Mar 31, 2016
To,
The Members of EMCO Limited,
The Directors present the 51st Annual Report on the business and operations of the Company together with the Consolidated and Standalone Audited Financial Statements for the year ended 31st March 2016.
Financial Summary/Highlights
During the year under review, the financial performance of the Company is as under:
(Amounts in Rs, Lakhs)
Particulars |
Standalone |
|
2015-16 |
2014-15 |
|
Total Income |
80,683.94 |
91,243.29 |
Profit / (loss) Before Taxation |
(3,671.31) |
607.02 |
Less: Provision for Tax - Current |
179.57 |
|
Deferred Tax |
(1,131.73) |
263.31 |
Earlier Year Tax |
18.26 |
|
MAT Credit Entitlement |
(179.57) |
|
Profit After Taxation |
(2,539.58) |
325.45 |
Add: Balance brought forward from previous year |
21,209.02 |
20,964.91 |
Profit Available For Appropriation |
18,669.44 |
21,290.36 |
APPROPRIATIONS: |
||
Proposed Dividend |
67.58 |
|
Tax on Proposed Dividend |
13.76 |
|
Balance carried to Balance Sheet |
18,669.44 |
21,209.02 |
TOTAL APPROPRIATION: |
18,669.44 |
21,290.36 |
Overview of Company''s Financial Performance
During the year under review, Income from Sales and Services of the Company was stood at Rs, 80,684 Lakhs against Rs, 91,243 Lakhs in the previous financial year.
The Company has incurred a net Loss of Rs, 2,540 Lakhs in the current financial year against the net profit of Rs, 325 Lakhs in the previous financial year.
Transfer to reserves
During the financial year under review, the Company did not transfer any amount to reserve.
Dividend
Considering the loss incurred during the year under review, your Directors have not recommended any dividend.
Share Capital
The paid up equity shares capital of the Company is Rs, 13,51,51,770/- divided in to 6,75,75,885 shares of face value of Rs, 2/- per share. During the year under review, the Company has not allotted any shares to directors and employees of the Company and therefore disclosure under Section 67(3)(c) of the Companies Act, 2013 ("Act") in respect of voting rights not exercised directly by the employees of the Company is not required.
Update on Scheme of Arrangement
During the year under review, in accordance with the direction of the Hon''ble High Court of Bombay vide its order dated 16th October, 2015, the Members of the Company at the Court Convened Meeting held on 17th November, 2015 approved the Scheme of Arrangement between EMCO Limited and its wholly owned subsidiary Company EMCO Infrastructure Ltd ("EIL") and their respective shareholders and creditors providing for sale and transfer of the Infrastructure Undertaking of the EMCO Limited to EIL. However, on account of change in market conditions related to Infrastructure business and lack of interest shown by investors in Infrastructure Sector globally and particularly in India, the Board of Directors of the Company at their meeting held on 9th February, 2016 withdrew the said Scheme of Arrangement. In view thereof, the Hon''ble High Court on 1st of April, 2016 passed the order as the Scheme withdrawn.
Change in the nature of business
There was no change in the nature of business of the Company during the financial year under review.
Public Deposits
During the financial year 2015-16, your Company has not accepted any deposit within the meaning of Section 73 and Section 74 of the Act read together with the Companies (Acceptance of Deposits) Rules, 2014 and any amendment thereof.
Subsidiaries and Joint venture Companies
As per the provisions of Section 136 of the Act, the Annual Audited Financial Statement of each of the subsidiaries of the Company are displayed on the website of the Company. If any Member of the Company so desires, the Company will be happy to make available the Annual Audited Accounts of the subsidiaries to him/her on request. The physical copy of the said documents will also be available at the Company''s registered office for inspection, during normal business hours on all working days, excluding Saturdays.
During the year under review, the Company incorporated a wholly owned subsidiary in UAE in the name of ''EMCO Global DMCC''. The said wholly owned subsidiary is likely to start its activities in the year to come.
Consolidated Accounts
The performance and financial position of each of the Subsidiaries, Associates and Joint venture companies are detailed in Statement containing salient features of the financial statement of subsidiaries/ associate companies/ Joint Ventures" in form AOC- I which is prepared pursuant to Section 129 of the Act and annexed herewith as Annexure- A.
Directors and Key Managerial Personnel
Pursuant to the provisions of Section 152 of the Act, and in accordance with the Articles of Association of the Company, Mr. Shailesh S. Jain (DIN:00006180), Non Executive Director designated as Vice-Chairman of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.
During the year under review, Mr. S. V. Deo (DIN: 00210554), Mr. Bherulal Choudhary (DIN:00011905) and Mr. Sanjay Bhatnagar (DIN: 00867848), Independent Directors of the Company completed their first term of appointment and they were appointed as Independent Directors of the Company for their second term for a period of five years by members of the Company by passing special resolution for each of them at the 50th Annual General Meeting held on 25th September, 2015.
Similarly, Mrs. Priyamvada Bhumkar (DIN:00726135) was regularized as Director and appointed as Independent (Woman) Director for her first term of five years at the 50th Annual General Meeting held on 25th September, 2015
Declaration by Independent Directors
The Company has received declaration of Independence under Section 149(7) of the Act, that he/she meets the criteria of Independence laid down in Section 149(6) of the Act, and Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operation in future
During the financial year under review, there were no such orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operation in future.
Adequacy of Internal Financial Control
The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies, the safeguarding the assets, the prevention and detention of frauds and errors, the accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosure.
Composition of Audit Committee
The Audit Committee comprises of four Non-Executive Directors and all are independent Directors. The Chairman and other Members of the Committee are having ability to read and understand financial statement. All members have knowledge of finance, accounting and law. Composition of the Audit Committee during the financial year 2015-16 is as follows:
Sr. No. |
Name of the Committee Members |
Designation |
1. |
Mr. Sanjay Bhatnagar |
Chairman |
2. |
Mr. S. V. Deo |
Member |
3. |
Mr. Bherulal Choudhary |
Member |
4. |
Mrs. Priyamvada Bhumkar |
Member |
There were no matters during the financial year 2015-16 wherein the Board did not accept recommendations given by the Audit Committee.
Establishment of Vigil Mechanism
The Company has established and adopted Vigil Mechanism and the policy thereof for directors and employees of the Company in accordance with the provisions of the Act as well as the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year under review, no personnel of the Company approached the Audit Committee on any issue falling under the said policy.
The vigil mechanism policy is available on the website of the Company at link: http://www.emco.co.in/pdf/policy/Vigil%20 Mechanism%20Policy.pdf
Particulars of remuneration to Directors and Employees
Pursuant to Section 197(12) of the Act read along with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the particulars of remuneration to the Directors and Employees of the Company are annexed with the report as Annexure- B.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors'' Report is annexed herewith as Annexure C.
AUDITORS a) Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the Companies (Audit & Auditors ) Rules, 2014, M/s. P. Raj & Co.(FRN: 108310W) and M/s. Chaturvedi & Shah (FRN: 101720W), practicing Chartered Accountants, Joint Statutory Auditors of the Company were appointed for their second term for the period of 2 years and 5 years respectively at the 50th Annual General Meeting held on 25th September, 2015. However, their appointment as Statutory Auditors of the Company shall be required to be ratified by the Members at the ensuing Annual General Meeting. The Company has received confirmation certificate from them that they are not disqualified to act as the Auditors and are eligible to hold the office as Auditors of the Company.
b) Secretarial Auditors
M/s. Makarand M. Joshi & Co. Practicing Company Secretaries, had been appointed as Secretarial Auditor of the Company to conduct Secretarial audit for Financial Year 2015-16, as required under Section 204 of the Act and rules made there under. Secretarial Audit Report issued by M/s. Makarand M. Joshi in form of MR-3 for Financial Year 2015-16 annexed herewith as Annexure- D.
c) Cost Auditors
Pursuant to the provisions of Section 148(1) of the Act, the Company maintains Cost records. M/s. Kishore Bhatia & Associates (FRN: 00294), Cost Accountants, were appointed as Cost Auditors of the Company for the financial year ended 31st March, 2017 at a remuneration of '' 2,25,000/- per annum plus service tax and reimbursement of out of pocket expenses that may be incurred. The Cost Audit Report or Compliance certificate in this regard to be obtained from Cost Accountants for the year ended 31st March, 2016. Your Directors recommend to ratify remuneration payable to him for the year ended on 31st March, 2017
d) Internal Auditors
Based on recommendation made by the Audit Committee, M/s. Rahul Birla & Company (FRN: 122589W), Chartered Accountants were appointed as Internal Auditors of the Company for financial year 2016-17.
Explanations by the Board on qualifications, reservation or adverse remark or disclaimer made by the Auditors in their report
- Auditors in their report
There were no qualification, reservation, disclaimer and adverse remarks made by the Auditors of the Company in their audit report.
- Company secretary in practice in his secretarial report
Sr. No. |
Observation |
Reply to the observation |
1. |
The Company has made delay in filing of Form -APR with respect to Overseas Direct Investment. |
The delay in filing of Form - APR was inadvertent on the part of the Company. |
Employees Stock Option Scheme (ESOS)
Human Resource is the essential resource for the growth of the Company and man power is the strength for achieving mission of the Company. Based on this view, your Company has framed following Employee Stock Option Schemes for the financial growth of employees of the Company.
1) Employees Stock Option Scheme, 2006
2) Employee Stock Option Scheme, 2011
3) Employee Stock Option Scheme, 2015
Pursuant to provisions of the SEBI ( Share Based Employee Benefits) Regulations, 2014 the detail statement of above mentioned options Schemes as on 31st March, 2016 are as given below:
Sr No. |
Particulars |
ESOS 2006 |
ESOS 2011 |
a. |
Option Granted |
3,99,850 options |
25,90,000 options |
b. |
Pricing Formula |
Options have been granted at the closing market price of the equity shares of the Company one day prior to the date of grant. |
Options have been granted at the closing market price of the equity shares of the Company one day prior to the date of grant. |
c. |
Option vested |
16,000 options |
3,50,000 options |
d. |
Option exercised |
38,000 options |
- |
e. |
Total number of ordinary shares arising out of the Options |
1,90,000 Shares |
- |
f. |
Options lapsed |
3,51,170 options |
16,09,900 options |
g. |
Variation of terms of Options |
N.A. |
N.A. |
h. |
Money realized by exercise of the options |
Rs,171 Lakhs |
- |
i. |
Total number of options in force |
10,680 options |
17,80,100 options |
j. |
(i) Detail of option granted to senior management personnel |
Name of employees are not disclosed in view of sensitivity involved |
Name of employees are not disclosed in view of sensitivity involved |
(ii) Any employee who receive in any one year of grant of options amounting to 5% or more of options granted during the year |
N.A. |
N.A. |
|
(iii) Employees who were granted options during any -one year, equal to or exceeding 1% of the issued capital of the Company at the time of the grant |
|||
k. |
Diluted EPS calculated in accordance with -Accounting Standard 20 issued by ICAI for the year ended 31st March, 2016 |
||
l. |
(i) Method of calculation of employee compensation Cost. |
Intrinsic Value |
Intrinsic Value |
(ii) Difference between the employee compensation cost so compared at (i) above and the employee compensation cost that shall have been recognized if fair value of options had been used. |
N.A. |
N.A. |
(iii) The impact of the difference on profits and EPS of the Company for the year ended 31st March, 2016 had fair value of options had been used for accounting employee Options. |
N.A. |
N.A. |
|
m |
Weighted average exercise price and weighted average fair value of options granted during the year whose exercise price equals market price of stock on the grant date. |
||
(there are no options granted whose exercise price either exceeds or less than the market price of the stock on the date of grant) |
N.A. |
N.A. |
|
n |
A description of the method and significant assumption used to estimate the fair values of options, including the following weighted average information: |
||
i. Risk Free Interest Rate |
|||
ii. Expected Life |
|||
iii. Expected volatility |
|||
iv. Expected Dividends |
|||
The price of the underlying share in market at the time of option granted |
N.A. |
Note: in view of the Sub division of the shares and in terms with the relevant provisions of ESOS- 2006 the options stand adjusted along with entitlement to apply for 5 equity shares of Rs,2 each instead of one Equity shares of Rs,10 each.
