Mar 31, 2018
DIRECTORS'' REPORT TO THE MEMBERS
The Directors have pleasure in presenting the 39th Annual Report of the Company along with the Audited Financial Statements for the Financial Year ended 31st March 2018.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE
(Rs. in Lacs)
Sl. No. |
Particulars |
2017-18 |
2016-17 |
1. |
Total Revenue |
6433.58 |
6475.21 |
2. |
Less: Expenses |
5110.76 |
5416.22 |
3. |
Profit before Tax |
1322.82 |
1058.99 |
4. |
Less: Net Tax Expenses |
503.87 |
368.23 |
5. |
Profit after Tax |
818.95 |
690.76 |
6. |
Other Comprehensive Income |
4.22 |
12.26 |
7. |
Total Comprehensive Income |
823.17 |
703.02 |
The gross revenue of the Company for the year under review at Rs.6433.58 Lacs was lower by 0.64% than that of the previous year''s gross revenue at Rs. 6475.21 lacs.
The Profit before tax after depreciation and finance cost at Rs.1322.82 Lacs for the year under review was higher by 24.91% as compared to Rs. 1058.99 Lacs for the previous year.
Net Profit after providing tax for the year under review was Rs.818.95 Lacs as compared to Rs 690.76 Lacs for the previous year, thus higher by 18.56% over the previous year.
The total comprehensive income for the year under review was Rs.823.17 Lacs as compared to Rs.703.02 Lacs for the previous year, thus higher by 17.09% over the previous year.
2. FIRST-TIME ADOPTION OF IND AS
The Financial Statements for the year ended 31st March 2018 are the first the Company has prepared in accordance with Ind AS. For periods up to and including the year ended 31st March, 2018, the Company prepared its Financial Statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (âIndian GAAPâ or âprevious GAAPâ).
Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31st March, 2018, together with the comparative period data as at and for the year ended 31st March 2017. In preparing these Financial Statements, the Company''s opening balance sheet was prepared as at 1st April 2016, the Company''s date of transition to Ind AS.
3. DIVIDEND
In view of the pending adjudication in Economic Court of Tajikistan as well as National Company Law Appellate Tribunal, your Company, being a Corporate Guarantor to the Loan availed by your subsidiary Company CHL International from EXIM Bank, has to seek prior permission from the EXIM Bank for declaration of Dividend. The EXIM Bank as per the normal practice would not agree to give prior permission for it. Hence your Directors are constrained not to recommend any Dividend for the year under review.
4. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Ms. Kajal Malhotra (DIN : 01319170) and Mr. Ashok Kumar Malhotra (DIN : 00676603) Directors who retire by rotation and being eligible, have offered themselves for re-appointment. The Board recommends their appointments.
In the 36th Annual General Meeting, Dr. Lalit Kumar Malhotra (DIN : 00213086) was reappointed as Chairman and Managing Director of the Company for a period of three years commencing from 15.07.2015 to 14.07.2018 and he completes his current tenure on 14.07.2018 and it is proposed to reappoint him for a further period beginning from 15.07.2018 to 14.07.2021.
Pursuant to the provisions of Section 203 of the Act, Dr. Lalit Kumar Malhotra, Chairman & Managing Director, Mr. Luv Malhotra, Joint Managing Director, Mr. Gagan Malhotra, Executive Director, Mr. Narender Kumar Goel, Vice President (Finance)/Chief Financial Officer and Mr. G. J. Varadarajan, Company Secretary, are formalized as the Key Managerial Personnel of the Company.
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and provisions of the Listing Regulations. The profile of the Independent Directors forms part of the Corporate Governance Report.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required under the Listing Regulation with the Stock Exchange, the Management Discussion and Analysis Report is enclosed as a part of the Report.
6. SUBSIDIARY COMPANY
Your subsidiary, CHL International, a Joint Venture company in Dushanbe, Tajikistan has developed a Five-Star Hotel known as the Sheraton at Dushanbe, the capital of Tajikistan. This project has been financed by the Export Import Bank of India by way of a Term Loan aggregating to USD 32.50 million. The hotel has been in operation since 2015.
Pursuant to the case filed by CHL International, our subsidiary Company against the Export-Import Bank of India (EXIM Bank), in the Economic Court of Dushanbe, Tajikistan, the case was decided by the Court vide its Order dated 01/05/2018 wherein the claims made by CHL International were partly accepted and the EXIM Bank inter alia was directed to reconcile the account, amend the loan agreements and to disburse the balance principal amount. During the pendency of above case filed by CHL International, the EXIM Bank initiated the proceedings under IBC and filed petition before Hon''ble National Company Law Tribunal (NCLT) against CHL Limited, being the Corporate Guarantor of the Loan. Vide order dated 11/01/2018 the NCLT dismissed the case filed by EXIM Bank. Pursuant to the dismissal, the EXIM Bank filed an appeal before Hon''ble Company Law Appellate Tribunal (NCLAT) and the same is pending adjudication.
There are no Associate Companies within the meaning of Section 2(6) of the Companies Act, 2013 (âActâ). Further there has been no material change in the nature of business of the subsidiary.
In terms of provision to sub section (3) of Section 129 of the Act, the salient features of the Financial Statement of the subsidiary is set out in the prescribed form AOC-1, which forms part of the Annual Report
7. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. During the financial year 2017-18 no complaint was received on sexual harassment.
8. WHISTLE BLOWER /VIGIL MECHANISM
In pursuant to the provisions of Section 177(9) and (10) of the Companies Act, 2013, a Vigil Mechanism for Directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.chl.co.in under investors/ Whistle Blower Policy link.
9. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith.
10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
11 MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
Your Directors would like to inform that no material changes and commitments have occurred between the end of the financial year under review and the date of this report that may adversely affect the financial position of the Company.
12 CONSOLIDATION OF FINANACIAL STATEMENT
As stipulated by regulation 33 of the Listing Regulations, the Consolidated Financial Statements have been prepared in accordance with the applicable Accounting Standards. The Audited Consolidated Financial Statements together with the Auditors'' Report forms part of the Annual Report.
13. DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(5) of the Act, and based on the representations received from the management, the Directors hereby confirm that:
i. In the preparation of the Annual Accounts for the Financial Year 2017-18, the applicable accounting standards have been followed and there is no material departure;
ii. They 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 at the end of the Financial year and of the profit of the Company for the Financial year;
iii. They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. They have prepared the Annual Accounts on a going concern basis;
v. They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating properly; and
vi. They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
14. CORPORATE GOVERNANCE
Your Company has taken adequate steps to adhere all the stipulations laid down in the Listing Regulation. A report on the Corporate Governance along with certificate from Practicing Company Secretary confirming the Compliance is included as part of the report.
15. LISTING WITH STOCK EXCHANGE
The Company confirms that it has paid the Annual Listing Fee for the year 2018-19 to BSE Limited (BSE), where the Company''s Shares are listed.
16. (a) PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information pursuant to Section 197 (12) of the Act, read with Rule 5(1), 5(2) and 5(3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, in respect of directors, key managerial personnel and employees of the Company is given in Annexure and form part of the report. There are no employees drawing remuneration above the limits specified under section 197 (12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014.
(b) REMUNERATION RATIO OF THE KEY MANAGERIAL PERSONNEL
The information required pursuant to section 197 read with rule 5 of the Companies (Appointment and Remuneration of the managerial Personnel) Rules, 2014 and Companies (Particulars of Employees ) Rules, 1975, in respect of employees of the Company and Directors is furnished in extract of Annual Return MGT 9.
17. DEMATERIALISATION OF SHARES
The total paid up equity share capital of the Company is Rs. 109,636,580 comprising of 5,48,18,290 equity shares of Rs. 2/- each. Out of the total equity shares, 5,21,39,770 (95.12%) Equity Shares of the Company stand dematerialized and balance 26, 78, 520 (4.88%) equity shares are still in physical form.
18. AUDITORS & AUDITORSâ REPORT Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the rules framed there under, M/s DGA & Co., Chartered Accountants, were appointed as Statutory Auditors of the Company from the conclusion of the 38th Annual General Meeting (AGM) of the Company held on 18th September 2017 till the conclusion of the 40th AGM, for a period of two years.
The Auditors'' Report is unqualified. The notes to the Accounts referred to in the Auditors'' Report are self-explanatory and therefore do not call for any further clarifications under section 134 of the Companies Act, 2013.
Internal Auditors
M/s Gulvardhan Malik & Co., Chartered Accountants have been conducting periodic Internal Audit of all the operations of the Company. Internal Audit Reports are regularly placed before the Audit Committee for their review and for recommendation to the Board.
Secretarial Auditors
According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s A. Chadha & Associates., Company Secretaries is continuing as Secretarial Auditor of the Company.
19. INTERNAL CONTROL
The information about internal controls is set out in the Management Discussion & Analysis report which is attached and forms part of this Report.
20. RISK MANAGEMENT
The Risk Management is overseen by the Audit Committee of the Company on a continuous basis. The Committee oversees Company''s process and policies for determining risk tolerance and review management''s measurement and comparison of overall risk tolerance to established levels. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuous basis.
21 CHANGE IN THE NATURE OF BUSINESS
During the year under review, there has been no change in the nature of business of the Company.
22. DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
23. CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per section 135 and Schedule VII of the Companies Act, 2013, your Company has constituted the Corporate Social Responsibility Committee of Board of Directors which presently comprises of three members viz Mr Yash Kumar Sehgal, Chairman, Mr Lalit Bhasin, Member and Mr Luv Malhotra, Member. The CSR policy as approved by Board of Directors in pursuance of section 134 (3) (o) of the Act is annexed and form part of this report. Further, the Annual Report on CSR activity in pursuance of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, describing inter-alia the initiatives taken by the Company in implementation of its CSR Policy is annexed and forms part of this Report.
24. RELATED PARTY TRANSACTIONS
During the year under review, there is no related party transaction covered under Section 188(1) of the Companies Act, 2013. Other Related party transactions that were entered during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company.
The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013, the Rules there under and the Listing Agreement. This Policy was approved by the Board and has been uploaded on the website of the Company at www.chl.co.in.
25. BOARD EVALUATION
The performance evaluation of the Board, its Committees and Individual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a whole, Committees and self-evaluation. Directors, who were designated, held separate discussions with each of the Directors of the Company and obtained their feedback on overall Board effectiveness as well as each of the other Directors. Based on the questionnaire and feedback, the performance of every Director was evaluated in the meeting of the Nomination and Remuneration Committee (NRC). The Meeting of NRC also reviewed performance of the Managing Director (qualitative).
A separate meeting of the Independent Directors (âAnnual ID meetingâ) was convened on 14/02/2018, which reviewed the performance of the Board (as a whole), the Non-Independent Directors and the Chairman & Managing Director. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairman of the NRC with the Board''s Chairman covering performance of the Board as a whole; performance of the Non-Independent Directors and performance of the Board Chairman.
Some of the key criteria for performance evaluation are as follows -
Performance evaluation of Directors
- Attendance at Board or Committee meetings.
- Contribution at Board or Committee meetings.
- Guidance/support to management outside Board/Committee meetings.
Performance evaluation of Board and Committees
- Degree of fulfillment of Key responsibilities
- Board structure and composition
- Establishment and delineation of responsibilities to committees.
- Effectiveness of Board processes, information and functioning.
- Board culture and dynamics.
- Quality of relationship between Board and Management.
- Efficacy of communication with external stakeholders.
26. PARTICULARS AS PER SECTION 134(3)(m) OF THE COMPANIES ACT, 2013 READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES 2014
Conservation of Energy
Energy conservation continues to receive priority attention at all levels. All efforts are made to conserve and optimize use of energy with continuous monitoring, improvement in maintenance and distribution systems and through improved operational techniques. To give thrust on energy conservation, âoptimum utilization of natural lightâ, is focused on and energy saving lighting solution such as light emitting diodes and solar panel and devices such as automated controls and sensors are fitted in wherever necessary and feasible and it is being continuously adopted.
Technology Absorption
The Company being in the hospitality industry, particulars on technological absorption or expenditure on research and development are not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company has earned Rs. 1535.55 Lacs foreign exchange (previous year Rs. 2197.59 Lacs) and used foreign exchange to the extent of Rs. 804.07 Lacs (previous year Rs. 859.96 Lacs).
27. ACKNOWLEDGEMENTS
Your Directors wish to convey their appreciation to the business associates for their support and contribution during the year. Your Directors would also like to thank Central Government and State Government especially Department of Tourism, employees, shareholders, customers, suppliers, alliance partners and bankers for the continued support given by them to the Company and their confidence reposed in the management and the Company.
For and on behalf of the Board
Place: New Delhi Dr. Lalit Kumar Malhotra
Date: 28th May, 2018 Chairman & Managing Director
Mar 31, 2016
TO THE MEMBERS OF CHL LIMITED
The Directors have pleasure in presenting the 37th Annual Report of the Company along with the Audited Financial Statements for the Financial Year ended 31st March 2016.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE (Rs. in Lacs)
S. No. |
Particulars |
2015-16 |
2014-15 |
1. |
Gross Income |
6,066.16 |
5,852.54 |
2. |
Less: Operating Expenses |
4,930.45 |
4,987.92 |
3. |
Operating Profit before Depreciation and Finance Cost |
1135.71 |
864.62 |
4. |
Less: Depreciation & Amortization expense |
211.97 |
412.17 |
5. |
Less: Finance Cost |
648.50 |
404.90 |
6. |
Earnings before Tax prior period and extra ordinary items |
275.24 |
47.55 |
7. |
Prior Period Adjustment of tax |
- |
11.98 |
8. |
Extra Ordinary Items |
(32.10) |
- |
9. |
Profit before Tax |
243.14 |
59.53 |
10. |
Less : Net Tax Expenses |
138.49 |
2.36 |
11. |
Profit after Tax |
104.65 |
57.17 |
Sales and other incomes for the year under review at Rs. 6,066.16 Lacs are higher by 3.65% than that of the previous year''s sales and other income at Rs.5,852.54 lacs.
Operating profit before depreciation, interest and tax at Rs. 1135.71 Lacs for the year under review is higher by 31.35% as compared to Rs. 864.62 Lacs for the previous year.
Net Profit after providing tax for the year under review is Rs. 104.65 Lacs as compared to Rs 57.17 Lacs for the previous year, thus higher by 83% over the previous year.
2. ECONOMIC ENVIRONMENT AND BUSINESS REVIEW
The Indian tourism and hospitality industry has emerged as one of the key drivers of growth among the service sectors in India. Tourism has now become a significant industry in India. It is an employment generator, a significant source of foreign exchange for the country. Tourism in India is the third largest foreign exchange earner of the country after gems, jewellery and readymade garments. The booming tourism industry has had a cascading effect on the hospitality sector with an increase in the occupancy ratios and average room rates.
The long term outlook for the Indian hospitality business continues to be positive, both for the business and leisure segments with the potential for economic growth. The tourism and hospitality sector is among the top 15 sectors in India to attract the highest Foreign Direct Investment (FDI).
The Indian Government has also taken several steps to make India a global tourism hub. The Government has initiated ''Project Mausam'' under which it has proposed to establish cross cultural linkages and to revive historic maritime cultural and economic ties with 39 Indian Ocean countries. Further, the Government plans to cover 150 countries under e-visa scheme by the end of the year. Recently, the Indian Government has also released a fresh category of visa i.e. the Medical visa (M visa), to encourage medical tourism in India. The hotel industry in India thrives largely due to the growth in tourism and travel. Due to the increase in tourism with rising foreign and domestic tourists, hotel sector is bound to grow.
India, after China, is considered as one of the most lucrative hotel markets in the world. The Indian economy has certainly performed creditably compared to most developed and emerging markets of the world in the past years.
3. DIVIDEND
Your Company, due to inadequacy of profit, is not in a position to declare Dividend for the Financial Year 2015-16.
4. DIRECTORS
Mr. A. K. Malhotra (00676603) and Ms. Kajal Malhotra (01319170J Directors who retire by rotation and being eligible, have offered themselves for re-appointment. The Board recommends their appointments.
Mr. Alkesh Tacker (00513286) has been appointed as an Additional Director w.e.f. 15.03.2016 pursuant to Section 149(1) of the Companies Act, 2013. He has rich and vast experience in varied business fields. Pursuant to the Section 161(1) of the Companies Act, 2013, Mr. Alkesh Tacker holds office only upto the date of the forthcoming Annual General Meeting of the Company and is eligible for appointment as an Independent Director. The Board recommends his appointment.
Mr. O.P. Bajaj (00570940) and Mr. D.V. Malhotra (00072040) resigned from the Board w.e.f. 16.11.2015. The Board placed on record its appreciation for their valuable services rendered by them.
Pursuant to the provisions of Section 203 of the Act, the appointment of Dr. L. K. Malhotra, Chairman & Managing Director, Mr. Luv Malhotra, Joint Managing Director, Mr. Gagan Malhotra, Executive Director, Mr. N. K. Goel, Vice President (Finance)/Chief Financial Officer and Mr. G. J. Varadarajan, Company Secretary, are formalized as the Key Managerial Personnel of the Company.
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and provisions of the Listing Regulations. The profile of the Independent Directors forms part of the Corporate Governance Report.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required under the Listing Regulation with the Stock Exchange, the Management Discussion and Analysis Report is enclosed as a part of the Report.
6. RIGHT ISSUE
In the Board Meeting held on 09.02.2016 a âShare Issuance Committeeâ was formed to augment fund resources. The Committee has decided to bring out a Right Issue in the ratio and at a premium in consultation with the Merchant Banker.
7. SUBSIDIARY COMPANY
Our subsidiary, CHL International, a Joint Venture company in Dushanbe, Tajikistan has developed a Five-Star Hotel known as the Sheraton at Dushanbe, the capital of Tajikistan. This project has been financed by the Export Import Bank of India by way of a Term Loan aggregating to USD 32.50 million. The hotel has been in operation since 2015.
