Directors Report of Videocon Industries Ltd.
Dec 31, 2014
Dear Shareholders,
The Directors take pleasure in presenting the Twenty-Fifth Annual
Report together with the Audited Accounts and Auditors'' Report for the
financial period ended on 31st December, 2014.
PERFORMANCE REVIEW
The performance of the Company, on standalone basis, for the financial
period ended on 31st December, 2014, is summarized below:
(Rs. in Million)
Period Ended Period Ended
31st December, 30th lune,
Farticulars 2014 2013
(18 months) (18 months)
Net Revenue from Operations 189,676.03 181,572.75
Other Income 11,651.42 4,182.66
Total Income 201,327.45 185,755.41
Profit Before Finance Costs, 45,093.02 34,246.52
Depreciation and Tax Finance Costs 35,188.96 27,148.18
Depreciation and Amortisation 9,858.11 8,243.50
Profit /(Loss) Before Tax 45.95 (1,145.16)
Tax Expenses 15.55 (428.84)
Profit/(Loss) for the Period 30.40 (716.32)
The financial year of the Company was extended by a period of six
months. Accordingly, the financial year under review comprises of a
period of eighteen months commencing from 1 st July, 2013 to 31st
December, 2014.
OPERATIONS
CONSUMER ELECTRONICS & HOME APPLIANCES
The period brought delight to Consumer Electronics & Home Appliances
Industry which saw signs of recovery after a very rough patch. Despite
challenges in both internal and external environment, Consumer
Electronics & Home Appliances Industry has shown growth in technically
innovative products. Cashing on correct anticipation of consumer needs
and innovative R&D and marketing, your Company was able to deliver a
stable performance.
OIL & GAS
The Company continues to remain actively involved in Exploration &
Production activities. The Company is exploring more and more
opportunities in Oil and Gas sector. During the year under review,
Videocon Mauritius Energy Limited has sold its 100% stake in Videocon
Mozambique Rovuma 1 Limited ("VMRL") for a consideration of US$
2,475.00 Million. VMRL held 10% participating in the offshore Area 1 in
Rovuma Basin in Mozambique (the "Offshore Area 1"), which has series of
sizable natural gas discoveries.
During the period under review, the Company has announced various
discoveries and explorations made by its wholly owned subsidiaries
and/or joint ventures thereby adding to the hydrocarbon resources
already established in these blocks. The details of discoveries are:
- August, 2013 - Petrobras, the Operator of the BM SEAL - 11, has
confirmed the presence of light hydrocarbons in the Appraisal Well,
drilled in Farfan Discovery Area. The consortium will carry on the
operations in the area to confirm the extent of hydrocarbons in place
and characteristic of the reservoir conditions encountered.
- October, 2013 - Petrobras, the Operator of the BM SEAL - 11 announced
that it has completed the formation test in Well (3-SES -176D),
informally known as Farfan 1 #. The test evaluated 30 meters of
turbidite sandstones formation and confirmed good reservoir
characteristics featuring excellent productivity of good quality oil.
- November, 2013 - Anadarko, the Operator of BM - C- 30 Concession that
Wahoo - 5 appraisal well has encountered more than 200 net feet of high
quality pay in pre-salt reservoir.
Afterthe balance sheet date, the following discoveries were announced:
- January, 2015 - Petrobras, the Operator of the BM SEAL - 11 announced
the discovery of new oil accumulation in Farfan area in the Sergipe
basin. The results confirmed the light oil and gas discovery in Farfan
area and presented the excellent permoporosity conditions in the
turbidities reservoirs with 54 meters thickness.
- February, 2015 - Petrobras, the Operator of the BM SEAL - 11
announced the drilling results of the third appraisal well 3-SES- 186,
located 103 km from the city of Aracaju and about 10 km from the
discovery well "Farfan". The results confirmed the extension of the
light oil reservoirs. In addition the well found presence of a new oil
accumulation with a total thickness of 68 meters in shallower
reservoirs.
- April, 2015 - Petrobras, the Operator of the BM SEAL - 11 completed
the formation test of well 3-BSRA-1286-SES located in BM SEAL - 11
concession in the SEAL - M- 426 Block in ultra- deep waters of the
Sergipe Alagoas Basin. The results confirmed the presence of light oil
and good productivity of reservoirs. This drilling identified two
reservoir intervals of light oil and gas -the top thickness of 44
meters and the bottom 11 meters thick. The bottom zone is the new
discovery of the area.
TELECOM
Videocon Telecommunications Limited (VTL), a subsidiary of the Company,
is an Indian cellular service provider that offers GSM mobile services
in India.
On 3rd March, 2013, VTL was awarded the Unified Licenses Access
Services for six circles, namely, Bihar, Gujarat, Haryana, Madhya
Pradesh & Chhattisgarh, Uttar Pradesh (East) and Uttar Pradesh (West)
effective 16th February 201 3, which are valid for a period of 20
years. VTL has also been allotted 5Mhz spectrum in 1,800 Mhz category
in each of these six circles. VTL is providing commercial services.
POWER
The Company has commissioned three solar power projects viz., 5.75 MW
solar Photovoltaic Power Project in Village Majra, District Warora,
Maharashtra; 5.75 MW solar PV power project in Village Betwasiya,
District Jodhpur, Rajasthan has been commissioned by the Company
through its step down subsidiary, Comet Power Private Limited; and 5.5
MW solar PV power project in Gujarat has been commissioned by the
Company through Unity Power Private Limited (26% equity stake held by
the Company). These solar projects are operating at full capacities and
are generating electricity.
The Company''s thermal power business consists of two 1,200 MW
coal-fired thermal electricity power projects under construction, the
Power Project in the state of Gujarat and the Power Project in the
state of Chhattisgarh. These power projects are being undertaken by
Pipavav Energy Private Limited and Chhattisgarh Power Ventures Private
Limited respectively. These power projects are not yet commissioned.
INSURANCE
The Company entered into a joint venture with Liberty Mutual Group to
setup a non-life insurance company, Liberty Videocon General Insurance
Company Limited, on 16th December, 2010. Liberty Videocon General
Insurance Company Limited is in the business of non-life insurance and
providing insurance coverages for auto, fire, marine, engineering,
liability & health. The Company currently holds 81.91% stake in the
joint venture and the remaining equity is owned by Liberty Mutual
Group.
DIVIDEND
Your Directors are pleased to recommend a dividend of Rs. 2.00 per equity
share, to the Non-Promoter Shareholders (Public Shareholders). The
equity dividend, if approved, by the shareholders, will entail a payout
of Rs. 230.14 Million and dividend distribution tax of Rs. 46.02 Million.
Further, your Directors recommend dividend of 8% on the preference
shares.
The dividend is tax free in the hands of the shareholders.
TRANSFER TO RESERVES
Your Directors propose to transfer Rs. 300.00 Million to the General
Reserve, Rs. 153.30 Million to Capital Redemption Reserve and Rs. 2,054.24
Million to Bond/Debenture Redemption Reserve.
FORFEITURE OF EQUITY SHARES
During the period under review, the Company has forfeited 12,794 partly
paid equity shares which were allotted pursuant to the Rights Issue
made in April, 2010.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The Company has transferred a sum of Rs. 2.67 Million in respect of
unpaid /unclaimed dividend for the Financial Year 2006-07 to the
Investor Education And Protection Fund (IEPF).
Dividend for the financial year ended 2007-08 and thereafter, which
remain unclaimed for a period of seven years will be transferred to the
IEPF. Members who have not encashed dividend warrant(s)/ instrument^)
for the said years are requested to obtain duplicate warrant(s)/demand
drafts by writing to the Company''s Registrar and Transfer Agent.
ISSUES/ALLOTMENT
During the period under review, the Company has allotted 15,700,000
underlying equity shares of face value of Rs. 10/- each, represented by
15,700,000 Global Depository Receipts (GDRs) at a price of US$ 2.88 per
GDR, equivalent to Rs. 181.61 per equity share, aggregating to US$ 45.216
Million to LLIC S.a.r.l., on a private placement basis.
FIXED DEPOSITS
Your Company has not accepted/renewed any Fixed Deposit within the
meaning of Section 58A of the Companies Act, 1956 and as such, no
amount of principal or interest was outstanding as on the Balance Sheet
date.
PERSONNEL
A statement of the particulars of employees required under Section
217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975, as amended, is annexed and
forms part of this Report.
CONSERVATION OF ENERGY
The greenest power is the power one doesn''t have to produce. Your
Company strongly believes that half the solution to conserve the energy
is the smart use of power. Your Company has taken several steps to
conserve energy through its "Sustainability" initiatives. The Company
strongly and religiously follows and practices the principle of 3Rs-
Reduce, Reuse and Recycle. Being a large and responsible conglomerate,
your Company has taken considerable steps to imbibe the practice of
energy conservation and energy efficiency at all levels of management
and has made a core part of the business strategy that takes
accountability for every dimension of social, cultural, economic and
environmental governance, creating sustainable value for all its
stakeholders.
The move is consistent with energy conservation plans, and your Company
believes it is the right way to go in achieving energy efficiency.
Some of the specific measures undertaken are:
- Use of energy saving lighting arrangement in shop floor & on roads
inside the manufacturing facilities by using LED lamps, Electronics
Ballets, CFL lamps, installation of transparent sheet which utilizes
natural illumination and usage of more star rating equipment to save
more energy
- Use of motion sensors, pull chord switches and daily/weekly timer for
better lighting control for stores, offices, washrooms and street
lights.
- Use of natural air-ventilators which does not consume power.
- Usage of treated water from effluent generation for developing garden
& plantation of trees at all the manufacturing units.
- Use of energy efficient submersible pump motors at all the
manufacturing units.
- Improvement of per hour production to reduce power burning hours for
the same production quantity.
- Awareness programs of energy savings & utilization of natural
resources.
- Conducting energy saving training sessions for employees at all
levels.
- Reduction in power consumption by taking opportunities of switching
off during idle production hours i.e. tea & lunch timings etc.
- Replacement of pneumatic tools & equipments by energy efficient
electrical tools & equipments and converted continuous power to
intermittent power consumption.
- Usage of innovation tools, proper scheduling of preventive
maintenance of machinery & equipments.
- Continuous monitoring of power usage throughout the year.
- Power Cost Optimization by Power Trading through Indian Energy
Exchange.
The adoption of the above energy conservation measures have helped to
curtail the proportionate increase in total energy usage consequent to
overall increase in production. This has made it possible to maintain
cost of production at optimum levels.
During the period under review:
- Your Company has been awarded prestigious National Energy
Conservation Award for 2013 by the Bureau of Energy Efficiency (BEE), a
part of the Central Electricity Authority, Ministry of Power. The award
for 2013 was given by Honorable President of India. The award has been
given in appreciation of the Company''s continuous efforts in R& D and
product up-gradation by implying new and innovative energy saving
practices resulting to achievement in Energy Conservation in the
category of BEE Star Labelled Appliances (Refrigerator) for strict
adherence to the BEE standards set up by the Bureau of Energy
Efficiency
- Aurangabad unit has been awarded State level Award for Excellence in
energy conservation and Management organised by MEDA (Maharashtra
Energy Development Agency) in the year 2013.
RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION
Research is to see what everybody else has seen, and to think what
nobody else has thought. Every year, the Company invests significantly
in research and development. The Research and Development (R & D) of
the Company focuses on developing and commercializing the technologies
of its businesses which are of strategic importance for future growth.
The Business is committed to achieve world benchmark quality besides
expanding new product offerings by expediting R&D products. Further,
the Company will continue to focus on improving its cost competitive
position.
The Company''s R & D is aligned towards developing and acquiring the
technology, core competence and skill sets required for robust and
timely delivery of the envisaged future product portfolio with leading
product attributes across the range of Consumer Electronic & Home
Appliances (CE & HA). For the CE & HA product range, the focus is on 1)
stunning design 2) rich features and 3) energy efficient, which is
value for money. All the R&D activities are undertaken taking into
account the current and likely future regulatory norms while ensuring
adherence to the prescribed energy regulations.
Your Company maintains the R&D facilities in India and China. The prime
focus of Company''s R& D is on developing existing technologies and
product engineering innovation together with production efficiency and
cost reduction. The Company''s domestic technology center is located in
Aurangabad, Maharashtra. The Company also seeks assistance from
external research agencies, from time to time.
Your Company has launched number of products in Consumer Electronics
Industry with a wide range of Refrigerators, Washing Machines, Air
Conditioners, Televisions, etc.,
The R&D activities of the Company are focused towards:
- Maximizing value;
- Increasing productivity;
- Cost reduction; and
- Creating a high performance environmentto promote innovation.
R&D activities carried out in various consumer electronics products and
benefits derived from these activities:
- Introduction of new technology called 4K2K smart TV with gesture
control, 3D Gaming, WiFi and N screen. With this introduction customer
can experience gaming console, TV and internet on a single display
unit.
- Introduction of large screen 85" 4K2K Smart TV
- Introduction of various other segments of 4K2K smart TV sets.
- Addition of MHL - Mobile High Definition Link feature: This feature
enables customer mirror MHL enabled mobile to TV and experience mobile
screen on TV big screen.
- Addition of ARC -Audio Return Channel Feature: This feature enables
customer to connect TV to Home theatre for enhanced digital audio
experience through single HDMI Cable.
- Introduction of Super Narrow Bezel LED TV with colour options viz.
Green/Orange/Red in 20"/24"/32"/40" Screen Size.
- Addition of N speaker feature: This enables customers to experience
personalized audio of TV on mobile wirelessly
- Introduction of India''s 1st "5 Star (7 Star Level) BEE Rating
Refrigerator". This DC refrigerator has lowest energy consumption.
- Introduction of India''s 1st "Photosis Fresh" technology Refrigerator
for keeping foods fresh for longer time.
- Introduction of widest range of Semi Automatic Machines in Industry
from 6.0 kg to 9.0 kg capacity to cater to the needs of various
segments of market and fulfilling requirements of wide spectrum of the
consumers.
- Introduction of wide range of Fully Automatic & Front Load Machines
from 5.5 kg to 7.8 kg capacity to meet the market requirements.
Future plan of action:
In near future, the Company shall continue to focus on environment
friendly products and also focus efforts on new technologies which
could offer better products in the domestic as well as international
market. The Company has the following plans through R&D:
- Introducing of 4K2K Smart Curve TV with a screen size of 55765".
- Adding a V Green feature - This features helps customer to reduce the
power consumption as well as protect eye sight based on ambient light
conditions automatically.
- Adding new back light and processor technology for the natural colour
reproduction.
- Adding a PVR - Personal Video Recorder feature in DDB platform -This
feature will enable customer to record favourite program of d2h and can
be watched at his/her convenient time.
- Increase in the market share and enhance the Brand Value.
- Bring in best features of various products together.
- Introduction of washing machines which are contemporary, user
friendly, energy efficient, use lesser water and detergents and value
for money.
Duringthe period under review, the Company has incurred an amount of Rs.
53.66 Million, representing 0.03 % of the turnover, towards recurring
R&D expenses.
HEALTH & SAFETY
The Company provides a safe and healthy workplace for its employees by
establishing the right safety culture across the organisation. The
senior leadership is fully committed to the ultimate goal of zero
injury to its employees and all stakeholders who are associated with
the Company''s operations. Emphasis is laid on creating a participatory
safety governance model.
Some of the measures and initiatives undertaken by the Company are:
- Release of Videocon Industries Safety Booklet for methodology for
usage of Personal Protective Equipments while working in critical areas
for e.g. Height Work, Hot Work, Electrical Work, Hazardous Chemical
Unloading work, Confined space Work in Campus.
- Accident Monitoring Boards Display in each department, main entrance
and maintenance of data of Accident for each department in Accident
Status Matrix.
- Procurement of new fire extinguisher to replace Hydraulic Pressure
testing.
- Installed Emergency Siren in each department and in the campus area.
- Installed Blowing Light Indicator with Siren for Electric Overhead
Travelling Crane operation in Molding Shop & Tool Room in Campus.
- Stage wise Safety Posters Display in local language on shop floor for
prevention of Accident.
- Renewal of fire NOC for Company''s campus.
- Procurement of Safety equipments in campus like LPG gas detector,
Road Convex Mirror, Fire blanket, Fire Bucket, First aid box &
Breathing Apparatus set.
- Implementations of work permit system with availability of security
guard for close monitoring.
- Periodic refreshertraining conducted for security guard regarding
fire prevention & control for to enhance competency level.
- Conducting regular safety audit & mock drill as per calendar in the
campus.
- Incident /Accidents investigation and reporting with root cause,
corrective and preventive actions.
- Installation of first aid box & fire blanket at security check point
for every department.
- Provide fire point at high hazardous area (Zone-0).
- Carried out HPT (Hydraulic Pressure Testing) of pressurized
extinguisher as per Maharashtra Fire Prevention & Life Safety Measures
Act.
- To speed up response time & handle emergency situation displayed list
of onsite & offsite contact numbers at conspicuous places in plant.
- Displayed cautionary signs at high hazardous area to warn workers
about imminent hazard dealt at site.
- Enhance road safety- displayed road convex mirror, speed limit board
& guide lines for visitors.
- Regular training programs to all levels for on the job & off the job.
- At the entrance of the building display of emergency evacuation plans
with location of fire extinguisher.
- Visualisation in the campus to access assembly point, first aid box &
emergency exit door.
- Displayed MSDS (Material Safety Data Sheet) at chemical storage area
as per rule 73-M from MFR 1963.
- Displayed UN classification boards at Zone - 0 areas.
- 100 % compliance with legal requirement of MPCB (Maharashtra
Pollution Control Board), DISH (Directorate of Industrial Safety &
Health) and Chief Fire Office & CCOE Chief Controller of Explosives
(Diesel, FO Storage).
- Celebration of Safety promotional activities like - National safety
week & fire service week to create awareness among the workers.
- Conducting the Safety Committee Meetings (SCM) in every month to
strengthen the Safety norms.
- Availability of fire officer round the clock in the campus to handle
the Emergency.
- Availability of Fire Blankets in the shop floor to handle the fire
emergency.
- Availability of well-equipped Occupational Health Center (OHC) &
ambulance with all medical devices, in case of emergency.
ENVIRONMENTAL PROTECTION
Your Company truly believes that environmental care is the most
profitable investment. During manufacturing process, the process causes
noise pollution and discharges waste water, exhaust gas, dust and solid
wastes. In orderto comply with Indian laws and regulations in respect
of environmental protection, the Company has implied internal
environmental protection control and monitoring measures.
The Company has established an internal environmental management
system. The industrial water and solid wastes (slurry) emitted during
the manufacturing processes are recycled and are utilised to make
bricks, which are then used in building construction.
The Company has also formed environmental protection committee at its
glass shell manufacturing facility in Bharuch and has planted teak and
mahogany plants around the glass shell manufacturing facility in order
to improve the environment, reducing dust and improving air quality
The Company has set up a number of specialized environmental protection
management divisions and environment monitoring teams in its various
manufacturing units and offices. The Company also practices the concept
of ''Resource Productivity''. The Company aims at drive-down of costs by
reducing waste and pollution and by creating opportunities for growth
through process and product innovations. The following are some of the
continuous measures taken by the Company for environment protection:
- Installation of New ETP Plant (3M3/Day) in AC Paint shop area to
utilize paint shop water for gardening.
- Received all Local NOCs requirements of C5 Project for CCOE
Approvals.
- Installed Fiber Roof Sheet on shop floor for use of natural light in
shop floor.
- Change Old Manifest System in LPG gas bank in canteen area to reduce
LPG consumption in Canteen.
- Repaired old Solar System in canteen & use of solar water for Rice
cooking & Tea making.
- Boiler blow down water collected in Tank and connection of ETP for
treatment & treated water use for gardening in campus.
- Renewal of contract of Hazardous Waste Disposal of the Company with
Maharashtra Enviro Power Limited (MEPL).
- Implementation of 3R system - Reduce, Reuse & Recycle.
- Certification of ISO - 14001 for Environmental Management System.
- Tree plantation done on different events in Campus.
- Regular Air & Water Monitoring as per (NAAQS -2010) Standards.
- Celebration of world environment day, to increase the mass awareness
among the employees.
- Maintain ETP STP outlet water parameter within limit as per CPCB
(Central Pollution Control Board).
- Disposal of Hazardous & Non-Hazardous waste to the authorized agency
(Authorized by pollution control authority) as per statutory
requirements.
- Conducting ISO, SGS Sustainability audit periodically.
- Arrangement of PUC Camp in the campus to increase the awareness among
the employees.
- Arrangements of Separate Location in scrap yard for Disposal of
Hazardous Waste & Display Category board of Hazardous Waste area.
The Company has formed ''Quality Circles'' and ''Team of Experts'' selected
from the employees, who are engaged in the manufacturing activities,
for time and motion study of the overall manufacturing process and who
give suggestions on ways and means for conservation of energy and power
and environment protection.
As a result of the same, there is an overall improvement in efficiency.
The Company has also been able to reduce energy costs. However, the
beneficial impact of the same on the cost cannot be quantified.
INFORMATION TECHNOLOGY
Information Technology (IT) is vital and integral part of your Company.
We have evolved our IT strategy and roadmap in line with our business
strategy. Usage of IT is revolutionising the rules of business,
resulting in structural transformation across enterprise.
We are continuously upgrading our infrastructure by replacing
old/obsolete Desktops/ Laptops/ Servers etc and also upgrading the
connectivity backbone across enterprise. The robust infrastructure is
the essential component of an enterprise and our management has given
due focus towards this.
We have initiated business process transformation program in direct
coordination with our senior leadership team. This exercise is
transforming our processes as per the Industry''s best business
practices and helping us in strengthening our existing processes across
the organisation.
We as an enterprise are fully focused on leveraging complete advantage
of our SAP system. We are continuously auditing our existing processes
mapped in SAR identifying the gaps and fulfilling the same across our
organization. We are also using IT to the optimum benefits of our MIS
users and decision makers. This whole exercise is helping us to be the
leader in our space and helping us in reducing the cost, increasing our
profit margins, bringing efficiency in our operations, building
controls etc.
The digital revolution has entered into a new age that presents
unprecedented challenges as well as tremendous business opportunities.
We are continuously exploring new ways to deal with digital disruption
and preparing a digital transformation strategy for our enterprise. We
are transforming our customer''s experience and operations to be the
digital leader in our space. Your Company has revamped many of its
existing infrastructure facilities and websites and also implemented
many mobile apps to support its digital strategy. In addition to this,
your Company has also made its strong presence felt on Social Media
platforms.