The Employee Stock Option Scheme 2015 was approved by the Members of the Company at their Extra Ordinary General Meeting held on 22nd January, 2015. However, the Board of the Company is yet to grant options out of the said Scheme.
Extract of Annual Return
Pursuant to Section 134(3) (a) of the Act, the details of an extract of Annual Return in Form No. MGT-9 is annexed herewith as Annexure E to the Board''s report.
Number of Meetings of the Board
During the year under review, 5 (Five) Board Meetings and 5(Five) Audit Committee Meetings were held. The details of which is given in the Corporate Governance Report contain the part of Annual Report.
Directors'' Responsibility Statement
Pursuant to the requirement of Section 134(3)(c) of the Act with respect to the Directors'' Responsibility Statement, it is hereby confirmed:
(i) that in the preparation of the accounts for the financial year ended on 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit/ loss of the Company for the year ended on that date;
(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) that the Directors had prepared the accounts for the financial year ended on 31st March, 2016 on a ''going concern'' basis.
(v) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.
(vi) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
Details in respect of fraud reported by Auditors
Pursuant to Section 143 (12) of the Act, there were no such frauds reported by the Auditors of the Company during the year under review.
Policy on directors'' appointment and remuneration
Pursuant to Section 178 (3) of the Act, policy for selection and appointment of directors and their remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters are adopted by the Board of the Company and contain part of the Corporate Governance Report.
Particulars of loans, guarantees or investments under Section 186
Your company is engaged in providing infrastructure facilities and therefore the provisions of Section 186 of the Act, related to loan made, guarantee given or security provided is exempted and not applicable to the Company. Whereas investment made during the year has been disclosed in notes to accounts of the Financial Statement.
Particulars of contracts or arrangements with related parties
During the year under review, the Company has appointed Ms. Meenakshi Jain as President- Corporate Affairs with the approval of members in 50th Annual General Meeting of the Company held on 25th September, 2015. The particulars of every contract or arrangements entered into by the Company with related parties referred to in Section 188 of the Act, in Form No. AOC -II is forming part of Board''s Report and annexed herewith as Annexure F.
Corporate Governance Report
As required under the provisions of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, a report on Corporate Governance and a certificate confirming compliance with the requirements of Corporate Governance forms part of this Annual Report.
Training to Independent Directors
The Company had arranged a presentation on rights, duties and responsibilities of Independent Directors brought by the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Material changes and commitments affecting financial position between the end of the financial year and date of report
There are no material changes and commitments affecting financial position between the end of the financial year and date of report.
Conservation and Energy, Technology Absorption and Foreign Exchange Earnings & Outgo
The particulars as prescribed under Sub-section 3(m) of Section 134 of the Act read with the Companies (Accounts) Rules, 2014, are annexed herewith as Annexure G.
Risk Management Policy
The Company has formulated a Risk Management Policy, which reflects the overall risk management philosophy, the Company''s overall approach to risk management and the role and responsibilities for risk management.
The Company is mainly engaged in Transformers and Engineering Procurement and Construction (EPC) of Transmission line and sub-station projects. The Company continuously identifies and mitigates the risks through a robust risk identification and management system.
Details of some of the risks involved in the business are discuss below:
1) Commodity Risk
The Company deals with various commodities, such as steel, zinc, copper and aluminum. Fixed price contracts can have a negative impact if input costs rise, if it is not appropriately hedged in time. By adding price escalation clause in most of the contracts, the Company passes off such negative impacts to its client, partially or completely.
2) Currency Risk
The Company is exposed to the risk of currency fluctuations, if any exposure remains open. The Company believes in keeping its currency exposures hedged. It measures and manages these risks centrally and carries out periodic reviews of these risks; whenever required external experts are also consulted.
3) Execution Risk
Execution delay may results in cost overruns and may also negatively impact company''s reputation. EPC projects could face delays due to external factors like Right of Way issues, manpower shortages, etc. The Company deploys a well defined standard operating procedure (SOP) - from project planning to completion. It keeps a close watch and review these risks periodically and take timely course corrections.
Corporate Social Responsibility (CSR)
Pursuant to the provisions of Section 134 of the Act, and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 Detailed Information as required is annexed herewith as Annexure H forming part of this report.
Report on Prevention of Sexual Harassment of Women
Detailed Report on cases filed & their disposal under the Sexual harassment of women at workplace (prevention, prohibition & redressal) Act, 2013 for the period ended December, 2015 are as under:
Number of complaints of sexual harassment received: NIL
Number of complaints disposed off: N. A.
Board Evaluation
Pursuant to the provisions of the Act and erstwhile Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit Committee, Nomination & Remuneration Committee and Stakeholder Relationship Committee. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
Insurance
All the assets of the Company are adequately insured.
Acknowledgment
Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed EMCOites for the contribution in trying to achieve the Company''s vision to "To Build A World Class Company Through Reliability and Be A Great Place To Work".
On behalf of the Board of Directors
For EMCO LIMITED
Sd/-
Place: Mumbai Rajesh S. Jain
Date: May 30, 2016 Chairman
(DIN:00005829)
Mar 31, 2015
To
The Members of EMCO Limited,
The Directors take immense pleasure in presenting their 50th Annual
Report on the business and operations of the Company and statement of
accounts for the year ended 31st March 2015.
Financial Summary/Highlights
During the financial year, the performance of the Company is as under:
(Amounts in Rs. Lakhs)
Particulars Standalone
2014-15 2013-14
Total Income 91,243.29 83,825.75
Profit Before Taxation 607.02 1,082.98
Less: Provision for Tax  Current 179.57 61.58
Deferred Tax 263.31 376.13
Earlier Year Tax 18.26 -
MAT Credit Entitlement (179.57) (61.58)
Profit After Taxation 325.45 706.85
Add: Balance brought forward from
previous year 20,964.90 20,334.26
Profit Available For Appropriation 21,290.35 21,041.11
APPROPRIATIONS:
Proposed Dividend 67.58 65.14
Tax on Proposed Dividend 13.76 11.07
Balance carried to Balance Sheet 21,209.01 20,964.90
TOTAL APPROPRIATION: 21,290.35 21,041.11
Overview of Company's Financial Performance
During the year under review, Income from Sales and Services was Rs.
91,243 Lakhs against Rs. 83,826 Lakhs in the previous year.
The Company has earned a net Profit of Rs. 325 Lakhs in the current
financial year against the net Profit of Rs. 707 Lakhs in the previous
financial year.
Transfer to reserves
During the financial year, the Company did not transfer any amount to
reserve.
Dividend
Considering the past performance of the Company and to maintain the
consistent track record of dividend, your Directors are pleased to
recommend for your approval a dividend of 10 paisa per equity share of
Rs. 2/- each for the financial year 2014-2015 out of the current year's
Profit.
Change in the nature of business
There was no change in the nature of business of the Company during the
financial year.
Public Deposits
During the financial year 2014-15, your Company has not accepted any
deposit within the meaning of Sections 73 and 74 of the Companies Act,
2013 read together with the Companies (Acceptance of Deposits) Rules,
2014.
Subsidiaries and Joint venture Companies
Pursuant to Section 136 of the Companies Act, 2013, the audited
accounts of each of the Company's subsidiaries are placed on the
website of the Company. If any Member of the Company so desires, the
Company will be happy to make available the Annual Accounts of the
subsidiaries to him/her, on request. The physical copies of the
aforesaid documents will also be available at the Company's Registered
Office for inspection during normal business hours on all working days,
excluding Saturdays.
Consolidation of Accounts
The performance and financial position of each of the subsidiaries,
associates and joint venture companies are detailed in 'Statement
containing salient features of the financial statement of
subsidiaries/associate companies/ joint ventures' in form AOC I
pursuant to Section 129 of the Companies Act, 2013 and given in
'Annexure A' to this report.
Directors and Key Managerial Personnel
During the financial year, Mr. Rajesh S. Jain (DIN: 00005829), Whole
Time Director (WTD) designated as Chairman of the Company was going to
be ceased his term as WTD on October 19, 2014.
The Nomination and Remuneration Committee of the Board of Directors had
recommended to the Board for re-appointment of Mr. Rajesh S. Jain as
WTD for the period of 3 years. The Board on recommendation of said
committee had approved the same and recommended to the Members for
their approval. Accordingly, the Members at their Annual General
Meeting held on August 08, 2014 accorded their approval for such
appointment.
Pursuant to the provisions of Section 152 of the Companies Act, 2013
and in accordance with the Articles of Association of the Company, Mr.
Rajesh S. Jain, WTD of the Company, retires by rotation at the ensuing
Annual General Meeting and being eligible, offer himself for
re-appointment.
During the year under review, on account of health issues Mr. K. N.
Shenoy (DIN:00021373), Independent Director, resigned on May 14, 2014
from the Board of the Company. Further, the Board at their meeting held
on October 17, 2014 appointed Mr. Amit Sudhakar as the Chief Financial
Officer (CFO) of the Company in place of Mr. Ram Mundra who resigned as
CFO on September 29, 2014.
Mr. Ganesh Tawari was appointed as the Company Secretary of the Company
on February 26, 2015 in place of Mr. Pravin Kumar who resigned as
Company Secretary on August 30, 2014.
Mr. K. N. Shenoy, Independent Director of the Company expired on August
18, 2014. The Board has placed on record it appreciation for the
valuable contribution made and support extended by Mr. K. N. Shenoy
during his tenure.
