to
accord consent of the shareholders of the Company to Mrs. Tanaz C. Doshi to hold and
continue to hold an office or place of Profit in the Company with the designation as
Special Executive and increase in the remuneration.
All resolutions including special resolutions were passed by the members of the
Company. No postal Ballots were used for voting at these meetings.
(12) Disclosures:
(i) Disclosure on materially significant related party transactions i.e. transactions
of the Company of material nature with its Promoters, Directors or the Management, their
Subsidiaries or Relatives, etc. that may have potential conflict with the interests of the
Company at large:
The Audit Committee and the Board consider periodically the statement of related party
transactions with details together with the basis at their meetings. However, these
transactions are not likely to have any conflict with the interest of the Company. As
required by the Accounting Standards AS-18, the details of related party transactions are
given in Note No. 31 to the Notes on the Financial Statements for the year ended September
30, 2012.
(ii) Management Disclosures:
The Senior Management personnel have made disclosures to the Board relating to all
material financial and commercial transactions, if any, where they may have personal
interest that may have a potential conflict with the interest of the Company at large.
Based on the disclosures received, none of the Senior Management personnel has entered
into any such transactions during the year.
(iii) Details of non-compliance by the Company, penalties and strictures imposed on the
Company by Stock Exchange or SEBI or any Statutory Authorities, on any matter related to
Capital markets during last three years:
None.
(iv) Details of compliance with mandatory requirements and adoption of the
non-mandatory requirements of this clause.
The Company has complied with all the mandatory requirements on the Corporate
Governance as specified in Annexure ID to the Clause 49 of the Listing Agreement with the
Stock Exchanges and the Company has fulfilled the following non-mandatory requirements as
prescribed in Annexure ID to the Clause 49 of the Listing Agreement with the Stock
Exchanges:
1. Chairman of the Board:
The Chairman’s Office with required facilities is provided and maintained at
Company’s expense for use by its Non-Executive Chairman.
2. Other Committees:
The Company has constituted 5 more committee viz. Remuneration Committee, Finance
Committee, Allotment Committee, Committee of Directors for Capital Issue and Corporate
Strategic Planning Committee of the Board of Directors of the Company.
(v) Corporate Identity Number (CIN):
The Corporate Identity Number of the Company allotted by the Ministry of Corporate
Affairs, Government of India is L74999MH1908PLC000291.
(vi) Compliance Certificate from Auditors on Corporate Governance:
Certificate from Statutory Auditors M/s. K. S. Aiyar & Co, Chartered Accountants
confirming compliance with the conditions of Corporate Governance as stipulated under
Clause 49 of the Listing Agreement is annexed to this Report.
(vii) Reconciliation of Share Capital Audit report (formerly known as Secretarial Audit
Report) and Certificate of Compliance with Clause 47(c) of the Listing Agreement:
The SEBI vide Circular No. CIR/MRD/DP/30/2010 dated 6th September, 2010 has modified
the terminology of ‘Secretarial Audit’, as ‘Reconciliation of Share
Capital Audit’. A qualified practicing company secretary has carried out
secretarial audit to reconcile the total admitted capital with National Securities
Depository Ltd. (NSDL) and Central Depository Services (India) Ltd. (CDSL) and total
issued and listed capital. The ‘Reconciliation of Share Capital Audit’ (formerly
known as Secretarial Audit Report) confirms that the total issued/paid-up capital is in
agreement with the total number of shares in physical form and the total number of
Dematerialized shares held with NSDL and CDSL. The audit is carried out by M/s. V. N.
Deodhar & Co., Practicing Company Secretaries every quarter and report thereon is
submitted to the Stock Exchanges along with half yearly Compliance Certificate as per
Clause 47(c) of the Listing Agreement and placed before the Board of Directors.
(viii) Risk Management Framework:
The Company has laid down procedures to apprise the Board of Directors regarding key
risk assessment and risk mitigation mechanisms and the same has been reviewed periodically
to ensure that executive management control risk through means of a properly defined
framework.
(ix) Proceeds from Public Issues, rights issues, preferential issues etc.:
During the financial year 2007-08, the Company had converted 8,00,000 convertible
warrants issued on preferential basis. The Company has received entire amount of Rs. 5,072
Lakhs on conversion of the warrants into equity shares. The Company has utilized Rs. 1,516
Lakhs for capital expenditure, Rs. 2,780 Lakhs for working capital and the balance amount
Rs. 776 Lakhs has been invested in Liquid & Debt schemes of Mutual Funds and Fixed
Maturity Plans.