Shri Narendra Modi, our Honourable Prime Minister visited Dushanbe in July 2015 for High-Level talks with the President of Tajikistan Mr. Emomali Rahmon. The main spheres of talks concerned defense cooperation, connectivity, investment, security, energy and agriculture. Your Chairman & Managing Director Dr. L.K. Malhotra and your Executive Director Mr. Gagan Malhotra were also present to welcome Shri Modi to Dushanbe. The Prime Minister appreciated the efforts undertaken by your company towards the construction and development of the hotel project as a visible sign of Indian investment in Tajikistan. Smt. Sushma Swaraj our erstwhile External Affairs Minister had also visited the hotel while attending the 13th Annual summit of the Shanghai Cooperation organizations held in Dushanbe.
There are no Associate Companies within the meaning of Section 2(6) of the Companies Act, 2013 (âActâ). Further there has been no material change in the nature of business of the subsidiary.
In terms of proviso to sub section (3) of Section 129 of the Act, the salient features of the financial statement of the subsidiary is set out in the prescribed form AOC-1, which forms part of the Annual Report as Annexure B.
Performance and financial position of the subsidiary company is separately given in the Annual Report.
8. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. A complaint received in the previous year was settled by the Internal Complaints Committee. However, the parties preferred to go to Court. During the financial year 2015-16 no complaint was received on sexual harassment.
9. WHISTLE BLOWER /VIGIL MECHANISM
In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for Directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.chl.co.in under investors/ Whistle Blower Policy link.
10. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure- A.
11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
12. CONSOLIDATION OF FINANACIAL STATEMENT
As stipulated by regulation 33 of the Listing Regulations, the Consolidated Financial Statements have been prepared in accordance with the applicable Accounting Standards. The Audited Consolidated Financial Statements together with the Auditors'' Report forms part of the Annual Report.
Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the Financial Statements of the subsidiary in the prescribed Form AOC-1 is annexed to this report at Annexure B.
The Annual Accounts of the Subsidiary shall be kept for inspection by shareholders in the head office of the holding company and the subsidiary company.
13. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(5) of the Act, and based on the representations received from the management, the directors hereby confirm that:
i. in the preparation of the annual accounts for the Financial Year 2015-16, the applicable accounting standards have been followed and there is no material departure;
ii. they 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 at the end of the Financial year and of the profit of the Company for the Financial year;
iii. they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating properly; and
vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
14. CORPORATE GOVERNANCE
Your Company has taken adequate steps to adhere all the stipulations laid down in the Listing Regulation. A report on the Corporate Governance along with certificate from Practicing Company Secretary confirming the Compliance is included as part of the report.
15. LISTING WITH STOCK EXCHANGE
The Company confirms that it has paid the Annual Listing Fee for the year 2016-17 to Bombay Stock Exchange Limited (BSE), where the Company''s Shares are listed.
16. PARTICULARS OF EMPLOYEES
Employees of the Company drawing remuneration above the limits specified under Section 197(12) of the Companies Act, 2013 read rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:
(A) Personnel who are in receipt of remuneration aggregating not less than Rs.60,00,000 per annum and employed throughout the financial year
Name |
Dr. L. K. Malhotra |
Designation |
Chairman & Managing Director |
Remuneration |
Rs. 84 Lacs Per Annum |
Nature of Employment |
Permanent and subject to the provisions of Companies Act, 2013 |
Qualification |
Honorary Ph. D |
Experience |
51 years |
Date of Commencement of Present employment |
25.10.1980 |
Age |
72 Years |
Previous Employment |
M/s A. N. Malhotra & Sons, Kuwait |
% of Shares held in the company Whether related to any director |
3.75 Related to Mr. Luv Malhotra, Joint Managing Director Mr. A. K. Malhotra Ms. Kajal Malhotra |
17. DEMATERIALISATION OF SHARES
The total paid up equity share capital of the Company is Rs. 109,636,580 comprising of 5,48,18,290 equity shares of Rs. 2/- each. 5,00,43,870 (91.29%) Equity Shares of the Company stand dematerialized and balance 47,74,420 (8.71%) equity shares are still in physical form.
18. AUDITORS'' REPORT
Auditors'' observations are suitably explained in the Notes to the Accounts and are self explanatory.
19. AUDITORS Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the rules framed there under, M/s G Rai & Co. Chartered Accountants, were appointed as Statutory Auditors of the Company from the conclusion of the 35th Annual General Meeting (AGM) of the Company held on 29th September, 2014 till the conclusion of the 38th AGM to be held in the year 2017, subject to ratification of their appointment at every AGM. M/s G Rai & Co., have expressed their willingness to their confirmation of appointment as the Statutory Auditors of the Company and has furnished a certificate of their eligibility and consent under Section 141 of the Companies Act, 2013 and the Rules framed there under. In terms of the Listing Agreement/Regulations the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI. His appointment is proposed for ratification in the ensuing Annual General Meeting.
Internal Auditors
M/s Gulvardhan Malik & Co., Chartered Accountants have been conducting periodic Internal Audit of all the operations of the Company. Internal Audit Reports are regularly placed before the Audit Committee for their review and for recommendation to the Board.
Secretarial Auditors
According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s A. Chadha & Associates., Company Secretaries is continuing as Secretarial Auditor of the Company.
20. REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder:
(Rs. in Lacs)
S. No. |
Name |
Designation |
Remuneration paid in FY 2015-16 |
Remuneration paid in FY 2014-15 |
Increase in remuneration from previous year |
Ratio/ Times per Median of employee remuneration |
1. |
Dr. L. K. Malhotra |
Chairman & Managing Director |
84.00 |
84.00 |
Nil |
45.16 |
2. |
Mr. Luv Malhotra |
Joint Managing Director |
42.00 |
42.00 |
Nil |
22.58 |
3. |
Mr. Gagan Malhotra |
Executive Director |
42.00 |
42.00 |
Nil |
22.58 |
4. |
Mr. N. K. Goel |
Vice President(Finance)/CFO |
21.75 |
21.75 |
Nil |
11.69 |
5. |
Mr. G. J. Varadarajan |
Company Secretary |
07.86 |
07.49 |
0.37 |
04.23 |
21. INTERNAL CONTROL
The information about internal controls is set out in the Management Discussion & Analysis report which is attached and forms part of this Report.
22. RISK MANAGEMENT
The Risk Management is overseen by the Audit Committee of the Company on a continuous basis. The Committee oversees Company''s process and policies for determining risk tolerance and review management''s measurement and comparison of overall risk tolerance to established levels. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuous basis.
23. DEPOSIT FROM PUBLIC
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
24. CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per section 135 and Schedule VII of the Companies Act, 2013, the Company is not required to constitute a Corporate Social Responsibility Committee and formulate policy as it does not fall within purview of Section 135(1) of the Companies Act, 2013.
25. RELATED PARTY TRANSACTIONS
During the year under review, there is no related party transaction covered under Section 188(1) of the Companies Act, 2013. Other Related party transactions that were entered during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company.
The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013, the Rules there under and the Listing Agreement. This Policy was approved by the Board and has been uploaded on the website of the Company at www.chl.co.in under Related Party Policy link.
26. BOARD EVALUATION
The performance evaluation of the Board, its Committees and Individual Directors was conducted and the same was based on questionnaire and feedback from all the Directors on the Board as a whole, Committees and self-evaluation. Directors, who were designated, held separate discussions with each of the Directors of the Company and obtained their feedback on overall Board effectiveness as well as each of the other Directors. Based on the questionnaire and feedback, the performance of every Director was evaluated in the meeting of the Nomination and Remuneration Committee (NRC). The Meeting of NRC also reviewed performance of the Managing Director (qualitative).
A separate meeting of the Independent Directors (âAnnual ID meetingâ) was convened, which reviewed the performance of the Board (as a whole), the Non-Independent Directors and the Chairman & Managing Director. Post the Annual ID Meeting, the collective feedback of each of the Independent Directors was discussed by the Chairman of the NRC with the Board''s Chairman covering performance of the Board as a whole; performance of the Non-Independent Directors and performance of the Board Chairman.
Some of the key criteria for performance evaluation are as follows -Performance evaluation of Directors
- Attendance at Board or Committee meetings.
- Contribution at Board or Committee meetings.
- Guidance/support to management outside Board/Committee meetings.
Performance evaluation of Board and Committees
- Degree of fulfillment of Key responsibilities
- Board structure and composition
- Establishment and delineation of responsibilities to committees.
- Effectiveness of Board processes, information and functioning.
- Board culture and dynamics.
- Quality of relationship between Board and Management.
- Efficacy of communication with external stakeholders.
27. PARTICULARS AS PER SECTION 134(4)(m) OF THE COMPANIES ACT, 2013 READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES 2014
Conservation of Energy
Energy conservation continues to receive priority attention at all levels. All efforts are made to conserve and optimize use of energy with continuous monitoring, improvement in maintenance and distribution systems and through improved operational techniques. To give thrust on energy conservation, âoptimum utilization of natural lightâ, is focused on and energy saving lighting solution such as light emitting diodes and solar panel and devices such as automated controls and sensors are fitted in wherever necessary and feasible.
Technology Absorption
The Company being in the hospitality industry, particulars on technological absorption or expenditure on research and development are not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company has earned Rs. 1628.31 Lacs Foreign Exchange (previous year Rs. 1446.46 Lacs) and used foreign exchange to the extent of Rs. 273.94 Lacs (previous year Rs. 334.80 Lacs).