The Board has placed on record its appreciation for the valuable
contribution made and support extended by Mr. Ram Mundra and Mr. Pravin
Kumar during their respective tenure.
Pursuant to the provisions of Sections 149, 152 and 161 of the
Companies Act, 2013, Mrs. Priyamvada Bhumkar (DIN: 00726138) was
appointed as an Additional Director (Woman  Independent Director) of
the Company. The Company has received a notice in writing from a member
along with requisite deposit under Section 160 of the Companies Act,
2013, proposing her candidature for the Office of Director. Your
Directors recommend her appointment for a term of 5 (five) years.
Re-appointment of Independent Directors
Pursuant to Section 149 and other applicable provisions, if any, of the
Companies Act, 2013 and rules framed there under, Mr. S. V. Deo
(DIN:00210554), Mr. Bherulal Choudhary (DIN:00011905) and Mr. Sanjay
Bhatnagar (DIN:00867848), Independent Directors of the Company will be
completing their first term of appointment on the Board at the ensuing
Annual General Meeting of the Company. The Company has received notices
in writing from a member along with requisite deposit under Section 160
of the Act, proposing their candidatures for the Office of Director.
Your Directors recommend their re-appointment for a next term of 5
(five) years by passing a special resolution separately for each one of
them.
The brief profiles of the Directors as required under Clause 49 of the
Listing Agreement entered with the Stock Exchange(s) are disclosed in
the notice convening 50th Annual General Meeting.
Declaration by independent directors
The Company has received necessary declaration from each independent
director under Section 149(7) of the Companies Act, 2013, that he/she
meets the criteria of independence laid down in Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
Significant and material orders passed by the regulators or courts or
tribunals impacting the going concern status and company's operations
in future
During the financial year, there were no such orders passed by the
regulators or courts or tribunals impacting the going concern status
and company's operations in future.
Adequacy of Internal Financial Control
The Board has adopted the policies and procedures for ensuring the
orderly and efficient conduct of its business, including adherence to
the Company's policies, the safeguarding the assets, the prevention and
detention of frauds and errors, the accuracy and completeness of the
accounting records, and timely preparation of reliable financial
disclosure.
Composition of Audit Committee
The Audit Committee comprises of three Non-Executive Directors, all of
whom are Independent Directors. The Chairman and other Members of the
Committee are having ability to read and understand financial
statement. Besides, all members have knowledge of finance, accounting
and law. Composition of the Audit Committee during the financial year
2014-2015 is as follows:
Sr.
No. Name of the Committee Members Designation
1 Mr. Sanjay Bhatnagar Chairman
2 Mr. Bheru Choudhary Member
3 Mr. S. V. Deo Member
There were no matters during the financial year 2014-2015, wherein the
Board did not accept recommendations given by the Audit Committee.
Establishment of Vigil Mechanism
The Company has established and adopted Vigil Mechanism and the policy
thereof for directors and employees of the Company in accordance with
the provisions of the Companies Act, 2013 as well as listing agreement.
During the year under review, no personnel of the Company approached
the Audit Committee on any issue falling under the said policy.
The vigil mechanism policy is available on the website of the company
at link: http://www.emco.co.in/pdf/policy/Vigil%20
Mechanism%20Policy.pdf
Particulars of remuneration to employees
The particulars of remuneration to directors and employees and other
related information required to be disclosed under Section 197 (12)
read with Rule 5 of The Companies (Appointment and Remuneration of
Managerial Personnel) Rules are given in 'Annexure B' to this Report.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors'
Report is annexed herewith as 'Annexure C'.
Auditors
a) Statutory Auditors
The Company's Auditors, M/s. P. Raj & Co.(FRN:108310W), and M/s.
Chaturvedi & Shah (FRN:101720W), Chartered Accountants, Statutory
Auditors hold Office up to the conclusion of the forthcoming 50th
Annual General Meeting and being eligible, offer themselves for
re-appointment. The Company has received letter from them giving their
consent to act as Auditors of the Company and stating that their
re-appointment, if made, would be within the prescribed limits under
Section 139 of the Companies Act, 2013. Your Directors recommend their
re-appointment for the second term of 2 years and 5 years respectively.
b) Secretarial Auditors
Makarand M. Joshi & Co., Practicing Company Secretaries, was appointed
to conduct the Secretarial Audit of the Company for the financial year
2014-2015, as required under Section 204 of the Companies Act, 2013 and
Rules thereunder. The secretarial audit report for financial year
2014-2015 forms part of the Directors Report as 'Annexure D' to the
Board's report.
c) Cost Auditors
The Company has appointed M/s. Kishore Bhatia & Associates (FRN:00294),
Cost Accountants, as Cost Auditors of the Company for the financial
year 31st March, 2015 at a remuneration of Rs. 1 Lac. The Company
maintains cost accounting records as required under Section 148 (1) of
the Act. The Compliance certificate in this regard to be obtained from
the Cost Accountants for the year ended 31st March 2015. Your Directors
recommend to ratify remuneration payable to him for the year ended 31st
March 2015 and 31st March 2016.
d) Internal Auditors
M/s. Rahul Birla & Company (FRN:122589W), Chartered Accountants, were
appointed the Internal Auditors of the Company for the financial year
2014-15. Based on the recommendation of the Audit Committee of the
Company, the Board of Directors has appointed M/s. Rahul Birla &
Company, Chartered Accountants as the Internal Auditors of the Company
for the financial year 2015-16.
Explanations by the Board on qualification, reservation or adverse
remark or disclaimer made by the
- Auditors in their report
There were no qualification, reservation, disclaimer and adverse
remarks made by the Auditors of the Company in their audit report.
- Company Secretary in practice in his secretarial audit report
The qualification given by the Company Secretary in practice in his
secretarial audit report:
Sr. Observation Reply to the observation
No.
1. The Company has made delay in
filling of The delay in fling of Form- APR
was inadvertent on the
FORMÂAPR with respect to
Overseas Direct part of the Company.
Investment.
Employees Stock Option Scheme (ESOS)
Your Company has always worked on the idea that the greatest strength
is its human resources and it is this resource, which makes your
Company a force to reckon with in the highly competitive environment.
With this view your Company has Employee Stock Option Scheme 2006,
Employee Stock Option Scheme 2011 and newly introduced Employee Stock
Option Scheme 2015 for the employees. The details of options under the
said Schemes as on 31st March, 2015 pursuant to the provision of SEBI
(Share Based Employee Benefits) Regulations, 2014 as amended are given
below:
Sr
No. Particulars ESOS 2006
a. Options Granted 3,99,850 options
b. Pricing formula Options have been granted
at the closing market price
of the Equity Shares of
the Company one day prior
to the date of grant.
c. Option vested 16,000 Options
d. Option exercised 38,000 Options
e. Total number of Ordinary shares
arising out of the 1,90,000 Shares
Options
f. Options lapsed 3,45,850 Options
g. Variation of terms of Options N.A.
h. Money realized by exercise of
the Options Rs.171 Lakhs
i. Total number of options in force 16,000 Options
j (i) Detail of option granted to:
senior management Name of employees are not
disclosed
personnel in view of sensitivity
involved.
(ii) Any employee who receives in
any one year of grant of N.A
options amounting to 5% or more of
options granted during the year
(2014-15)
(iii) Employees who were granted
options during any one -
year, equal to or exceeding 1% of
the issued capital of the Company
at the time of the grant.
k. Diluted EPS calculated in accordance
with Accounting -
Standard 20 issued by ICAI for the
year ended 31st March 2015
l.
(i) Method of calculation of employee
compensation Cost. Intrinsic Value
(ii) Difference between the employee
compensation NA
cost so compared at (i) above and
the employee compensation cost that
shall have been recognised if fair
value of options had been used.
(iii) The impact of the difference on
Profits and EPS of the NA
Company for the year ended 31st
March, 2015 had fair value of options
had been used for accounting employee
Options.
m. Weighted average exercise price and
weighted average fair value of options
granted during the year whose exercise
price equals market price of stock on
the grant date.
(there are no options granted whose
exercise price NA
either exceeds or less than the market
price of the stock on the date of
grant).
n. A description of the method and
Significant assumptions used to
estimate the fair values of options,
including the following weighted
average information:
i. Risk Free Interest Rate
ii. Expected Life
iii. Expected volatility
iv. Expected Dividends
The Price of the underlying share
in market at the time NA
of option granted
Sr
No. Particulars ESOS 2006
a. Options Granted 25,90,000 options
b. Pricing formula Options have been granted
at the closing market price
of the Equity Shares of
the Company one day prior
to the date of grant.
c. Option vested 3,50,000 Options
d. Option exercised -
e. Total number of Ordinary shares
arising out of the Options -
f. Options lapsed 12,40,000 Options
g. Variation of terms of Options N.A.
h. Money realized by exercise of
the Options -
i. Total number of options in force 13,50,000 Options
j(i) Detail of option granted to: senior
management Name of employees are not
disclosed
personnel in view of sensitivity
involved.
(ii) Any employee who receives in any one
year of grant of N.A
options amounting to 5% or more of
options granted during the year
(2014-15)
(iii) Employees who were granted options
during any one year, equal to or
exceeding 1% of the issued capital
of the Company at the time of
the grant. -
k. Diluted EPS calculated in accordance
with Accounting Standard 20 issued by
ICAI for the year ended 31st March 2015 0.50
l.(i) Method of calculation of employee
compensation Cost. Intrinsic Value
(ii) Difference between the employee
compensation NA
cost so compared at (i) above and the
employee compensation cost that
shall have been recognised if fair
value of options had been used.
(iii) The impact of the difference on
Profits and EPS of the NA
Company for the year ended 31st March,
2015 had fair value of options had
been used for accounting employee
Options.
m. Weighted average exercise price and
weighted average fair value of options
granted during the year whose exercise
price equals market price of stock on
the grant date.
(there are no options granted whose
exercise price NA
either exceeds or less than the market
price of the stock on the date
of grant).
n. A description of the method and
Significant assumptions used to
estimate the fair values of options,
including the following weighted
average information:
i. Risk Free Interest Rate
ii. Expected Life
iii. Expected volatility
iv. Expected Dividends
The Price of the underlying share
in market at the time NA
of option granted ESOS 2011
Note: In view of the Sub division of the shares and in terms with the
relevant provisions of ESOS Â 2006 the Options stand adjusted along
with entitlement to apply for 5 equity share of Rs. 2 each instead of
one Equity shares of Rs. 10 each.
The Employee Stock Option Scheme 2015 was approved by the Members of
the Company at their Extra Ordinary General Meeting held on 22nd
January, 2015. However, the Company is yet to grant options out of this
Scheme.
Extract of Annual Return
In accordance with Section 134(3)(a) of the Companies Act, 2013, an
extract of the Annual return in the prescribed format is annexed
herewith as 'Annexure E ' to the Board's report.