Your Company has matured Sales Transformation & Enhancement Program
(STEP) application, an innovative & customised in-house developed sales
tool for providing day to day information required by sales force on
the field. This tool helps in improving efficiency, enhance ability &
productivity of sales force, leading to long-term business
sustainability and customer delight.
Your Company is building excellent relationship with Suppliers. It has
implemented Supplier Communication Portal for direct communication with
its suppliers as per the business needs.
Your Company is riding on the technology wave and improving IT systems
in complete sync with organization''s goals.
CORPORATE SOCIAL RESPONSIBILITY
Your Company believes that the business existence comes from society
therefore it is important "To improve the quality of life of the
communities we serve through long-term stakeholder value creation".
The Company takes on Corporate Social Responsibility (CSR) as part of
its business viz. health, education, sports, sustainable livelihoods,
drinking water, renewable energy (solar street lights), employability
training and ethnicity.
The Company is keen to play "Save the environment" responsibility and
to fulfill this responsibility it prorogates, consumer awareness to
dispose of E-Waste through proper re-cycler channel.
The Company has taken this responsibility by participating in school
and enriching students'' talents in many competitive activities.
Another common approach towards social responsibility is community
based development where the Company is committed to provide safe
/energy efficient and environment friendly product.
The Company has constituted CSR Committee which shall monitor the
Corporate Social Responsibility Policy. Other details of the Committee
are given in the Corporate Governance Report.
BOARD OF DIRECTORS
During the period under review, Mr. S. P Talwar ceased to be the
Director of the Company w.e.f. 9th August, 201 3, on account of his sad
demise. The Board would like to express its deep condolence towards the
sad demise of Mr. S. P Talwar, and also expresses its heartfelt
gratitude towards the contribution made by Mr. S. P Talwar during his
tenure.
Further, Mr. S. Padmanabhan, Director of the Company resigned from the
Board of the Company w.e.f. 25th March, 2014 and Mr. Ravindranath
Bannanje - Nominee of IDBI Bank Limited ceased to be the Director of
the Company w.e.f. 26th August, 2014, consequent to withdrawal of his
nomination by IDBI Bank Limited.
The Board places its sincere appreciation towards the valuable
contribution received from Mr. S. Padmanabhan and Mr. Ravindranath
Bannanje, during their tenure as the Directors of the Company.
During the period under review, Mr. Subroto Gupta was co-opted as a
Nominee Director of IDBI Bank Limited on the Board of the Company
we.f.14th November, 2014.
In terms of the provisions of Section 149 and other applicable
provisions of the Companies Act, 2013, read with the Rules made
thereunder, every listed company shall have at least one-third of the
total number of directors as independent directors. Further, in terms
of the provisions of Clause 49 (II) (A) (2) of the Listing Agreement
where the Chairman of the Board is a non-executive director, at least
one-third of the Board should comprise independent directors and in
case the company does not have a regular non-executive Chairman, at
least half of the Board should comprise independent directors.
Therefore, with a view to comply with the requirements of the
provisions of Section 149 of the Companies Act, 2013 and the provisions
of Clause 49 of the Listing Agreement, the Board thought it fit to
appoint Mr. Radheyshyam Dalchand Agarwal, Maj. Gen. Sudhir Chintamani
Nilkanthjatarand Mr. Aniljoshi as Independent Directors) for a period
of five years. Accordingly, the Board of Directors of the Company at
its meeting held on 14th August, 2014, have approved and made to
continue appointment of Mr. Radheyshyam Dalchand Agarwal, Maj. Gen.
Sudhir Chintamani Nilkanth Jatar and Mr. Anil Joshi as Independent
Directors to hold office uptoaterm of five consecutive years from 14th
August, 2014, not liable to retire by rotation.
The Company has received from Mr. Radheyshyam Dalchand Agarwal, Maj.
Gen. Sudhir Chintamani Nilkanth Jatar and Mr. Anil Joshi (1) consent in
writing to act as Director in Form DIR-2 pursuant to Rule 8 of the
Companies (Appointment & Qualification of Directors) Rules, 2014, (2)
intimation in Form DIR-8 in terms of Companies (Appointment &
Qualification of Directors) Rules, 2014, to the effect that they are
not disqualified under Sub-section (2) of Section 164 of the Companies
Act, 2013 and (3) a declaration to the effect that he meets the
criteria of independence as provided in Sub-section (6) of Section 149
of the Companies Act, 201 3.
The Company has also received a notice in writing along with requisite
deposit, from a member under Section 160 of the Companies Act, 2013,
signifying its intention to propose candidature of each of Mr.
Radheyshyam Dalchand Agarwal, Maj. Gen. Sudhir Chintamani Nilkanth
Jatar and Mr. Anil Joshi for the office of Directors of the Company.
In the opinion of the Board of Directors, Mr. Radheyshyam Dalchand
Agarwal, Maj. Gen. Sudhir Chintamani Nilkanth Jatar and Mr. Anil Joshi,
the Independent Directors, fulfills the conditions specified in the
Companies Act, 2013 and the Rules made thereunder and they are
independent of the Management.
The Board considers that their continued association would be of
immense benefit to the Company and it is desirable to continue to avail
the services of Mr. Radheyshyam Dalchand Agarwal, Maj. Gen. Sudhir
Chintamani Nilkanth Jatar and Mr. Anil Joshi as Independent Directors
and accordingly recommend their appointment/confirmation.
Changes after the balance sheet date: Pursuant to the provisions of
Section 149 of the Companies Act, 2013 and in terms of the Articles of
Association of the Company, Mrs. Ramabai Venugopal Dhoot was appointed
as an Additional Director (Promoter, Non-Executive) of the Company
w.e.f. 28th February, 2015.
The Company has also received a notice in writing along with requisite
deposit, from a member under Section 160 of the Companies Act, 2013,
signifying its intention to propose candidature of Mrs. Ramabai
Venugopal Dhoot for the office of Director of the Company. The Board
recommends her appointment.
A brief profile of Mr. Radheyshyam Dalchand Agarwal, Maj. Gen Sudhir
Chintamani Nilkanth Jatar, Mr. Anil Joshi and Mrs. Ramabai V Dhoot,
nature of expertise in specific functional area, name of other public
companies in which they hold directorship and membership/ chairmanship
of the committees of the Board of Directors and the particulars of the
shareholding as stipulated under Clause 49 of the Listing Agreement
entered into with the Stock Exchanges is appended to the Notice.
LISTING
The equity shares of your Company are listed on the BSE Limited and The
National Stock Exchange of India Limited. The Global Depository
Receipts and Foreign Currency Convertible Bonds issued by your Company
are listed on the Bourse de Luxembourg and Singapore Exchange
Securities Trading Limited, respectively
SUBSIDIARY COMPANIES
During the period under review, Videocon Estelle Limited, Videocon
Ivory Limited, Videocon Mozambique Rovuma 1 Limited and Unity Power
Private Limited ceased to be the subsidiaries of the Company.
As on 31st December, 2014, your Company had 25 subsidiaries (including
step down subsidiaries) viz. Applied Energy Private Limited,
Chhattisgarh Power Ventures Private Limited, Comet Power Private
Limited, Datacom Telecommunications Private Limited, Indigo Energy
Private Limited, Jumbo Techno Services Private Limited, Liberty
Videocon General Insurance Company Limited, Middle East Appliances LLC,
Percept Energy Private Limited, Pipavav Energy Private Limited,
Proficient Energy Private Limited, Prosperous Energy Private Limited,
Senior Consulting Private Limited, Videocon Australia WA-388-P Limited,
Videocon Electronics (Shenzhen) Limited, Videocon Energy Limited,
Videocon Energy Brazil Limited, Videocon Global Limited, Videocon
Hydrocarbon Holdings Limited, Videocon Indonesia Nunukan Inc., Videocon
International Electronics Limited, Videocon JPDA 06-103 Limited,
Videocon Mauritius Energy Limited, Videocon Oil Ventures Limited and
Videocon Telecommunications Limited.
Ministry of Corporate Affairs, Government of India, vide its General
Circular No(s). 2/2011 and 3/2011 dated 8th February, 2011 and 21 st
February, 2011, respectively, has granted exemption from attaching the
Annual Accounts and other documents of the subsidiary companies with
the Balance Sheet of the holding company, subject to fulfillment of
certain conditions stipulated therein. The Board of Directors have
accorded their consent for not attaching the Balance Sheet of the
subsidiary companies. The consolidated financial statements of the
Company and all subsidiaries duly audited by its statutory auditors are
presented in the Annual Report. The consolidated financial statements
have been prepared in strict compliance with applicable Accounting
Standards and where applicable, Listing Agreement, as prescribed by the
Securities and Exchange Board of India.
Further, the following information in aggregate for each subsidiary
including subsidiaries of the subsidiaries has been annexed to the
consolidated balance sheet:-
(a) capital (b) reserves (c) total assets (d) total liabilities (e)
investment (except in case of investment in the subsidiaries) (f)
turnover (g) profit before taxation (h) provision for taxation (i)
profit after taxation and (j) proposed dividend.
The Company undertakes that the Annual Accounts of the subsidiary
companies and the related detailed information of the subsidiary
companies shall be made available to the shareholders of the holding
and subsidiary companies seeking such information at any point of time.
The Annual Accounts of the subsidiary companies shall also be kept open
for inspection at the Registered Office of the Company and that of the
respective subsidiary companies. The Company shall furnish a hard copy
of details of accounts of subsidiaries to any shareholder on demand.
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements, based on the Financial
Statements received from the subsidiaries, associates and joint
ventures, as approved by their respective Board of Directors, have been
prepared in accordance with the requirements of Accounting Standard 21
on "Consolidated Financial Statements", Accounting Standard 27 on
"Financial Reporting of Interests in Joint Ventures" and Accounting
Standard 23 on "Accounting for Investments in Associates in
Consolidated Financial Statements."
CASH FLOW STATEMENT
The Cash Flow Statement for the period ended 31 st December, 2014, in
conformity with the provisions of Clause 32 of the Listing Agreement
entered with the Stock Exchanges, is annexed hereto.
AUDITORS
In terms of Section 139 of the Companies Act, 2013 read with the Rules
made thereunder, a company can appoint or re-appoint an audit firm as
an Auditor of the Company for a maximum of two terms of five
consecutive years.
As per Rule 6 of Companies (Audit and Auditors) Rules, 2014 the term
for which the Auditors have already acted as Auditors shall be taken
into account for calculating tenure of maximum ten years.
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai (Firm
Registration No. 105049W) and M/s. Kadam & Co., Chartered Accountants,
Ahmednagar (Firm Registration No. 104542W), have completed more than
ten years of their appointment as the Auditors of the Company.
Therefore, in terms of the provisions of Section 139 of the Companies
Act, 2013 read with the Rules made thereunder, M/s. Khandelwal Jain &
Co., and M/s. Kadam & Co., can be re-appointed as the Auditors of the
Company for a further period of three years, i.e., from the conclusion
of this Annual General Meeting i.e. the 25th Annual General Meeting
until the conclusion of the 28th Annual General Meeting.
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai and M/s.
Kadam & Co., Chartered Accountants, Ahmednagar, have confirmed their
eligibility and willingness to accept the office.
The Board recommends their re-appointment for a term of three years
from the conclusion of this Annual General Meeting i.e. the 25th Annual
General Meeting until the conclusion of the 28th Annual General Meeting
(subject to ratification of the appointment by the Members at every
Annual General Meeting held after this Annual General Meeting) on such
remuneration as may be fixed by the Board of Directors of the Company.
AUDITORS'' REPORT
The Statutory Auditors of the Company have submitted Auditors'' Report,
which have certain Qualifications on the Standalone Financial
Statements for the period ended on 31st December, 2014.
Management''s Explanation to the Auditors'' Qualifications:
a) In respect of Point No. 4 of the Auditor''s Report on Standalone
Financial Statements for the period ended 31st December, 2014,
regarding the extent of realisability of investments made in and
advances given to Videocon Telecommunications Limited (VTL), the
subsidiary and the consequential effect of the above on assets and
liablities as at 31st December, 2014, the explanation of management is
as under:
As mentioned in Note No. 40, to the financial statements, the Company
has, directly and through its subsidiaries, made investments
aggregating to Rs. 65,002.03 Million and also given advances of Rs. 340.46
Million to Videocon Telecommunications Limited (VTL), the subsidiary.
The licenses awarded by the Department of Telecommunications (DoT) to
VTL to provide Unified Access Services (UAS) in 21 circles in India
w.e.f. 25th January, 2008, were quashed by the Hon''ble Supreme Court of
India, vide its order and judgment dated 2nd February, 2012.
Subsequently, VTL participated in the auction conducted by DoT and has
been awarded the Unified Licenses (Access Services) for 6 circles with
effect from 16th February, 2013, which are valid for a period of 20
years. VTL has also been allotted spectrum in these 6 circles. VTL is
continuing its commercial operations.
VTL has been continuously incurring losses and has huge accumulated
losses as at 31st December, 2014. The ability of VTL to continue as a
going concern is substantially dependent on its ability to fund its
operating and capital expenditure requirements. The management is
confident of mobilizing the necessary resources for continuing the
operations of VTL as per the business plan.
COST AUDITOR
The Central Government has directed, vide various Orders to conduct a
Cost Audit in respect of the specified products viz.,
1. Electrical and Electronic Equipments or Appliances;
2. Machinery and Mechanical Appliances;
3. Glass and Glass Product;
4. Electrical Energy
5. Petroleum Oils - Crude; and
6. Petroleum Gases.
The Board of Directors of the Company have accorded its approval for
appointment of Mr. Jayant B. Galande, Cost Accountant in Whole-Time
Practice, Aurangabad (Membership Number 5255) as the Cost Auditor of
the Company, to conduct Audit of the Cost Accounting Records maintained
by the Company for the financial year commencing on 1 st January, 2015
and ending on 3 I st December, 2015, subject to the approval of Central
Government.
In accordance with the provisions of Section 148 of the Companies Act,
2013 read with the Companies (Audit & Auditors) Rules, 2014, the
remuneration payable to the Cost Auditor has to be ratified by the
members of the Company. Accordingly, consent of the Members is sought
by way of an Ordinary Resolution for ratification of the remuneration
amounting to Rs. 1,00,000/- (Rupees One Lac Only) plus applicable service
tax and out of pocket expenses payable to the Cost Auditors for
financial year commencing on 1 st January, 2015.
In compliance with the provisions of The Companies (Cost Audit Report)
Rules, 2011 and General Circular No. 15/2011 issued by Government of
India, Ministry of Corporate Affairs, Cost Audit Branch, we hereby
submit that the Company has filed the Cost Audit Report for the
financial period ended 30th June, 2013 on 24th December, 2013 (due date
27th December, 201 3). As regards financial period ended on 31st
December, 2014, the due date for filing the Cost Audit Report is 29th
June, 2015 and the Company shall file the same on or before due date.
COMMITTEES OF THE BOARD
Pursuant to the provisions of the Companies Act, 201 3 and provisions
of the Listing Agreement, the Company has constituted following
Committees:
Audit Committe Nomination and Remuneration Committee Stakeholders''
Relationship Committee Corporate Social Responsibility Committee
Risk Management Committee
The composition, scope and powers of the aforementioned Committees
together with details of meetings held during the period under review,
forms part of Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report, highlighting the performance
and prospects of the Company''s business, forms part of the Annual
Report.
CORPORATE GOVERNANCE
As required under Clause 49 of the Listing Agreement entered with the
Stock Exchanges, Corporate Governance Report forms part of this Report.
Your Company is in full compliance with the requirements and
disclosures that have to be made in this regard. A certificate from the
Statutory Auditors of the Company confirming compliance of the
Corporate Governance is appended to the Report on Corporate Governance.
DIRECTORS'' RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act, 1956, with respect
to Directors'' Responsibility Statement, it is hereby confirmed that:
a) in the preparation of the Annual Accounts for the period ended 31st
December, 2014, the applicable accounting standards read with
requirements set out under Schedule VI to the Companies Act, 1956, have
been followed and there are no material departures from the same;
b) the Directors have 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 31st December, 2014 and of the profit of the
Company for the period ended on that date;
c) the Directors have 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
d) the Directors have prepared the annual accounts of the Company on a
''going concern'' basis.
ACKNOWLEDGEMENT
The Board of Directors would like to thank the Customers, Vendors,
Investors, Financial Institutions, Bankers, Business Partners and
Government Authorities for their continued support. The Board of
Directors also appreciate the contribution made by the employees at all
levels for their hard work, dedication, co-operation and support for
the growth of the Company
The Board of Directors would also like to thank all stakeholders for
the continued confidence and trust placed by them with the Company.
For and on behalf of the Board of Directors
of VIDEOCON INDUSTRIES LIMITED
VENUGOPAL N. DHOOT
CHAIRMAN & MANAGING DIRECTOR
DIN:00092450
Place: Mumbai
Date: 15th May, 2015
Jun 30, 2013
Dear Shareholders,
The Directors take pleasure in presenting the Twenty-Fourth Annual
Report together with the Audited Accounts and Auditors'' Report for the
financial period ended on 30th June, 2013.
PERFORMANCE REVIEW
The performance of the Company, on standalone basis, for the financial
period ended on 30th June, 2013, is summarized below:
(Rs.in Million)
Period Ended Year Ended
31st
Particulars 30th June,
2013 December, 2011
(18 months) (12 months)
Net Revenue from Operations 181,572.75 126,502.22
Other Income 4,182.66 1,063.12
Total Income 185,755.41 127,565.34
Profit Before Finance Costs, 34,246.52 23,587.25
Depreciation and Tax
Finance Costs 27,148.18 9,777.89
Depreciation and Amortization 8,243.50 6,075.64
Profit/(Loss) Before Tax (1,145.16) 7,733.72
Taxation Expenses (428.84) 2,334 61
Profit/(Loss) for the Period (716.32) 5,399.11
The financial year of the Company was extended by a period of 6 months.
The financial year under review accordingly comprises of a period of 18
months commencing from 1st January, 2012 to 30th June, 2013. The
figures for the current period are for 18 months as against 12 months
in the previous year and hence, are not comparable.
OPERATIONS
CONSUMER ELECTRONICS & HOME APPLIANCES:
The period was a very tough period marked by challenges in both
internal and external environment and the Consumer Electronics & Home
Appliances Industry was not an exception to this. The performance of
the Company was affected due to economic slowdown, which resulted in
lower business volumes. Even through thick and thin, the Company was
able to deliver a stable performance.
OIL & GAS:
During the period under review, the wholly owned Mauritius based
subsidiary named Videocon Mauritius Energy Limited has on 25th June,
2013 executed at Singapore, a Share Sale & Purchase Agreement with ONGC
Videsh Limited and Oil India Limited for sale of its 100% stake in
Videocon Mozambique Rovuma 1 Limited ("VMRL") for a consideration of
US$ 2.475 billion. VMRL holds 10% participating interest in the
offshore Area 1 Block in Rovuma Basin in Mozambique (the "Offshore Area
1"), which has series of sizable natural gas discoveries. However, the
financial results of the Company for the period do not include any
revenue in respect of the same as the said transaction has not been yet
consummated.
The Company continues to explore more opportunities in oil and gas
sector in pursuance to its corporate objective and strategy to remain
actively involved in E&P activities worldwide. The various discoveries
and explorations made by the Company and through its wholly owned
subsidiaries and/or joint ventures during the period under review have
further added to the hydrocarbon resources already established in these
Blocks.
BRAZIL
During the period under review, Petroleo Brasileiro SA, the Operator
for Sergipe, Espirito Santos and Potiguar concessions, announced
various discoveries in these Concessions. These discoveries and
explorations further establishes and increases the prospectivity of
various basins in which IBV Brasil Petroieo Limitada, a 50:50 joint
venture of the Company, through its wholly owned subsidiary Videocon
Energy Brazil Limited, with BPRL Ventures B.V., have concessions,
adding to the discoveries already established. This further underlines
our efforts in Brazil.
During the period under review, the exploration program in ES-M-661
block, BM-ES-24-A concession, in the Espirito Santo Basin, offshore
Brazil was successfully completed. Exploration Well 1-ESS-209, known as
"Grana Padano" was successfully drilled upto a depth of 2961 meters, in
a water depth of 1208 meters by the consortium. Further, drilling of
the second well in the area of Barra in the deep waters of the
Sergipe-Alagoas Basin was also completed.
During the period under review, the existence of light hydrocarbons in
the concession BM-SEAL-11, in ultradeep waters of the Sergipe- Alagoas
basin offshore was discovered. This discovery was made during drilling
of well 1-BRSA-1083-SES (1-SES-167) informally known as ''Farfan'',
situated in a water depth of 2720m, located 109 km from the city of
Aracaju, located in ultra deep waters of Sergipe Alagoas Basin. The
well proved presence of sandstone reservoirs saturated with light
hydrocarbons in the Maastrichtian and Campanian sections with gross pay
thickness of 98m in intervals of 4578m to 4605m (net pay of 17 m) and
5321 to 5365m (net pay of 24m) respectively.
After the Balance Sheet date:
Petroleo Brasileiro SA ("Petrobras"), the Operator, confirmed the
existence of light hydrocarbons in the Appraisal Well currently drilled
in the ''Farfan Discovery Area'', in Concession BM-SEAL-11, in ultradeep
waters of the Sergipe-Alagoas basin Offshore. Further, formation test
in Well (3-SES-176D) informally known as Farfan#1, the first to
evaluate the production capacity of the accumulation located in the
concession area BM-SEAL-11, Block SEAL-M-426 in ultra deep waters of
the Sergipe-Alagoas basin offshore was completed. Petrobras further
confirmed that the test evaluated 30 meters of turbidite sandstones
formation and confirmed good reservoir characteristics featuring
excellent productivity of good quality oil.
Further, the Wahoo-5 appraisal well in BM-C-30 Concession, wherein
Anadarko Petroleum Corporation, USA, through its Brazilian subsidiary,
is acting as the Operator, drilled in the eastern flank of the Wahoo
structure and encountered more than 200 net feet of high-quality pay in
a pre-salt reservoir, with a total hydrocarbon column now established
at 460 feet. The drilling result of the well has proved beyond doubt
the extent of the Upper Sag pay towards the NE of the Wahoo main
structure. During drilling, oil and gas shows have been reported within
the Coquina section, below the upper sag.
MOZAMBIQUE
During the period under review, Anadarko Petroleum Corporation, USA
("Anadarko") announced its seventh well in the discovery area offshore
Mozambique successfully appraised previous discoveries at Lagosta and
Camarao. The Lagosta-2 appraisal well, located about 4.4 miles north of
the Lagosta discovery and 5.3 miles south of the Camarao well,
encountered 777 total net feet (237 meters) of natural gas pay in
multiple zones.