28. ACKNOWLEDGEMENTS
Your Directors wish to convey their appreciation to the business associates for their support and contribution during the year. Your Directors would also like to thank Central Government and State Government especially Department of Tourism, employees, shareholders, customers, suppliers, alliance partners and bankers for the continued support given by them to the Company and their confidence reposed in the management and the Company.
For and on behalf of the Board
Place: New Delhi Dr. L. K. Malhotra
Date: 27th May, 2016 Chairman & Managing Director
Mar 31, 2015
THE MEMBERS OF CHL LIMITED
The Directors have pleasure in presenting the 36th Annual Report of
the Company along with the Audited Financial Statements for the
Financial Year ended 31st March, 2015.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE (Rs. in Lacs)
S. No. Particulars 2014-15 2013-14
1 Gross Income 5,852.54 6,019.76
2 Profit Before Interest and Depreciation 864.62 954.66
3 Finance Charges 404.90 347.34
4 Provision for Depreciation 412.17 422.20
5 Net Profit Before Tax 47.55 185.12
6 Provision for Tax 11.42 73.82
7 Net Profit After Tax 48.11 126.54
Sales and other incomes for the year under review at Rs. 5,852.54 lacs
are lower by 2.78% than that of the previous year's sales and other
income at Rs. 6,019.76 lacs.
Operating profit before depreciation, Interest and tax at Rs. 864.62
lacs for the year under review is lower by 9.43% as compared to Rs.
954.66 lacs for the previous year.
Net Profit after providing tax for the year under review is Rs. 48.11
lacs as compared to Rs 126.54 lacs for the previous year, thus lowered
by 61.98% over the previous year. This is due to high fixed cost,
finance cost and operational cost accompanied by low tariff rate and
low occupancy because of oversupply of rooms and cut throat
competition.
2. ECONOMIC ENVIRONMENT AND BUSINESS REVIEW
While the new government has been able to project India as a investment
hub, in reality, the flow of Foreign Institutional Investments uncover
the truth that there is a lot to be done by the new government.
However, the policy paradigm by the new government has boosted
investors' sentiments strongly apart from a number of global factors.
Overall in the past one year the Indian markets have led this rally
with substantial increase in the investments in various sectors.
The Indian hospitality industry has emerged as one of the key
industries driving growth of the services sector in India. The fortunes
of the hospitality industry have always been linked to the prospects of
the tourism industry and tourism is the foremost demand driver of the
industry. The Indian hospitality industry has recorded healthy growth
fuelled by robust inflow of foreign tourists as well as increased
tourist movement within the country and it has become one of the
leading players in the global industry. The industry is likely to
experience robust growth on the back of rising disposable incomes and
favorable industry statistics.
The tourism and hospitality sector is among the top 15 sectors in India
to attract the highest Foreign Direct Investment (FDI). During the
period April 2000-February 2015, this sector attracted around US$
7,862.08 million of FDI, according to the data released by Department
of Industrial Policy and Promotion (DIPP).
The Indian government has realized the country's potential in the
tourism industry and has taken several steps to make India a global
tourism hub. Some of the major initiatives taken by the Government of
India to give a boost to the tourism and hospitality sector of India
are as follows:
- The Government of India has set aside Rs. 500 crore (US$ 79.17
million) for the first phase of the National Heritage City Development
and Augmentation Yojana (HRIDAY). The 12 cities in the first phase are
Varanasi, Amritsar, Ajmer, Mathura, Gaya, Kanchipuram, Vellankani,
Badami, Amaravati, Warangal, Puri and Dwarka which will be developed as
smart cities.
- The Government of India is extending visa on arrival facility to
150 countries in stages from the current 43 countries. This is a big
leap towards the promotion of tourism in India.
In the recent years there are new hotel projects including entry of
foreign hotel chains that are coming up in and around Delhi and the
other Metropolitan cities. The Indian Hotel room market for ten metros
is expected to expand at a compound rate. The supplies of rooms are
outpacing its demand. These new hotels have added further competition
to the already existing cut throat competition resulting in low tariff
but at the same time cost of material that has gone up will threaten
the profitability.
3. DIVIDEND
Your Company, due to inadequacy of profit, is not in a position to
declare Dividend for the financial year 2014-15.
4. DIRECTORS
Mr. A. K. Malhotra and Mr. O. P. Bajaj, Directors who retire by
rotation and being eligible, have offered themselves for re-
appointment. The Board recommends their appointment.
Mr. R. C. Sharma, an Independent Director who retires by rotation and
being eligible has offered himself for re-appointment for a period of 5
(Five) consecutive years and not liable to retire by rotation. The
Board recommends his appointment.
Ms. Kajal Malhotra has been appointed as an Additional Director w.e.f.
09.02.2015 pursuant to Section 149(1) of the Companies Act, 2013 and
clause 49(11)(A)(1) of the Listing Agreement. She has good grip in
finance and has legal acumen. As a Woman Director in the Company she
will contribute a lot in the affairs of the Company. Pursuant to the
Section 161(1) of the Companies Act, 2013 Ms. Kajal Malhotra holds
office only upto the date of the forthcoming Annual General Meeting of
the Company and is eligible for appointment as Director. The Board
recommends her appointment.
Pursuant to the provisions of Section 203 of the Act, the appointment
of Dr. L. K. Malhotra, Chairman & Managing Director Mr. Luv Malhotra,
Joint Managing Director, Mr N. K. Goel, Vice President (Finance)/Chief
Financial Officer and Mr. G. J. Varadarajan, Company Secretary, are
formalized as the Key Managerial Personnel of the Company.
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required under Clause 49 of the Listing Agreement with the Stock
Exchange, the Management Discussion and Analysis Report is enclosed as
a part of the Report.
6. SUBSIDIARY COMPANY
You are all well aware that CHL International, a Joint Venture Company
at Dushanbe, Tajikistan, which promoted a Hotel project at Dushanbe,
Tajikistan has been financed by Export Import Bank of India (EXIM Bank)
by way of term loan. The EXIM Bank has financed the project by
sanctioning a further additional term loan of USD 6 Million, thus
aggregating the term loan of USD 32.50 Mn.
The hotel was inaugurated partly in September, 2014 due to requirement
of rooms by Tajikistan Government for Shanghai Cooperation
Organization, under the brand name Sheraton Dushanbe. The soft opening
(trial run) of the hotel was commenced in the last week of December,
2014 and it has commenced its full operation w.e.f. 01.04.2015.
There are no Associate Companies within the meaning of Section 2(6) of
the Companies Act, 2013 ("Act"). Further there has been no material
change in the nature of business of the subsidiary.
In terms of proviso to sub section (3) of Section 129 of the Act, the
salient features of the financial statement of the subsidiary is set
out in the prescribed form AOC-1, which forms part of the Annual Report
as Annexure B.
Performance and financial position of the subsidiary company is
separately given in the Annual Report.
7. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance for sexual harassment at workplace and
has adopted a policy on prevention, prohibition and redressal of sexual
harassment at workplace in line with the provisions of Sexual
Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and the rules framed thereunder. During the
financial year 2014-15, one complaint was received on sexual harassment
which is under process of enquiry.
8. WHISTLE BLOWER /VIGIL MECHANISM
In pursuant to the provisions of section 177(9) & (10) of the Companies
Act, 2013, a Vigil Mechanism for directors and employees to report
genuine concerns has been established. The Vigil Mechanism Policy has
been uploaded on the website of the Company at www.chl.co.in under
investors/ Whistle Blower Policy link.
9. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form
MGT-9 is annexed herewith as Annexure- A
10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
11. CONSOLIDATION OF FINANACIAL STATEMENT
The duly audited consolidated financial statement as required under the
Accounting Standard 21 and provisions of Clause 32 of the Listing
Agreement has been prepared after considering the audited financial
statement of your Company and its subsidiary.
The annual accounts of the subsidiary shall be kept for inspection by
shareholders in the head office of the holding company and the
subsidiary company.
12. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(5) of the Act, and based on
the representations received from the management, the directors hereby
confirm that
i. in the preparation of the annual accounts for the Financial Year
2014-15, the applicable accounting standards have been followed and
there are no material departures;
ii. they 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 at the end of the financial year and of the profit of the
Company for the financial year;
iii. they have taken proper and sufficient care to the best of their
knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Act. They confirm that
there are adequate systems and controls for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by
the Company and that such internal financial controls are adequate and
operating properly; and
vi. they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
13. CORPORATE GOVERNANCE
Your Company has taken adequate steps to adhere all the stipulations
laid down in clause 49 of the Listing Agreement. A report on the
Corporate Governance along with certificate from Practicing Company
Secretary confirming the Compliance with the conditions of Corporate
Governance as stipulated under clause 49 of the Listing Agreement is
includes as a part of the report. In the ensuing Annual General Meeting
its appointment is being ratified.
14. LISTING WITH STOCK EXCHANGE
The Company confirms that it has paid the Annual Listing Fee for the
year 2015-16 to Bombay Stock Exchange Limited (BSE), where the
Company's Shares are listed. Securities and Exchange Board of India
(SEBI) vide its Order passed on 19.11.2014 has withdrawn the
recognition granted to Delhi Stock Exchange Limited (DSE) and DSE is
derecognized w.e.f.19.11.2014. Pursuant to de-recognition, Listing of
shares of your Company at DSE became ineffective and got automatically
de-listed and the same has been informed to the shareholders by the
Company through public notice.