Number of Meetings of the Board
During the financial year, 9 (Nine) Board Meetings and 5 (Five) Audit
Committee Meetings were held. The details of which are given in the
Corporate Governance Report forming part of the Annual Report.
Directors' Responsibility Statement
Pursuant to the requirement of Section 134(3)(c) of the Companies Act
2013, with respect to the Directors' Responsibility Statement, it is
hereby confirmed:
a) that in the preparation of the accounts for the financial year ended
on 31st March, 2015, the applicable accounting standards have been
followed along with proper explanation relating to material departures;
b) that the Directors had selected such accounting policies and applied
them consistently and made judgments and estimates that were reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2015 and of the Profit/ loss of the
Company for the year ended on that date;
c) that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act, for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
d) that the Directors had prepared the accounts for the financial year
ended on 31st March, 2015 on a 'going concern' basis.
e) that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively.
f) that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
Policy on directors' appointment and remuneration
Policy for Selection and Appointment of Directors and their
Remuneration including criteria for determining qualifications,
positive attributes, independence of a director and other matters under
Sub-section (3) of Section 178 of the Companies Act, 2013, adopted by
the Board, is given in the Corporate Governance Report forming part of
this report.
Particulars of loans, guarantees or investments under Section 186
Your Company being engaged in providing infrastructural facilities, the
provisions of Section 186 of the Companies Act, 2013 with regards to
loan made, guarantee given or security provided is not applicable.
Whereas investment made during the year has been disclosed in notes to
accounts of the Financial Statement.
Particulars of contracts or arrangements made with related parties
There were no new contract or arrangements entered into by the Company
with related parties referred to in sub-section (1) of Section 188 of
the Companies Act 2013 during the financial year 2014-2015. Hence,
particulars of related party contracts or arrangements in form AOC - 2
is not applicable
Corporate Governance Report
As required by clause 49 of the Listing Agreement with the Stock
Exchange(s), a report on Corporate Governance and a certificate
confirming compliance with requirement of Corporate Governance forms
part of this Annual Report.
Training to Independent Directors
The Company had arranged a presentation on rights, duties and
responsibilities of Independent Directors brought by the Companies Act,
2013 and listing agreement. The Independent directors of the Company
attended the said presentation given by a practicing company secretary.
The details of presentation is available at web link
http://www.emco.co.in/other-information.html
Preferential allotment
The Members at their Extraordinary General Meeting held on 22nd
January, 2015 passed a special resolution according their consent to
the Board for issue and allotment of 24,39,025 equity shares of Rs. 2/-
each at a premium of Rs. 39/- per share to EMCO Investments Private
Limited, a promoter group company, on preferential allotment basis.
Accordingly, the Board allotted EMCO Investments Private Limited
11,00,000 equity shares on 26th February, 2015 and 13,39,025 equity
shares on 4th March, 2015. The Company has complied with all
applicable provisions of the Companies Act, 2013, listing agreement and
SEBI regulation.
Material changes and commitments affecting financial position between
the end of the financial year and date of report
There are no material changes and commitments affecting financial
position between the end of the financial year and date of report.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings & Outgo
The particulars as prescribed under Sub-section (3)(m) of Section 134
of the Companies Act, 2013, read with the Companies (Accounts) Rules,
2014, are enclosed as 'Annexure F' to the Board's report.
Risk Management Policy and Compliance Framework
The Board at their Meeting held on 17th October, 2014 constituted the
Risk Management Committee and adopted the Risk Management Policy with a
majority of Board Members, the details of which are as follows:
Sr.
No. Name of the Committee Members Designation
1 Mr. Rajesh Jain, Chairman
2 Mr. Shailesh Jain Member
3 Mr. Shyam Sunder Deo Member
4 Mr. Amit Sudhakar, Chief Financial Officer Member
5 Mr. Ganesh Tawari, Company Secretary /
Compliance Officer Member
The Company is mainly engaged in the Engineering Procurement and
Construction (EPC) projects and Transformer business. The Company
continuously identifies and mitigates the arising risks through a
robust risk identification and management system.
Details of some of the risks involved in the business are discuss
below:
1) Commodity Risk
The Company deals with various commodities, such as steel, zinc, copper
and aluminium. Fixed price contracts can have a negative impact if
input costs rise, if it is not appropriately hedged in time. By adding
price escalation clause in most of the contracts, the Company passes
off such negative impacts to its client, partially or completely.
2) Currency Risk
The Company is exposed to the risk of currency fluctuations, if any
exposure remains open. The Company believes in keeping its currency
exposures hedged. It measures and manages these risks centrally and
carries out periodic reviews of these risks; whenever required external
experts are also consulted.
3) Execution Risk
Execution delay may results in cost overruns and may also negatively
impact company's reputation. EPC projects could face delays due to
external factors like Right of Way issues, manpower shortages, etc. The
Company deploys a well- defined standard operating procedure (SOP) Â
from project planning to completion. It keeps a close watch and review
these risks periodically and take timely course corrections.
Corporate Social Responsibility (CSR)
Detailed Information as required pursuant to the provisions of Section
134 of the Companies Act 2013, and Rule 9 of the Companies (Corporate
Social Responsibility) Rules, 2014 is annexed herewith as 'Annexure G '
forming part of this report.
Board Evaluation
Clause 49 of the Listing Agreement mandates that the Board shall
monitor and review the Board evaluation framework. The Companies Act,
2013 states that a formal annual evaluation needs to be made by the
Board of its own performance and that of its committees and individual
directors. Schedule IV of the Companies Act, 2013 states that the
performance evaluation of independent directors shall be done by the
entire Board of Directors, excluding the director being evaluated
The evaluation of all the directors and the Board as a whole was
conducted based on the criteria and framework adopted by the Board. The
evaluation process has been explained in the corporate governance
report section in this Annual Report.
Insurance
All the assets of the Company are adequately insured.
Acknowledgment
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed EMCOites for the contribution in trying to achieve the
Company's vision to "To Build A World Class Company Through Reliability
and Be A Great Place To Work".
On behalf of the Board of Directors
For EMCO LIMITED
Sd/-
Place: Mumbai Rajesh S. Jain
Date: 29th May, 2015 Chairman
(DIN:00005829)
Mar 31, 2014
The Directors take pleasure in presenting their 49th Annual Report on
the business and operations of the Company and statement of accounts
for the year ended 31st March 2014.
Your Directors pleased to inform you that the Company has achieved its
50 glorious year and celebrating this year as Golden Jubilee.
Financial Results
During the year the performance of the Company is as under:
(All amounts in Rupees Lakhs,
unless otherwise stated)
Particulars Current Year Previous Year
2013-14 2012-13
Total Income 83,825.75 66,977.32
Profit Before Taxation 1,082.98 556.21
Less: Provision for Tax
Current 61.58 Nil
Deferred Tax 376.13 267.76
Earlier Year Tax Nil Nil
MAT Credit Entitlement -61.58 Nil
Profit After Taxation 706.85 288.45
Add: Balance brought forward from
previous year 20,334.26 20,198.23
Profit Available For Appropriation 21,041.11 20,486.68
APPROPRIATIONS:
Proposed Dividend 65.14 130.27
Tax on Proposed Dividend 11.07 22.15
Balance carried to Balance Sheet 20,964.90 20,334.26
TOTAL APPROPRIATION: 21,041.11 20,486.68
Review of Operations
During the year under review, Income from Sales and Services was Rs.
83,068 Lakhs against Rs. 66,881 Lakhs in the previous year.
The Company has earned a net profit of Rs. 707 Lakhs in the current
financial year against the net profit of Rs. 288 Lakhs in the previous
financial year.
Dividend
Considering the past performance of the Company and to maintain the
consistent track record of dividend, your Directors are pleased to
recommend for your approval a dividend of Rs. 0.10 paise on each share of
face value of Rs. 2/- each for the financial year 2013-14 out of the
current year''s profit.
Subsidiaries
The Company had five direct subsidiaries in the year under review,
namely:- a) EMCO Power Limited,
b) EMCO Renewable Energy Limited,
c) Shekhawati Transmission Service Company Limited
d) EMCO Infrastructure Limited*
e) EMCO Overseas Pte Limited, Singapore
* The Company has acquired 100% Equity share capital of EMCO
Infrastructure Limited from EMCO Power Limited w.e.f. October 18, 2013.
And two step-down subsidiaries, namely:-
a) EMCO Transmission Networks Limited
(Formerly known as East West Power Generation Company Limited) b) PT
Setenco Investa Niaga, Indonesia
In terms of general circular no. : 2/2011 issued on 8th February, 2011
by the Ministry of Corporate Affairs, Government of India under section
212 (8) of the Companies Act, 1956, a copy of Statement of Accounts
along with the reports of the Board of Directors and Auditors Report of
the above subsidiaries companies are not being attached with the Annual
Report of the Company.
The Company will make available Annual Accounts of the subsidiary
companies and related information to any members who may be interested
in obtaining the same. The Annual Accounts of subsidiary companies will
also be kept open for inspection at the Registered Office of the Company
and that of the respective subsidiary companies between 10.00 A.M. to
12.00 Noon on any working day of the Company and its subsidiaries.
The Consolidated Financial Statements presented by the Company includes
the financial results of the subsidiary companies.
Fixed Deposits
During the year under review the Company has neither invited nor
accepted any fixed deposits from the public.
Directors
Mr. Rajesh S. Jain, a Whole Time Director(WTD) designated as Chairman
of the Company, whose tenor as WTD will cease on October 19, 2014. The
Nomination and Remuneration Committee of the Board of Directors has
recommended to the Board for re- appointment of Mr. Rajesh S. Jain as
WTD for the period of Three years subsequent to the date of cessation
of their current tenure. The Board on recommendation of said committee
has approved the same and recommended to the members for their approval
at ensuing Annual General Meeting
Pursuant to the provision of Section 152 of the Companies Act, 2013 and
in accordance with the Articles of Association of the Company, Mr.
Shailesh S. Jain, Director of the Company, retire by rotation at the
ensuing Annual General Meeting and being eligible, offer himself for
reappointment.
Further pursuant to section 149, 152 and other applicable provision, if
any of the Companies Act, 2013("Act") and rules framed there under, Mr.
S. V. Deo, Mr. Bheru Choudhary and Mr. Sanjay Bhatnagar as Independent
Directors of the Company are need to be reappointed for the period of
one year with effect from August 8, 2014 and will hold office till the
conclusion of next Annual General Meeting of the Company. The said
appointment/re-appointment forms part of the notice convening 49th
Annual General Meeting.
Mr. T. N. V. Ayyar, Independent Director of the Company has resigned
from the Board of the Company with effect from March 26, 2014.
The brief profile of these Directors as required under Clause 49 of the
Listing Agreement entered with the Stock Exchange(s), are disclosed in
the notice convening 49th Annual General Meeting.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors''
Report is annexed hereto.