Further, Anadarko also announced the results of its first flow test
offshore Mozambique. The Barquentine-2 well flowed at an
equipment-constrained rate of 90 to 100 million cubic feet of gas per
day (MMcf/d), with minimal pressure drawdown, providing confidence in
well designs that are capable of 100 to 200 MMcf/d.
During the period under review, Barquentine-4 well encountered
approximately 160 net meters of natural gas pay. The Barquentine-4 well
is the ninth successful well in the complex that includes the earlier
Windjammer, Barquentine, Lagosta and Camarao discoveries and the five
subsequent appraisal wells in the block.
During the period under review, the Golfinho exploration well
discovered a new, major natural gas accumulation nearly 20 miles
northwest of its Prosperidade complex within the Offshore Area 1 of the
Rovuma Basin. The Golfinho discovery well encountered more than 193 net
feet (59 net meters) of natural gas pay in two high-quality Oligocene
fan system. Further, the Atum exploration well discovered another
significant natural gas accumulation within the Offshore Area 1 of the
Rovuma Basin. The Atum discovery well encountered more than 300 net
feet (92 meters) of natural gas pay in two high-quality Oligocene fan
systems. Similarly, The Orca-1 discovery well encountered approximately
190 net feet (58 meters) of natural gas pay in a Paleocene fan system.
After the Balance Sheet date:
Espadarte Well encountered approximately 280 net feet of natural gas
pay in Oligocene and Miocene sands.
Also, Golfinho-5 and Golfinho-6 wells drilled in Mozambique during the
third quarter 2013, encountered approximately 330 net feet and
approximately 240 net feet pay of natural gas pay, respectively.
TELECOM:
Videocon Telecommunications Limited (VTL), a subsidiary of the Company
had been awarded licenses by the Department of Telecommunications
("DoT") to provide Unified Access Services ("UAS") in 21 telecom
circles in India with effect from 25th January, 2008 which were valid
for a period of 20 years. VTL had also been allocated spectrum in 20
circles and had launched its commercial operations in 17 circles.
The Hon''ble Supreme Court of India, vide its order and judgment dated
2nd February, 2012 ("Judgment") in two separate writ petitions, quashed
the UAS licenses granted on or after 10th January, 2008 pursuant to two
press releases issued on 10th January, 2008 and the subsequent
allocation of spectrum to
licensees which included the 21 UAS licenses issued and allocation of
spectrum to VTL. The Hon''ble Supreme Court of India''s judgment reasoned
that the allocation of 2G spectrum pursuant to the UAS License was
unconstitutional and arbitrary. The order quashing the UAS licenses and
the allocation of spectrum was to be operative after four months from
the date of the Judgment. By subsequent orders dated 24th April, 2012
and 27th August, 2012, the Hon''ble Supreme Court directed that the
licensees whose licenses had been cancelled were to continue their
operations until 18th January 2013. This order was modified by a
subsequent order dated 15th February 2013, whereby it was directed that
the licensees have to stop operations with immediate effect.
The Hon''ble Supreme Court of India vide its Judgment had also directed
the Central Government to grant fresh UAS licenses and spectrum
allocation by auction. The DoT, had issued a Notice Inviting
Applications (bearing file no. 3-16/2012- Fin./Auction) dated 28th
September, 2012 for auction of spectrum in 1800 MHz and 800 MHz bands.
VTL participated in the aforesaid auction and was declared as a
successful bidder of spectrum in six circles in 1800 MHz, namely,
Bihar, Gujarat, Haryana, Madhya Pradesh, Uttar Pradesh (East) and Uttar
Pradesh (West). On 3rd March, 2013, VTL was awarded the Unified
Licenses (Access Services) for these six circles with effect from 16th
February, 2013 which are valid for a period of 20 years. VTL has also
been allotted 5Mhz spectrum in 1800Mhz category in each of these 6
circles out of which, VTL is already providing its commercial services
in 3 circles i.e. Gujarat, Haryana and Madhya Pradesh.
By the order dated 15th February, 2013, the Hon''ble Supreme Court of
India has, inter-alia, held that the successful applicants in the
auction should be allowed to operate in those circles in which they
have been successful. VTL is continuing its commercial operations in 3
circles viz. Gujarat, Haryana and Madhya Pradesh. VTL shall be
launching, subject to receipt of the necessary approvals from DoT, its
commercial operations in remaining 3 circles viz. Bihar, Uttar Pradesh
(East) and Uttar Pradesh (West) shortly.
POWER:
5.75 MWp Solar Photovoltaic Power Project commissioned by the Company
in October, 2011 at Village: Majra, Taluka: Warora, Dist.: Chandrapur,
Maharashtra; 5.75 MWp Solar Photovoltaic Power Project commissioned by
Comet Power Private Limited, a step down subsidiary of the Company; and
5.50 MWp Solar Photovoltaic Power Project commissioned by Unity Power
Private Limited, a step down subsidiary of the Company; are operating
at full capacities and are generating electricity.
There are two 1,200 MW coal-fired thermal electricity power projects
which are under development. These projects are being undertaken by
Pipavav Energy Private Limited and Chhattisgarh Power Ventures Private
Limited, the subsidiaries of the Company in the state of Gujarat and
Chhattisgarh respectively.
INSURANCE:
Your Company has entered into a joint venture with USA headquatered
global insurance company, Liberty Mutual Insurance Group to setup a
non-life insurance business in India. As per prevailing FDI Guidelines
for the Insurance sector in India, Liberty
Mutual Insurance Group will for the present hold a maximum of 26.0% of
the equity interest in the new joint venture and our Company will hold
a minimum of 74.0%. The Joint Venture Company, Liberty Videocon General
Insurance Company Limited, has received the Certificate of Registration
to operate as a General Insurance Company from the Insurance Regulatory
and Development Authority (IRDA), under Section 3 of the Insurance Act,
1938, in July, 2012.
Currently, our Company is holding 77.90% equity stake in the Joint
Venture Company.
Post receipt of the necessary license from IRDA to commence its
operations and after the requisite set up of manpower, technology,
distribution arrangements & product approvals from IRDA, the Joint
Venture Company has launched the Non-Life Insurance business in India
in January, 2013. It has now commenced business operations from 8
branches across India and plans to expand its product suite and
geographical presence nationally.
DIVIDEND
Your Directors are pleased to recommend a dividend of Rs. 21- (Rupees Two
only) per equity share, to the Non-Promoter Shareholders (Public
Shareholders).
The dividend, if approved, by the shareholders, will entail a payout of
Rs. 232.55 Million including dividend distribution tax of Rs. 33.78
Million.
Your Directors recommend 8% dividend on the preference shares for the
period ended 30th June, 2013.
The dividend is tax free in the hands of the shareholders.
TRANSFER TO RESERVES
Your Directors propose to transfer Rs. 300.00 Million to the General
Reserve, Rs. 155.96 Million to Capital Redemption Reserve and Rs. 1,909.34
Million to Bond/Debenture Redemption Reserve.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The Company has transferred a sum of Rs. 15.39 Million in respect of
unpaid /unclaimed dividend for the Financial Year 2004-05 to the
Investor Education And Protection Fund.
ISSUES/ALLOTME
During the period under review, the Company has allotted 15,750,000
equity shares of face value of Rs.10/- each, represented by the issue of
15,750,000 Global Depository Receipts at a price of US$ 3.2395 per GDR,
equivalent to Rs. 174/- per equity share, aggregating to US$ 51.02
Million to LLIC S.a.r.l., on a private placement basis.
FIXED DEPOSITS
Your Company has not accepted any Fixed Deposit within the meaning of
Section 58A of the Companies Act, 1956 and as such, no amount of
principal or interest was outstanding as on the Balance Sheet date.
ERSONNEL
A statement of the particulars of employees required under Section
217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975, as amended, is annexed and
forms part of this Report.
CONSERVATION OF ENERGY
Sustainable development is an integral part what your Company does.
Your Company''s commitment to sustainable development is reflected in
its ambitious targets to reduce consumption footprints in energy, water
and waste. Your Company has shifted energy management parameters from
the ''can do'' alternative to the ''must do''. It strives to conserve
energy on a perpetual basis in order to meet the future demands.
Your Company is striving continuously to conserve energy by adopting
innovative measures to reduce wastage and optimize consumption. Some of
the specific measures undertaken are:
- Mutual utilization of energy among adjacent factories and
workplaces/inter-industry collaboration;
- Development of practical application of technologies to rationalize
energy utilization;
- Lighting energy savers have been installed at various units which
have led to significant savings in power usage;
- Installation of astronomical digital timers, occupancy sensors for
better lighting control;
- Use of natural air ventilators which does not consume power;
- Induction of Energy Audit at the manufacturing facilities;
- Rain water harvesting to reduce water consumption at factory;
- Installation of Energy Efficient Motors at all the manufacturing
units;
- Introduction of additional machinery with improved technology which
results in reducing the cycle time and power saving;
- Increased awareness among the employees through visual management;
- Conducting energy saving training sessions;
- Replacement of pneumatic tools by energy efficient electrical tools
and converted continuous power to intermittent power consumption; and
- Use of hi-tech energy monitoring appliances and conservation systems
to monitor usage, minimize wastage and increase overall efficiency at
every stage of power consumption.
The adoption of the above energy conservation measures have helped to
curtail the proportionate increase in total energy usage consequent to
overall increase in production. This has made it possible to maintain
cost of production at optimum levels.
During the period under review:
- Your Company was conferred with the prestigious National Energy
Conservation Award for 2011 by the Bureau of Energy Efficiency (BEE), a
part of the Central Electricity Authority, Ministry of Power,
Government of India.
- Your Company has been awarded the first prize in the Manufacturers of
BEE Star Labeled Appliances (Refrigerator) sector for strict adherence
to the BEE standards set up by the Bureau of Energy Efficiency. The
Award for 2011 was given by honorable Union Minister for Power.
RESEARCH & DEVELOPMENT AND TECHNOLOGY
ABSORPTION
Research & Development (R & D) is a scientific investigation that
explores the development of new goods and services, new inputs into
production, new methods of producing goods and services, or new ways of
operating and managing organizations.
"Research" aims to generate knowledge in the hope that it will help
create or improve a product, process or service. "Development" converts
research findings or other knowledge into a new or improved product,
process or service.
In concrete terms, R&D brings new knowledge and processes to a
business, the new higher value-added products, processes and services
that company needs in order to thrive in a knowledge intensive market.
R&D allows your Company to participate in new markets and industries
and offer their customers new or improved products, processes and
services.
In order to compete with the ever changing market and to fetch the
benefits of technological advancement, your Company has set up a
dynamic and active R&D Centre. The R&D Centre has qualified staff
working continuously on new products, process etc.
Your Company has launched number of products in Consumer Electronics
Industry with a wide range of Refrigerators, Washing Machines, Air
Conditioners, Televisions, etc.
R&D involves constant revitalization of knowledge and expertise, and
could result in developments such as:
- New / Improved products;
- Improved operational process;
- Meeting the changing requirements of customers;
- Cost reduction;
- Meeting the changing social and environmental needs; and
- Maintenance of quality.
R&D activities carried out in various consumer electronics products and
benefits derived from these activities:
- Development and production of Digital Direct Broadcast (DDB)
technology in India with a broader convergence of TV, D2H, Internet and
Cloud Computing.
- DDB TV with single chip solution with built in DTH facility having
MPEG4 DVB-S2 digital signal. Customer can enjoy the unmatched picture &
audio quality of LCD/LED TV. This product has various features such as
Dual Core Processor, 14-Bit Video Processor, Faroudja Video and Audit
Optimization, 10-Band Graphics Equalizer, STRATA certified audio,
Flicker Free 3D, 2D to 3D conversion, Internet etc.
- The large screen LED TVs i.e. 80", 65", 58", 55" LED TVs have been
launched with the incredible DDB Technology.
- 58" cinema scope TV having an aspect ratio of 21:9 which is
altogether a different segment than the conventional LED TVs. It
enables users to experience a theatre like environment at home.
- Your Company has set a platform for "Internet TV" based on Android
Operating System having DTH facility. This advancement completes the
need of today with digital signal reception and internet accessibility.
This platform gives freedom for live chatting, video conferencing,
browsing, email accessing etc.
- PIXUS LED is again advancement in display technology which has direct
LEDs in it instead of complete display unit. This integrated module is
a revolutionary product which has more colours, vivid pictures
and.better viewing angle. The in-house designed audio system "BOOM BOX"
adds much value to this TV.
- Metallica Series: As aesthetical advancement in display technology,
the real metal finish LED has altogether a sophisticated look with
advance TV algorithms for vivid picture and sound. The lustrous look
and slim design has made them pioneers in market.
- Introduction of Digi Gracia Series of 6.5kg, 6.0kg, 5.5kg FA Washing
Machines with 10 Wash Programs, 10 Water levels, rinse hold feature
resulting in less water consumption.
- Introduction of Digi Rio series of 6.5kg FA Machines with 8 Wash
Programs, 8 Water levels, Child lock feature and Special Air Dry
feature.
- Introduced Digi Pearl series of 6.5kg FA Machines with 10 Wash
Programs, 10 Water levels, Air Dry features, Eco wash program.
- Introduction of designer series in Semi Auto and Fully automatic
washing machines with blazing colour in the Semi auto & fully auto
category.
- Introduced India''s first 9 Wash and 9 Spin Program in Semi- Automatic
Washing Machine.
- Introduced India''s first 4 Wash Program Semi-Automatic Washing
Machine.
- Introduced various Air Conditioners with various features viz, auto
clean function, introduction of PFC or MC condenser. Vita Air
Technology, Vitamin C Filters, Gold and Blue Fin evaporator etc.
- Launched various models of refrigerators with smart features such as
digital sensor, electronic display control, new looks etc.
Future plan of action:
In near future, the Company shall focus on environment friendly
products and also focus efforts on new technologies which could offer
better products in the domestic as well as international market. The
Company has the following plans through R&D:
- Introducing new technology called 4K2K or Ultra HD TV. 4K2K in short
is 4 times High Definition pixel image and the term 4K refers to the
horizontal resolution of formats which are all on the order 4,000
pixels;
- Increase in the market share and enhance the Brand Value; and
- Bring in best features of various products together.
During the period under review, the Company has incurred Rs. 155.46
Million, representing 0.08% of the turnover towards recurring R&D
expenses.
HEALTH & SAFETY
Safety is an area of paramount Importance in your Company. A well
defined occupational health and safety management system is in place to
ensure the safety of employees, workforce as well as equipment and
machinery. Your Company continues to exhibit a robust assurance towards
Safety, Health and Environment during the period under review. Some of
the initiatives, measures taken by your Company for building healthy
work culture are:
- Recognition of its human capital by opting for life insurance cover,
medical and other welfare covers for the employees that it has
purchased to protect its employees against various risks - those of
health, disability, accident etc;
- Use of guards and engineering solutions wherever possible instead of
relying on PPE (Personal Protective Equipments);
- Provision of health and medical services to all the employees at all
levels through well- equipped health centers located at all
manufacturing plants;
- Implementation of Human Injury Reporting System to report all types
of human injury and to find out the root cause;
- Introduction of new materials and equipments to eliminate various
hazards at workplace;
- Regular counseling and medical checkups to ensure fitness of its
employees;
- Arranging different seminars and events at workplace to create
awareness among the employees for hygiene and cleanliness;
- Displaying of notices and information on the Notice Boards at all
work stations for information and awareness of employees;
- Introduction of Basic First Aid Course and demonstration of Fire
Extinguisher Courses conducted for the employees and security guards;
- Installation of fire blankets at security check point for every
department;
- Provision of emergency exit door on all shop floor areas so as to
reach safe assembly points in case of emergency;
- Provision of such information, instruction, training and supervision
as necessary to ensure the health and safety of all workers at work;
- Arrangements at manufacturing plants for ensuring safety and absence
of risks to health in connection with the use, handling, storage and
transport of articles and substances;
- Provision and maintenance of effective drainage system;
- Effective and suitable provision in every workroom for securing and
maintaining the adequate ventilation by circulation of fresh air;
- Provision of vaccination facilities for contagious diseases;
- Display of emergency evacuation plans with location of fire
extinguisher;
- Provision of modern amenities at manufacturing units to meet strict
requirements of efficient servicing and smooth functioning at all
times;
- Compliance with the legal requirement of Directorate of Industrial
Safety & Health (DISH), Chief Fire Office etc.;
- Night Manager concept for vigilance of the overall campus; and
- Conducting Safety Committee Meeting to strengthen the safety.
ENVIRONMENTAL PROTECTION
Environmental protection is an increasingly vital issue all over the
world. Ozone depletion, green house effect, global climate changes or
global warming, etc, are the main issues in environment. Your Company
believes that it is the responsibility of the Company to maintain
ecological balance for sustainable development.
Your Company is committed to Green Initiative wherein it has
established a green management goal for significantly reducing
greenhouse gases and launching eco friendly products.
Your Company continues to strive to address matters related to
Environmental Protection through a variety of initiatives like:
- Preparation of manual, codes and guides relating to prevention,
control or abatement of environmental pollution;
- Collection and dissemination of information among employees in
respect of matters relating to environmental pollution;
- Implementation of 3R System - Reduce, Reuse and Recycle for the
optimum utilization of natural resources;
- Examination of manufacturing processes, materials and substances and
replacement thereof, if any, that are likely to cause environmental
pollution;
- Emission of pollution as per the standards prescribed by Central
Pollution Control Board (CPCB);
- Celebration of Vanamohatsava (Annual Festival for Tree Plantation)
and World Environment Day to increase mass awareness among the
employees;
- Adoption of Industrial Waste Management Program and Pollution Under
Control (PUC) camps for the benefit of the environment;
- Manufacturing facilities at various plants are certified to ISO 14001
standards;
- Organizing various events and seminars for environmental awareness;
and
- Upgradation of automated sewage treatment and effluent treatment
plants.
Your Company is in compliance of e-waste rules and guidelines and has a
tie up on all India basis, with authorized recycler for collection and
disposal of e-waste products. The Company has taken the initiative to
spread awareness regarding e-waste management and its handling and
disposal through print media, social sites, advertisement campaign by
way of putting standee-educating the dealers and the end consumers.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars of Foreign Exchange Earnings and Outgo during the
financial period ended on 30th June, 2013 are set out hereunder:
(Rs. In Million)
Period ended Year ended
Particulars 30th June, 2013 31st December, 2011
(18 months) (12 months)
Foreign Exchange Earnings 9,851.76 3,840.53
Foreign Exchange Outgo 26,193.13 16,745.84
INFORMATION TECHNOLOGY
Your Company continues to invest in Information Technology (IT)
leveraging it as a source of competitive advantage.
A good IT infrastructure in the Company is absolutely necessary for
complying with the regulatory or safety norms, to improve performance
and quality via real-time process monitoring, and finally, improve
reliability via appropriate maintenance, driven by up-to-date
information on equipment status.
The Company has adopted "Digital Nervous System" for sustaining the cut
throat competition for the "Numero Uno" position in any sector of
economy. Your Company has upgraded its existing facilities with
improved technology for customers like call centers, connect through
SMS, Websites so on to have best and speedy customer interaction. Your
Company has put in place an enabled Consumer Interaction Centre for
addressing complaints and suggestions from consumers, retailers and
distributors.
Through the latest version of SAP Solutions your Company has leveraged
the benefits like accelerate innovation, produce high- quality products
at high profit margins, reduce the cost and effort of compliance,
integration in business operations, optimization of enterprise
resources, standardized business processes and standard operating
practices with well established controls.
Your Company has introduced Sales Transformation & Enhancement Program
(STEP), an innovative & customized in- house developed sales tool for
providing day to day information required by sales force on the field.
This tool helps improving efficiency, enhance ability & productivity of
sales force, leading to long term business sustainability and customer
delight.
GPS Tracker, an integral part of STEP tool, uses strength of Android
GPS technology GPRS coverage to deliver a high performance enable
tool for the sales force. This gives visibility of Sales force on
ground, dealer network etc.
CORPORATE SOCIAL RESPONSIBILITY
Contribution to Society is one of the core values of the Company.
Corporate Social Responsibility (CSR) encompasses within itself
sustainability which means creating an awareness of climate change and
social imbalance and demands suitable actions for its enhancement. The
Company is continuously reviewing its efforts towards improving the
quality of life of the communities it serves.
It is not only important for organizations to formulate CSR strategies
but also important to make the employees adapt the same. The human
resource department and corporate social responsibility are closely
interrelated with each other.
Your Company believes that while profit is important for all
businesses, profit cannot be the only reason for the existence.
Profits help to achieve mission while contributing to the society.
Your Company conducts its business in a sustainable and socially
responsible manner. This principal is an integral part of your
Company''s corporate values. The Company continues to impact the lives
of people through relentless CSR initiatives. Your Company has put in
place the strategy including CSR priorities and actions for improvement
everywhere in the organization.
Your Company ensures to remain in a constant dialogue with customers,
suppliers and other parties which enable the Company to explore new
business opportunities and it shall continue to discharge its CSR in
the best possible manner.
APPOINTMENT AND RE-APPOINTMENT OF DIRECTORS
During the period under review, Mr. Karun Chandra Srivastava, Director
of the Company resigned from the Board of the Company w.e.f 1st
February, 2012. Mr. Girish K. Nayak - Nominee of ICICI Bank Limited
ceased to be the Director of the Company w.e.f. 14th February, 2012,
consequent to withdrawal of his nomination by ICICI Bank Limited.
Further, during the period, Mr. Pradipkumar N. Dhoot, Whole-Time
Director of the Company resigned from the Board of the Company w.e.f.
14th August, 2012.
The Board places its sincere appreciation towards the valued
contribution received from Mr. Karun Chandra Srivastava, Mr. Girish K.
Nayak and Mr. Pradipkumar N. Dhoot, during their tenure as the
Directors of the Company.
During the period under review, Mr. S. Ananthakrishnan was co- opted as
a Nominee Director of IDBI Bank Limited on the Board of the Company
w.e.f 29th February, 2012. However, Mr. S. Ananthakrishnan, ceased to
be the Director of the Company w.e.f 13th June, 2013, consequent to
withdrawal of nomination by IDBI Bank Limited. Mr. B. Ravindranath was
nominated in place of Mr. S. Ananthakrishnan.
Changes after the Balancesheet Date:
Mr. S. P. Talwar ceased to be the Director of the Company w.e.f 9th
August, 2013, on account of his sad demise. The Board would like to
express its deep condolence towards the sad demise of Mr. S. P.
Talwar, and also expresses its heartfelt gratitude towards the
contribution made by Mr. S. P. Talwar during his tenure.