(13) Means of Communication:
(i) Quarterly, Half Yearly and Annual Results are published in All India Edition of
Financial Express in English & Mumbai Lakshadeep in Marathi News papers from Mumbai.
(ii) The quarterly, half yearly and annual results and shareholding pattern are also
posted on the website of the Company (www. walchand.com) and on the Corporate Filing (CORP
filing) and Dissemination system which is excel based software at www. corpfiling.co.in.
The Shareholding Pattern and Corporate Governance Report are also filed electronically on
NSE Electronic Application Processing System (NEAPS), web based application designed for
corporate at https://www.connect2nse.com/ LISTING/.
(iii) Green Initiative:
In support of the "Green Initiative" undertaken by Ministry of Corporate
Affairs, the Company had during the year 2011-12 sent various communications
including the Annual Report for F.Y. 2010-11, intimation of dividend for the year ending
September 30, 2011, by email to those shareholders whose email addresses were made
available to the depositories or the Registrar and Transfer Agents. Physical copies were
sent to only those shareholders whose email addresses were not available and for the
bounced email cases and who have specifically requested for the same.
As a responsible citizen, your Company strongly urges you to support the Green
Initiative by registering/updating your email addresses with the Depositories Participants
or the Registrar and Transfer Agents for receiving soft copies of various communications
including the Annual Reports.
(iv) The Company has designated investors@walchand.com as an email id for the purpose
of registering complaints by investors and displayed the same on the Company’s
website.
(v) "Management Discussion and Analysis" is given as Annexure ‘A’
to the Directors’ Report. (vi) No presentations were made to institutional investors
or to the analysts during the year.
(14) General Shareholder information:
| (i) AGM : Date, Time & Venue |
: |
31st January, 2013 – 4.00 p.m. |
|
|
Walchand Hirachand Hall, |
|
|
Indian Merchants’ Chambers Building, |
|
|
Churchgate, |
|
|
Mumbai – 400 020 |
| (ii) Financial Calendar |
: |
The Company follows October to September as its Financial Year. The results for every
quarter beginning from October are declared within 45 days from the end of the quarter
except for the last quarter, for which Annual Audited Results are declared within the
period of 60 days from the end of the quarter as per Clause 41 under the Listing
Agreement. |
| (iii) Date of Book Closure |
: |
25th January, 2013 to 31st January, 2013 |
|
|
(Both days inclusive) |
| (iv) Dividend payment date |
: |
15th February, 2013 |
| (v) Listing on Stock Exchanges |
: |
Bombay Stock Exchange Ltd. & National Stock Exchange of India Ltd. The Listing
fees for the year 2012-2013 have been paid to both the Stock Exchanges. |
| (vi) Stock Code |
: |
507410 (BSE) and WALCHANNAG (NSE) |
| (vii) Market Price Data : High, Low during each month in last financial year |
: |
BSE/NSE |
(Amount in Rs.)
| Month |
BSE High |
Low |
SENSEX Closing |
NSE High |
Low |
S & P CNX-500 Closing |
| Oct-11 |
91.45 |
82.35 |
17,705.01 |
91.50 |
82.00 |
4,215.90 |
| Nov-11 |
95.50 |
70.20 |
16,123.46 |
95.30 |
70.00 |
3,811.25 |
| Dec-11 |
75.25 |
57.00 |
15,454.92 |
81.00 |
61.00 |
3,597.75 |
| Jan-12 |
97.50 |
60.60 |
17,193.55 |
98.00 |
60.80 |
4,082.85 |
| Feb-12 |
111.40 |
88.25 |
17,752.68 |
111.40 |
88.55 |
4,275.55 |
| Mar-12 |
97.10 |
78.50 |
17,404.20 |
97.50 |
78.50 |
4,221.80 |
| Apr-12 |
88.75 |
73.30 |
17,318.81 |
88.90 |
73.35 |
4,178.35 |
| May-12 |
79.50 |
63.20 |
16,218.53 |
79.90 |
63.10 |
3,913.05 |
| Jun-12 |
71.40 |
64.75 |
17,429.98 |
71.20 |
64.65 |
4,170.65 |
| Jul-12 |
105.75 |
69.05 |
17,236.18 |
105.70 |
68.40 |
4,126.45 |
| Aug-12 |
80.80 |
66.20 |
17,429.56 |
80.00 |
66.90 |
4,129.90 |
| Sep-12 |
84.40 |
68.50 |
18,762.74 |
84.80 |
68.00 |
4,504.35 |
| (viii) Performance in comparison to BSE Sensex and S & P CNX-500 |
: |
The Chart shows the performance of the Company’s Shares at BSE and NSE as
compared to BSE SENSEX and S & P CNX - 500 during the year 2011-2012: |
| (ix) Registrar and Transfer Agents |
: |
M/s. Link Intime India Pvt. Ltd. |
|
|
Unit: Walchandnagar Industries Ltd. |
|
|
C-13, Pannalal Silk Mills Compound, L.B.S. Marg, |
|
|
Bhandup (W), Mumbai 400 078 |
|
|
Ph. No. (022) 25963838 |
|
|
Fax No. (022) 25946969 |
|
|
e-mail id: mumbai@linkintime.co.in |
| (x) Share Transfer System |
: |
Shareholders are permitted to hold shares in Physical form or in Demat Form. In case
of Physical form, shareholders are informed to lodge the shares for transfer purpose to
the Registrars and Share Transfer Agents and the Company is taking care to ensure that
share transfer work gets completed as early as possible and not later than 15 days period.