Corporate Governance Report
As required by clause 49 of the Listing Agreement with the Stock
Exchange(s), a report on Corporate Governance and a certificate
confirming compliance with requirement of Corporate Governance forms
part of this report.
Directors'' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, with respect to the Directors'' Responsibility Statement, it is
hereby confirmed:
(i) that in the preparation of the accounts for the financial year ended
on 31st March, 2014, the applicable accounting standards have been
followed along with proper explanation relating to material departures,
if any;
(ii) that the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at March 31, 2014 and of the profit of the
Company for the year ended on that date;
(iii) that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
(iv) that the Directors had prepared the accounts for the financial year
ended on 31st March, 2014 on a ''going concern'' basis.
Employees Stock Option Scheme (ESOS)
Your Company has always worked on the idea that the greatest strength
is its human resources and it is this resource, which makes your
Company a force to reckon with in the highly competitive environment.
With this view your Company has an Employee Stock Option Scheme 2006
and Employee Stock Option Scheme 2011 for its employees. The details of
options under the said Schemes as required under ESOP Disclosures to be
made under Clause 12.1 of the Securities and Exchange Board of India
(Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999 are given below:
Sr
No. Particulars ESOS2006 ESOS 2011
a. Options Granted 3,99,850 options 24,90,000 options
b. Pricing formula Options have been
granted at the
closing Options
have been granted at
the closing
market price of
the Equity Shares
of the market price of
the Equity
Shares of the
Company one day
prior to the date
of Company one day prior
to the date of
grant. grant.
c. Option vested 10,640 Options 3,09,500 Options
d. Option exercised 38,000 Options Nil
e. Total number of Ordinary
shares arising out of the 1,90,000 Shares
Nil
Options
f. Options lapsed 3,45,850 Options 9,25,000 Options
g. Variation of terms of
Options N.A. N.A.
h. Money realized by exercise
of the Options Rs. 171 Lakhs Nil
i. Total number of options
in force 16,000 Options 15,65,000 Options
j. (i) Detail of option granted
to: senior management Name of employees
are not disclosed
in Name of employees
are not disclosed in
personnel view of sensiti
vity
involved. view of sensitivity
involved.
(ii) Any employee who
receives in any one year of
grant N.A N.A
of options amounting to 5%
or more of options
granted during the year
(2013-14)
(iii) Employees who were
granted options during any Nil Nil
one year, equal to or
exceeding 1% of the issued
capital of the Company
at the time of the grant.
k. Diluted EPS calculated in
accordance with Nil 1.08
Accounting Standard 20
issued by ICAI for the
year ended 31st March
2014
l. (i) Method of calculation
of employee compensation
Intrinsic Value
Intrinsic Value
Cost.
(ii) Difference between
the employee compensation NA NA
cost so compared at (i)
above and the employee
compensation cost that
shall have been recognised
if fair value of options
had been used.
(iii) The impact of the
difference on profits and
EPS NA NA
of the Company for the
year ended 31st March,
2014 had fair value of
options had been used for
accounting employee
Options.
m. Weighted average exercise
price and weighted NA NA
average fair value of
options granted during
the year whose exercise
price equals market price
of stock on the grant date.
(there are no options
granted whose exercise
price
either exceeds or less than
the market price of the
stock on the date of grant).
n. A description of the method
and significant NA NA
assumptions used to estimate
the fair values of options,
including the following
weighted average
information:
i. Risk Free Interest Rate
ii. Expected Life
iii.Expected volatility
iv. Expected Dividends
The Price of the underlying share in market at the
time of option granted
Note: In view of the Sub division of the shares and in terms with the
relevant provisions of ESOS Â 2006 the Options stand adjusted along
with entitlement to apply for 5 equity share of Rs. 2 each instead of one
Equity shares of Rs. 10 each.
Particulars of Employees
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of employees are required to
be set out in the annexure to the Directors'' Report. However as per the
provisions of section 219 (1)(b)(iv) of the said Act, the Annual Report
excluding the aforesaid information is being sent to all the members of
the Company and others entitled thereto. Any member interested in
obtaining such particulars may write to the Company Secretary.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings & Outgo
Information as required under the provisions of Section 217(1)(e) of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 is annexed
to and forms part of this report.
Cost Accounting Records
Your Company is required to maintain cost accounting records in respect
of manufacture of power transformers, transmission towers, electronic
energy meters and generation of electricity from Wind Mill and Solar
farm (Power) pursuant to the Companies (Cost Accounting Records) Rules,
2011. The Compliance certificate in this regard to be obtained from the
Cost Accountants for the year ended 31st March 2014.
Auditors
The Company''s Auditors, M/s. P. Raj & Co., and M/s Chaturvedi & Shah
Chartered Accountants Statutory Auditors hold office up to the
conclusion of the forthcoming 49th Annual General Meeting and being
eligible, offer themselves for re-appointment. The Company has received
letter from them giving their consent to act as Auditors of the Company
and stating that their re-appointment, if made, would be within the
prescribed limits under Section 139 of the Companies Act, 2013. Your
Directors recommend their re- appointment.
Insurance
All the assets of the Company are adequately insured.
Acknowledgement
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed EMCOites for the contribution in trying to achieve the
Company''s vision to "To Build A World Class Company Through Reliability
and Be A Great Place To Work".
On behalf of the Board
of Directors
For EMCO LIMITED
Sd/-
Mumbai Rajesh S. Jain
April 25, 2014 Chairman
Mar 31, 2013
To, The Members of EMCO Limited,
The Directors take pleasure in presenting their 48th Annual Report on
the business and operations of the Company and statement of accounts
for the year ended 31st March 2013.
Financial Results
During the year the performance of the Company is as under:
(All amounts in X Lakhs, unless otherwise stated)
Current Year Previous Year
Particulars 2012-13 2011-12
Total Income 66,977.32 80,991.85
Profi t Before Taxation 556.21 914.90
Less: Provision for Tax - Current Nil Nil
Deferred Tax 267.76 108.55
Earlier Year Tax Nil Nil
Profi t After Taxation 288.45 806.35
Add: Balance brought forward
from previous year 20,198.23 19,543.28
Profi t Available For Appropriation 20,486.68 20,349.63
APPROPRIATIONS:
Proposed Dividend 130.27 130.27
Tax on Proposed Dividend 22.15 21.13
Balance carried to Balance Sheet 20,334.26 20,198.23
TOTAL APPROPRIATION: 20,486.68 20,349.63
Review of Operations
During the year under review, Income from Sales and Services was Rs.
66,881 Lakhs against Rs. 80,953 Lakhs in the previous year.
The Company has earned a net profi t of Rs. 288 Lakhs in the current fi
nancial year against the net profi t of Rs. 806 Lakhs in the previous fi
nancial year.
Dividend
Considering the past performance of the Company and to maintain the
consistent track record of dividend, your Directors are pleased to
recommend for your approval a dividend of Rs. 0.20/- paise on each share
of face value of Rs. 2/- each for the fi nancial year 2012-13 out of the
current year s profi t.
Subsidiaries
The Company had four direct subsidiaries in the year under review,
namely:-
a) EMCO Power Limited,
b) EMCO Renewable Energy Limited,
c) Shekhawati Transmission Service Company Limited*
d) EMCO Overseas Pte Limited, Singapore
* The Company has acquired 100% Equity share capital of Shekhawati
Transmission Service Company Limited (STSCL) from Rajasthan Rajya
Vidyut Prasaran Nigam Limited (RRVPNL) w.e.f. February 01, 2013.
And four step-down subsidiaries, namely:-
a) East West Power Generation Company Limited
b) EMCO Infrastructure Limited
c) EMCO Edison Transformers (Pty) Limited, South Africa**
d) PT Setenco Investa Niaga, Indonesia
** The company has divested it s investment in EMCO EDISON TRANSFORMER
PTY. LTD.
In terms of general circular no. : 2/2011 issued on 8th February, 2011
by the Ministry of Corporate Affairs, Government of India under section
212 (8) of the Companies Act, 1956, a copy of Statement of Accounts
along with the reports of the Board of Directors and Auditors Report of
the above subsidiaries companies are not being attached with the Annual
Report of the Company.
The Company will make available Annual Accounts of the subsidiary
companies and related information to any members who may be interested
in obtaining the same. The Annual Accounts of subsidiary companies will
also be kept open for inspection at the Registered Offi ce of the
Company and that of the respective subsidiary companies between 10.00
A.M. and 12.00 Noon on any working day of the Company and its
subsidiaries.
The Consolidated Financial Statements presented by the Company includes
the fi nancial results of the subsidiary companies.
Fixed Deposits
During the year under review the Company has neither invited nor
accepted any fi xed deposits from the public.
Directors
Pursuant to section 256 of the Companies Act, 1956 and in accordance
with the Articles of Association of the Company, Mr. S.V.Deo and Mr.
Bheru Choudhary, Directors of the Company, retire by rotation at the
ensuing Annual General Meeting and being eligible, offer themselves for
reappointment. The said appointment/re-appointment forms part of the
notice convening 48th Annual General Meeting. The profi le of these
Directors as required under section 49 of the Listing Agreement entered
with the Stock Exchange(s), are given in the notice convening 48th
Annual General Meeting.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors
Report is annexed hereto.
Corporate Governance Report
As required by clause 49 of the Listing Agreement with the Stock
Exchange(s), a report on Corporate Governance and a certifi cate confi
rming compliance with requirement of Corporate Governance forms part of
this report.
Directors Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, with respect to the Directors Responsibility Statement, it is
hereby confi rmed:
(i) that in the preparation of the accounts for the fi nancial year
ended on 31st March, 2013, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
(ii) that the Directors had selected such accounting policies and
applied them consistently and made judgements and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at 31st March, 2013 and of the profi t/
loss of the Company for the year ended on that date;
(iii) that the Directors had taken proper and suffi cient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
(iv) that the Directors had prepared the accounts for the fi nancial
year ended on 31st March, 2013 on a Âgoing concern basis .
Employees Stock Option Scheme (ESOS)
Your Company has always worked on the idea that the greatest strength
is its human resources and it is this resource, which makes your
Company a force to reckon with in the highly competitive environment.
With this view your Company has an Employee Stock Option Scheme 2006
and Employee Stock Option Scheme 2011 for the employees. The details of
options under the said Schemes as required under ESOP Disclosures to be
made under Clause 12.1 of the Securities and Exchange Board of India
(Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999 are given below:
Insurance
All the assets of the Company are adequately insured.
Acknowledgement
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed EMCOites for the contribution in trying to achieve the
Company s vision to "To Build A World Class Company Through Reliability
and Be A Great Place To Work".
On behalf of the Board of Directors
For EMCO LIMITED
Sd/-
Mumbai Rajesh S. Jain
9th May, 2013 Chairman
Mar 31, 2012
To,The Members of EMCO Limited,
The Directors take pleasure in presenting their 47th Annual Report on
the business and operations of the Company and statement of accounts
for the year ended 31st March 2012.