Pursuant to the provisions of Section 255, 256 of the Companies Act,
1956 and in terms of the Articles of Association of the Company, Mr.
Anil G. Joshi and Mr. S. Padmanabhan are liable to retire by rotation
at the ensuing Annual General Meeting and being eligible, have offered
themselves for re-appointment. The Board recommends their
re-appointment.
Brief profiles of Mr. Anil G. Joshi and Mr. S. Padmanabhan, specifying
their expertise in specific functional area, other public companies in
which they hold directorships and committee positions, is annexed to
the Notice and forms part thereof.
LISTING
The equity shares of your Company are listed on the BSE Limited
(Formerly: the Bombay Stock Exchange Limited) and The National Stock
Exchange of India Limited (NSE). The Global Depository Receipts (GDRs)
and Foreign Currency Convertible Bonds (FCCBs) issued by your Company
are listed on the Bourse de Luxembourg and Singapore Exchange
Securities Trading Limited respectively.
SUBSIDIARY COMPANIES
As on 30th June, 2013, your Company had 29 subsidiaries (including step
down subsidiaries) viz. Applied Energy Private Limited, Chhattisgarh
Power Ventures Private Limited, Comet Power Private Limited, Datacom
Telecommunications Private Limited, Indigo Energy Private Limited,
Jumbo Techno Services Private Limited, Liberty Videocon General
Insurance Company Limited, Middle East Appliances LLC, Percept Energy
Private Limited, Pipavav Energy Private Limited, Proficient Energy
Private Limited, Prosperous Energy Private Limited, Senior Consulting
Private Limited, Unity Power Private Limited, Videocon Australia WA-
388-P Limited, Videocon Electronics (Shenzhen) Limited, Videocon Energy
Limited, Videocon Energy Brazil Limited, Videocon Estelle Limited,
Videocon Global Limited, Videocon Hydrocarbon Holdings Limited,
Videocon Indonesia Nunukan Inc., Videocon Ivory Limited, Videocon
International Electronics Limited, Videocon JPDA 06-103 Limited,
Videocon Mauritius Energy Limited, Videocon Mozambique Rovuma 1
Limited, Videocon Oil Ventures Limited and Videocon Telecommunications
Limited.
Ministry of Corporate Affairs, Government of India, vide its General
Circular No(s). 2/2011 and 3/2011 dated 8th February, 2011 and 21st
February, 2011, respectively, has granted exemption from attaching the
Annual Accounts and other documents of the subsidiary companies with
the Balance Sheet of the holding company, subject to fulfillment of
certain conditions stipulated therein. The Board of Directors have
accorded their consent for not attaching the Balance Sheet of the
subsidiary companies. The consolidated financial statements of the
Company and all subsidiaries duly audited by its statutory auditors are
presented in the Annual Report. The consolidated financial statements
have been prepared in strict compliance with applicable Accounting
Standards and where applicable, Listing Agreement as prescribed by the
Securities and Exchange Board of India.
Further, the following information in aggregate for each subsidiary
including subsidiaries of the subsidiaries has been annexed to the
consolidated balance sheet:-
(a) capital (b) reserves (c) total assets (d) total liabilities (e)
investment (except in case of investment in the subsidiaries) (f)
turnover (g) profit before taxation (h) provision for taxation (i)
profit after taxation and (j) proposed dividend.
The Company undertakes that the Annual Accounts of the subsidiary
companies and the related detailed information of the subsidiary
companies shall be made available to the shareholders of the holding
and subsidiary companies seeking such information at any point of time.
The Annual Accounts of the subsidiary companies shall also be kept open
for inspection by any shareholder at the Registered Office of the
Company and that of the respective subsidiary companies. The Company
shall furnish a hard copy of details of accounts of subsidiaries to any
shareholder on demand.
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements, based on the Financial
Statements received from the subsidiaries, associates and joint
ventures, as approved by their respective Board of Directors, have been
prepared in accordance with the requirements of Accounting Standard 21
on "Consolidated Financial Statements", Accounting Standard 27 on
"Financial Reporting of Interests in Joint Ventures" and Accounting
Standard 23 on "Accounting for Investments in Associates in
Consolidated Financial Statements."
CASH FLOW STATEMENT
The Cash Flow Statement for the period ended 30th June, 2013, in
conformity with the provisions of Clause 32 of the Listing Agreement
with the Stock Exchanges in India, is annexed hereto.
AUDITORS
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai and M/s.
Kadam & Co., Chartered Accountants, Ahmednagar, Statutory Auditors of
the Company, retire at the conclusion of ensuing Annual General Meeting
and have confirmed eligibility and willingness to accept office, if
re-appointed. The Company has received certificates from the said
Auditors to the effect that their re-appointment, if made, would be
within the limits prescribed under Section 224(1 B) of the Companies
Act, 1956.
The Board recommends their re-appointment.
AUDITORS'' REPORT
The Statutory Auditors of the Company have submitted Auditors'' Report,
which have certain Qualifications on the Standalone and Consolidated
Financial Statements for the period ended on 30th June, 2013.
Management''s Explanation to the Auditors'' Qualifications:
a) In respect of Point No. 4(f) of the Auditor''s Report on Standalone
Financial Statement for the period ended 30th June, 2013, regarding the
extent of realisability of investments made in and advances given to
Videocon Telecommunications Limited (VTL), the subsidiary, the
explanation of management is as under:
The Company has, directly and through its subsidiaries, made
investments aggregating to Rs. 49,337.50 Million and also given advances
of Rs. 782.74 Million to Videocon Telecommunications Limited (VTL), the
subsidiary. VTL was granted the license for providing Unified Access
Services (UAS) in 21 circles by the Department of Telecommunications,
Government of India (DoT) in 2008 and was also allotted spectrum in 20
circles. The Hon''ble Supreme Court of India, vide its judgment dated
2nd February, 2012, quashed all the UAS licenses granted on or after
10th January, 2008 and the subsequent allocation of spectrum to these
licensees, which also include the 21 UAS licenses granted to VTL and
the spectrum allotted to it. The Hon''ble Supreme Court of India, also
directed the Telecom Regulatory Authority of India (TRAI) to make fresh
recommendations for grant of licenses and allocation of spectrum and
the Central Government to grant fresh licenses and allocation of
spectrum by auction thereafter.
The Central Government conducted the auction of spectrum in November,
2012. VTL participated in the auction and has been declared as a
successful bidder in 6 circles and has been awarded spectrum in these
circles. VTL is continuing its business as a going concern. As VTL has
huge accumulated losses, its ability to continue as going concern is
dependent on its ability to fund its operating requirements. VTL is
confident of mobilizing necessary resources for continuing its
operations as per the business plan. Accordingly, in the opinion of the
management, no provision is required for diminution in the value of
aforesaid investments and advances to VTL.
b) In respect of Point No. 6 of Auditors'' Report on Consolidated
Financial Statement regarding the recognisation of Deferred Tax Assets
by the Subsidiary VTL, the explanation of management is as under:
The Subsidiary, VTL has evaluated its future taxable income after it
has been awarded the Unified Licenses (Access services) in six circles
with effect from 16th February 2013 which are valid for a period of 20
years and also been allotted 5Mhz spectrum in 1800 Mhz category in each
of these six circles. The management is of the opinion that there is a
virtual certainty, based on the future business plan, estimated
increase in subscribers base and considering additional capital
infusion into the Company which would restrict further borrowings and
related costs, that sufficient future taxable income will be available
against which the deferred tax assets can be realized. Accordingly, the
Subsidiary VTL has recognized net deferred tax assets of Rs. 11,583.48
Million on the unabsorbed depreciation and business losses.
COST AUDITOR
The Central Government has directed, vide various Orders to conduct a
Cost Audit in respect of the specified products viz.,
1. Refrigerator;
2. Petroleum Products - Oils & Gas;
3. Electrical Energy; and
4. Glass and Glass Product.
The Board has accorded its approval for the re-appointment of Mr.
Sudhir C. Sant, Cost Accountant in Whole-Time Practice, Pune, having
Membership Number 7836, as the Cost Auditor of the Company, to conduct
Audit of the Cost Accounting Records maintained by the Company for the
financial year 2013-14, subject to the approval of Central Government.
In accordance with the provisions of The Companies (Cost Audit Report)
Rules, 2011 and General Circular No. 15/2011 issued by Government of
India, Ministry of Corporate Affairs, we hereby submit that the Company
has filed the Cost Audit Report for the financial year ended 31st
December, 2011 on 30th January, 2013 (due date 28th February, 2013).
As regards filing of the Cost Audit Report for the financial period
ended on 30th June, 2013, the due date for filing the Cost Audit Report
is 27th December, 2013 and the Company shall file the same on or before
due date.
AUDIT COMMITTEE
Pursuant to the provisions of Section 292A of the Companies Act, 1956
and provisions of the Listing Agreement, the Company has constituted an
Audit Committee. The composition, scope and powers of the Audit
Committee together with details of meetings held during the period
under review, forms part of Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report, highlighting the performance
and prospects of the Company''s business, forms part of the Annual
Report.
CORPORATE GOVERNANCE
As required under Clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance Report forms part of this Report. Your
Company is in full compliance with the requirements and disclosures
that have to be made in this regard. A certificate from the Statutory
Auditors of the Company confirming compliance of the Corporate
Governance is appended to the Report on Corporate Governance.
DIRECTORS'' RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act, 1956, with respect
to Directors'' Responsibility Statement, it is hereby confirmed that;
a) in the preparation of the Annual Accounts for the period ended 30th
June 2013, the applicable accounting standards read with requirements
set out under Schedule VI to the Companies Act, 1956, have been
followed and there are no material departures from the same;
b) the Directors have 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 30th June, 2013 and of the loss of the Company for
the period ended on that date;
c) the Directors have 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
d) the Directors have prepared the annual accounts of the Company on a
''going concern'' basis.
ACKNOWLEDGEMENT
The Board of Directors would like to thank the Customers, Vendors,
Investors, Financial Institutions, Bankers, Business Partners and
Government Authorities for their continued support. The Board of
Directors also appreciate the contribution made by the employees at all
levels for their hard work, dedication, co-operation and support for
the growth of the Company.
The Board of Directors would also like to thank all stakeholders for
the continued confidence and trust placed by them with the Company.
For and on Behalf of the
Board of Directors of
VIDEOCON INDUSTRIES LIMITED
VENUGOPAL N. DHOOT
CHAIRMAN & MANAGING DIRECTOR
Place : Mumbai
Date : 29th November, 2013
Dec 31, 2011
The Directors take pleasure in presenting the Twenty-Third Annual
Report together with the Audited Accounts and Auditors' Report for
the financial year ended on 31st December, 2011.
PERFORMANCE REVIEW
The performance of the Company, on standalone basis, for the financial
year ended on 31st December, 2011, is summarized below:
(Rs in Million)
Year ended Period ended
Particulars 31st Dec., 2011 31st Dec., 2010
(12 Months) (15 Months)
Net Sales 126,502.22 144,096.91
Other Income 1,063.12 429.86
Total Income 127,565.34 144,526.77
Profit before Interest, 23,587.25 26,565.60
Depreciation and Tax
Interest and Finance charges 9,777.89 8,931.56
Depreciation, Amortization and 6,075.64 7,129.62
Impairment
Profit Before Tax 7,733.72 10,504.42
Provision for Taxation 2,278.14 3,057.48
Profit after Tax 5,455.58 7,446.94
The figures for the current year are for a period of 12 months as
against 15 months in the previous period and hence, are not comparable.
OPERATIONS CONSUMER ELECTRONICS & HOME APPLIANCES
During the year under review, your Company was able to post a stable
performance in the consumer electronics and home appliances segment.
However, the margins were under pressure in view of increase in the
cost of raw materials and components and intense competition.
OIL & GAS
Your Company intensified its exploratory efforts. These efforts paid
good dividends in terms of new discoveries and reserve accretion.
BRAZIL
21st September, 2011
Petrobras, the Operator of the BM-SEAL- 11 Concession in the Sergipe
Basin announced that the presence of oil and gas accumulations,
confirmed after completing the drilling, logging, sampling fluid in a
formation testing operations at Barra well (1-SES-158) with the
presence of excellent reservoirs with good porosities and
permeabilities at several depths.
MOZAMBIQUE
7th February, 2011
Anadarko announced the latest in a string of major deepwater natural
gas discoveries off the coast of Mozambique. The Tubarao discovery well
encountered more than 110 net feet of natural gas pay.
22nd August, 2011
Anadarko announced that the Barquetine - 2 appraisal well, located in
Mozambique's Offshore Area 1 of the Rovuma Basin, encountered more
than 230 net feet (70 meters) of natural gas pay in high quality
Oligocene- age reservoirs. Barquetine - 2 was the first appraisal well
in the Windjammer, Barquentine and Lagosta complex, which is estimated
to hold a minimum of 6 trillion cubic feet (Tcf) of recoverable natural
gas resources.
5th October, 2011
Anadarko announced that the appraisal section of most recent
exploration well at the Camarao prospect encountered approximately 240
net feet (73 meters) of natural gas pay in an excellent quality
reservoir and confirmed static pressure connectivity with the
partnerships' previously announced Windjammer and Lagosta
discoveries. In addition, the Camarao well discovered approximately 140
net feet (43 meters) of natural gas pay in shallower Miocene and
Oligocene sand packages not encountered in previous wells.
28th November, 2011
Barquetine-3 appraisal well encounters more than 662 net feet (202
meters) of natural gas pay in two high-quality Oligocene-aged fan
systems, significantly expanding the estimated recoverable resource
range to 15 to 30 trillion cubic feet (Tcf) of natural gas, with an
estimated 30 to 50 Tcf of natural gas in place.
Post Balance Sheet date
17th January, 2012
Anadarko announced its seventh well in the discovery area offshore
Mozambique successfully appraised previous discoveries at Lagosta and
Camarao. The Lagosta-2 appraisal well, located about 4.4 miles (7
kilometers) north of the Lagosta discovery and 5.3 miles (8.5
kilometers) south of the Camarao well, encountered 777 total net feet
(237 meters) of natural gas pay in multiple zones.
12th March, 2012
Anadarko announced the results of its first flow test offshore
Mozambique. The Barquentine-2 well flowed at an equipment - constrained
rate of 90 to 100 Million cubic feet per day (MMcf/d), with minimal
pressure drawdown, providing confidence in well designs that are
capable of 100 to 200 MMcf/d.
4th April, 2012
Anadarko announced the success of the Barquentine-4 appraisal well
which encountered approximately 160 net meters of natural gas pay.
15th May, 2012
Anadarko announced that Golfinho exploration well discovered a new,
major natural gas accumulation nearly 20 miles (32 kilometers)
northwest of its Properidade complex within the Offshore Area 1 of the
Rovuma Basin. The Golfinho discovery well encountered more than 193 net
feet (59 net meters) of natural gas pay in two high-quality Oligocene
fan systems that are age- equivalent to, but geologically distinct
from, the previous discoveries in the Prosperidade complex.
TELECOM
Videocon Telecommunications Limited (VTL), a subsidiary of the Company,
was granted Unified Access Services (UAS) Licenses in 21 circles and
had also been allotted spectrum in 20 circles out of which it has
launched its services in 16 circles.
The Hon'ble Supreme Court of India, vide its judgment dated 2nd
February, 2012, in two separate writ petitions filed by Centre for
Public Interest Litigations and by another, has quashed all the UAS
Licenses granted on or after 10th January, 2008, pursuant to two press
releases issued on 10th January, 2008 and the subsequent allocation of
spectrum to the licencees. This includes 21 Licenses issued to the VTL
and the spectrum allotted to it in 20 circles. The Hon'ble Supreme
Court of India further directed that its Order of quashing the Telecom
Licenses and the allocation of the spectrum shall be operative after
four months from 2nd February, 2012. On 24th April, 2012, the Hon'ble
Supreme Court of India modified its Order and postponed the operation
of its Order of quashing of the Telecom Licenses and the allocation of
the spectrum to 7th September, 2012. The Hon'ble Supreme Court of
India had also directed, in its Judgement of 2nd February, 2012,
Telecom Regulatory Authority of India (TRAI) to make fresh
recommendations for grant of Licences and allocation of spectrum (TRAI
has since issued its recommendations on 23rd April, 2012) and the
Central Government to grant fresh Licenses and allocation of spectrum
by auction thereafter. The Central Government has announced that it
will complete the auction of Licenses and allocation of spectrum on or
before 31st August, 2012. VTL has decided to participate in such
auction.
POWER
The Company commissioned 5.75 MWp Solar Photovoltaic Power Project at
Village Majra, District Warora, Maharashtra, in the month of October
2011.
Comet Power Private Limited, a step down subsidiary of the Company,
commissioned 5.75 MWp Solar Photovoltaic Power Project at Village
Betwasiya, Osiyan, District Jodhpur, Rajasthan, in the month of October
2011.
Unity Power Private Limited, a step down subsidiary of the Company,
commissioned 5.50 MWp Solar Photovoltaic Power Project in the State of
Gujarat, in the month of January, 2012.
There are two 1,200 MW coal-fired thermal electricity power projects
which are under development. These projects are being undertaken by
Pipavav Energy Private Limited and Chhattisgarh Power Ventures Private
Limited, the subsidiaries of the Company in the state of Gujarat and
Chhattisgarh respectively.
INSURANCE
Your Company has entered into a joint venture with USA headquartered
Liberty Mutual Insurance Group to setup a non-life insurance business
in India. As per prevailing FDI Guidelines for the Insurance sector in
India, Liberty Mutual Insurance Group will for the present hold a
maximum of 26.0% of the equity interest in the Joint Venture Company
and our Company will hold a minimum of 74.0%. The Joint Venture
Company, Liberty Videocon General Insurance Company Limited, has
received the Certificate of Registration as a General Insurance Company
from the Insurance Regulatory and Development Authority (IRDA), under
Section 3 of the Insurance Act, 1938.
As on the Balance Sheet date, the Joint Venture Company, was a wholly
owned subsidiary of the Company. However, currently, the Company is
holding 79.41% equity stake in the Joint Venture Company.
ISSUES / ALLOTMENT
During the year under review, the Company has allotted 1,058,035 equity
shares of Rs 10/- each at a conversion price of Rs 239.5265 per equity
share, upon conversion of Foreign Currency Convertible Bonds. The
details of conversion are set out hereunder:
Sr. Date of Allotment No. of equity Principal Amount
No shares allotted (US $)
1. 27th July, 2011 491,230 2.6 Million
2. 22nd August, 2011 188,935 1.0 Million
3. 31st October, 2011 377,870 2.0 Million
Material changes Post Balance Sheet date:
On 22nd May, 2012, the Company has allotted 15,750,000 equity shares of
face value of Rs 10/- each, represented by the issue of 15,750,000
Global Depository Receipts at a price of US $ 3.2395 per GDR,
equivalent to Rs 174/- per equity share, aggregating to US $ 51.02
Million to LLIC S.a.r.l., on a private placement basis.
DIVIDEND
Your Company follows a dividend policy by harmonizing the needs of the
Company as well as the shareholders. Your Directors are pleased to
recommend a dividend of Rs 0.50 (Fifty paisa only) per equity share for
the financial year ended on 31st December, 2011.
The dividend, if approved, by the shareholders, will entail a payout of
Rs 185.24 Million including dividend distribution tax of Rs 25.85
Million.
Your Directors recommend 8% dividend on the preference shares for the
year ended 31st December, 2011.
The dividend is tax free in the hands of the shareholders.
TRANSFER TO RESERVES
Your Directors propose to transfer Rs 1,000 Million to the General
Reserve and Rs 150.83 Million to Capital Redemption Reserve. An amount
of Rs 34,680.55 Million is proposed to be retained in the Profit and
Loss Account.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The Company has transferred a sum of Rs 2.91 Million in respect of
unpaid/ unclaimed dividend for the Financial Year 2003-04 to the
Investor Education and Protection Fund.
FIXED DEPOSITS
Your Company has not accepted any Fixed Deposit within the meaning of
Section 58A of the Companies Act, 1956 and as such, no amount of
principal or interest was outstanding as on the Balance Sheet date.
PERSONNEL
Human Capital is an important asset for the Company and the Company has
taken and shall continue to take adequate steps towards education and
enrichment of the human capital.
A Statement of the Particulars of Employees required under Section
217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975, as amended, is annexed and
forms part of this Report.
CONSERVATION OF ENERGY
Energy can neither be created nor destroyed by itself; it can only be
transformed. The conservation of energy is a need of the day. Your
Company believes in the conservation of energy to meet the future
demands. Your Company has made different policies and rules to save the
energy and make optimum utilization of natural resources.
The Company has taken following key initiatives for conservation of
energy:
- Use of hi-tech energy monitoring appliances and conservation
systems to monitor usage, minimize wastage and increase overall
efficiency at every stage of power consumption;
- Installation of energy saving lights;
- Reduction of energy consumption via behavioural modification of
facility occupants, i.e. turning off lights, personal computers and
other electronic equipments, when not in use;
- Installation of astronomical digital timers, occupancy sensors for
better lighting control;
- Based on the outdoor temperature raising the air handler, supply
air temperature to prevent over cooling and reduce the cooling coil
load;
- Timely maintenance and up-gradation of machinery & equipments;
- Auto shut-off of air conditioners and other equipments during lunch
breaks and during shift change;
- Plantation of trees at all the manufacturing facilities;
- Awareness programs towards optimum utilization of natural resources
at managerial as well as employee level;
- Reduction in power consumption by taking opportunities of idle
production hours, tea and lunch timings etc.; and
- Use of energy saving lighting arrangement on shop floors and on
roads, inside the manufacturing facilities by using Electronics Ballet
and CFL lamps.
To make available the resources for future generation is the ultimate
responsibility of today's generation. Hence, your Company continues
to lay emphasis on conservation of energy, power and other energy
resources. Such measures for conservation of energy will ultimately
reduce the cost of production by reducing maintenance cost and
efficient use of resources.
RESEARCH AND DEVELOPMENT (R & D) AND TECHNOLOGY ABSORPTION
The consumer electronics industry is one of the most dynamic industries
in the world, undergoing seemingly continual change with changing
lifestyle of the people thereby creating demand for meaningful
innovations based on unique insights of the customers.
Technolgy and R & D go hand in hand. To compete with ever changing
market conditions and fetch the technological advancement, your Company
has set up a very dynamic and active R & D center. Your Company has
built up strong R & D centers, having qualified staff working
continuously for betterment of product and services. Our R & D team
continuously does market research as well as customer survey to
understand the needs and requirements of the consumers.