15. PARTICULARS OF EMPLOYEES
Employees of the Company drawing remuneration above the limits
specified under Section 197(12) of the Companies Act, 2013 read rule
5(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given below.
16. DEMATERIALISATION OF SHARES
The total paid up equity share capital of the Company is Rs.
109,636,580 comprising of 5,48,18,290 equity shares of Rs. 2/- each.
4,68,56,192 (85.48%)Equity Shares of the Company stand dematerialized
and balance 79,62,098 (14.52%) equity shares are still in physical
form.
17. AUDITORS' REPORT
Auditors' observations are suitably explained in notes to the Accounts
and are self explanatory.
18. AUDITORS Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the rules
framed thereunder, M/s G Rai & Co. Chartered Accountants, were
appointed as statutory auditors of the Company from the conclusion of
the 35th Annual General Meeting (AGM) of the Company held on 29th
September, 2014 till the conclusion of the 38th AGM to be held in the
year 2017, subject to ratification of their appointment at every AGM.
Internal Auditors
M/s L.N. Malik & Co. Chartered Accountants had been conducting periodic
internal audit of all operations of the Company. As per Section 144 of
the Companies Act, 2013, Statutory Auditors of a subsidiary company can
not function as Internal Auditor of its holding company (CHL Limited).
Pursuant to section 138 of the Companies Act, 2013, M/s Gulvardhan
Malik & Co., Chartered Accountants was appointed as an Internal Auditor
of the company w.e.f. 15.11.2014. Internal Audit Reports are regularly
placed before the Audit Committee for their review and for
recommendation to the Board.
Secretarial Auditors
According to the provision of section 204 of the Companies Act, 2013
read with Rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, M/s A. Chadha & Co., Company
Secretaries is continuing as Secretarial Auditor of the Company.
19. REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL
(KMP) / EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of
The Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in
respect of employees of the Company and Directors is furnished
hereunder:
(Rs. in Lacs)
S. Name Designation Remuneration Remuneration
No. paid FY paid FY
2014-15 2013-14
1. Dr. L. K. Malhotra Chairman & 84 42
Managing Director
2. Mr. Luv Malhotra Joint Managing 42 42
Director
3. Mr. Gagan Malhotra Executive Director 42 42
4. Mr. N. K. Goel Vice President 21.75 21.12
(Finance)/CFO
5. Mr. G. J. Varadarajan Company Secretary 7.49 7.27
Name Increase in Ratio/Times
remuneration per Median
from previous of employee
year remuneration
Dr. L. K. Malhotra 42 44.24
Mr. Luv Malhotra Nil 22.12
Mr. Gagan Malhotra Nil 22.12
Mr. N. K. Goel 0.63 11.46
Mr. G. J. Varadarajan 0.22 3.94
20. INTERNAL CONTROL
The information about internal controls is set out in the Management
Discussion & Analysis report which is attached and forms part of this
Report.
21. RISK MANAGEMENT
The Risk Management is overseen by the Audit Committee of the Company
on a continuous basis. The Committee oversees Company's process and
policies for determining risk tolerance and review management's
measurement and comparison of overall risk tolerance to established
levels. Major risks identified by the businesses and functions are
systematically addressed through mitigating actions on a continuous
basis. For details, please refer to the Management Discussion and
Analysis report which form part of the Board Report.
22. DEPOSIT FROM PUBLIC
The Company has not accepted any deposits from public and as such, no
amount on account of principal or interest on deposits from public was
outstanding as on the date of the balance sheet.
23. CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per section 135 and Schedule VII of the Companies Act, 2013, the
Company is not required to constitute a Corporate Social Responsibility
Committee and formulate policy as it does not fall within purview of
Section 135(1) of the Companies Act, 2013.
24. RELATED PARTY TRANSACTIONS
During the year under review there is no related party transaction
covered under section 188(1) of the Companies Act, 2013. Other Related
party transactions that were entered during the financial year were on
an arm's length basis and were in the ordinary course of business.
There were no materially significant related party transactions with
the Company's Promoters, Directors, Management or their relatives,
which could have had a potential conflict with the interests of the
Company.
The Board of Directors of the Company has, on the recommendation of the
Audit Committee, adopted a policy to regulate transactions between the
Company and its Related Parties, in compliance with the applicable
provisions of the Companies Act 2013, the Rules there under and the
Listing Agreement. This Policy was approved by the Board and has been
uploaded on the website of the Company at www.chl.co.in under Related
Party Policy link.
25. BOARD EVALUATION
The performance evaluation of the Board, its Committees and Individual
Directors was conducted and the same was based on questionnaire and
feedback from all the Directors on the Board as a whole, Committees and
self-evaluation. Directors, who were designated, held separate
discussions with each of the Directors of the Company and obtained
their feedback on overall Board effectiveness as well as each of the
other Directors. Based on the questionnaire and feedback, the
performance of every director was evaluated in the meeting of the
Nomination and Remuneration Committee (NRC). The meeting of NRC also
reviewed performance of the Managing Director (qualitative). Ms. Kajal
Malhotra, Additional Director, appointed on 09.02.2015, was excluded
from the process of evaluation.
A separate meeting of the independent directors ("Annual ID meeting")
was convened, which reviewed the performance of the Board (as a whole),
the non-independent directors and the Chairman & Managing Director.
Post the Annual ID meeting, the collective feedback of each of the
Independent Directors was discussed by the Chairman of the NRC with the
Board's Chairman covering performance of the Board as a whole;
performance of the non-independent directors and performance of the
Board Chairman.
Some of the key criteria for performance evaluation are as follows -
Performance evaluation of Directors
- Attendance at Board or Committee meetings.
- Contribution at Board or Committee meetings.
- Guidance/support to management outside Board/Committee meetings.
Performance evaluation of Board and Committees
- Degree of fulfillment of Key responsibilities
- Board structure and composition
- Establishment and delineation of responsibilities to committees.
- Effectiveness of Board processes, information and functioning.
- Board culture and dynamics.
- Quality of relationship between Board and management.
- Efficacy of communication with external stakeholders.
26. PARTICULARS AS PER SECTION 134(4)(m) OF THE COMPANIES ACT, 2013
READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES 2014
Conservation of Energy
Energy conservation continues to receive priority attention at all
levels. All efforts are made to conserve and optimize use of energy
with continuous monitoring, improvement in maintenance and distribution
systems and through improved operational techniques. To give thrust on
energy conservation, "optimum utilization of natural light", is focused
on and energy saving lighting solution such as light emitting diodes
and solar panel and devices such as automated controls and sensors are
fitted in wherever necessary and feasible.
Technology Absorption
The Company being in the hospitality industry, particulars on
technological absorption or expenditure on research and development are
not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company has earned Rs.1446.46 lacs
Foreign Exchange (previous year Rs. 1760.29 lacs) and used foreign
exchange to the extent of Rs. 334.80 lacs (previous year Rs. 306.00
lacs).
27. ACKNOWLEDGEMENTS
Your Directors wish to convey their appreciation to the business
associates for their support and contribution during the year. Your
Directors would also like to thank Central Government and State
Government especially Department of Tourism, employees, shareholders,
customers, suppliers, alliance partners and bankers for the continued
support given by them to the Company and their confidence reposed in
the management and the Company.
For and on behalf of the Board
Place: New Delhi Dr. L. K. Malhotra
Date: 11th August, 2015 Chairman & Managing Director
Mar 31, 2014
Dear Members,
The Directors are pleased to present their 34th Annual Report together
with the Audited Accounts for the year ended 31st March 2014.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE
2013-14 2012-13
Particulars (Rs. in Lacs) (Rs. in Lacs)
Total Income
Sales 5746.80 5590.41
Other Income 272.96 6019.76 283.47 5873.88
Less:Total Expenses
(Inclusive of
exceptional items) 5049.76 4275.31
Gross Profit before 969.90 1598.57
Interest, Depreciation
and Tax
Less : Financial 347.34 375.76
: Depreciation 422.20 769.54 474.36 850.12
Profit Before Tax 200.36 748.45
Less: Provision for Tax 73.56 243.99
Net Profit after Tax 126.80 504.46
Add : Profit brought
forward from last year 4542.57 4372.95
Profit available for
appropriation 4669.37 4877.41
APPROPRIATIONS
Transferred to General Reserves 30.00 80.00
Proposed Dividend on equity shares
including interim dividend - 219.27
Tax on Dividend - 35.57
Balance carried to Balance Sheet 4639.37 4542.57
Sales and other incomes for the year under review at Rs 6019.76 lacs is
higher by 2.48% than that of the previous year''s sales and other income
at Rs. 5873.88 lacs.
Operating profit before depreciation, finance charges and tax at Rs.
969.90 lacs for the year under review is lower by 39.32% as compared to
Rs.1598.57 lacs for the previous year. Net Profit after providing tax
for the year under review is Rs. 126.80 lacs as compared to Rs. 504.46
lacs for the previous year, thus lower by 74.86% over the previous
year. This is due to high fixed cost accompanied by operational cost in
the context of meager increase in turnover.