Financial Results
During the year the performance of the Company is as under:
(Rs. in Lakhs)
Current Year Previous Year
Particulars 2011-12 2010-11
Total Income 80,991.85 105,106.90
Profit Before Taxation 914.90 (6,561.14)
Less: Provision for Tax - Current NIL NIL
Deferred Tax 108.55 (2,114.57)
Earlier Year Tax NIL (23.30)
Profit After Taxation 806.35 (4,423.27)
Add: Balance brought forward
from previous year 19,543.28 24,114.61
Profit Available For
Appropriation 20,349.63 19,691.34
APPROPRIATIONS:
Proposed Dividend 130.27 130.27
Tax on Proposed Dividend 21.13 17.79
Balance carried to Balance Sheet 20,198.23 19,543.28
TOTAL APPROPRIATION: 20,349.63 19,691.34
Review of Operations
During the year under review, Income from Sales and Services was Rs.
80,953 lakhs against Rs. 104,947 lakhs in the previous year.
The Company has earned a net profit of Rs. 806 lakhs in the current
financial year against the net loss of Rs. 4,423 lakhs in the previous
financial year.
Dividend
Considering the past performance of the Company and to maintain the
consistent track record of dividend, your Directors are pleased to
recommend for your approval a dividend of 10% i.e. Rs. 0.20 per share
(previous year 10% i.e. Rs. 0.20 per share) on face value of Rs. 2 each for
the financial year 2011-12 out of the current year's profit.
Subsidiaries
The Company had three direct subsidiaries in the year under review,
namely:-
a. EMCO Power Limited,
b. EMCO Renewable Energy Limited,
c. EMCO Overseas Pte Limited, Singapore And four step-down
subsidiaries, namely:-
a. East West Power Generation Company Limited
b. EMCO Infrastructure Limited
c. EMCO Edison Transformer (Pty) Limited, South Africa
d. PT Setenco Investa Niaga, Indonesia
In terms of general circular issued by the Ministry of Corporate
Affairs, Government of India under section 212 (8) of the Companies
Act, 1956, a copy of Statement of Accounts along with the reports of
the Board of Directors and Auditors Report of the above subsidiary
companies are not being attached with the Annual Report of the Company.
The Company will make available Annual Accounts of the subsidiary
companies and related information to any members who may be interested
in obtaining the same. The Annual Accounts of subsidiary companies will
also be kept open for inspection at the Registered Office of the
Company and that of the respective subsidiary companies between 10.00
A.M. and 12.00 Noon on any working day of the Company and its
subsidiaries.
The Consolidated Financial Statements presented by the Company includes
the financial results of the subsidiary companies. Fixed Deposits
During the year under review the Company has neither invited nor
accepted any fixed deposits from the public.
Directors
Mr. Sanjay Bhatnagar was appointed as Non - executive Director by the
Members of the Company at their Annual General Meeting held on 20th
September 2011.
Further in the same meeting Mr. Rajesh S. Jain and Mr. Shailesh S. Jain
were reappointed as Whole Time Director designated as Chairman and Vice
Chairman for a period of three years with effect from 20th October 2011
and 19th October 2011 respectively.
Mr. Ajay Kumar Dhagat ceased to be Managing Director and Director of
the Company with effect from 4th November 2011. The Board places on
record its appreciation for the contribution made by Mr Ajay Kumar
Dhagat during his tenure as Managing Director of the Company.
Pursuant to section 256 of the Companies Act, 1956 Mr. K N Shenoy and
Mr. T N V Ayyar who retire by rotation and being eligible for
reappointment, offer themselves for reappointment at the ensuing Annual
General Meeting.
The above appointments/re-appointments forms part of the notice
convening 47th Annual General Meeting. The profile of these Directors
as required under Clause 49 of the Listing Agreement entered with the
Stock Exchange(s), are given in the notice convening 47th Annual
General Meeting.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors'
Report is annexed hereto.
Corporate Governance Report
As required by clause 49 of the Listing Agreement with the Stock
Exchange(s), a report on Corporate Governance and a certificate
confirming compliance with requirement of Corporate Governance forms
part of this report.
Directors' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, with respect to the Directors' Responsibility Statement, it is
hereby confirmed:
(i) that in the preparation of the accounts for the financial year
ended on 31st March 2012, the applicable accounting standards have been
followed along with proper explanation relating to material departures,
if any;
(ii) that the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at 31st March 2012 and of the profit/ loss
of the Company for the year ended on that date;
(iii) that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
(iv) that the Directors had prepared the accounts for the financial
year ended on 31st March 2012 on a 'going concern' basis.
Employees Stock Option Scheme (ESOS)
Your Company has always worked on the idea that the greatest strength
is its human resources and it is this resource, which makes your
Company a force to reckon with in the highly competitive environment.
With this view your Company has an Employee Stock Option Scheme 2006
and Employee Stock Option Scheme 2011 for the employees. The details of
options under the said Schemes as required under ESOP Disclosures to be
made under Clause 12.1 of the Securities and Exchange Board of India
(Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999 are given below:
Sr
No. Particulars ESOS 2006 ESOS 2011
a. Options Granted 3,99,850 options 13,90,000 options
b. Pricing formula Options have been
granted at the Options have been
granted at the
closing market
price of the Equity closing market price
of the Equity
Shares of the
Company one day
prior Shares of the Company
one day prior
to the date of
grant. to the date of grant.
c. Option vested 2,21,225 Options Nil
d. Option exercised 38,000 Options Nil
e. Total number of
Ordinary shares
arising 1,90,000 Shares Nil
out of the Options
f. Options lapsed 3,23,850 Options 7,25,000 Options
g. Variation of terms
of Options N.A. N.A.
h. Money realized by
exercise of the
Options ' 171 lakhs Nil
i. Total number of
options in force 38,000 Options 665,000 Options
j (i) Detail of option
granted to:
senior Mary Mody : 8,000 B.J.Amritkar: 75,000
management
personnel Neeraj Yadav:
8,000 Ganesh Tawari: 40,000
N.K.Mukherjee :
14,000 Deepak Khandelwal:
75,000
Ashok Bhambhani :
8,000 N K Mukherjee: 5,000
Ram Mundra: 40,000
Kishor Patel: 40,000
Ratnakar Wagh: 40,000
Anagha Dixit: 40,000
N K Paramal: 40,000
Mahesh Jagiasi: 40,000
Prashant
Sahasrabudhe: 40,000
K P Singh: 75,000
R P Singh: 40,000
Kailash
Agarwal: 75,000
(ii) Any employee who
receives in any one Mary Mody B.J.Amritkar
year of grant of
options amounting
to 5% Neeraj Yadav Deepak
Khandelwal
or more of options
granted during the
year (2011-12) N.K.Mukherjee K P Singh
Ashok Bhambhani Kailash Agarwal
(iii) Employees who were
granted options Nil Nil
during any one year,
equal to or
exceeding
1% of the issued
capital of the
Company at the time
of the grant.
k. Diluted EPS calcu
lated in accordance
with 1.24 1.24
Accounting Standard
20 issued by ICAI
for the year ended
31st March 2012
l.(i) Method of calcu
lation of employee Intrinsic Value Intrinsic Value
compensation Cost.
(ii) Difference between
the employee NA NA
compensation cost
so compared at (i)
above and the emp
loyee compensation
cost that shall have
been recognised if
fair value of options
had been used.
Sr
No. Particulars ESOS 2006 ESOS 2011
(iii) The impact of the
difference on
profits NA NA
and EPS of the
Company for the
year ended 31st
March, 2012 had
fair value of
options had been
used for accoun
ting employee
Options.
m. Weighted average
exercise price
and NA NA
weighted average
fair value of op
tions granted
during the year
whose exercise
price equals
market price of
stock on the
grant date.
(there are no
options granted
whose exercise
price either
exceeds or less
than the market
price of the
stock on the
date of grant).
n. A description of
the method and NA NA
significant assum
ptions used to
estimate the fair
values of options,
including the
following weighted
average information:
(i) Risk Free
Interest Rate
(ii) Expected Life
(iii) Expected
volatility
(iv) Expected
Dividends
The Price of the
underlying share
in market at the
time of option
granted
Note: In view of the Sub division of the shares and in terms with the
relevant provisions of ESOS - 2006 the Options stand adjusted along
with entitlement to apply for 5 equity share of Rs. 2 each instead of one
Equity shares of Rs. 10 each.
Particulars of Employees
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of employees are required to
be set out in the annexure to the Directors' Report. However as per the
provisions of section 219 (1)(b)(iv) of the said Act, the Annual Report
excluding the aforesaid information is being sent to all the members of
the Company and others entitled thereto. Any member interested in
obtaining such particulars may write to the Company Secretary.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings & Outgo
Information as required under the provisions of Section 217(1)(e) of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 is annexed
to and forms part of this report.
Auditors
The Company's Auditors, M/s. P. Raj & Co., and M/s Chaturvedi & Shah
Chartered Accountants (Joint Statutory Auditors) hold office up to the
conclusion of the forthcoming 47th Annual General Meeting and being
eligible, offer themselves for re-appointment. The Company has
received letter from them giving their consent to act as Auditors of
the Company and stating that their re- appointment, if made, would be
within the prescribed limits under Section 224(1B) of the Companies
Act, 1956. Your Directors recommend their re-appointment.
Cost Auditors
The Board of Directors pursuant to order issued by the Central
Government under section 233B of the Companies Act, 1956 have appointed
M/s Kishore Bhatia & Associates, Cost Accountants for the conducting
the audit of the cost accounting records maintained by the company in
respect of manufacture of power transformers, transmission towers,
electronic energy meters and generation of electricity from Wind Mill
and Solar farm (Power). The due date for submission of the Report is
27th September 2012.
Insurance
All the assets of the Company are adequately insured.
Acknowledgement
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed EMCOites for the contribution in trying to achieve the
Company's vision to "To Build A World Class Company Through
Reliability And Be A Great Place To Work".
On behalf of the Board of Directors
For EMCO LIMITED
sd/-
Rajesh S. Jain
Chairman
Mumbai 15th May 2012
Mar 31, 2011
The Members of EMCO Limited,
The Directors take pleasure in presenting their 46th Annual Report on
the business and operations of the Company and statement of accounts
for the year ended 31st March 2011.