Your Company has launched variety of products in consumer electronics
industry including wide range of Refrigerators, Washing Machines,
Televisions, Air-Conditioners, Microwave Ovens etc. Your Company is
committed towards introducing new models and improving existing
products to meet the ever-increasing demands of the consumers by fully
exploring technological options and advancements.
R & D centers are operated for the following activities:
- To conduct market survey and ascertain the new trend;
- To foresight the consumer needs and modify the products to suit the
consumer demands;
- To bring variety of products at an affordable price level;
- To generate new technologies and make adequate use of the same;
- To improve operational efficiency;
- To reduce cost of production;
- To improve quality of product; and
- To supply value-for-money products in the market with best
aesthetics and advanced features.
Benefits derived from the R & D activities:
- Maintenance of quality;
- Innovations in product designs and outlook;
- Efficient use of technological advancement;
- Cost reduction; and
- Optimum utilization of resources.
R & D activities carried out in various consumer electronics products
and benefits derived from these activities: Televisions:
Consumer electronics market is majorly influenced by technology which
is changing day by day with many innovations and continuous R & D. In
this dynamic world, the Company is launching LED TVs, 3D TVs, DTH LED
TVs, Internet TVs etc. with attractive designs and aesthetics, using
latest technologies, to delight Indian consumers with wide range of
products. These products will not only be technologically advanced but
also be connected with consumers in their everyday lives.
Your Company has also introduced many unique selling propositions like
models with brush and metal finish, slim TVs etc. Some of the unique
models introduced are as follows :
- Integrated Digital TV with single chip solution with a built in DTH
(Direct to Home) facility having MPEG 4 DVB-S2 Digital signal. Customer
can enjoy the unmatched picture & audio quality of LCD TV & LED TV.
This product has the following unique features:
- MPEG-4 DVB-S2: Single Chip iDTV Solution with second generation
MPEG- 4 DVB-S2 technology for enhanced picture quality.
- FULL HD (1920 x 1080P): 100% Full HD Reception which improves the
picture & sound quality.
- H.264 Video Decoder: Excellent video quality across entire
Bandwidth Spectrum as H.264 decoder is inside the single chip.
- CPU Performance: Dual core CPU with 450MHz which is controlled by
Linux Operating System. It leads to high system performance with
greater operational speed.
- Internal RAM: 48-Bit DDR2/3 (384MB) Local Memory interfacing with
the high speed accessing capability up to 1066Mbps (533MHz clock rate)
for better frame rate performance.
- MADi Technology for Motion Control: Crystal clear rendering on Full
HD (1080p) displays using advanced motion control algorithms such as
MADi technology inside.
- Advanced Video Post Processing: Video is optimized with 14 - Bit
Colour processing which leads high depth in picture, true colour
enhancement with natural skin tone.
- Digital Noise reduction with 3D Comb filter: Better noise reduction
and signal conditioning using built-in 3D/TNR noise suppression, cross
colour suppression, media noise suppression which includes 'Block
noise' and 'Mosquito noise' reduction.
- Enriched Graphic On Screen Display (OSD): Enriched & Animated
Graphical OSD with WXGA resolution, Unique OSD for both in Analog &
Digital with 14 Multi-Regional Languages.
- Silicon Hybrid Tuner: As using Silicon Hybrid Tuner which is giving
better picture, sound quality and high performance as compared to Dual
Tuner and in the Dual Tuner insertion loss will be around 8~10dB.
- Unique "Android TV" - Videocon has set a platform for "Internet
TV" to enjoy the live chatting, browsing, video conferencing, email
access and enabling the customers to download and play lot of
applications from Google Apps Market. Customer can download and store
his preferred applications in TV memory. This product has various
unique capability such as Android Market; Flicker Free 3D; QWERTY
Remote; Web Browser; Facebook; You Tube/Picasa; Skype/Horoscope;
Maps/Weather Updates; App Installer; Inbuilt Wi-Fi and Games.
- Uhe new "DVBS (Digital Video Boosting Station) LED" series with
Faroudja engine which brings life to every color with 120Hz refresh
rate and FULL HD 1080P resolution with built in DTH service.
- "Persistence" (LED) TV with FULL HD 1080p resolution. It has a
unique feature of MJC (Motion Judder Compensation). With this unique
picture quality improvement algorithm, it reproduces e 1 Billion
display colour for more natural, vivid and true to life colours.
Refrigerators:
Your Company has variety of models in double door and single door
refrigerators.
With the help of R & D, the Company was able to introduce various
models having the following features:
- High End Frost Free (FF) and Direct Cool (DC) range of
refrigerators from 50L to 610L;
- High glass designer exterior panels in both DC and FF;
- Introduction of designer models like Lily, Rose, Bird in DC and
Orion and Creeper series in FF;
- First time introduction of night vision FF refrigerator with
ambient light sensing LED illumination in door handle;
- Introduction of very unique USPs like digital watch, crisper
separator, cosmetic box in FF refrigerator;
- Developed & launched Side By Side refrigerator to enter into super
luxury refrigerator segment;
- Introduction of FM radio in refrigerators;
- Introduction of new Metallic robust Bar handle for DC & FF
refrigerators;
- Introduction of toughened glass shelves for DC refrigerators, which
strengthened our market position in DC range;
- LED light implementation in both DC & FF refrigerators, which
ultimately shows our commitment towards energy saving and new
innovation;
- Introduction of the products on health platform with Deodorizer,
which gives the solution to remove the odour created by rotten
vegetables and fruits; and
- Introduction of high glass pre-coated material with new designs and
attractive colours across refrigerator range for luxurious look.
Washing Machines:
The following new models and technologies were introduced:
- Introduced five star rated models in top loading and four star
rated models in front loading washing machines;
- Front loading machines with memory back up and "do it yourself'
mechanism;
- Attractive design with 3 auxiliary programs i.e. pre-wash, eco wash
and intensive wash technology;
- 15 degree tilted drum in Front loading machines for easy loading of
clothes;
- Introduced dual element heater in dryer with drying efficiency
greater than 97%;
- Introduced toughened glass tops, in semi automatic washing machine
with floral printing and matching body graphics;
- Launched new variants with cosmetic changes including new vibrant
colours, body graphics, chrome knobs, etc.; and
- Added air dry function in semi automatic washing machine to
increase the drying efficiency.
Air Conditioners:
Your Company has developed and improved its product range by
introducing the following new technologies:
- Introduction of Videocon Copper Plus series which are equipped with
100% copper condenser which has inner grooved copper pipes;
- New models of Air Conditioners which are equipped with auto
cleaning technology for the consumers' ease;
- Introduced PFC coil in AC Outdoor Unit. PFC technology is far
better than conventional Cu-Al fin tube heat exchanger in terms of
performance. Because of its high efficiency, PFC is 30% smaller in
size (when compared to conventional condenser) and hence can be easily
accommodated in smaller chassis. Overall size and weight of outdoor
unit is reduced substantially. Being an all aluminum condenser, it
gives better resistance to galvanic corrosion and is cost competitive
and is able to meet revised energy star rating norms;
- Introduced new range and new indoor unit looks and upgraded all
models by one step up to match new BEE (Bureau of Energy Efficiency)
star rating norms to compete in revised market scenario;
- Introduced another variant of highly technological DC inverter AC,
which has efficiency better than even revised 5 star rating norms. It
moderates the compressor performance as per need and adjusts compressor
rotation to operate with minimum power input and saves more than 40%
power when compared to the conventional AC;
- Developed the AC with Vitamin C filter. This filter dispenses
Vitamin C charged ions with the cool air, thereby boosts immunity,
keeps skin glowing with its anti oxidant property hence keeps the user
fresh and vibrant; and
- Added the Gold, Blue and Green Fin Evaporator for enhanced
reliability and durability of AC. The Indoor unit cooling coil is
coated with Gold anti corrosive agent which keeps the cooling coil in
excellent and efficient working condition for a long time.
Microwave Ovens:
Your Company has made innovations in number of products to suit the
market demand. Products contain innovative technologies like:
- Auto Deodorizer which helps in removing odour vapours, leftover oil
and food particles immediately by just pressing a button providing ease
and convenience of cleaning and maintaining the machine;
- Anti Bacterial Coating which helps to reduce bacterial growth
inside the microwave up to 99.99%;
- Lemon Clean Function which helps to remove leftover oil, odour and
food particles from microwave cavity;
- Express cooking which helps to heat-up the food quickly; to prepare
it faster and ultimately saves time;
- Multi-Stage Cooking which allows cooking food at different heat
levels ensuring preparation of delicious dishes;
- Clock Setting Timer which allows setting the desired cooking times
as per the requirement;
- Enhanced Auto Cook Recipe to customize 251 functions with
categorization like sweets, beverages, snacks, meal, child favourite
etc. Special focus is being given to Indian dishes covering major parts
of India;
- Introduced Tandoori heater, which intelligently adjusts the cycle
time of grill operation to give a flavour of grilling like in Indian
tandoor;
- Developed special coating to prevent bacterial growth and is
applied to cavity to retard the growth of bacteria and make food
healthy to eat. Even if some food particle is left over in Microwave
Oven, no microbial growth sustain due to anti bacterial cavity;
- Modified the software program & introduced one touch Indian Preset
Menu which cooks the food more efficiently and retains the nutritive
value;
- Developed the timers and preset timer to help the customer to cook
as per their convenience even if they are away; and
- Models revamped with new floral design on glass and control panel
aesthetics.
Future plan of action:
Your Company is committed to provide variety of products at an
affordable prices. Your Company is looking forward to take an
advantage of technological changes and compete efficiently with
multinational players.
The future plan of action includes:
- Introduction of new models in LED and LCD TV. "Elena" model in
LED TV is coming up with 2D to 3D conversion, Flicker Free 3D, Full HD
services. "Smart TV" model in LCD TV is coming up with full fledge
high speed internet, Skype, Twitter, You Tube, Picasa etc.;
- Implementation of new technology;
- Making variations in designs and making the product attractive; and
- Manufacturing of environmental friendly products keeping in mind
the green initiative steps taken by the Company.
During the year under review, the Company has incurred Rs 86.67 Million,
representing 0.07% of the turnover towards recurring R & D expenses.
INFORMATION TECHNOLOGY
Information Technology and Business are becoming inextricably
interwoven. Nobody can meaningfully talk about one without talking
about the other. Indeed, the growing influence of Information
Technology as an enabler of business in today's time has made use of
Information Technology indispensible. Information Technology, having
made inroads into major industries, has left no aspect of our business
and life untouched. Your Company firmly believes that an organization
needs to have a "Digital Nervous System" for sustaining the
cut-throat competition and for acheiving the "Numero Uno" status in
any sector of economy.
In due recognition of the key role played by Information Technology in
revolutionizing the world, your Company has re-engineered its processes
by leveraging Information Technology for building, sustaining and
expanding its competitive edge.
Your Company has designed and implemented web based Customer
Relationship Management (CRM) application. The robust and stable CRM
application with comprehensive support enables handling of larger call
volumes resulting into speedy response and prompt resolving of customer
queries. This is tightly integrated with all other systems like
Enterprise Resource Planning (ERP), Business Intelligence (BI) and so
on to have one consolidated system.
Your Company has established facilities for customers such as call
centres, connect through SMS, websites etc., to provide speedy customer
services.
SAP Solution has enabled your Company to leverage the benefits of
integration in business operations, optimization of enterprise
resources, standardized business processes, thereby enabling standard
operating practices with well-established controls. This has enabled
the Company to adopt best and standardized business processes across
the functions. It has also benefited the management at all levels with
business information which is available online and reliable to control
the business operations in a well informed manner.
Recently, Company has upgraded SAP from ECC 5.0 to ECC 6.0 to get
benefits of technology and processes which are new in ECC 6.0. This
upgradation of SAP will give immense benefits to the Company leading
into more stringent business processes and practices.
Your Company has scale-up data center infrastructure to cater the
business requirements. During the year under review, SAP BI Tool was
upgraded from 3.5 to 7 for providing intelligent and advance reporting
functionality. There is secured and point to point Vitual Private
Network (VPN) connectivity in most of the branches and warehouses of
the Company.
Your Company has bagged SAP ACE Award, twice in a row for "Best
Consumer Sector Implementation" and "Excellence in Implementation
of various SAP Modules".
Your Company has also implemented couple of sales automation system
which are mobile based application which helps sales force to enter
dealer, distributor, sub dealer grievances / requirements from the
dealer shop and also enables real time tracking of information.
Your Company has also implemented couple of strong system like VQINS
which helps in production defect analysis and helps to increase quality
of product.
Your Company has always focused all its Information Technology system
to help its employees to maximize their productivity for enhancing
quality and higher customer satisfaction.
HEALTH AND SAFETY
The safety and security of the workers are important things for
building healthy work environment. Your Company has taken effective
measures in the field of healthcare and safety. Your Company has
conducted following activities for building healthy work culture:
- Regular medical checkups;
- Medical aid facility for the workers and their family members and
placement of First-Aid boxes at several places;
- Ensuring safety of the workers by displaying signs, cautionary
boards, emergency phone calling system;
- Vaccination facility for contagious diseases;
- Conducting training programs for all employees on the job and off
the job;
- Conducting lectures and seminars to create awareness for hygiene
and cleanliness;
- Implementation of night manager concept;
- Conducting regular safety audit & mock drill;
- Doing "HIRA" (Hazard Identification Risk Assessments) of the
critical activity to eliminate the risk;
- Availability of occupational health centre and ambulance with all
medical devices, in case of emergency;
- Fire tender modified from water monitor to multipurpose use (water
and foam), to handle the situation in case of emergency;
- Training given to fire marshals and display their contact number at
various locations; and
- MSDS (Material Safety Data Sheet) displayed at chemical storage
places.
Your Company believes that healthy and happy working environment is the
fundamental right of every employee and to provide the same is a duty
of the Company. Your Company is committed towards providing a healthy
working environment in every possible way.
ENVIRONMENTAL PROTECTION
With the increase in awareness of global warming, consumers are
becoming more and more conscious about the energy efficiency of the
products they use. Consumers in India are taking lead in prompting the
manufacturers to adopt technologies to manufacture eco-friendly
products. There is an increase in consumer preference towards
environment friendly products.
Your Company believes that clean surrounding and healthy environment
adds to the efficiency of workers. Your Company believes that it is the
responsibility of the Company to maintain the ecological balance for
sustainable development. Your Company aims towards maintaining the
harmony and rhythm of the eco-system.
The eco friendly initiatives adopted by your Company include:
- Optimum use of natural resources;
- Implementing the 3R system - Reduce, Reuse & Recycle;
- Tree plantation campaigns;
- Upgradation of effluent treatment and sewage treatment plants from
manual to automation;
- Regular internal environmental check;
- Reduction in process waste;
- Storage and disposal of hazardous waste as per statutory
requirements;
- Celebration of world environment day, to increase the awareness
among the employees;
- Follows National Ambient Air Quality Standards - 2010 (NAAQS - 2010
standards) for checking of stack emission and ambient air monitoring;
- Certification of ISO-14001, for environment management system; and
- Conduct sustainability audit from SGS.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) is not a new concept in India.
The only new is that the focus has been shifted from making profits to
meeting societal challenges.
Corporate Social Responsibility is the continuing commitment by
business to behave ethically and contribute to economic development
while improving the quality of life of the workforce and their families
as well as of the local community and society at large.
Your Company is dedicated to serve the society at large. Commitment
towards health, safety and environment protection are the core values
of the Company. The Company is continuously making efforts to preserve
the environment by undertaking various measures such as plantation of
trees, encouraging paperless transactions, optimum use of natural
resources etc..
Your Company shall continue to undertake more activities and
initiatives to improve the quality of life and society at large.
APPOINTMENT/ RE-APPOINTMENT OF DIRECTORS
During the year, Mr. Sushil Muhnot, Nominee of IDBI Bank Limited, on
the Board of Directors of the Company, resigned from the Board of the
Company consequent to his appointment as Chairman & Managing Director
of Small Industries Development Bank of India (SIDBI) by Government of
India.
Mr. Arun L. Bongirwar resigned from the Board of Directors of the
Company w.e.f. 1st November, 2011. Also, during the year, ICICI Bank
Limited substituted its nominee on the Board of Directors of the
Company. Mr. Girish Nayak was nominated in place of Mr. Ajay Saraf.
Accordingly, Mr. Ajay Saraf ceased to be a Director and Mr. Girish
Nayak was co-opted as a Nominee - ICICI Bank Limited on the Board of
Directors of the Company w.e.f. 26th May, 2011.
Ms. Gunilla Nordstrom did not offer herself for re-appointment at the
Annual General Meeting held on 29th June, 2011, therefore, ceased to be
the Director on the Board of Directors of the Company.
The Board places its sincere appreciation for the valuable guidance
received from Mr. Sushil Muhnot, Mr. Ajay Saraf, Mr. Arun L. Bongirwar
and Ms. Gunilla Nordstrom, during their tenure as the Directors of the
Company.
Also, Mr. Anil G. Joshi was appointed as a Director on the Board of
Directors of the Company w.e.f. 29th June, 2011.
Changes after the Balance Sheet date:
Mr. K. C. Srivastava, Director of the Company resigned from the Board
of the Company w.e.f. 1st February, 2012. Mr. Girish Nayak - Nominee of
ICICI Bank Limited ceased to be the Director of the Company w.e.f. 14th
February, 2012, consequent to withdrawal of nomination by ICICI Bank
Limited.
The Board expresses its sincere gratitude towards the valued
contribution received from Mr. K. C. Srivastava and Mr. Girish Nayak,
during their tenure as the Directors.
IDBI Bank Limited nominated Mr. S. Ananthakrishnan as its nominee on
the Board of Directors of the Company. He is an Executive Director at
IDBI Bank Limited. He was co-opted as a Nominee of IDBI Bank Limited on
the Board of Directors of the Company w.e.f. 29th February, 2012.
Pursuant to the provisions of Section 255, 256 of the Companies Act,
1956 and in terms of the Articles of Association of the Company, Mr.
Pradipkumar N. Dhoot and Maj. Gen. S.C.N. Jatar are liable to retire by
rotation at the ensuing Annual General Meeting and being eligible, have
offered themselves for re-appointment.
The Board recommends their re-appointment. Brief profiles of Mr.
Pradipkumar N. Dhoot and Maj. Gen. S.C.N. Jatar, specifying their
expertise in specific functional areas, other public companies in which
they hold directorships and committee positions, is annexed to the
Notice and form part thereof.
LISTING
The equity shares of your Company are listed on BSE Limited (Formerly:
the Bombay Stock Exchange Limited) and The National Stock Exchange of
India Limited (NSE). The Global Depository Receipts (GDRs) and Foreign
Currency Convertible Bonds (FCCBs) issued by your Company are listed on
the Bourse de Luxembourg and Singapore Exchange Securities Trading
Limited respectively.
SUBSIDIARY COMPANIES
As on 31st December, 2011, your Company had 30 subsidiaries (including
step down subsidiaries) viz., Pipavav Energy Private Limited, Videocon
International Electronics Limited, Chhattisgarh Power Ventures Private
Limited, Videocon Energy Limited, Prosperous Energy Private Limited,
Videocon Oil Ventures Limited, Liberty Videocon General Insurance
Company Limited, Videocon Telecommunications Limited, Datacom
Telecommunications Private Limited, Jumbo Techno Services Private
Limited, Senior Consulting Private Limited,
Proficient Energy Private Limited, Applied Energy Private Limited,
Comet Power Private Limited, Unity Power Private Limited, Middle East
Appliances LLC, Videocon Global Limited, Videocon Electronics
(Shenzhen) Limited, Eagle ECorp Limited, Videocon Energy Ventures
Limited, Videocon Hydrocarbon Holdings Limited, Videocon Oman 56
Limited, Videocon JPDA 06-103 Limited, Videocon Mozambique Rovuma 1
Limited, Videocon Energy Brazil Limited, Videocon Indonesia Nunukan
Inc., Videocon Australia WA-388-P Limited, Oil Services International
S.A.S, Videocon Estelle Limited and Videocon Ivory Limited.
Ministry of Corporate Affairs, Government of India, vide its General
Circular No(s). 2/2011 and 3/2011 dated 8th February, 2011 and 21st
February, 2011, respectively, has granted general exemption from
attaching the Annual Accounts and other documents of the subsidiary
companies to the Balance Sheet of the holding company, subject to the
fulfilment of certain conditions stipulated therein. The Board of
Directors have accorded their consent for not attaching the Balance
Sheet of the subsidiary companies. The consolidated financial
statements of the Company and all subsidiaries duly audited by its
statutory auditors are presented in the Annual Report. The consolidated
financial statements have been prepared in strict compliance with
applicable Accounting Standards and, where applicable, Listing
Agreement as prescribed by the Securities and Exchange Board of India.
Further, the following information in aggregate for each subsidiary
including subsidiaries of the subsidiaries has been annexed to the
consolidated balance sheet:
(a) capital (b) reserves (c) total assets (d) total liabilities (e)
investment (except in case of investment in the subsidiaries) (f)
turnover (g) profit before taxation (h) provision for taxation (i)
profit after taxation and (j) proposed dividend.
The Company undertakes that the Annual Accounts of the subsidiary
companies and the related detailed information of the subsidiary
companies shall be made available to the shareholders of the holding
and subsidiary companies seeking such information at any point of time.
The Annual Accounts of the subsidiary companies shall also be kept open
for inspection by any shareholder at the Registered Office of the
Company and that of the respective subsidiary companies. The Company
shall furnish a hard copy of details of accounts of subsidiaries to any
shareholder on demand.
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements, based on the Financial
Statements received from the subsidiaries, associates and joint
ventures, as approved by their respective Board of Directors, have been
prepared in accordance with the requirements of Accounting Standard 21
on "Consolidated Financial Statements", Accounting Standard 27 on
"Financial Reporting of Interests in Joint Ventures" and Accounting
Standard 23 on "Accounting for Investments in Associates in
Consolidated Financial Statements".
CASH FLOW STATEMENT
The Cash Flow Statement for the financial year ended 31st December,
2011, in conformity with the provisions of Clause 32 of the Listing
Agreement with the Stock Exchanges in India, is annexed hereto.
AUDITORS
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai and M/s.
Kadam & Co., Chartered Accountants, Ahmednagar, Statutory Auditors of
the Company, retire at the conclusion of the ensuing Annual General
Meeting and have confirmed their eligibility and willingness to accept
the office, if re-appointed. The Company has received certificates from
the said Auditors to the effect that their re- appointment, if made,
would be within the limits prescribed under Section 224(1B) of the
Companies Act, 1956.
The Board recommends their re-appointment.