The transfers are being approved once in a week. In case the shares are transferred
through Demat mode, the procedure is adopted as stated in Depositories Act, 1996. |
(xi) (a) Shareholding Pattern : as on September 30, 2012
| Category |
No. of Shares |
% |
| Promoters & Directors, Directors Relatives/HUF & Group Companies/Group Trusts |
20,938,613 |
55.00 |
| Mutual Funds & Unit Trust of India |
6,500 |
0.02 |
| Banks, Financial Institutions, State Government |
194,990 |
0.51 |
| Insurance Companies |
2,296,200 |
6.03 |
| Private Corp. Bodies & Clearing Members |
1,858,909 |
4.88 |
| NRI/OCB/FII/FN |
216,091 |
0.57 |
| Public (Resident Indians/Trusts) |
12,558,902 |
32.99 |
| Total |
38,070,205 |
100.00 |
(b) Distribution of shareholding : as on September 30, 2012
| Shareholding of nominal value of Rs. |
Number of Shareholders |
% to Total |
Amount in Rs. |
% to Total |
| 1 to 5000 |
84,590 |
99.2293 |
20,156,420 |
26.4727 |
| 5001 to 10000 |
410 |
0.4810 |
2,936,400 |
3.8566 |
| 10001 to 20000 |
142 |
0.1666 |
2,053,948 |
2.6976 |
| 20001 to 30000 |
45 |
0.0528 |
1,103,644 |
1.4495 |
| 30001 to 40000 |
15 |
0.0176 |
541,810 |
0.7116 |
| 40001 to 50000 |
6 |
0.0070 |
272,836 |
0.3583 |
| 50001 to 100000 |
23 |
0.0270 |
1,520,500 |
1.9970 |
| 100001 onwards |
16 |
0.0188 |
47,554,852 |
62.4568 |
| Total |
85,247 |
100.0000 |
76,140,410 |
100.0000 |
| (xii) Dematerialization of Shares and Liquidity |
: |
As stated earlier, the Company’s shares are listed on the Stock Exchanges. As per
the SEBI notifications, trading in Company’s shares has been made compulsorily in
Dematerialised form w.e.f. 26th December, 2000 and Company’s Registrar & Transfer
Agents have connectivity with NSDL & CDSL. The ISIN No. is INE711A01022. As on
September 30, 2012, 3,67,93,019 equity shares representing 96.65% of the total shares have
been Dematerialised. The members holding shares in physical form are requested to get the
shares converted into demat form as per the prescribed procedure. The shares of the
Company are traded in the "B" group and Index "BSE SMALL-CAP". |
| (xiii) National ECS Facility |
: |
As per RBI notification, with effect from October 1, 2009 the remittance of money
through ECS is replaced by National Electronic Clearing Services (NECS) and banks have
been instructed to move to the NECS platform. NECS essentially operates on the new and
unique bank account number, allotted by banks post implementation of Core Banking Solution
(CBS) for centralized processing of inward instructions and efficiency in handling bulk
transaction. In this regard, shareholders holding shares in electronic form are requested
to furnish the new 10-digit Bank Account Number allotted to you by your bank along with
photocopy of a cheque pertaining to the concerned account, to your Depository Participant
(DP). Please send these details to the Company/Registrars, if the shares are held in
physical form, immediately. If your bank particulars have changed for any reason, please
arrange to register the NECS with the revised bank particulars. The Company will use the
NECS mandate for remittance of dividend either through NECS or other electronic modes
failing which the bank details available with Depository Participant will be printed on
the dividend warrant. All the arrangements are subject to RBI guidelines, issued from time
to time. |
| (xiv) Unclaimed Dividends |
: |
Under the Companies Act, 1956, Dividends that are unclaimed for a period of seven
years is required to be transferred to the Investor Education and Protection Fund
administered by the Central Government. After completion of seven years, no claims shall
lie against the said Fund or the Company for the amounts of Dividend so transferred nor
shall any payment be made in respect of such claims. |
|
: |
Separate intimation has been given in the notice convening 104th Annual General
Meeting, a part of this 104th Annual Report. Members are requested to utilize this
opportunity and get in touch with Company’s Registrar and Share Transfer Agent, M/s.