2. ECONOMIC ENVIRONMENT AND BUSINESS REVIEW
The Indian tourism and hospitality industry has emerged as one of the
key drivers of growth among the services sectors in India. Tourism in
India is an employment generator and a significant source of foreign
exchange for the country, apart from being an economic activity that
helps local and host communities. In 2013, the travel and tourism
industry contributed Rs 2.17 trillion (US$ 36 billion) or 2 per cent to
the country''s gross domestic product (GDP). This is expected to rise to
Rs 4.35 trillion (US$ 72.17 billion) in the coming years.
The tourism industry in India is thriving due to an increase in foreign
tourist arrivals (FTA) and a greater number of Indians travelling to
domestic destinations than before. The revenue from domestic tourism is
likely to grow by 8.2 per cent in 2014 as compared to 5.1 per cent a
year ago, according to the World Travel and Tourism Council (WTTC).
Hotels are also an extremely important component of tourism industry.
India''s travel and tourism industry is expected to grow by about 7.3
per cent in 2014, according to WTTC.
The Government of India has contributed significantly to the growth and
development of the industry by providing policy and infrastructural
support such as simplification of visa procedures and tax holidays for
hotels. Further, the tourism policy of the government aims at speedy
implementation of tourism projects, development of integrated tourism
circuits, special capacity building in the hospitality sector and new
marketing strategies.
FTAs during the period JanuaryÂMarch 2014 stood at 21.27 lakh as
compared to FTAs of 20.27 lakh during the corresponding period of 2013,
registering a marginal growth of 4.9%. FTAs during March 2014 were 6.69
lakh as compared to 6.40 lakh during March 2013, a growth of 4.5 %.
During the year under review the Domestic Tourism Industry remained
sluggish with marginal increase of Foreign Tourist Arrivals. But,
consequent to the addition of more than 10,000 rooms in Delhi/NCR and
other Metropolitan cities like Mumbai, Chennai, Bangaluru and Hyderabad
the Hotel Industry was particularly impacted and your Hotel is not an
exception to it. Weak pricing scenario and increase in operating costs
in an inflationary environment has particularly affected the
profitability of Hotel Industry and your company is equally impacted in
such challenging business environment. With the formation of the New
Government our economy should re-gain a trajectory of high growth and
outlook for the company in expected to grow.
3. DIVIDEND
Your Company, due to inadequacy of profit, is not declaring Dividend
for the financial year 2013-14.
4. DIRECTORS
Mr. Subhash Ghai, Mr. D. V. Malhotra and Mr. Lalit Bhasin, Directors of
the Company are due to retire by rotation at the forthcoming Annual
General Meeting. Mr. Subash Ghai and Mr. Lalit Bhasin who are already
on the Board of the Company as Independent Directors are being
appointed in the same position in the forth coming Annual General
Meeting for a period of 5 (five) consecutive years and shall not retire
by rotation. Mr. D.V. Malhotra a non-independent director being
eligible, offer himself for re-appointment.
Mr. Yash Kumar Sehgal has vast experience in the field of finance. He
held various positions at Commercial Bank of Kuwait, Oman for more than
two decades in the past.. He has a good expertise in framing policies
and procedure for various services of the Bank. Mr. Yash Kumar Sehgal
was appointed as an Additional Director of the Company w.e.f.
25.09.2013 holding the position of an Independent Director He holds
office till the conclusion of the ensuing Annual General Meeting. The
company has received notice from the shareholder/s proposing the
appointment of Mr. Yash Kumar Sehgal as independent Director for a
period of 5 (five) consecutive years and shall not retire by rotation.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required by Clause 49 of the Listing Agreement with the Stock
Exchange(s), Management Discussion and Analysis is annexed to the
Annual Report.
6. SUBSIDIARY COMPANY
CHL International, a Joint Venture Company at Dushanbe, Tajikistan, is
under final phase of its Hotel project at Dushanbe Tajikistan. The
Export Import Bank of India has financed the Hotel Project by
sanctioning a term loan of USD 26.50 million for which your company has
given a corporate guarantee. It is expected to commence its operation
soon under the brand name Sheraton Dushanbe.
The statement as required under Section 212 of the Companies Act, 1956
in respect of the subsidiary company is annexed and forms an integral
part of the Annual Report.
7. CONSOLIDATION OF FINANACIAL STATEMENT
The duly audited consolidated financial statement as required under the
Accounting Standard 21 and provisions of Clause
32 of the Listing Agreement has been prepared after considering the
audited financial statement of your Company and its
subsidiary.
The Annual Accounts of the Subsidiary companies and the detailed
information shall be made available to the shareholders
seeking any information relating to consolidated accounts at any point
of time. The annual accounts of the subsidiary shall
be kept for inspection by shareholders in the head office of the
holding company and the subsidiary company.
The summarized position of the Subsidiary has been appended to the
report.
8. DIRECTORS'' RESPONSIBILITY STATEMENT
In terms of Section 217 (2AA) of the Companies Act 1956, the Directors
confirm as under:
(i) That in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with proper
explanation relating to material departures. (ii) The accounting
policies have been applied consistently, judgments and estimates made
are responsible and prudent
so as to give a true and fair view of the State of Affairs of the
Company as at the end of the accounting year and of the
profit of the Company for that period. (iii) That proper and
sufficient care for maintenance of adequate accounting records in
accordance with the provisions of
this Act for safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities have
been made. (iv) That the Annual Accounts have been prepared on a going
concern basis.
9. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, a Report on
Corporate Governance together with Practicing Company Secretary''s
certificate is annexed to the Annual Report.
10. INFORMATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 217(2A)
OF THE COMPANIES ACT 1956 READ WITH THE COMPANIES (PARTICULARS OF
EMPLOYEES RULES 1975, AS AMENDED) EMPLOYED THROUGHT THE YEAR/PART OF
THE YEAR.
There are no employees of the Company drawing remuneration above the
limits specified under Section 217(2A) of the Companies Act, 1956 read
with the Companies (Particular of Employees) Rules 1975.
11. SECRETARIAL AUDIT
As directed by Security and Exchange Board of India (SEBI), Secretarial
Audit is being carried out by Practicing Company Secretary. The finding
of the Secretarial Audit have been satisfactory.
12. AUDITORS'' REPORT
As regards Auditors'' observations, the notes on accounts are
self-explanatory and do not call for any further clarification.
13. AUDITORS
Statutory Auditors
M/s G Rai & Co. Chartered Accountants, Auditors of the Company, retire
at the close of the Annual General Meeting and are eligible for
re-appointment. In terms of Section 139 of the Companies Act, 2013 they
can be appointed for a remaining term of 3 years starting from the
conclusion of the ensuing Annual General Meeting until the conclusion
of the 38th Annual General Meeting of the company (subject to
ratification of their appointment at each Annual General Meeting.
The company has received letter from the Statutory Auditors to the
effect that their re-appointment, if made, would be within the
prescribed limit under section 141(3)(g) of the Companies Act. 2013 and
that they are not disqualified for re- appointment.
Internal Auditors
M/s L.N. Malik & Co. Chartered Accountants have been conducting
periodic internal audit of all operations of the Company. Internal
Audit Reports are regularly placed before the Audit Committee for their
review and for recommendation to the Board.
14. FIXED DEPOSITS
The Company has not accepted deposits within the meaning of Company''s
(Acceptance of Deposits) Rules 1975 from public during the year. There
is no unpaid or unclaimed deposits lying with the Company.
15. PARTICULARS AS PER COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF DIRECTORS) RULES 1988
Conservation of Energy
Efforts on energy conservation are being pursued continuously. Regular
repairs and maintenance of all equipment/ materials are carried out to
ensure optimum efficiency. To give thrust on energy conservation,
"optimum utilization of natural light", is focused on and energy saving
lighting solution such as light emitting diodes and solar panel and
devices such as automated controls and sensors are fitted in wherever
necessary and feasible. Your Company, being engaged in the Hotel
business, details as per Form ''A'' are not applicable.
Technology Absorption
The Company being in the hospitality industry, particulars on
technological absorption or expenditure on research and development are
not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company earned Foreign Exchange
equivalent to Rs. 1760.29 lacs (previous year Rs. 1570.42.lacs ) and
used foreign exchange to the extent of Rs. 306.00 lacs (previous year
Rs. 77.18 lacs).
16. ACKNOWLEDGEMENTS
Your Directors wish to thank Central and State Governments, especially
Department of Tourism, Company''s Bankers, customers, suppliers for the
valuable cooperation and support.
The Board of Directors also expresses their sincere thanks to the
shareholders for the support and the confidence reposed in the Company.
The Board takes this opportunity to thank all employees of the Company
at all levels for their commitment and dedication. Your Directors look
forward to the bright future.