AUDITORS' REPORT
The Statutory Auditors of the Company have submitted Auditors'
Report, which have certain Qualifications/ Observations on Standalone
and Consolidated Financial Statements for the year ended on 31st
December, 2011.
Management's Explanation to the Auditors' Qualifications/
Observations:
a) In respect of Point No. 4(f) of the Auditors' Report on Standalone
Financial Statement and Point No. 5(a) of Auditors' Report on
Consolidated Financial Statement for the year ended 31st December,
2011, regarding the extent of realisability of the investments made in
and the share application money and advances given to Videocon
Telecommunications Limited (VTL), the subsidiary, and the financial
statements of VTL being prepared on going concern basis, the
explanation of management is as under:
The Company has, directly and through its subsidiaries, made
investments of Rs 15,000.00 Million, given share application money of Rs
5,000.00 Million and advanced loans of Rs 19,620.84 Million to Videocon
Telecommunications Limited (VTL), the subsidiary. VTL was granted
Unified Access Services (UAS) Licenses in 21 circles on 10th January,
2008 and had also been allotted spectrum in 20 circles out of which it
has launched its services in 16 circles.
The Hon'ble Supreme Court of India, vide its judgment dated 2nd
February, 2012 in two separate writ petitions filed by Centre for
Public Interest Litigation and by another, has quashed all the UAS
licenses granted on or after 10th January, 2008 and the subsequent
allocation of spectrum to these licencees. This includes the 21
licenses issued to VTL and the spectrum allotted to it in 20 circles.
The Hon'ble Supreme Court of India had directed that its aforesaid
order shall be operative after four months from 2nd February, 2012. On
24th April, 2012, the Hon'ble Supreme Court of India modified its
order and postponed the operation of its order of quashing the Telecom
Licenses and related allocation of spectrum to 7th September, 2012. The
Hon'ble Supreme Court of India has, vide order dated 2nd February,
2012, also directed TRAI to make fresh recommendations for grant of
licenses and allocation of spectrum and the Central Government to grant
fresh licenses and allocation of spectrum by auction thereafter. The
Central Government has announced that it will complete the auction of
licenses and related spectrum on or before 31st August, 2012.
Pending the fresh auction as mentioned above, VTL is continuing its
business. It proposes to participate in such fresh auction and is
hopeful of continuing the business thereafter. Accordingly, in the
opinion of the management, no provision is required for diminution in
the value of aforesaid investments, share application money and
advances.
b) In respect of Point No. 5(b) of Auditors' Report on Consolidated
Financial Statement for the year ended 31st December, 2011, regarding
the ability of VTL to continue as going concern due to erosion of its
networth, the explanation of management is as under:
The management is confident of mobilizing the necessary resources for
continuing the operations of VTL as per the business plan, as may
evolve. Accordingly, the financial statements of VTL have been
prepared on a going concern basis.
COST AUDITOR
Mr. Sudhir Chintaman Sant, Cost Accountant in Whole-Time Practice,
Pune, has been appointed as the Cost Auditor for conducting cost audit
of Refrigerators, Petroleum products i.e. Oil & Gas and Glass Shells
for the financial year 2012.
AUDIT COMMITTEE
Pursuant to the provisions of Section 292A of the Companies Act, 1956
and provisions of the Listing Agreement, the Company has constituted an
Audit Committee. The composition, scope and powers of the Audit
Committee together with details of meetings held during the year under
review, forms part of Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
'Management Discussion and Analysis Report', highlighting the
performance and prospects of the Company's business, forms part of
the Annual Report.
CORPORATE GOVERNANCE
As required under Clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance Report forms part of this Report. Your
Company is in full compliance with the requirements and disclosures
that have to be made in this regard. A certificate from the Statutory
Auditors of the Company confirming compliance of the Corporate
Governance is appended to the Report on Corporate Governance.
DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act, 1956, with respect
to Directors' Responsibility Statement, it is hereby confirmed that:
a) in the preparation of the Annual Accounts for the financial year
ended 31st December, 2011, the applicable accounting standards read
with requirements set out under Schedule VI to the Companies Act, 1956,
have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at 31st December, 2011 and of the profit of the
Company for the year ended on that date;
c) the Directors have 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
d) the Directors have prepared the annual accounts of the Company on a
'going concern' basis.
ACKNOWLEDGEMENT
The Board of Directors would like to thank the Customers, Vendors,
Investors, Financial Institutions, Bankers, Business Partners and
Government Authorities for their continued support. The Board of
Directors also appreciate the contribution made by the employees at all
levels for their hard work, dedication, co-operation and support for
the growth of the Company.
The Board of Directors would also like to thank all stakeholders for
the continued confidence and trust placed by them with the Company.
For and on Behalf of the Board of Directors of
VIDEOCON INDUSTRIES LIMITED
VENUGOPAL N. DHOOT
Chairman & Managing Director
Place : Mumbai
Date : 26th May, 2012
Dec 31, 2010
The Directors take pleasure in presenting the Twenty Second Annual
Report together with the Audited Accounts and Auditorsà Report of your
Company for the period ended 31st December, 2010.
PERFORMANCE REVIEW
A snapshot of the performance of the Company, on standalone basis, for
the period ended on 31st December, 2010, is summarized below:
(Rs. Million)
Particulars Period Ended Year Ended
31st December, 2010 30th September,2009
Net Sales 144,096.91 91,630.41
Other Income 429.86 340.15
Total Income 144,526.77 91,970.56
Profit before
Interest, 26,565.60 17,918.57
Depreciation
and Taxation
Interest and
Finance Charges 8,931.56 6,363.61
Depreciation,
Amortisation 7,129.62 5,771.52
and Impairment
Profit Before
Tax 10,504.42 5,783.44
Provision for
Taxation 3,057.48 1,776.82
Profit after
Tax 7,446.94 4,006.62
The Financial Year of the Company was extended by a period of three
months. The Financial Year under review accordingly comprises of a
period of 15 months commencing from 1st October, 2009 and ended on 31st
December, 2010. Subsequent Financial Years shall be from 1st January to
31st December.
OPERATIONS
CONSUMER ELECTRONICS & HOME APPLIANCES [CE&HA]:
The global economic recovery and improved markets were the welcome
signs in the second half of the period under review. Your Company
continued its growth in CE&HA Business backed by ongoing in-house
technological advancement; aggressive marketing, distribution and
advertising strategies with focused penetration in the key markets.
OIL & GAS:
Your Company intensifed its exploratory efforts both in domestic and
overseas basins to identify new oil and gas assets. These efforts paid
good dividends in terms of new discoveries and reserve accretion.
MOZAMBIQUE
February 2010: Anadarko Mozambique announced a discovery in the
exploration well, Windjammer. The drilling was
completed in the first quarter of 2010 and reached
an intermediate casing point encountering more than
480 net feet of natural gas pay in high-quality
reservoir sands with a gross column of more than
1,200 feet.
March 2010: Anadarko Mozambique announced that it had
encountered an additional 75 net feet of natural
gas pay. The additional pay intersected in the
deeper objective brings the total net feet of
natural gas pay in Windjammar to more than 555
feet.
October 2010: Anadarko Mozambique announced a further discovery
in the Barquentine exploration well, encountering
a total of more than 416 net feet of natural gas in
multiple high-quality sands.
November 2010: Anadarko Mozambique announced a discovery
of natural gas of more than 550 net pay
feet in multiple high quality sands in Lagosta
exploration well, approximately 16 miles to
the south of the Barquentine discovery. After this
discovery, Anadarko Mozambique estimates that there
is adequate gas which has been discovered in the
Rovuma Block to support a viable LNG facility.
BRAZIL
November 2009: Anadarko, the Operator of block BM-C-30 offshore
Brazil in the Campos Basin has announced the Wahoo
#2(also called Wahoo North) exploration well in
the Campos Basin, offshore Brazil, has encountered
more than 90 feet of high quality net oil pay in
the same pre-salt interval, as the original Wahoo
discovery. The Wahoo #2 is located in block BM-C-
30 five miles to the north and down-dip from the
original Wahoo Discovery well, which encountered
more than 195 feet of net pay.
April 2010: Anadarko, the Operator of block BM-C-30 offshore
Brazil in the Campos Basin, has announced the
results of the Wahoo-1 drillstem test in the Wahoo
field, located in block BM-C-30, in the deepwater
Campos Basin offshore Brazil. The Wahoo-1 well
flowed at a test rate of approximately 7500 barrels
per day of 31-degree API gravity crude oil and
approximately 4 million cubic feet per day of
associated natural gas.
October 2010: PETROBRAS, the Operator of the BM-SEAL-11
Concession Block in the Sergipe-Alagos Basin of the
Brazilian Offshore,announced that the drilling of
first ultra deep water (2321m) well,designated
as 1-SES- 158,on "Barra" structure, located
58 km off theCoast of Brazil and 90 km from city
Aracaju, in Atlantic Ocean,discovered hydrocarbon
in Cretaceous turbidite fan system.
INDONESIA
November 2010: Anadarko, the Operator, announced the Badik
Discovery located in the Tarakan Basin of
Indonesia. The well encountered approximately 133
net feet of oil and gas pay.
These world-class finds have positioned your Company as one of the most
successful private Indian explorer globally.
TELECOM
Videocon Telecommunications Limited ("VTL"), a subisidiary of the
Company, has been awarded licences to provide Unified Access Services
in 21 circles in India with effect from January 25, 2008 which is valid
for 20 years. VTL has been allotted spectrum in 20 circles and has
launched its services in 16 circles as on the Balance Sheet Date.
POWER
Pipavav Energy Private Limited ("PEPL") and Chhattisgarh Power Ventures
Private Limited ("CPVPL"), subsidiaries of the Company are assigned to
implement Power Projects in the State of Gujarat and Chhattisgarh
respectively. Status brief of these projects:
Pipavav Energy The Power Project in Gujarat is a thermal power
project
Private Limited: with a capacity of 1,200 MW comprising of two
units of 600 MW each based on sub-critical
technology. PEPL has signed the necessary
Memorandum of Understanding with the Government
of Gujarat and has also obtained necessary
approvals to commence construction including the
environmental clearances from Gujarat Pollution
Control Board and the Ministry of Environment and
Forests. Notice to Proceed has already been issued
to BHEL, the BTG Contractor.
Chhattisgarh The Chhattisgarh Power Project is also a thermal
Power Ventures power project with a capacity of
1,200 MW and is
Private Limited: located in District Champa- Janjgir in
Chhattisgarh. It will consist of two units of
600 MW each . The Company has signed an
Implementation Agreement with the Government of
Chhattisgarh with respect to the said project. The
Government of Chhattisgarh has agreed to
facilitate the process of obtaining statutory
clearances as well as help in acquisition
of land for setting up the Chhattisgarh Power
Project and provide the incentives available
under the industrial policy of Chhattisgarh for
similar projects. The Company has already
obtained coal linkage from the Ministry of Coal
for 600 MW whereas an application seeking coal
linkage for the balance quantity has already been
fled.
Further, your Company has also undertaken few solar power projects in
the other parts of the country through step-down subsidiaries.
ISSUES / ALLOTMENT
9th December, 2009: The Company issued and allotted 1,858,275 Equity
Shares, on preferential basis, at a price
of Rs. 242.16 per Equity Share inclusive of a
premium of Rs. 232.16 per Equity Share to Infotel
Telecom Infrastructure Private Limited.
22nd April, 2010: The Company allotted 51,392,243 partly paid Equity
Shares of Rs. 10/- each at Rs. 225/- consisting of
premium of Rs. 215/- per Equity Share,aggregating
to Rs. 1,156.33 Crores, on rights basis, to the
successful applicants. As per the terms of the
rights issue, an amount of Rs. 112.50 per
Equity Share was payable on application; and the
balance on the first and the final call. The first
and the final call was made; and was payable by
15th June, 2010.Subsequently, the Company sent
the reminders to the shareholders who failed to
make payment by the due date. As on 31st December,
2010, the Company received the first and the final
call money in respect of 51,361,328 Equity Shares
which were confirmed as fully paid whereas 30,915
partly paid Equity Shares remained outstanding as
on the same date.
7th July, 2010: The Company issued and allotted 7,541,300
Equity Shares, on preferential basis, at a price
of Rs. 211.96 per Equity Share inclusive of a
premium of Rs. 201.96 per Equity Share to IDBIBank
Limited, ING Vysya Bank Limited, Oriental Bank of
Commerce Limited, State Bank of Patiala and
Life Insurance Corporation of India.
7th December,2010: The Company allotted 11,765,000 equity shares, at
a price of Rs. 170/- per Equity Share, to Bennett,
Coleman & Company Ltd.("BCCL") pursuant to option
exercised by BCCL to subscribe to 1 (One) Equity
Share of the Company per warrant. These warrants
were allotted on preferential basis on 1st June,
2009.
15th December,2010: The Company issued Foreign Currency Convertible
Bonds (the "FCCBs") amounting to USD 200 Million.
These FCCBs are convertible, by the exercise of
option by Bondholders, into fully paid equity
shares of the Company at any time between 25th
January, 2011 to 7 days before maturity date i.e.
16th December, 2015. The initial conversion price is
Rs. 239.5265 per Equity Share.
DIVIDEND
Your Company follows a policy to pay sustainable dividend considering
its projected growth plans; internal accruals, the potential
requirements of funds for capex and working capital and the existing
financial arrangements.
Your directors are pleased to recommend a Dividend of Re. 1/- (Rupee
One only) per equity share for the period ended on 31st December, 2010.
The dividend, if approved by the shareholders in the Annual General
Meeting shall entail a payout of ? 352.13 million including dividend
distribution tax of ? 50.16 million. The dividend is free of tax in the
hands of the shareholders.
TRANSFER TO GENERAL RESERVE
Your directors propose to transfer Rs. 1,000.00 million to the General
Reserve. An amount of Rs. 28,680.29 million is proposed to be retained
in the Profit and Loss Account accordingly.
TRANSFER TO INVESTOR EDUCATION AND PROVIDENT FUND
The Company has transferred a sum of Rs. 3.58 Million in respect of
unpaid/ unclaimed dividend for the Financial Year 2002-03 to Investor
Education Protection Fund.
PERSONNEL
A Statement of the Particulars of Employees as required under Section
217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975 as amended is annexed and forms
part of this Report.
Effective development of Human Resources is key to several learning
processes and initiatives have been designed and delivered in this area
keeping in view the need to cultivate a workforce that offers true
competitive advantage.
CONSERVATION OF ENERGY
Your Company believes in sustainable consumption of natural resources.
Conservation of Energy is a focus area. Some of the energy conservation
initiatives adopted by the Company are as under:
1. Process improvement to eliminate/minimize the aging process of CTV
Line leading to reduction in power consumption during aging.
2. Energy checks performed at all manufacturing units ensuring
efficient energy management.
3. Replacement of electrical tools by pneumatic tools and conversion
of continuous power to intermittent power consumption.
4. Automation to stop freewheeling of machines during no production /
less production hours. Servo controlled mechanisms and parts are being
used and replaced in older machines to get better energy efficiencies.
5. Improvement of per hour production to reduce power burning hours
for the same production quantity.
6. Improve process to reduce freewheeling of machines due to waiting
time at work stations.
7. Awareness programs of energy savings; and utilization of natural
resources.
8. Implementation of advance technology; and continuous innovations at
manufacturing processes /plants in the form of energy efficient
equipments.
9. Improved awareness amongst employees by effective communications
and trainings.
10. Increased usage of energy saving lighting arrangement in shop
floor and on roads inside the facilities by using Electronics Ballets
and CFL lamps.
11. Plantation of trees at all the manufacturing plants.
Further, the Company has formed "Quality Circles" and "Team of Experts"
comprising of selected employees engaged in manufacturing activities to
perform time and motion study of the overall manufacturing process and
recommend ways and means for conservation of energy and power.
The noted initiatives leading to optimal consumption of resources have
resulted in an overall improvement in efficiency.
RESEARCH & DEVELOPMENT [R & D]
The Company aims to inspire consumers around the world with innovation
and fun through its unique combination of technology and entertainment
based on its consumer electronics and home appliances businesses.
The Company continues to give utmost importance to R & D. Our focus on
developing existing technologies and product engineering innovation,
aimed at improving production efficiency leading to lowering cost of
production. The Company has R & D centres located at Aurangabad,
Gurgaon; and in China with skilled engineers/experts working
continuously on new products development. With the R & D centres
working non-stop, your Company launched several products in CTVs, FPDs,
refrigerators and fully automatic washing machines.
R & D activities include:
- Market Trend analysis;
- Study/Analyse CustomerÃs demands and changing needs; and
- Design/Develop products suitable for Indian climatic conditions as
well as same for Export market.
Benefits derived from the R & D Activities:
- Development of high end products;
- Introduction of Integrated Digital TV ( iDTV) with a built in DTH
facility with MPEG 4 DVB-S2 Digital signal;
- Introduction of LED TV with "Nano Pixels" for immense picture
performance and razor slim design; and
- Introduction of unique "SMART TV" with a platform for "Internet TV"
to enjoy Live Chatting, Browsing , Video Conferencing , Email Access ,
Blue Tooth Connectivity and many more applications to make LCD TV a
real "SMART TV".
To align the Global needs and CompanyÃs Vision of being committed to
"Eco Logic": Technology for Sustainable Life, R&D has developed:
- Star Rated Products in Consumer Electronics and Home Appliances: This
technology offers energy savings of 15 % of power consumption
approximately to the benefit of consumers; and leading to effective
utilization of power resources.
- Introduction of further paint less product with a unique Hot and Cold
Technology for moulding of part: This helps to reduce pollution
generated due to hazardous chemicals used in plastic paints and its
process. Customer can enjoy the high glossy finish with ultimate
scratch resistance.
- State of art technology LED illumination in Refrigerators: This gives
better illumination with lowest energy consumption.
- New concept for PCM (Pre-Coated Material) finish with floral design
for Refrigerators.
- Introduction of State of Art technology à Ioniser in Refrigerators:
It is a first time introduction in Indian market to kill the bacteria
and offer hygienic fruits and vegetables.
- "Centre Water Fall Technology" for Dolphin washing machine: This
technology saves water when directed to spin side.
- "UV cleaning" technique eliminates any bacteria contents in clothes.
R & D activities carried out in various consumer electronic products
and benefits derived from these activities:
Televisions:
- Introduced new "Titanium LED" Series with NANOPIX Engine with 120Hz
refresh rate and FULL HD 1080P resolution.
- Introduced "3D LED TV" which enhances the viewing experience.
- Introduced "Titanium", "Hurricane" and "Tornado" Series of LCD TV
with FULL HD 1080p resolution: It has a unique feature of DCRe (Digital
Cinema Reality Engine). With this unique picture quality improvement
algorithm, it reproduces 1 Billion display colour for more natural,
vivid and true to life colours. "Titanium" series of LCD TV has a DVBS
(Digital Video Boosting Station) with 1,00,000: 1 Super Contrast Ratio
to give crisper image and dramatic picture quality. It has an advance
function of "Energy Meter" for efficient energy utilization while
viewing. Its 10 Bit advanced Scalar Video Data processing gives the
flicker free images & optimal video fidelity to provide most natural
and Cinema Quality Video Images. With boot capture logo function user
can view his family photo every time when TV is switched on. With the
multimedia port user can watch photos/movies/ songs stored in USB
device. With Multi Function Monitor concept in LCD TV and USB / Multi
Media connectivity the viewer can enjoy maximum connectivity to the
Digital World. Its Natural Easy View Panel provides ultra wide viewing
angle with enhanced picture quality and antireflective coating to make
black more darker with low refection for very clear images. PIP
(Picture in Picture) feature enables the user to watch TV programme and
movie simultaneously.
- Introduction of Blue Tooth Function in TV enables a user to transfer
photos/songs stored on his mobile to TV sets wirelessly.
- Introduced unique RF remote control technology in its product where
customer can operate TV from any angle (360 degree). Conventional
remote operates only when it is keep in line with TV sets (+/- 30
Degree).
- Introduced touch control function in CRT TV segment.
- Introduced "Hot and Cold" moulding technology in TV.
- Introduced SRS technology in LED Series to improve the acoustic
performance of sets.
- Introduced "MAGNNUM" LCD Series with unique metallic finish and glass
front.
- Introduced "Titanium iye" LCD series with brush finish.
- Introduced new segment of 14" Ultra Slim TV in market.
- Introduced new range of products viz : Universal Media player, Solar
Mobile Charger, High End Home Theatre and new range of LCD TVÃs.
Refrigerators:
- Developed new range of Direct Cool as well as Frost Free
refrigerators like Ecocool, Ecocool Plus, Ecofresh, Deofresh,
Nutricool, Nutricool Plus, Powercool.
- Developed 4 & 5 Star Rated refrigerators with new exterior finish
i.e. PCM.
- Introduction of new base stand with smart VEGI TRAY which is unique
and give convenience to customer in day to day usage.
- Introduction of new looks of refrigerators, which strengthen our
market position in Direct Cool range.
- Introduction of new economic series of Direct Cool Refrigerator as
"Bharat Series", which has given cutting edge solution for the
competitors on the price factor.
- Introduction of the products on health platform with Deodorizer which
gives the solution to remove the odour created by rotten vegetables and
fruits.
- Enhanced Frost Free refrigerator series with introduction of LED &
LEDi technology.
- Introduction of 3 & 4 Star Rated Refrigerators, with high energy
efficient compressors.
To enhance the brand image, the Company re-engineered number of models
with new packing design such as:
- 50 Powder coated models with catchy & smooth colours; and
- Introduction of Black colour refrigerators.
Washing Machines:
- Developed higher capacity Washing Machines to be offered to Indian
market with Hand Wash and UV light technology.
- Digi-Aqua and Digi-Pacifc series of 5.5 kg Fully Automatic (FA)
Washing Machines with 8 Wash Programs, 8 Water levels, Child lock
feature resulting in less water consumption.
- Introduced Digi-Wave and Digi-Atlantic series of 6.0kg FA Machines
with 8 Wash Programs, 8 Water levels, Child lock feature and Special
Air Dry features.
- Introduced IndiaÃs first UV light technology Washing Machine, Digi-
Marine and Digi-Ocean. This has other features like Hand Wash, LCD
Display, Delay Time setting etc. for user convenience.
- Developed 6kg Semi Automatic (SA) Washing Machine "Aqua and Pacifc".
- Developed Dolphin, Atlantic, Marine series of 7.0kg SA Washing
Machines with Gear Drive for improved wash ability and efficiency.
- Introduced SA 7.0kg Spring with Decorative Transparent Panels, Roller
Coster Pulsator, centre water fall & Chrome Knobs. Delight to watch and
efficient in use.