Financial Results
During the year the performance of the Company was as under:
Rs in lakhs
Current Year Previous Year
2010-11 2009-10
Total Income 105,106.90 110,656.65
Profit Before Taxation (6 ,561.14) 18,328.97
Less: Provision for Tax - Current - 4,480.00
Deferred Tax (2,114.57) 275.38
Earlier Year Tax (23.30) 193.93
Profit After Taxation (4,423.27) 13,379.66
Add: Balance brought forward
from previous year 24,114.61 13,566.60
Profit Available For
Appropriation 19,691.34 26,946.26
APPROPRIATIONS:
General Reserve - 1,400.00
Debenture Redemption Reserve - 417.33
Proposed Dividend 130.27 866.98
Tax on Dividend 17.79 147.34
Balance carried to Balance Sheet 19,543.28 24,114.61
TOTAL APPROPRIATION: 19,691.34 26,946.26
Review of Operations
During the year under review, Income from Sales and Services was
104,947 lakhs against 97,855 lakhs in the previous year registering
growth of 7.24%.
The Company has incurred a net loss of Rs 4,423 lakhs in current
financial year against the net profit of Rs 13,379 lakhs in previous
financial year. The profit of previous financial year includes
extra-ordinary item of Rs 12,735 lakhs which was arising out of sale of
investment in EMCO Energy Limited, a wholly owned subsidiary of the
Company.
The Company's performance was adversely affected due to Project -
Sub-station business where we have experienced execution challenges
which include designs, drawings and estimations for lump sum items and
also had cost overrun due to delay and quantity variation coupled with
from prices at the time of project closure. Further Transformers
Industry is passing through a tough time due to competition as a result
of excess capacity within the country which leads to pressure on
margin.
The Company is focusing on commissioning of the projects which will
release the retention money and reduce the interest cost. The Company
has also taken necessary corrective actions and effective measures to
improve the performance of the Company.
Dividend
Considering the past performance of the Company and to maintain the
consistent track record of dividend your Directors are pleased to
recommend for your approval, a dividend of 10% i.e. Re. 0.20/- per
share (previous year 70% i.e. Rs 1.40 per share) on face value of Rs
2/- each for the financial year 2010-11 out of the accumulated profits
of the previous years.
Subsidiaries
The Company had three direct subsidiaries in the year under review,
namely:- a) EMCO Power Limited,
b) EMCO Renewable Energy Limited*,
c) EMCO Overseas Pte Limited, Singapore And four step-down
subsidiaries, namely
a) East West Power Generation Company Limited,
b) EMCO Infrastructure Limited
c) EMCO Edison Transformer (Pty) Limited, South Africa
d) PT Setenco Investa Niaga, Indonesia
*The name of the Company is changed from EMCO Power Infrastructure
Limited to ÃEMCO Renewable Energy Limitedà on December 23, 2010.
In terms of general circular issued by the Ministry of Corporate
Affairs, Government of India under section 212 (8) of the Companies
Act, 1956, a copy of Statement of Accounts along with the reports of
the Board of Directors and Auditors Report of the above subsidiary
companies are not being attached with the Annual Report of the Company.
The Company will make available Annual Accounts of the subsidiary
companies and related information to any members who may be interested
in obtaining the same. The Annual Accounts of subsidiary companies will
also be kept open for inspection at the Registered Offce of the Company
and that of the respective subsidiary companies between 10:00 A.M. and
12:00 Noon on any working day of the Company and its subsidiaries.
The Consolidated Financial Statements presented by the Company includes
the financial results of the subsidiary companies.
Fixed Deposit
During the year under review the Company has neither invited nor
accepted any fixed deposits from the public.
Directors
Mr. Ajay Kumar Dhagat has been appointed as Managing Director of the
Company at the Board Meeting held on April 19, 2010 and his terms of
appointment including remuneration was Confirmed by the Members of the
Company at their Annual General Meeting held on August 25, 2010.
In accordance with Section 256 of the Companies Act, 1956 and the
Articles of Association of the Company, Mr. Rajesh S. Jain and Mr.
Shailesh S. Jain, Directors of the Company, are liable to retire by
rotation at the ensuing Annual General Meeting and being eligible,
offer themselves, for reappointment.
Further the tenure of Mr. Rajesh S. Jain and Mr. Shailesh S. Jain as
Whole Time Director will cease on October 19, 2011 and October 18, 2011
respectively. The Remuneration, Nomination and Selection Committee of
the Board of Directors of the Company has recommended the Board for the
re-appointment of Mr. Rajesh S. Jain and Mr. Shailesh S. Jain as Whole
Time Director designated as Chairman and Vice Chairman respectively for
a period of three years subsequent to the date of cessation of their
current tenure. The Board has approved the same and recommended to the
members for their approval at the ensuing Annual General Meeting.
Mr. Anil Kumar Sardana ceased to be a Director of the Company with
effect fro m January 14, 2011. The Board places on record its
appreciation for the contribution made by Mr Anil Kumar S ardana during
his tenure as Independent Director of the Company.
Mr. R.S. Shah ceased to be a Director of the Company with effect from
April 19, 2010 on expiry of his term as Director-Technical of the
Company. The Board places on record its appreciation for the services
rendered by Mr R.S. Shah during his tenure as Director- Technical of
the Company.
The above appointments/re-appointments forms part of the Notice of the
46th Annual General Meeting. The profle of these Directors as required
under Clause 49 of the Listing Agreement entered with the Stock
Exchange(s), are given in the notice of the 46th Annual General
Meeting.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Directors'
Report is annexed hereto.
Corporate Governance Report
As required by clause 49 of the Listing Agreement with Stock
Exchange(s), a report on Corporate Governance and a certificate
confirming compliance with requirement of Corporate Governance forms
part of this report.
Directors' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, with respect to the Directors' Responsibility Statement, it is
hereby confirmed:
(i) that in the preparation of the accounts for the financial year
ended on 31st March, 2011, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
(ii) that the Directors had selected such accounting policies and
applied them consistently and made judgements and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at March 31,2011 and of the profit /
loss of the Company for the year ended on that date;
(iii) that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
(iv) that the Directors had prepared the accounts for the financial
year ended on 31st March, 2011 on a 'going concern' basis.
Employee Stock Option Scheme (ESOS)
Your Company has always worked on the idea that the greatest strength
is its human resources and it is this resource, which makes your
Company a force to reckon with in the highly competitive environment.
With this view your Company has an Employee Stock Option Scheme 2006,
for the employees. The details of options under the said Scheme as
required under ESOP Disclosures to be made under Clause 12.1 of the
Securities and Exchange Board of India (Employee Stock Option Scheme
and Employee Stock Purchase Scheme) Guidelines, 1999 are given below:
Sr. Particulars Particulars
No.
1. Options Granted 325,850 Options
2. Pricing formula Options have been granted
at the closing market price
of the Equity Shares of the
Company one day prior
to the date of grant.
3. Options vested 177,025 Options
4. Options exercised 38,000 Options
5. Total number of Ordinary
shares arising out of the Options 190,000 Shares
6. Options lapsed 243,650 Options
7. Variation of terms of Options N.A.
8. Money realized by exercise of
the Options Rs 171 lakhs
9. Total number of options in
force 44,200 Options
10. i). Detail of option granted
to senior management personnel Ajay Kumar Dhagat 5,000
options
Parag Paranjpe 10,000
options
Ajay Prasad 5,000 options
Satish Gupta 2,000 options
Sunil Rustagi 1,200 options
N.K. Mukherjee 2,000 options
Sanjay Badve 2,000 options
Deepak Khandelwal 4,000
options
ii). Any employee who receives in
any one year of grant of options Ajay Kumar Dhagat
amounting to 5% or more of options
granted during the year (2010-11) Parag Paranjpe
Ajay Prasad
iii). Employees who were granted
options during any one year, equal to NIL
or exceeding 1% of the issued capital
of the Company at the time of the
grant.
11 . Diluted EPS calculated in
accordance with Accounting Standard 20 Rs (7.05) per share
issued by per share ICAI for the year
ended 31st March 2011
12. i) Method of calculation of
employee compensation Cost. N.A.
ii) Difference between the
employee compensation cost N.A.
so compared at (i) above and the
employee compensation cost that
shall have been recognised if fair
value of options had been used.
iii) The impact of the difference on
profits and EPS of the Company for N.A.
the year ended 31st March, 2011 had
fair value of options had been used for
accounting employee Options.
13. Weighted average exercise price N.A.
and weighted average fair value of
options granted during the year whose
exercise price equals market price of
stock on the grant date.
(there are no options granted whose
exercise price either exceeds or
less than the market price of the
stock on the date of grant).
14. A description of the method and N.A.
significant assumptions used to
estimate the fair values of options,
including the following
weighted average information:
(i) Risk Free Interest Rate
(ii) Expected Life
(iii) Expected volatility
(iv) Expected Dividends
The Price of the underlying share in market at the time of option
granted
Note: In view of the Sub division of the shares and in terms with the
relevant provisions of ESOS - 2006 the Options stand adjusted along
with entitlement to apply for 5 equity share of Rs 2/- each instead of
one Equity shares of Rs 10/- each.
Particulars of Employees
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of employees are required to
be set out in the annexure to the Directors' Report. However as per the
provisions of section 219 (1)(b)(iv) of the said Act, the Annual Report
excluding the aforesaid information is being sent to all the members of
the Company and others entitled thereto. Any member interested in
obtaining such particulars may write to the Company Secretary.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings & Outgo
Information as required under the provisions of Section 217(1)(e) of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 is annexed
to and forms part of this report.
Cost Accounting Records
Your Company is required to maintain cost accounting records in respect
of manufacture of power transformers and generation of electricity from
Wind Mill (Power) pursuant to the Cost Accounting Records (Engineering
Industries) Amendment Rules, 2001. The Company has complied with the
above requirement for the year ended 31st March 2011.
Auditors
The Company's Auditors, M/s. P. Raj & Co., Chartered Accountants hold
offce up to the conclusion of the forthcoming 46th Annual General
Meeting and being eligible offer themselves for re-appointment. The
Company has received letter from them giving their consent to act as
Auditors of the Company and stating that their re-appointment, if made,
would be within the prescribed limits under Section 224(1-B) of the
Companies Act, 1956. Your Directors recommend their re-appointment.
Insurance
All the assets of the Company are adequately insured.
Acknowledgement
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed employees for the contribution in trying to achieve the
Company's vision to ÃTo Build A World Class Company Through Reliability
And Be A Great Place To WorkÃ.
On behalf of the Board of Directors
For EMCO LIMITED
Sd/-
Rajesh S. Jain
Chairman
Mumbai
May 30, 2011
Mar 31, 2010
The Directors take pleasure in presenting their 45th Annual Report on
the business and operations of the Company and statement of accounts
for the year ended 31 st March 2010.
Financial Results
During the year the performance of the Company was as under:
(Rupees In Lakhs)
Current Year Previous Year
2009-2010 2008-2009
Total Income 103,137.91 105,906,15
Prof it Before Taxation 18,328.97 8,037.32
Less: Provision for Tax - Current 4,480.00 2,075.00
Fringe Benefit Tax - 85.00
Deferred Tax 275.38 567.24
Earlier Year Tax 193.93 -
Profit After Taxation 13,379.66 5,310.08
Add: Balance brought
forward from previous year 13,566.60 10,387.56
Profit Available For Appropriation 26,946.26 15,697.64
APPROPRIATIONS:
General Reserve 1,400.00 750.00
Debenture Redemption Reserve 417.33 417.33
Proposed Dividend 866.98 823.72
Tax on Dividend 147.34 139.99
Balance carried to Balance Sheet 24,114.61 13,566.60
TOTAL APPROPRIATION 26.946.26 15,697.64
Review of Operations
During the year under review, Income from Sales and Services was Rs.