Link Intime India Pvt. Ltd., C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (W),
Mumbai – 400 078 for encashing the unclaimed Dividend for the financial year
2004-2005 and for subsequent years standing to the credit of their account. The
details of Unclaimed amount of Dividend/matured Fixed Deposit/matured Interest on Fixed
Deposit are now available on the website of the Company and MCA website i.e.
www.mca.gov.in. |
| (xv) Unclaimed Equity Shares |
: |
SEBI by circular no: CIR/CFD/DIL/10/2010 dated December 16, 2010 has amended Clause 5A
of the Listing Agreement to provide that shares held physically which may have remained
unclaimed by shareholders due to insufficient/incorrect information or for any other
reason should be transferred in demat mode to one folio in the name of "Unclaimed
Suspense Account" with one of the Depository Participants. The Company has sent three
reminders as required in the Clause 5A to the concerned shareholders and is taking steps
to open "Unclaimed Suspense Account" for transferring the unclaimed shares into
that Account. |
| (xvi) Outstanding GDRs/ADRs/Warrants or any other Convertible Instruments, Conversion
date and likely impact on equity |
: |
No instrument is outstanding for allotment or conversion. |
| (xvii) Plant Locations |
: |
The Company currently has 3 plants located as follows: |
|
|
1. Walchandnagar, Dist. Pune, Maharashtra |
|
|
2. Satara Road, Dist. Satara, Maharashtra |
|
|
3. Attikola Dharwad, Karnataka |
| (xviii)Address for correspondence |
|
|
| (a) For Correspondence relating to shares |
: |
Link Intime India Pvt. Ltd. |
|
|
Unit: Walchandnagar Industries Ltd., |
|
|
C-13, Pannalal Silk Mills Compound, |
|
|
L.B.S. Marg, Bhandup (W), Mumbai 400 078 |
|
|
Ph. No. (022) 25963838 Fax No. (022) 25946969 |
|
|
Email : mumbai@linkintime.co.in |
| (b) For other matters |
: |
Walchandnagar Industries Ltd. |
| (At Company’s registered Office) |
|
3, Walchand Terraces |
|
|
Tardeo Road, Mumbai 400 034 |
|
|
Tel: 022 40287110 |
|
|
Fax: 022 23634527 |
|
|
Email: investors@walchand.com; gsagrawal@walchand.com |
| (xix) Company Website |
: |
The Company has its website namely www.walchand.com. The website provides detailed
information about the Company, its products and services offered, locations of its
corporate offices and various sales offices etc. The Quarterly Results, Annual Reports and
Shareholding patterns are updated on the website of the Company. |
| (xx) Prevention of Insider Trading |
: |
In accordance with the requirements of SEBI (Prohibition of Insider Trading)
Regulations 1992, the Company has instituted a comprehensive Code of Conduct for
Prohibition of Insider Trading in the Company’s Shares. |
DECLARATION ON COMPLIANCE WITH CODE OF CONDUCT
Compliance of Code of Conduct for Directors and Senior Management Personnel pursuant to
amended provision of Clause 49 of the Listing Agreement.
The Board laid down a Code of Conduct for all Board Members and Senior Management
Personnel of the Company on 1st March, 2005. The Code of Conduct was also posted on the
Website of the Company.
All the Board Members and Senior Management Personnel affirmed that they have complied
with the said Code of Conduct on an annual basis in respect of the financial year ended
30-09-2012.
J. L. Deshmukh
Date: 23rd November, 2012
Managing Director & CEO
AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE
To,
The Members
Walchandnagar Industries Limited
We have examined the compliance of conditions of Corporate Governance by Walchandnagar
Industries Limited for the year ended 30th September, 2012 as stipulated in Clause
49 of the Listing Agreement of the Company with the Stock Exchange(s).
The compliance of conditions of Corporate Governance is the responsibility of the
management. Our examination was limited to procedures and implementation thereof, adopted
by the Company for ensuring the compliance of the conditions of the Corporate Governance.