- Centre Water Fall Technology for Dolphin which saves water when
directed to spin side.
- Features like Magic Filter for Dolphin and Atlantic series, which are
better lint collectors and user friendly.
- Introduction of designer Floral patterns with blazing top colours
which will give attractive look to Washing Machine in the 6kg & above
FA category.
- Focusing on Environmental friendly technologies: R&D is working on
series of FA & SA machines which are energy efficient, use lesser water
and detergents.
- Introduced Digi Dolphin Dlx with Direct Drive technology along with
enhanced features like "Do It Yourself" program. This has multi spin
speed, 8 Water levels and dynamic soak features.
- Developed 6.5Kg FA TILT Drum Careen Plus with Direct Drive Motor:
This has advanced features like Sterilization program, Aero Wash
technology and self cleaning of Tub.
Air Conditioners:
- Introduced highly technological AC DC inverter AC: This has
efficiency better than even current 5 star as stated and set by Bureau
of Energy Efficiency (BEE). It moderates the compressor performance as
per need and adjusts compressor rotation to operate with minimum power
input, hereby saving more than 40% power saving than the conventional
AC.
- Introduced Vitamin C filter: This Filter dispenses Vitamin C charged
ions with the cool air. Thereby boosts immunity, keeps skin glowing
with its antioxidant property hence keeps the user fresh and vibrant.
- Added the Gold Fin Evaporator for enhanced reliability and durability
of Air Conditioner. The indoor unit cooling coil is coated with Gold
anti corrosive agent which keeps the cooling coil in excellent and
efficient working condition for a long time.
- Developed multi utility Universal Remote: This remote can operate AC
(Videocon brand) and CE products like LCD/LED TV, Set top box, DVD
player etc (LG/SS/Philips/Videocon/Akai etc) thereby providing multiple
solutions with a single remote.
Microwave Ovens:
- Introduction of Auto Cook Recipe Function with categorization like
Sweets, Beverages, Snacks, Meals, etc. For the ease of cooking, pre-
programmed menu enables microwave to do all the functions with a single
touch.
- Developed Sensi Grill Function which senses the cooking cycle in
between of cycle to turn over and give a home cooking taste. This
function gives an alarm after completion of half cycle to turn your
food in Grill Model.
- Added Deodorizer feature which helps in removing post cooking odour
from microwave. This way the odour does not mix with next recipe and
makes it healthy and tasty.
- Introduced Lemon Clean feature to remove all odour after cooking.
With this all the oil and food particles can be cleaned easily.
- Developed an Anti Bacterial Cavity to retard the growth of bacteria
and make your food healthy to eat. Even if some food particle is left
over in Microwave Oven no microbial growth sustains due to anti
bacterial cavity.
- Developed a range of touch screen microwaves which cooks better
keeping food nutrients intact with multi stage & express cooking.
Future Plan of Action:
In near future, the Company shall continue to focus on all the areas
mentioned earlier and also aims to offer new technologies and processes
to provide better products at affordable prices to the customers.
The Company proposes the following R & D activities in near future:
- To bring in features of various products together;
- Continuous upgradation of technologies for better features, better
quality and improved reliability for reduced/low prices; and
- Reducing the electricity consumption for consumer electronics and
home appliances.
R & D Expenditure:
During the period, your Company has incurred an expenditure of Rs.
120.50 Million representing 0.08% of the turnover towards R & D, to
enhance the competitiveness of our core business and develop tomorrowÃs
technologies.
Recognitions:
- Integrated Digital TV (iDTV) product with a built in DTH facility
having MPEG 4 DVB-S2 Digital Signal has been awarded as "Product of the
Year 2011" by Nelson Survey. Your Company being the first company to
launch this patented product in Indian market.
- 6kg SA Washing Machine "Aqua and Pacific" is judged as the best
drying machine in its category by ConsumerÃs Voice.
- The Company has received 5-star BEE rating for its top loading model
Digi Dolphin Dlx Washing Machine.
- The Company has received 4-star BEE rating for Careen Plus washing
machine which comes with tilt drum.
FOREIGN EXCHANGE INFLOW & OUTGO
The particulars of Foreign Exchange Earnings and Outgo during the
period are set out as under:
(Rs. Million)
Particulars For the period ended For the year ended
31st December, 2010 30th September, 2009
Foreign Exchange
Earned 5,240.64 5,226.24
Foreign Exchange
Used 23,721.69 13,922.44
The Company has undertaken various initiatives for exports and
development of export markets for Consumer Electronics and Home
Appliances to increase its Foreign Exchange Earnings.
INFORMATION TECHNOLOGY
Information technology and Business are becoming inextricably
interwoven. The growing influence of information technology as an
enabler of business in todayÃs time has made use of information
technology indispensible. Information technology, having made inroads
into major industries, has left no aspect of our business and life
untouched. Your Company firmly believes that an organization needs to
have a "Digital Nervous System" for sustaining the cut-throat
competition for the "Numero Uno" position in any sector of economy.
In due recognition of the key role played by information technology in
revolutionizing the world, your company has re-engineered its processes
by leveraging information technology with an eye building, sustaining
and expanding its competitive edge.
Your Company has designed and implemented web based CRM application
using ASP.Net 3.5 and SQL server 2005. The robust and stable CRM
application with comprehensive support enables handling of larger call
volumes resulting into speedy response and prompt resolution of
customersà queries.
Company has established facilities for customers like call center,
connect through SMS, Web-sites so on to have best and speedy customer
interaction.
SAP Solutions have enabled your Company to leverage the benefits of
integration in business operations, optimization of enterprise
resources, standardized business processes and standard operating
practices with well-established controls. This has enabled the Company
to adopt best and standardized business processes across the functions.
It has also benefited the management at all levels with on-line
reliable business information to control the business operations in a
well-informed manner. Your Company has scale-up data center
infrastructure to cater to the business requirements. There is secured
as well as point to point VPN connectivity in most of its branches and
warehouses.
HEALTH AND SAFETY
The Company is committed towards health and safety of the employees at
all levels. Healthy atmosphere and safe working conditions increases
employeeÃs motivation and satisfaction thereby contributing
significantly to productivity. Key initiatives taken by your Company
in this area are summarized as under:
- Conducting regular safety checks;
- Regular on the job and off-line training programs for all employees;
- Conducting mock drill as per calendar in the campus and training
given to fire marshals;
- Fire tender modified from water monitor to multipurpose use (Water &
Foam), to handle the situation in case of emergency;
- Providing emergency exit door and display of evacuation plans at
various locations to reach the assembly point, in case of emergency;
- Organising different events in the campus to increase the awareness
among the employees;
- Display of signs, cautionary boards, emergency telephone numbers
etc., at various locations for information and awareness of the
employees;
- MSDS (Material Safety Data Sheet) display at chemical storage places;
- Implementation of night manager concept;
- Conducting "HIRA"(Hazard Identifcation Risk Assessments) of the
critical activity, to eliminate the risk;
- Accessibility health and medical services to all the employees at all
levels through well- equipped health centers located at all
manufacturing plants;
- Placement of First-Aid boxes at several places for employees;
- Regular medical check-up to ensure fitness of its employees;
- Implementation of Human Injury Reporting System to report all types
of human injury and to find out the root cause; and
- Cleanliness and timely disposal of waste and scrap is ensured at the
entire premises.
ENVIRONMENTAL PROTECTION
Your Company being a good corporate citizen assumes its responsibility
towards conservation of environment. A clean environment at the
workplace and in its surroundings is our main focus and objective for
sustainable development and business growth.
In order to comply with Indian laws and regulations in respect of
environmental protection, the Company has taken internal environmental
protection control and monitoring measures.
The Company extracts maximum value from available resources, making the
best use of renewable resources and minimizing waste produced. This
concept is called "Resource Productivity". The Company aims at
drive-down of costs by reducing waste and pollution; and by creating
opportunities for growth through process and product innovations.
The eco friendly initiatives adopted by the Company include:
- Efficient use of natural resources by Implementing the 3R system Ã
Reduce, Reuse & Recycle;
- Tree plantation campaigns;
- Following National Ambient Air Quality Standards (NAAQS) Ã 2010, for
checking of stack emission & ambient air monitoring;
- Up gradation of effluent treatment & sewage treatment plants from
manual to automation;
- Regular internal environmental audit;
- Arrangement of Pollution Under Control (PUC) camps;
- Certification of ISO Ã 14001, for environment management system;
- Effective Storage and Disposal of Hazardous Waste as per statutory
requirements; and
- Celebration of World Environment Day to increase the awareness among
the employees.
APPOINTMENT / RE-APOINTMENT OF DIRECTOR
During the period under review, Mr. Sushil Muhnot was appointed as a
Nominee of IDBI Bank Limited in place of Dr. Birendra Narain Singh. The
Board places on record its sincere appreciation for the valuable
guidance received from Dr. Birendra Narain Singh, during his tenure as
Director of the Company.
At the Twenty First Annual General Meeting held on 30th March, 2010.
Mr. Venugopal N. Dhoot was re-appointed to the office of Managing
Director for a period of 5 years with effect from 1st September, 2010
to 31st August, 2015.
Further, at the Extra-Ordinary General Meeting held on 22nd June, 2010,
Mr. Pradipkumar N Dhoot was re-appointed to the office of Whole Time
Director for a period of 5 years with effect from 20th November, 2010
to 19th November, 2015.
Pursuant to the provisions of the Companies Act, 1956 and in terms of
the Articles of Association of the Company, Mr. Satya Pal Talwar, Mr.
Radhey Shyam Agarwal and Ms. Gunilla Nordstrom are liable to retire by
rotation at the ensuing Annual General Meeting and being eligible, Mr.
Satya Pal Talwar and Mr. Radhey Shyam Agarwal have offered themselves
for re-appointment. Ms. Gunilla Nordstrom has not offered herself for
re-appointment and accordingly shall retire at the ensuing Annual
General Meeting.
The Board of Directors have recommended appointment of Mr. Anil G.
Joshi in place of Ms. Gunilla Nordstrom. The Company has received due
notice under Section 257 of the Companies Act, 1956.
The Board recommends re-appointment of Mr. Satya Pal Talwar and Mr.
Radhey Shyam Agarwal; and recommends appointment of Mr. Anil G. Joshi
as Directors of the Company. Brief profiles of each of these directors,
specifying their expertise in specific functional areas, public
companies in which they hold Directorships and Committee positions, are
annexed to the Notice and forms part thereof.
Changes after the Balance Sheet Date:
Government of India has appointed Mr. Sushil Muhnot as Chairman &
Managing Director of Small Industries Development Bank of India
(SIDBI). Consequent to the said appointment, he has resigned from IDBI
Bank Limited and also from the Board of Directors of the Company.
Accordingly, Mr. Muhnot ceased to be the Director of the Company.
ICICI Bank Limited substituted its nominee on the Board. Mr. Girish
Nayak was nominated in place of Mr. Ajay Saraf. Accordingly, Mr. Ajay
Saraf ceased to be a director and Mr. Girish Nayak was co opted as a
Nominee on the Board of Directors of the Company. The Board places on
record its sincere appreciation for the valuable guidance received from
Mr. Sushil Muhnot and Mr. Ajay Saraf during their tenure as Directors
of the Company.
LISTING
The Equity Shares of your Company are listed on the Bombay Stock
Exchange Limited and The National Stock Exchange of India Limited.
The Global Depository Receipts (GDRs) and Foreign Currency Convertible
Bonds (FCCBs) issued by your Company are listed on the Bourse de
Luxembourg and Singapore Exchange Securities Trading Limited
respectively.
SUBSIDIARY COMPANIES
During the period under review, Chhattisgarh Power Ventures Private
Limited, Triumph Energy Private Limited, Videocon Energy Limited,
Videocon Hydrocarbon Holdings Limited and Senator Energy Private
Limited became the wholly-owned subsidiaries of the Company.
Videocon Oil Ventures Limited, Videocon Power Ventures Limited, Marvel
Energy Private Limited, Aim Energy Private Limited, Viable Energy
Private Limited, Vital Power Private Limited, Proficient Energy Private
Limited, Orchid Energy Private Limited, Applied Energy Private Limited,
Instant Energy Private Limited, Comet Power Private Limited, Unity
Power Private Limited, Percept Energy Private Limited, Galaxy Power
Private Limited, Videocon Australia WA-388-P Limited, Oil Services
International S.A.S, Videocon Energy Brazil Limited, Videocon Indonesia
Nunukan Inc, Videocon Mozambique Rovuma 1 Limited (Formerly: Videocon
Energy Resources Limited) and Videocon JPDA 06-103 Limited (Formerly:
Global Energy Inc) became the step down subsidiaries of the Company.
During the period under review, Godavari Consumer Electronics
Appliances Private Limited, Mayur Household Electronics Appliances
Private Limited, Sky Billion Trading Limited, Paramount Global Limited,
Powerking Corporation Limited and Venus Corporation Limited ceased to
be the subsidiaries of the Company and Videocon Display Research
Company Limited got voluntarily liquidated.
As such as on 31st December, 2010, your Company had 37 subsidiaries
(including step-down subsidiaries) viz. Pipavav Energy Private Limited,
Videocon International Electronics Limited, Chhattisgarh Power Ventures
Private Limited, Triumph Energy Private Limited, Videocon Energy
Limited, Senator Energy Private Limited, Datacom Telecommunications
Private Limited, Videocon Telecommunications Limited, Jumbo Techno
Services Private Limited, Senior Consulting Private Limited, Videocon
Oil Ventures Limited, Videocon Power Ventures Limited, Marvel Energy
Private Limited, Aim Energy Private Limited, Viable Energy Private
Limited, Vital Power Private Limited, Proficient Energy Private
Limited, Orchid Energy Private Limited, Applied Energy Private Limited,
Instant Energy Private Limited, Comet Power Private Limited, Unity
Power Private Limited, Percept Energy Private Limited, Galaxy Power
Private Limited, Middle East Appliances LLC, Videocon Global Limited,
Videocon Electronic (Shenzhen) Limited, Eagle ECorp Limited, Videocon
Energy Ventures Limited, Videocon Hydrocarbon Holdings Limited,
Videocon Oman 56 Limited (Formerly: Videocon Hydrocarbon Holdings
Limited), Videocon JPDA 06-103 Limited (Formerly: Global Energy Inc),
Videocon Mozambique Rovuma 1 Limited (Formerly: Videocon Energy
Resources Limited), Videocon Energy Brazil Limited (Formerly: Videocon
Global Energy Holdings Limited), Videocon Indonesia Nunukan Inc
(Formerly: Spectrum Overseas Inc), Videocon Australia WA-388-P Limited
and Oil Services International S.A.S.
Ministry of Corporate Affairs, Government of India has granted its
approval under Section 212(8) of the Companies Act, 1956 and
accordingly the provisions contained in sub-section (1) of Section 212
of the Companies Act, 1956 shall not be applicable in respect of the
Balance Sheet etc. of the aforesaid 37 subsidiaries which are required
to be attached to the CompanyÃs accounts for the financial period ended
on 31st December, 2010. Accordingly, the Balance Sheet, Profit and Loss
Account and other documents of the subsidiary companies as specified in
sub-section (1) of Section 212 of the Companies Act, 1956 are not being
attached with the Balance Sheet of the Company.
Financial information of the subsidiary companies, as required by the
said approval, is disclosed in the Annual Report. The Consolidated
Financial Statements presented by the Company include financial results
of its subsidiary companies, joint ventures and associates, in
accordance with relevant Accounting Standards issued by the Institute
Chartered Accountants of India.
The Company undertakes that the annual accounts of the subsidiary
companies and the related detailed information, including hard copy of
the accounts of the subsidiaries, will be made available to the
investors/ shareholders of holding and subsidiary companies seeking
such information at any point of time and the annual accounts of the
subsidiary companies will also be kept available for inspection by any
investor at the Registered Office of the Company as well as the
respective Registered Offices of Subsidiary Companies.
Further, the summarized financial information of the subsidiary
companies is also available on the website of the Company viz.,
www.videoconworld.com
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements, basis the Financial
Statements received from the subsidiaries, associates and joint
ventures, as approved by their respective Board of Directors, have been
prepared in accordance with the requirements of Accounting Standard 21
on "Consolidated Financial Statements", Accounting Standard 27 of
"Financial Reporting of Interests in Joint Ventures" and Accounting
Standard 23 on "Accounting for Investments in Associates in
Consolidated Financial Statements."
CASH FLOW STATEMENT
The Cash flow Statement for the period ended 31st December, 2010,
inconformity with the provisions of Clause 32 of the Listing Agreement
with the Stock Exchanges in India, is annexed hereto.
AUDITORSÃ REPORT
The Auditorsà Report is unqualified. The observations made in the
Auditorsà Report, read together with the relevant notes thereon, are
self-explanatory and hence, do not call for any comments under Section
217 of the Companies Act, 1956.
AUDITORS
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai and M/s.
Kadam & Co., Chartered Accountants, Ahmednagar, Statutory Auditors of
the Company, retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office, if
re-appointed. The Company has received certificates from the said
Auditors to the effect that their re-appointment, if made, would be
within the limits prescribed under Section 224(1B) of the Companies
Act, 1956.
The Board recommends their re-appointment.
AUDIT COMMITTEE
The Company has constituted the Audit Committee, pursuant to the
provisions of Section 292A of the Companies Act, 1956 and provisions of
the Listing Agreement. The composition, scope and powers of Audit
Committee together with details of meetings held during the period
under review forms part of Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report, highlighting the performance
and prospects of the CompanyÃs business, forms part of the Annual
Report.
CORPORATE GOVERNANCE
As required under Clause 49 of the Listing Agreement with the Stock
Exchanges, the Corporate Governance Report forms part of the Annual
Report. Your Company is in full compliance with the requirements and
disclosures as stated therein. A certificate from the Statutory
Auditors of the Company confirming compliance of the Corporate
Governance is appended to the Report on Corporate Governance.
DIRECTORSÃ RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act, 1956, with respect
to Directorsà Responsibility Statement, it is hereby confirmed that:
a) In the preparation of the annual accounts for the period ended 31st
December, 2010, the applicable accounting standards read with
requirements set out under Schedule VI to the Companies Act, 1956, have
been followed and there are no material departures from the same;
b) The Directors have 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 31st December, 2010 and of the profit of the
Company for the period ended on that date;
c) The Directors have 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
d) The Directors have prepared the annual accounts of the Company on a
Ãgoing concernà basis.
ACKNOWLEDGEMENT
The Board would like to express their heartfelt gratitude for the
assistance and co-operation received from the Financial Institutions,
Government Authorities and Banks.
The Board would also like to place on record its sincere thanks and
appreciation for the continuing support of the dealers, vendors,
business associates and employees.
The Board is also grateful to you for your support and look forward for
your continued support in future as well.
For and behalf of the Board of Directors of
VIDEOCON INDUSTRIES LIMITED
VENUGOPAL N. DHOOT
Chairman & Managing Director
Place : Mumbai
Date : 26th May, 2011
Sep 30, 2009
The Directors take pleasure in presenting the Twenty-first Annual
Report together with the Audited Accounts and Auditors Report of your
Company for the year ended 30th September, 2009.
PERFORMANCE REVIEW
The performance of the Company, on standalone basis, for the financial
year ended 30th September, 2009 is as summarized below:
(Rs. in Million)
Particulars Year ended Year ended
30th Sept., 2009 30th Sept., 2008
Net Sales 91,630.41 97,536.54
Other Income 340.15 288.22
Total Income 91,970.56 97,824.76
Profit before Interest,
Depreciation, 17,918.57 23,560.88
Exceptional Items and Tax
Interest and Finance charges 6,363.61 4,011.03
Depreciation 5,771.52 6,602.07
Exceptional Items - 1,278.10
Profit before Tax 6,783.44 11,669.68
Provision for Taxation 1,776.82 3,126.73
Profit after Tax 4,006.62 8,542.95
OPERATIONS
Highlights on the performance of the Company during the year under
review are summarized hereunder:
CONSUMER ELECTRONICS & HOME APPLIANCES:
Undeterred by the economic uncertainties looming large over the global
horizon, your Company has made positive strides in its Consumer
Electronics & Home Appliances Business and Company has posted a stable
performance thanks to the technological up-gradation; multi-brand
strategy; aggressive marketing; launch of new logo; and focused
penetration in the key markets.
OIL & GAS:
The Company, through its wholly owned subsidiaries and / or joint
ventures is carrying on the exploration activities in the oil and gas
fields in Brazil, Mozambique, East Timor, Oman, and Australia.
As a part of Companys overall plans of acquiring further interests in
oil and gas fields worldwide, the Company, through one of its
subsidiaries, acquired a 12.5% participating interest in Production
Sharing Contract, covering the area referred to as Nunukan Block,
located offshore Indonesia.
During the year under review a pre-salt discovery was announced in the
Wahoo prospect offshore Brazil block in the Campos basin wherein VB
Brazil Petroleo Private Limitada, a joint venture company of the
Company with Bharat PetroResources Limited, through its wholly owned
subsidiary, holds, a 25% participating interest.
Subsequent to the balance sheet date, more than 480 net feet of natural
gas pay in high quality reservoir sands with a gross column of more
than 1,200 feet was encountered in Rovuma Basin, Area 1, offshore
Mozambique, wherein one of the subsidiaries of the Company holds 10%
participating interest.
Meanwhile, the Company continues to reap dividends from its oil & gas
venture in Rawa Oil & Gas Field in India.
TELECOM
Videocon Telecommuncations Limited ("VTL"), (formerly Datacom Solutions
Limited), one of the subsidiaries of the Company, has been awarded
License to provide Unified Access Services in 21 local service areas
and has also been allotted spectrum in 20 of these local service areas.
VTL is in process of launching the mobile services and has
substantially completed creation of the basic infrastructure for the
same. VTL has signed interconnect and roaming agreements with various
operators and has entered into long term master service agreements with
various reputed infrastructure providers for usage of their passive
telecom infrastructure services. VTL plans to roll out its mobile
services commercially in six circles by March 2010 and will be present
in 11 Circles by June 2010. VTL plans to roll out the mobile services
commercially in rest of the telecom service areas where spectrum has
been allotted, by December 2010.
POWER
One of the subsidiaries of the Company, Pipavav Energy Private Limited
("PEPL") is implementing a Power project in Gujarat, near Pipavav port,
Village Bherai, Taluka Rajula, Dist. Amreli, Gujarat. This will be a
thermal power plant with a capacity of 1,200 MW and the same will be
completed in two phases. PEPL has signed necessary Memorandum of
Understanding with the Govt, of Gujarat whereby the Govt of Gujarat has
agreed to provide all required support to the project. PEPL has
obtained necessary environmental clearances from Gujarat Pollution
Control Board for constructing the power plant and has also obtained
CRZ clearance from State Department of Environment & Forest.