For and on behalf of the Board
Place: New Delhi Dr L.K. Malhotra
Date: 9th August, 2014 Chairman & Managing Director
Mar 31, 2012
TO THE MEMBERS OF CHL LIMITED
The Directors are pleased to present their 33rd Annual Report together
with the Audited Accounts for the year ended 31st March 2012.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE
2011-12 2010-11
Particulars (Rs. in lacs) (Rs. in lacs)
Total Income
Sales 6,238.55 6,561.03
Other Income 424.26 6,662.81 374.93 6,935.96
Less: Total Expenses 4,906.15 4,846.03
(Inclusive of
exceptional items)
Gross Profit before
Interest,
Depreciation and Tax 1,756.66 2,089.93
Less : Financial Charges 485.80 436.35
Depreciation 485.13 431.26
970.93 867.61
Profit Before Tax 785.73 1,222.32
Less: Provision
for Tax 329.60 338.48
Net Profit after Tax 456.13 883.83
Add : Profit
brought forward
from last year 4,251.67 3,881.38
Profit available
for appropriation 4,707.80 4,765.21
APPROPRIATIONS
Transferred to General Reserves 80.00 130.00
Proposed Dividend on equity
shares including interim dividend 219.28 328.91
Tax on Dividend 35.57 54.63
Balance carried to Balance Sheet 4,372.95 4,251.67
Sales and other incomes for the year under review at Rs. 6,662.81 lacs
is lower than that of the previous year's sales and other incomes at
Rs. 6,935.96 lacs by 3.93%.
Operating profit before depreciation finance charges and tax at Rs.
1,756.66 lacs for the year under review as compared to Rs. 2,089.93
lacs for the previous year, is lower by 15.95 %.
Net Profit after providing tax for the year under review is to Rs.
456.13 lacs as compared to Rs. 883.83 lacs for the previous year, thus
lower by 48.39% over the previous year.
2. BUSINESS REVIEW
The success story of the 'Hotel Industry in India' seconds only to
China in Asia-Pacific. India is witnessing an unpredictable growth in
hotel construction and will be adding almost 1,14,000 hotel guest rooms
to its inventory over the next five years. Hotel industry in India is
supporting a large number of population. From labour class to working
professionals, the tourist sector provides employment over 50 million
people in India and it is the single largest employment generator. The
Federation of Hotel and Restaurant Association of India (FHRAI) has
sought support from the government in the 12th year plan for the
development of the tourism sector including budgetary allocation aiming
to increase the foreign flow for this sector.
While reviewing operating performance of the hotel industries it was
analyzed that hotel industry in India is recovering from the blows it
suffered in the year 2008 first due to financial meltdown in America in
September and later due to terrorists attack at Mumbai. The foreign
tourist flow in India is substantially reduced by 18-20% during these
periods. The onset of the global economic slowdown still has a greater
impact on the profitability of the sector determined by occupancy rate.
The local competition has also increased due to number of hotels coming
up in and around Delhi which adversely affect the occupancy rate and
profitability of the company.
3. DIVIDEND
The Board has already declared an interim dividend @ Rs. 1.00 per
equity share in the Board Meeting held on 10.02.2012 for the financial
year ended 31.03.2012.
The Board further recommended a Final Dividend @ Rs. 1.00 per equity
share in respect of the Financial Year under review.
The Final Dividend, together with the Interim Dividend, will make the
total dividend @ Rs. 2.00 (20%) per share in respect of the Financial
Year. As per the provisions of the Income Tax Act 1961, the tax on
Dividend will be borne by the Company.
The overall distribution of Dividend for the year under review will be
Rs 254.85 lacs including Corporate Dividend Tax.
4. DIRECTORS
Mr. Subhash Ghai and Mr. D. V. Malhotra, Directors of the Company are
due to retire by rotation at the forthcoming Annual General Meeting and
they, being eligible, offer themselves for re-appointment.
Mr. Lalit Bhasin was appointed as a Director of the Company in Casual
Vacancy arisen due to demise of Shri H. C. Bhasin. He will vacate
office at the ensuing Annual General Meeting. Pursuant to Section 257
of the Companies Act, 1956, it is proposed to appoint him as a director
of the company with effect from the date of the ensuing Annual General
Meeting of your company. Your Board recommends for the approval of
members the appointment of Mr. Lalit Bhasin as a Director of the
Company.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required by Clause 49 of the Listing Agreement with the Stock
Exchange(s), Management Discussion and Analysis is annexed to the
Annual Report.
6. SUBSIDIARY COMPANY
As you are aware, CHL International, a Joint Venture Company at
Tajikistan, is constructing a hotel at Dushanbe at Tajikistan. The CHL
International has entered into an agreement with Starwood, Sheraton
brand for marketing, management and operation of the hotel.
The hotel is at the advance stage of completion and interior fitout
works and procurement of hotel operating system are in full swing.
The statement as required under Section 212 of the Companies Act, 1956
in respect of the subsidiary company is annexed and forms an integral
part of the Annual Report.
In terms of circular No. 2/2011 dared 08th February 2011, issued by
Ministry of Corporate Affairs, Government of India, the Board of
Directors has, at the meeting held on 23.07.2011, passed a resolution
giving consent for not attaching the Balance Sheet, Statement of Profit
and Loss and other Documents of the subsidiary company.
7. CONSOLIDATION OF FINANACIAL STATEMENT
The duly audited consolidated financial statement as required under the
Accounting Standard 21 and provisions of Clause 32 of the Listing
Agreement has been prepared after considering the audited financial
statement of your Company and its subsidiary.
The Annual Accounts of the Subsidiary companies and the detailed
information shall be made available to the shareholders seeking any
information relating to consolidated accounts at any point of time. The
annual accounts of the subsidiary shall be kept for inspection by
shareholders in the head office of the holding company and the
subsidiary company.
The summarized position of the Subsidiary has been appended to the
report.
8. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 217 (2AA) of the Companies Act 1956, the Directors
confirm as under:
(i) That in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
(ii) The accounting policies have been applied consistently, judgments
and estimates made are responsible and prudent so as to give a true and
fair view of the State of Affairs of the Company as at the end of the
accounting year and of the profit of the Company for that period.
(iii) That proper and sufficient care for maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities have been made.
(iv) That the Annual Accounts have been prepared on a going concern
basis.
9. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, a Report on
Corporate Governance together with Practicing Company Secretary's
certificate is annexed to the Annual Report.
10. INFORMATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 217(2A)
OF THE COMPANIES ACT 1956 READ WITH THE COMPANIES (PARTICULARS OF
EMPLOYEES RULES 1975, AS AMENDED) EMPLOYED THROUGHT THE YEAR/PART OF
THE YEAR
There are no employees of the Company drawing remuneration above the
limits specified under Section 217(2A) of the Companies Act, 1956 read
with the Companies (Particular of Employees) Rules 1975.
11. SECRETARIAL AUDIT
As directed by Security and Exchange Board of India (SEBI), Secretarial
Audit is being carried out by Practicing Company Secretary. The finding
of the Secretarial Audit have been satisfactory.
12. AUDITORS' REPORT
As regards Auditors' observations, the notes on accounts are
self-explanatory and do not call for any further clarification.
13. AUDITORS
Statutory Auditors
M/s G Rai & Co. Chartered Accountants, Auditors of the Company, retire
at the close of the Annual General Meeting and are eligible for
re-appointment. The Company has received confirmation from the firm
that the appointment will be within the limits prescribed under section
224(1) (B) of the Companies Act, 1956. The Audit Committee of the Board
has recommended their appointment. The necessary resolution is being
placed before the shareholder for their approval.
Internal Auditors
M/s L.N. Malik & Co. Chartered Accountants have been conducting
periodic internal audit of all operations of the Company. Internal
Audit Reports are being laid down before the Audit Committee for their
review and for recommendation to the Board.
14. AUDITORS OF SUBSIDIARY COMPANY
M/s G. Rai & Co. Chartered Accountants, has resigned from the
Auditorship of the Subsidiary Company and M/s L. N. Malik & Co.
Chartered Accountants, has been appointed as auditors of the Subsidiary
Company in their place for the financial year 2012-2013.
15. FIXED DEPOSITS
The Company has not accepted deposits within the meaning of Company's
(Acceptance of Deposits) Rules 1975 from public during the year. There
is no unpaid or unclaimed deposits lying with the Company.
16. PARTICULARS AS PER COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF DIRECTORS) RULES 1988 Conservation of Energy
Efforts on energy conservation are being pursued continuously. Regular
repairs and maintenance of all equipment/materials are carried out to
ensure optimum efficiency. To give thrust on energy conservation,
"optimum utilization of natural light", is focused on and energy
saving lights and devices are fitted in wherever necessary and
feasible. Your Company, being engaged in the Hotel business, details as
per Form 'A' are not applicable.
Technology Absorption
The Company being in the hospitality industry, particulars on
technological absorption or expenditure on research and development are
not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company earned Foreign Exchange
equivalent to Rs 1600.17 lacs (previous year Rs. 2088.42.lacs ) and
used foreign exchange to the extent of Rs. 139.22 lacs (previous year
Rs. 348.24 lacs).
17. ACKNOWLEDGEMENTS
Your Directors wish to thank Central and State Governments, especially
Department of Tourism, Company's Bankers, customers, suppliers for the
valuable cooperation and support.
The Board of Directors also expresses their sincere thanks to the
shareholders for the support and the confidence reposed in the Company.
The Board takes this opportunity to thank all employees of the Company
at all levels for their commitment and dedication. Your Directors look
forward to the bright future.