It is neither an audit nor an expression of opinion on the financial statements of the
Company.
In our opinion and to the best of our information and according to the explanations
given to us and the representations made by the Directors and the management, we certify
that the Company has complied with conditions of Corporate Governance as stipulated in the
above mentioned Listing Agreement. We further state that such compliance is neither an
assurance as to future viability of the Company nor the efficiency or effectiveness with
which the management has conducted the affairs of the Company.
For K. S. Aiyar & Co.
Chartered Accountants
FRN 100186W
Satish K. Kelkar
Partner
Membership No. 38934
Place : Mumbai
Dated : 23rd November, 2012
ANNEXURE "C" TO THE DIRECTORS’ REPORT (ADDITIONAL INFORMATION GIVEN IN
TERMS OF NOTIFICATION NO. 1029 OF 31-12-1988 ISSUED BY THE DEPARTMENT OF COMPANY AFFAIRS)
(DISCLOSURES) (A) CONSERVATION OF ENERGY
(a) Energy Conservation measures taken:
(1) Installation of Thyristorised controlled electrical furnaces at plant for Solution
Annealing Furnace & Stress relieving furnace.
(2) Installation of Air Compressors with variable frequency drives to reduce power
consumption.
(3) Installed Metal Halide industrial lamp fittings. These lamps are energy efficient
as compared to High Pressure Mercury Vapour lamps.
(4) Installation of inverter based welding equipments.
(b) Energy Conservation Measures Proposed:
(1) To control current Harmonious Distortions injected on account of non linear nature
of electric load. This will improve the power factor from 0.95 to 0.98.
(2) Upgradation of stress relieving furnace from present heat resistant brick lining to
ceramic blanket lining, which will reduce fuel consumption per charge.
(3) Providing layer of insulation cover to all electrical furnaces to prevent heat
losses.
(B) TECHNOLOGY ABSORPTION, RESEARCH AND DEVELOPMENT
(1) Specific areas in which R&D has been carried out by the Company:
- New Product Development
- Import Substitution
- Process/Equipment Developments
- Value Engineering and Value Analysis (VEVA)
(2) Benefits derived as a result of R&D:
- Development of Advanced Sodium to Air Heat Exchanger for Nuclear applications.
- Design & Manufacturing of Moderator Heat Exchanger for Nuclear Application.
- Development of Double Walled Spherical Vessel for BARC.
- Development of Planetary Gear box for cement mills (2900 kw)
- Design & Manufacturing of Slide Shoe Mill with central drive arrangement (3500
kw).
- Development of Water Spray arrangement to central drive clinker grinding mill.
(3) Future Plan of Action
Develop the processes for critical equipments for Defense and Nuclear jobs, for
improving productivity.
| Expenditure on R&D |
Rs. in Lakhs |
| Capital (Development Expenditure) |
121.00 |
| Recurring |
25.30 |
| Total |
146.30 |
| Total R&D Expenditure |
|
| Percentage to turnover |
0.17 |
(4) Imported technology (imported during last 5 years reckoned from the beginning of
the financial year):
(i) (a) Technology import
Foster Wheeler North America Corporation, New Jersey, USA for High Pressure Stroker
Fired Boilers:
(b) Year of Collaboration – 2008-2009.
(c) We have already started manufacturing and executing high pressure boilers.
(ii) (a) Kawasaki Heavy Industries Ltd. Tokyo, Japan (b) Year of collaboration :
2010-11 (c) We have already started getting enquiries for air supported Belt Conveyors and
Parts thereof. (iii) (a) Earthtechnica Co. Ltd. Tokyo, Japan.
(b) Year of Collaboration : 2011-12
(c) We have already started getting enquires for super breaker for lime stone crushing
and parts thereof.
Technology absorption, adaptation and innovations: (1) Efforts in brief made towards
technology absorptions:
- Continuous monitoring of technology trends.
- Continuous interaction & exchange of information.
- Deputing engineers abroad for interaction & exchange of information.
- Development efforts for technology adaptations in new Areas.
(2) Benefits derived as a result of above efforts:
- Improvement in manufacturing methods and quality standards.
- Enhancing engineering skills.
- Development of energy efficient, cost effective & high performance engineering
products.
C) FOREIGN EXCHANGE EARNING AND OUTGO
Foreign exchange used and earned:
| Earning in Foreign Exchange |
Rs. 29867.09 Lakhs |
| Foreign Exchange Outgo |
Rs. 7954.84 Lakhs |
??? |