Acquisition of the necessary land required for the first phase of the
project has been substantially completed and PEPL has invited bids for
key equipments and necessary civil work and bathymetric survey work.
The Company is also considering power projects in the other parts of
the country and also evaluating alternate technologies for the same.
ISSUES/ALLOTMENT & FORFEITURE OF SECURITIES
During the year under review, 1,17,65,000 warrants were allotted at a
price of Rs. 42.50 per warrant, on preferential basis, to Bennett,
Coleman & Company Limited with an option to subscribe to 1,17,65,000
equity shares at a price of Rs. 170.00 per equity share inclusive of a
premium of Rs. 160.00 per equity share, within a period of 18 months
from the date of allotment.
Forfeiture of Equity Shares
The Board of Directors of the Company at its meeting held on 31st July,
2009, approved the forfeiture of 43,948 equity shares of face value of
Rs 10/- each and cancelled the shares. These shares were allotted
pursuant to the amalgamation of erstwhile Videocon International
Limited with the Company and in respect of which the allotment/call
money were due and unpaid.
MATERIAL EVENTS AFTER BALANCE SHEET DATE:
Post balance sheet date, 1,858,275 equity shares were allotted, on
preferential basis, to Infotel Telecom Infrastructure Private Limited
at a price of Rs. 242.16 per equity share inclusive of a premium of Rs.
232.16 per equity share.
Further, post balance sheet date, the Board of Directors of the Company
approved in-principle issue of equity shares, on rights basis, for an
amount not exceeding Rs. 1,200 Crores. The Company has filed Draft
Letter of Offer with the Securities & Exchange Board of India.
APPROPRIATIONS
DIVIDEND:
Your directors are pleased to recommend a dividend of Rs. 21- (Rupees
Two only) per equity share for the financial year ended on 30th
September, 2009.
The dividend, if approved by the shareholders, will entail a payout of
Rs. 541.14 million including dividend distribution tax of Rs. 78.61
million. The dividend is free of tax in the hands of the shareholders.
The dividend payout, as proposed, is in accordance with the Companys
policy to pay sustainable dividend besides keeping in view the
Companys need for capital, its growth plans and the intent to finance
such plans through internal accruals.
TRANSFER TO GENERAL RESERVE:
Your directors propose to transfer Rs. 1,000.00 million to the General
Reserve. An amount of Rs. 22,438.44 million is proposed to be retained
in the profit and loss account.
FIXED DEPOSITS
The Company has never accepted any fixed deposit within the meaning of
Section 58A of the Companies Act, 1956 and as such, no amount of
principle or interest was outstanding as of the Balance Sheet date.
PERSONNEL
A statement of the Particulars of Employees required under Section
217(2A) of the Companies Act, 1956, read with the Companies (Disclosure
of Particulars in the Report of the Board of Directors) Rules, 1988, is
annexed and forms part of this Report.
Your Company has an environment which is empowered, inclusive, driven
by performance yet fun-filled with a diversified talent base.
- Creativity and Autonomy:
An individuals creativity is the basis for value creation. Your
Company respects diversity and autonomy allowing each of its employees
to exercise their creativity to the fullest.
- Emphasis on Competence:
Competence is the basis for performance. Your Company eyes competence
as the most important factor in its personnel decisions.
- Equal Opportunities:
Equal opportunities build trust among people. Your Company ensures
equal opportunities to all regardless of gender, race, age, religion or
nationality.
- Long-Term Perspective:
Maintaining a long-term perspective is the foundation for your
Companys Human Resource policies. Human Resource programmes are
designed with a long-term perspective and implemented with dedication
and persistence.
- Training:
Your Company offers diverse training programmes to its employees
according to position to encourage learning and development. This is
done by equipping them with the professional capabilities and enabling
them to apply the latest technologies at work.
- Rewards:
Your Company offers its employees a competitive, unique rewards system
which motivates employees to perform better by helping them to enhance
their quality of life.
CONSERVATION OF ENERGY
"Energy saved is energy generated." Your Company strives for
sustainable consumption of natural resources. The thrust of your
Companys strategy Is to save energy through application of various
efficiency measures.
During the year, the efforts of your Company maneuvered to innovation
and improvement so as to further reduce energy consumption. A novel
concept nomenclatured as "Resource Productivity" was coined by the
management of your Company as a golden means to attain optimum
utilization of available resources, especially renewable resources.
Implementation of the said concept has led to improvement in over-all
efficiency. The same was implemented at all the manufacturing
facilities.
Better controls are planned to achieve further reduction in energy
consumption. The manufacturing facilities of the Company are equipped
with hi-tech energy monitoring and conservation systems to monitor
usage, minimise wastage and increase overall efficiency at every stage
of power consumption.
Some of the measures being undertaken by the Company in its endeavor to
conserve energy are enumerated hereunder:
- Energy auditing at the manufacturing units;
- Improvement in power factors by installation of Capacitors;
- Use of advanced technology at manufacturing plants in the form of
energy efficient equipments;
- Use of unconventional energy sources like solar energy in the form of
solar water heater plant;
- Timely maintenance of machinery and equipments;
- On-the-job and off-the-job training for employees at all levels;
- Use of energy saving lighting arrangement in shop floor and on roads
inside the facilities by using Electronics Ballast and CFL lamps;
- Reduction in power consumption;
- Display of Notice Boards and Information Boards at all work stations
for information and awareness of the employees;
- Awareness programmes towards optimum utilization of natural
resources; and
- Plantation of trees at all the manufacturing units. RESEARCH,
DEVELOPMENT AND TECHNOLOGY ABSORPTION
Technology and Research & Development (R&D) go hand in hand. Your
Company firmly believes that a sound R&D programme is a forte of every
flourishing organisation and a well-planned R&D acts as a catalyst to
foster innovation and enhance the interfaces in both, conventional and
emerging technological arenas.
Accordingly, an in-house R&D team comprising of over 200 skilled
engineers/experts in varied fields has been formed to keep pace with
the rapid technological changes in the industry. The Company has
Research and Development centre located in China, Aurangabad, Japan and
Gurgaon.
Your Company is determined to develop its own technologies in select
areas besides being an efficient user and customiser of available
technologies. R&D and technology development are integral to your
Companys innovation agenda for achieving growth, business
profitability, sustainability and rural transformation.
The main thrust of the Companys R&D activities is upon strengthening
of the current portfolio of products, looking for new concepts and
product platforms, development of new technological platforms to
support the consumer needs more effectively and introduction of a
number of novel technologies in Consumer Electronics & Home Appliances.
R&D work is in progress in the areas of basic technology, manufacturing
skills, performance, quality, design and standardisation.
The Companys customer-oriented performance is backed by R&D
activities. The Company has reinforced activities in advanced digital
technology to deliver smart products which simplify life.
During the year under review, your Company has explored R&D avenues in
an array of areas, some of them being:
- Home theaters - High-end models and HTIB Models.
- Larger Screen Television i.e. 32 inch and 38inch.
- True Flat Televisions. LCD TVs.
- Plasma Televisions.
- Cosmetic design and new out look to the TVs.
- Manufacturing of components for CTV, Refrigerators and Air
conditioners.
- Developed high-end products to be offered to Indian market.
- Efforts to reduce power consumption of all its final products.
- Development of products suitable for Indian climate conditions, as
well as same for export market.
- Introduction of TV with immense picture performance and razor slim
design.
The Companys ongoing commitment to technology leadership coupled with
its cutting-edge R&D capabilities has enabled it to consistently
deliver innovative products that enhance and enrich life. In a
nutshell, during the year, your Company was able to cash in on the
following benefits:
- Developed new design in products and launched various new models.
- Developed high-end products to be offered to Indian market.
- Introduced Integrated Digital TV (iDTV) with a built-in digital
decoder having MPEG 4 DVB-S2 Digital signal; Introduced LED TV with
"Nano Pixels" for immense picture performance and Razor slim design;
Introduced Unique "SMART TV, which set a platform for Internet TV" to
enjoy the Live Chatting, Browsing, Video conferencing, email access,
Blu Tooth connectivity etc.; and various other ranges/series of LCD TV
with Full HD 1080p resolution.
- Introduced Star Rated Products in Consumer Electronics and Home
appliances. With this technology, the customer can have benefit of
saving approximately 15% of power consumption, resulting into effective
utilization of power resources in the nation.
- Introduced paint less product with a unique Hot and Cold Technology
for moulding of parts. This helps to reduce pollution generated due to
hazardous chemicals used in plastic paints and its process. Customer
can enjoy the high glossy finish with ultimate scratch resistance.
- Developed new ranges of Direct Cool as well as Frost Free
refrigerators like Ecocool, Ecocool Plus, Ecofresh, Deofresh,
Nutricool, Nutricool Plus, Powercool. Developed 4 & 5 Star rated
refrigerators with new exterior finish i.e. PCM-Pre-coated material.
- Introduced new base stand with smart VEGI TRAY, which is unique and
give convenience to customer in day to day usage.
- Introduced new economic series of Direct cool refrigerator as "Bharat
series", to cater to each and every Indian family. This has given
cutting edge solution for the competitors on the price factor.
- Introduction of the products on health platform with Deodorizer,
which gives the solution to remove the odour created by rotten
vegetables and fruits.
- Enhanced Frost Free refrigerator series with introduction of LED &
LEDi technology.
- Increase in Productivity.
In near future, the Company is proposing to concentrate on all the
areas mentioned earlier, hereinbefore and to focus efforts on new
technologies which could offer better products in the domestic market.
The Company aims to achieve R&D in the following areas:
- Manufacturing of components for consumer Electronics Products.
- Various models of Multimedia TV; iDTV; LCDTVs; LED & LEDi
- Plasma Televisions.
- Composite Home Entertainment system with internet adaptability.
- Better features, better quality & improved reliability with
reduced/low prices.
During the year, your Company has incurred Rs. 92.76 million
representing 0.10% of the turnover towards R&D, to enhance the
competitiveness of our core business and develop tomorrows
technologies.
As the management continues to expand its investment in core
technologies and cutting-edge growth businesses, your Company ensures
that its technology leadership, in India and abroad, grows stronger
with every passing year.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars of Foreign Exchange Earnings and Outgo during the year
are as set out hereunder:
(Rs. in Million)
Particulars For the year ended For the year ended
30th Sept., 2009 30th Sept., 2008
Foreign Exchange Earned 5,226.24 6,080.77
Foreign Exchange Used 13,962.01 14,113.62
The Company has taken various initiatives for exports and development
of export markets for Consumer Electronics and Home Appliances to
increase its foreign exchange earnings.
INFORMATION TECHNOLOGY
Information Technology and business are becoming inextricably
interwoven. Nobody can meaningfully talk about one without talking
about the other. Indeed, the growing influence of Information
Technology as an enabler of business in todays time has made use of
Information Technology indispensable. Information Technology, having
made inroads into major industries, has left no aspect of our business
and life untouched. Your Company firmly believes that an organization
needs to have a digital nervous system for sustaining the cut-throat
competition for the Numero Uno position in any sector of economy.
In due recognition of the key role played by Information Technology in
revolutionizing the world, your Company has re-engineered its processes
by leveraging Information Technology with an eye to building,
sustaining and expanding its competitive edge.
Your Company has designed and implemented web based CRM application
using ASP.NET 3.5 and SQL Server 2005. The robust and stable CRM
application with comprehensive support enables handling of larger call
volumes resulting into speedy response and prompt resolution of
customers queries.
SAP Solutions have enabled your Company to leverage the benefits of
integration in business operations, optimization of enterprise
resources, standardized business processes thereby enabling standard
operating practices with well established controls. This has enabled
the Company to adopt best and standardized business processes across
the functions. It has also benefited the management at all levels with
business information which is on-line and reliable to control the
business operations in a well- informed manner. Your Company has a
scale-up data centre infrastructure to cater to the business
requirements. During the year under review, SAP Bl Tool (Business
Intelligence) was upgraded from 3.5 to 7 for providing intelligent and
advance reporting functionality. There is secured and point-to-point
VPN connectivity in its most of the branches and warehouses.
The Company has bagged SAP ACE Award, twice in a row, for "Best
Consumer Sector Implementation" and "Excellence in Implementation of
Various SAP Modules".
HEALTH AND SAFETY
Safety of persons overrides all Production targets - bearing this
safety motto in mind, every business issue in your Company is discussed
and every solution complies with the safety policy of your Company. The
management of your Company believes that the employees are the heart
and soul of the organization and hence, considers health and safety of
its employees as its prime responsibility.
The health and safety platform of your Company is well supported by the
safety management team which comprises of employee and management
representatives. The team studies a plethora of health, safety and
environment related issues at manufacturing plants and reports the
observations along with requisite correctives measures, if any, to the
management for necessary action. The Company arranges for and takes
various measures to prevent occurrence of accidents on job. There is
regular interaction between Corporate and the manufacturing units on
the health and safety policy.
The health and safety initiatives adopted by the Company include:
- Conduct of safety audits.
- Accessibility of health and medical services to all employees through
well equipped health centres at all manufacturing facilities.
- Medical camps, at regular intervals, to ensure fitness of its
employees.
- Availability of ambulance, incase of emergency.
- On-the-job and off-the-job training programmes at regular intervals
for upgradation of employees on awareness front.
- Display of evacuation plans at various locations to reach assembly
point.
- Display of cautionary boards, notice boards and information boards at
work stations for information and awareness of the employees.
- Close monitoring of health and safety activities to ensure
maintenance of adequate standards.
ENVIRONMENT
Your Company is committed to sustainable development, for meeting the
needs of the present without jeopardizing the welfare of future
generations. The Companys business strategies consciously factor
environment conservation as a major principle. The Company is
continously looking for new ways to preserve the environment and manage
resources responsibly. Your Company endeavours to be as eco-efficient
as possible are unrelenting.
For your Company, economic, social and environmental responsibilities
forms an integral part of its business. The eco-friendly initiatives
adopted by the Company includes:
- setting new targets for energy efficiency.
- reducing the use of natural resources.
- promoting the use of alternative fuels and materials.
- re-engineering the processes and products to reduce energy
consumption.
- tree-plantation campaigns.
- awareness programmes for employees at all levels.
The Company adopt clean technologies and processes that combine both
economic progress and sustainable environment.
APPOINTMENT/RE-APPOINTMENT OF DIRECTORS
During the year under review, Dr. Birendra Narain Singh was appointed
as a Nominee of IDBI Limited in substitution of Mr. B. Ravindranath.
Further, Thomson S.A, withdrew its nomination of Mr. Didier Trutt from
the Board of the Company. Also, AB Electrolux (Publ) substituted their
nominee on the Board of the Company. Ms. Gunilla Nordstrom was
nominated on the Board in place of Mr. Johan Fant.
At the Twentieth Annual General Meeting held on 30th March, 2009, Ms.
Gunilla Nordstrom and Mr. Radhey Shyam Agarwal were appointed as
Directors and Mr. Kuldeep Drabu retired at the said Annual General
Meeting, since not offered himself for re-appointment.
Pursuant to the provisions of the Companies Act, 1956 and in terms of
the Articles of Association of the Company, Mr. S. Padmanabhan, Mr.
Karun Chandra Srivastava and Mr. Arun L. Bongirwar are liable to retire
by rotation at the ensuing Annual General Meeting and being eligible,
have offered themselves for re-appointment.
Mr. Venugopal N. Dhoot was appointed to the office of Managing Director
for a period of 5 years with effect from 01st September, 2005. The
tenure of Mr. Venugopal N. Dhoot as Managing Director of the Company
ends on 31st August, 2010. The Board of Directors of the Company has
approved re-appointment of Mr. Venugopal N. Dhoot as Managing Director
of the Company subject to the approval of shareholders at the ensuing
Annual General Meeting.
The Board recommends re-appointment of Mr. S. Padmanabhan, Mr. Karun
Chandra Srivastava, Mr. Arun L. Bongirwar as Director and Mr. Venugopal
N. Dhoot as Managing Director. Brief profiles of each of these
Directors, specifying their expertise in specific functional areas,
public companies in which they hold Directorship and Committee
Positions, is annexed to the Notice and forms part thereof.
LISTING
The equity shares of your Company are listed on the Bombay Stock
Exchange Limited and National Stock Exchange of India Limited. The
Global Depository Receipts (GDR) and Foreign Currency Convertible Bonds
(FCCB) issued by your Company are listed on the Luxembourg Stock
Exchange and Singapore Exchange Trading Securities Limited
respectively.
SUBSIDIARY COMPANIES
During the year under review, Videocon Indonesia Nunukan Inc., Senior
Consulting Private Limited and Jumbo Techno Services Private Limited
became subsidiaries of the Company whereas Videocon (Mauritius)
Infrastructure Ventures Limited and consequently Investcon Singapore
Holdings Limited ceased to be the subsidiaries of the Company.
As such, as on 30th September, 2009, your Company had 23 (Twenty-
three) subsidiaries (including step-down subsidiaries) viz.. Datacom
Telecommunications Private Limited; Eagle Ecorp Limited; Videocon JPDA
06-103 Limited (formerly, Global Energy Inc.); Godavari Consumer
Electronics Appliances Private Limited; Jumbo Techno Services Private
Limited; Mayur Household Electronics Appliances Private Limited; Middle
East Appliances LLc; Paramount Global Limited; Pipavav Energy Private
Limited; Powerking Corporation Limited; Senior Consulting Private
Limited; Sky Billion Trading Limited;Venus Corporation Limited;
Videocon Displays Research Company Limited; Videocon Energy Brazil
Limited (formerly: Videocon Global Energy Holdings Limited); Videocon
Global Limited; Videocon Indonesia Nunukan Inc. (formerly: Spectrum
Overseas Inc.); Videocon International Electronics Limited; Videocon
Mozambique Rovuma 1 Limited (formerly: Videocon Energy Resources
Limited); Videocon Energy Ventures Limited; Videocon Oman 56 Limited
(formerly: Videocon Hydrocarbon Holdings Limited); Videocon
Telecommunications Limited (formerly: Datacom Solutions Limited); and
Wei You Kang Electronic (Shenzhen) Limited.
Ministry of Corporate Affairs, Government of India has granted approval
that the requirement to attach various documents in respect of
subsidiary companies, as set out in sub-section (1) of Section 212 of
the Companies Act, 1956, shall not apply to the Company. Accordingly,
the Balance Sheet, Profit and Loss Account and other documents of the
subsidiary companies are not being attached with the Balance Sheet of
the Company. Financial information of the subsidiary companies, as
required by the said approval, is disclosed in the Annual Report. The
Consolidated Financial Statements presented by the Company include
financial results of its subsidiary companies, joint ventures and
associates, in accordance with relevant Accounting Standards of the
Institute of Chartered Accountants of India.
The Company undertakes that annual accounts of the subsidiary companies
and the related detailed information will be made available to the
holding and subsidiary companies investors seeking such information at
any point of time and the annual accounts of the subsidiary companies
will also be kept for inspection by any investor at the Registered
Office of the Company as well as the respective Registered Offices of
subsidiary companies. Further, the summarized financial information of
the subsidiary companies is also available on the website of the
Company viz., www.videoconworld.com
CONSOLIDATED FINANCIAL STATEMENTS
The Audited Consolidated Financial Statements, based on the Financial
Statements received from the subsidiaries, associates and joint
ventures, as approved by their respective Board of Directors, have been
prepared in accordance with the requirements of Accounting Standard 21
on Consolidated Financial Statements, Accounting Standard 27 of
Financial Reporting of Interests in Joint Ventures and Accounting
Standard 23 on Accounting for Investments in Associates in Consolidated
Financial Statements.
CASH FLOW STATEMENT
The Cash flow Statement for the year ended 30th September, 2009, in
conformity with the provisions of Clause 32 of the Listing Agreement
with the Stock Exchanges in India, is annexed hereto.
AUDITORS REPORT
The Auditors Report is unqualified. The observations made in the
Auditors Report, read together with the relevant notes thereon, are
self-explanatory and hence, do not call for any comments under section
217 of the Companies Act, 1956.
AUDITORS
M/s. Khandelwal Jain & Co., Chartered Accountants, Mumbai and M/s.
Kadam & Co., Chartered Accountants, Ahmednagar, Statutory Auditors of
the Company, retire at the ensuing Annual General Meeting and have
confirmed eligibility and willingness to accept office, if
re-appointed. The Company has received certificates from the said
Auditors to the effect that their re-appointment, if made, would be
within the limits prescribed under Section 224( 1B) of the Companies
Act, 1956.
The Board recommends their re-appointment.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report, highlighting the performance
and prospects of the Companys business, forms part of the Annual
Report.
CORPORATE GOVERNANCEæ
It has been the endeavour of your Company to follow and implement best
practices in corporate governance, in letter and spirit. Your Company
is committed to maintain the highest standards of Corporate Governance.
The Directors adhere to the Corporate Governance requirements set out
by the Securities and Exchange Board of India and have implemented all
the stipulations prescribed.
A detailed Corporate Governance Report is included in the Annual
Report. A certificate from the Auditors of the Company regarding
compliance with the conditions of corporate governance as required
under Clause 49 of the Listing Agreement with the Stock Exchanges in
India, forms part of the said report.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act, 1956, with respect
to Directors Responsibility Statement, it is hereby confirmed that:
a) In the preparation of the annual accounts for the year ended 30th
September, 2009, the applicable accounting standards read with
requirements set out under Schedule VI to the Companies Act, 1956, have
been followed and there are no material departures from the same;
b) the Directors have 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 30th September, 2009 and of the profit of the
Company for the year ended on that date;
c) the Directors have 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
d) the Directors have prepared the annual accounts of the Company on a
going concern basis.
TOKEN OF APPRECIATION
The Board applauds its employees of the Company for their alacrity and
dedication to stabilize the companys operations in the tough market
conditions.
The Board places on record its sincere thanks and appreciation for the
continuing support of the dealers, vendors, business associates and
employees in ensuring an excellent all-round operational performance.
Your Directors also place on record their heartfelt gratitude to the
Government Authorities, Banks and Financial Institutions for their
support and guidance in navigating the Company through thick and thin.
The Board is also grateful to you for your support, especially during
the challenging times. The Company salutes its shareholders for their
undeterred faith in the credentials of the Company.
Your Directors look forward to their continued support in the future as
well.
For and on Behalf of the Board of Directors
of VIDEOCON INDUSTRIES LIMITED
Venugopal N. Dhoot
Chairman & Managing Director
Place: Mumbai
Date: 27th February, 2010
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