103,138 lakh against Rs. 105,906 lakh
in the previous year. The volume In leims of MvA in
transforms division stood at 13,692 MVA in the FY 2009-10 against
10,947 MVA in the previous FY, registering growth of 25%. The dQcline
in sales value was mainly attributed to change in product mix coupled
with decrease in realisation per MVA due to fall in the commodity
prices. Profits before tax was Rs 18,329 lakh as against Rs. 8,037 lakh
in the previous year. This include profit from extra-ordinary item of
Rs. 12,735 lakh which was arising out of sale of 100% holding in EMCO
Energy Limited, a wholly owned subsidiary of the Company. Profit after
Tax for the year under review was Rs. 13,380 lakh as against Rs.5,310
lakh in the previous year. Earning per equity share was Rs. 22.72 as
compared to Rs. 9.03 in the previous year.
Dividend
Your Directors are pleased to recommend for your approval, a dividend
of 70% i.e Rs. 1.40 per share (Previous Year 70% i.e Rs. 1.40 per
share) (face value of Rs. 2 per share) iw the year ended 31 st March
2010, aggregating to Rs. 1014 lakh (Previous year Rs, 964 |akh),
inclusive of tax on distribution of dividend.
Subsidiary
The Company had three direct subsidiaries in the year /underreview,
namely:-
a) EMCO were Limited,
b) EMCO Power lnta9av(uctureUmjted(
c) EMCO Overseas Pte limited, SiNGAPO And three step-down subsidiarit.
name|y:_
a) East West Power Generation Co,.^ny Limited_
b) EMCO Infrastructure Limited*
c) EMCO Edison Transformer (Pty) Limited, Sou Africa
*The name of the Company is changed from Warora Power Company Limited
to EMCO Infrastructure Limited on 27th October 2009.
In terms of approval granted by the Central Government under section 21
2 (8) of the Companies Act 1956, copy of Statement of Accounts along
with the reports of the Board of Directors and Auditors Report of the
above subsidiary companies have not been attached with the Annual
Report of the Company.
These documents will be made available upon request by any member of
the Company and its subsidiaries, interested in obtaining the same and
a copy of the same is also available for inspection at the Companys
corporate office and the registered office of the subsidiary companies
between 10:00 A.M. and 1 2:00 Noon on any working day of the company
and its subsidiaries, upto the date of the 45th Annual General Meeting.
Further as directed by Central Government, the financial data of the
subsidiaries forms part of this Annual Report and the Consolidated
Financial Statements of the Company and its subsidiary Companies,
prepared in accordance with Accounting Standard 21 prescribed by The
Institute of Chartered Accountants of India, forms part of the Annual
Report.
During the year under review, the Company had sold its 100% holding in
EMCO Energy Limited to GMR Energy Limited in order to unlock the value
to pursue "larger opportunities in the power generation business. The
Company, in order to fuel its power generation plans, had perceived
this strategy after taking into consideration the changing scenario in
the power sector in which the emphasis is essentially on large size
projects to become competitive, cost efficient and environmental
friendly. The decision has earned good return on investment and
increased _your Companys networth and risk taking capability against
future unforeseen events. However, the Company has only sold a project
and not the business and therefore, entire core team and knowledge
remains with the Company.
Fixed Deposits
During the year under review the Company has neither invited nor
accepted any fixed deposits from the public.
Directors
At the Board meeting held on 19th April 2010, the Board of Directors
had appointed Mr. Ajay Kumar Dhagat as an Additional Director of the
Company with effect from the same date to hold the office till the date
of ensuing Annual General Meeting. At the same meeting, Mr. Ajay Kumar
Dhagat was appointed as Managing Director of the Company with effect
from 19th April 2010 for three years that is upto 18th April 2013. The
terms and conditions of his appointment, including his remuneration,
are subject to approval of the members in the ensuing Annual General
Meeting. He will be non-retiring Director till the time he continues as
the Managing Director of the Company.
Mr. Anil Kumar Sardana was appointed as an Additional Director on
27thjanuary 2010 and is to hold the office till the date of ensuing
Annual General Meeting. Considering his professional background and
expertise, the Board is of the opinion that the appointment of Mr. Anil
Kumar Sardana, as Director, will be beneficial to the Company.
In accordance with Section 256 of the Companies Act, 1 956 and the
Articles of Association of the Company, Mr. S.V. Deo and Mr. Bheru
Choudhary, Directors of the Company, are liable to retire by rotation
at the ensuing Annual General Meeting and being eligible, offer
themselves for reappointment.
Mr. R.S. Shah ceased to be a Director of the Company with effect from
19th April 2010 on expiry of his term as Director-Technical of the
Company. The Board places on record its appreciation for the services
rendered by Mr R.S. Shah during his tenure as Director of the Company.
The above appointments/re-appointments forms part of the Notice of the
45th Annual General Meeting. The profile of these Directors as required
under Clause 49 of the Listing Agreement entered with the Stock
Exchanges, are given in the notice of the 45th Annual General Meeting.
Management Discussion and Analysis
The Management Discussion and Analysis forms part of the Dworttirs
Report and is annexed hereto.
Corporate Governance Report
As required by clause 49 of the listing agreement with æstock
exchanges, a report on corporate governance and a certificate
confirming compliance with requirement of corporate goverrnance forms
part of this report.
Directors Responsibility Statement
Fusslmntton the requirement of Section 217(2AA) of the (Compariess AA.
ct, 1956, with respect to the Directors IRe^aDTBtbl/tty Statement, it
is hereby confirmed:
(o) that in the preparation of the accounts for the finacial Year
ended on 31st March 2010, the applicable accounting standards have been
folowed at ong with proper explanation relating tto maternalde
epartures;
p) that the Directors had selected such accounting policies and
appiied them consistently and made judgements and estimates that
were reasonable and prudent so as to give a true and fair view of
the state of affairs of the Company at the end of the financial
year and of the profit of the Company for the year under review;
(iii) that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(iv) that the Directors had prepared the accounts for the financial
year ended on 31 st March 2010 on a going concernbasis,
Employees Stock Opti on Scheme (6.SOS)
Your Company has always worked tin the idea that the greatest strength
is its human resources and it is this resource, which makes your
Cornpany a force o reckon with in the highly competitive environment,
With this view your Company has an Employee Stock Option Scheme? 2006,
for the employees, The details of options under the said Scheme as
required under ESOP Disclosures to be rare tie under Clause 12,1 of
the Securities and Exchange Board of India (Employee Stock Option
Scheme and Employee Stock* Purchase Scheme) Guidelines, 1999 are given
below;
Sl.
No
1. Options Granted 305,850 Options
2. Prtclngiformulai Options have been granted at
the closing market
price of the
Equity Shares of the Company one day
prior to the date of grant.
3. Options wasted 172,10O Options
4. Options exercised 38,000 Options
5. Total number of
Ordenary Shars artaint 190,000 Shares
out of the Options
6. Options lapsed 131,900 Options
7. Variation of
terms of. Options NA
8 Money realized of
options in force Rs,17Lakh
Optitara
9 Total sumbe of options
in force 1. 35.9500 options
10 Detail of option granted Acc Singh - 5,000 Options
I senior manegement
Persons ML. Jain - 4,000 Options
Satish Copth - 6,000 Options
Sunitha - 6,000 Options
ii) Any employee who receives in any one NIL
year of grant of options amounting to
5% or more of options granted during
the year (2009-10)
iii) Employees who were granted options NIL
during any one year, equal to or
exceeding 1 % of the issued capital of
the Company at the time of the grant.
11. Diluted EPS calculated in accordance Rs. 22.16 per share
(including Profit from
extraordinary
with Accounting Standard 20 issued by item) and Rs. 5.85 per
share (excluding
Profit from
ICAI for the year ended 31 st March extraordinary item)
2010
12. i) Method of calculation of employee N.A.
compensation Cost.
ii) Difference between the employee N A
compensation cost so compared at (i)
above and the employee compensation
cost that shall have been recognised if
fair value of options had been used.
iii) The impact of the difference on N.A
profits and EPS of the Company for the
year ended 31st March 2010 had fair
value of options had been used for
accounting employee Options.
13. Weighted average exercise price and N.A.
weighted average fair value of options
granted during the year whose exercise
price equals market price of stock on the
grant date.
(there are no options granted whose
exercise price either exceeds or less
than the market price of the stock on the
date of grant).
14. A description of the method and N.A,
significant assumptions used to
estimate the fair values of options,
including the following weighted
average information:
i, Risk Free Interest Rate
ii. Expected Life
III. Expected Volatility
iv. Expected Dividends
v, The Price of the underlying share In
market at the time of option granted
Particulars of Employees
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of employees are required to
be set out in the annexure to the Directors Report. However as per the
provisions of section 21 9 (1) (b) (iv) of the said Act, the Annual
Report excluding the aforesaid information is being sent to all the
members of the Company and others entitled thereto. Any member
interested in obtaining such particulars may write to the Company
Secretary.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings & Outgo
Information as required under the provisions of Section 217(1 )(e) of
the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 is annexed to and forms part of this report.
Cost Accounting Records
Your Company is required to maintain cost accounting records in respect
of manufacture of power transformers and generation of electricity from
Wind Mill (Power) pursuant to the Cost Accounting Records (Engineering
Industries) Amendment Rules, 2001. The Company has complied with the
above requirement for the year ended 31 st March 2010.
Auditors
The Companys Auditors, M/s. P, Raj 8 Co., Chartered Accountants hold
office up to the conclusion of the forthcoming 45th Annual General
Meeting and being eligible offer themselves for re-appointment. The
Company has received letter from them giving their consent to act as
Auditors of the Company and stating that their re-appointment, if made,
would be within the prescribed limits under Section 224(1 -B) of the
Companies Act, 1956. Your Directors recommend their re- appointment.
Insurance
All the assets of the Company are adequately insured.
Acknowledgement
Your Directors would like to express their grateful appreciation for
the assistance, support and co-operation received from the Financial
Institutions, Banks, Government Authorities and Shareholders during the
year under review. Your Directors would also like to take this
opportunity to express their appreciation to the dedicated and
committed employees for the contribution in trying to achieve the
Companys vision to" To Build a World Class Company through Reliability
and be a Great Place to Work".
For and on behalf of the Board of
EMCO LIMITED
Place;Thane Rajesh 5 Jain
Date :26th May 2010 Chairman
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article