For and on behalf of the Board
Place : New Delhi Dr L.K. Malhotra
Date : 9th August, 2012 Chairman & Managing Director
Mar 31, 2011
TO THE MEMBERS OF CHL LIMITED
The Directors are pleased to present their 32nd Annual Report together
with the Audited Accounts for the year ended 31st March 2011.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE
2010-11 2009-10
Particulars (Rs. in lacs) (Rs. in lacs)
Total Income
Sales 6,561.03 70,36.97
Other Income 374.93 6,935.96 368.81 7,405.78
Less: Total Expenses 4,840.78 4,871.00
Gross Profit before
Interest, Depreciation
and Tax 2,095.18 2,534.78
Less : Financial
Charges 436.35 381.05
Depreciation 431.26 421.12
Deferred Revenue
Expenditure - 867.61 1.40 803.57
Profit Before Tax 1,227.57 1,731.21
Less: Provision
for Tax 338.48 589.27
Net Profit
after Tax 889.09 1,141.94
Add : Profit
brought
forward from
last year 3,881.38 3,422.76
Adjustment of last
year's provision (5.26) 1.49
Profit available
for appropriation 4,765.21 4,566.19
APPROPRIATIONS
Transferred to
General Reserves 130.00 300.00
Proposed Dividend
on equity shares 328.91 328.91
including interim
dividend
Tax on Dividend 54.63 55.90
Balance carried
to Balance Sheet 4,251.67 3,881.38
Sales and other incomes for the year under review at Rs. 6935.96 lacs
is lower than that of the previous year's sales and other incomes at
Rs. 7405.78 lacs by 6.34%.
Operating profit before depreciation finance charges and tax at Rs.
2095.18 lacs for the year under review as compared to Rs. 2534.78 lacs
for the previous year, is lower by 17.34 %
Net Profit after providing tax for the year under review is to Rs.
889.09 lacs as compared to Rs. 1141.94 lacs for the previous year, is
lower by 22.14%.
2. BUSINESS REVIEW
Hospitality industry is very well knitted with travel and tourism
industry. India is the most favourite destination for the global
tourists and it experiences huge footfalls as a favourite place of
visit because of its vast and rich cultural heritage.
Tourism in India was seen as a mere service sector for a long time. It
is being now recognized as an export industry due its multiple
advantages. Now it is one of the largest service industries in India
with contribution of 6.23% to the National GDP and 8.78% of the total
employment in India.
The mood is upbeat in the travel and tourism especially in the Hotel
Business. At the Hotel Investment Forum India, Indian and International
Hotel chains expressed optimism at the growth potential of the Indian
Market and outlined big investment plans for coming years.
The business of Indian Hotel industry is very bright because the kind
of the growth expected over the next couple of years or more is in tune
of 15-20%. Importantly the Hotel Industry and the Hotel chain groups
are very bullish and optimistic about their investment and commitment
as far as the growth is concerned. Thus by reviewing the last year
trend about the Hotel Industry in India we are hopeful for the better
result in the near future.
3. DIVIDEND
The Board has already declared an interim dividend @ Rs. 1.50 per
equity share in the Board Meeting held on 27.01.2011 for the financial
year ended 31.03.2011.
The Board further recommended a Final Dividend @ Rs.1.50 per equity
share in respect of the Financial Year under review.
The Final Dividend, together with the Interim Dividend, will make the
total dividend @ Rs.3.00 (30%) per share in respect of the Financial
Year 2010-2011. As per the provisions of the Income Tax Act 1961, the
tax on Dividend will be borne by the Company.
The overall distribution of Dividend for the year under review will be
Rs 383.54 lacs including Corporate Dividend Tax.
4. DIRECTORS
Mr. R. C. Sharma, Mr. A. K. Malhotra and Mr. O. P. Bajaj, Directors of
the Company are due to retire by rotation at the forthcoming Annual
General Meeting and they, being eligible, offer themselves for
re-appointment.
Shri. Harish Chander Bhasin demised on 7th December, 2010.
Mr. Lalit Bhasin was appointed as a Director of the Company in the
casual vacancy arisen due to sudden demise of Late Shri. Harish Chander
Bhasin, in the Board Meeting held on 27.01.2011.
Mr. Gagan Malhotra was appointed as a Director of the Company in Casual
Vacancy arisen due to resignation of Mr. Kumud Malhotra. He will vacate
office at the ensuing Annual General Meeting. Pursuant to Section 257
of the Companies Act, 1956, it is proposed to appoint him as a director
of the company with effect from the date of the ensuing Annual General
Meeting of your company.
Subject to the approval of shareholders in the ensuing Annual General
Meeting, Mr. Gagan Malhotra was appointed as a Whole Time Director of
the Company for a period of 3 years commencing from 1st April, 2010 to
31st March, 2013 in the Board Meeting held on 29.10.2010. Your Board
recommends for the approval of members the appointment of Mr. Gagan
Malhotra as Director as well as Whole Time Director.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required by Clause 49 of the Listing Agreement with the Stock
Exchange(s), Management Discussion and Analysis is annexed to the
Annual Report.
6. SUBSIDIARY COMPANY
CHL International, a Joint Venture Company at Dushanbe, Tajikistan, is
constructing a Hotel at Dushanbe very near to Dushanbe International
Airport. All the works and structure of the Hotel have already been
completed and is expected to be operational by first quarter of the
year 2012.
As on the Balance Sheet date, your company holds 338,940 equity shares
of 100 Somoni each in CHL International comprising of 70% of its share
capital, equivalent to Rs.36.32 Crore, including call in arrears Rs.
4.16 Crore.
Your company has furnished a Corporate Guarantee to the extent of US
$18.00 million to the Export Import Bank of India on behalf of the
subsidiary company
CHL International was awarded four contracts from NHPC, for draining
and de-silting the Varzob River and also for repairing the dam
structure of the river. Out of which two contracts were successfully
completed.
The Statement as required under Section 212 of the Companies Act, 1956
in respect of the subsidiary of the Company is annexed and forms an
integral part of the Annual Report
7. CONSOLIDATION OF FINANACIAL STATEMENT
Pursuant to general exemption granted in terms of Circular No. 2/2011
dated 8.02.2011 issued by Ministry of Corporate Affairs, New Delhi,
under Section 212 of the Companies Act, 1956, the company has not
attached Balance Sheet, Profit & Loss Account of the subsidiary company
and its other documents, with the Annual Report of the Company.
However, the Company makes available of these documents upon requests
by any member of the Company. Further these documents is available at
the Registered Office of the Company for inspection by any member of
the Company during office hours
As required under the aforesaid Circular, a summarized position of the
Subsidiary has been appended to the report.
The duly audited consolidated financial statement as required under the
Accounting Standard 27 and provisions of Clause 32 of the Listing
Agreement has been prepared after considering the audited financial
statement of your Company and its subsidiary.
8. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act 1956, the Directors
confirm as under:
(i) That in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
(ii) The accounting policies have been applied consistently, judgments
and estimates made are responsible and prudent so as to give a true and
fair view of the State of Affairs of the Company as at the end of the
accounting year and of the profit of the Company for that period.
(iii) That proper and sufficient care for maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities have been made.
(iv) That the Annual Accounts have been prepared on a going concern
basis.
9. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, a Report on
Corporate Governance together with Practicing Company Secretary's
Certificate is annexed to the Annual Report.
10. INFORMATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 217(2A)
OF THE COMPANIES ACT 1956 READ WITH THE COMPANIES (PARTICULARS OF
EMPLOYEES) RULES 1975, AS AMENDED EMPLOYED THROUGH OUT THE YEAR/PART OF
THE YEAR.
There are no employees of the Company drawing remuneration above the
limits specified under Section 217(2A) of the Companies Act, 1956 read
with the Companies (Particular of Employees) Rules 1975 as amended by
the Ministry of Corporate Affairs vide general Circular No.
23/2011dated 03.05.2011
11. SECRETARIAL AUDIT
As directed by Security and Exchange Board of India (SEBI), Secretarial
Audit is being carried out by Practicing Company Secretary. The finding
of the Secretarial Audit have been satisfactory.
12. AUDITORS' REPORT
As regards Auditors' observations, the notes on accounts are
self-explanatory and do not call for any further clarification.
13. AUDITORS
Statutory Auditors
M/s G Rai & Co. Chartered Accountants, Auditors of the Company, retire
at the close of the Annual General Meeting and is eligible for
re-appointment. The Company has received confirmation from the firm
that the appointment will be within the limits prescribed under section
224(1) (B) of the Companies Act, 1956. The Audit Committee of the Board
has recommended their appointment. The necessary resolution is being
placed before the shareholder for the approval.
Internal Auditors
M/s L.N. Malik & Co. Chartered Accountants have been conducting
periodic internal audit of all operations of the Company. Internal
Audit Reports are being laid down before the Audit Committee for their
review and for recommendation to the Board.
The Audit Committee of the Board of Directors has recommended their
re-appointment.
14. PARTICULARS AS PER COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF DIRECTORS) RULES 1988
Conservation of Energy
Efforts on energy conservation are being pursued continuously. Regular
repairs and maintenance of all equipment/materials are carried out to
ensure optimum efficiency. To give thrust on energy conservation,
Ãoptimum utilization of natural lightÃ, is focused on and energy saving
lights and devices are fitted in wherever necessary and feasible. Your
Company, being engaged in the Hotel business, details as per Form ÃA'
are not applicable
Technology Absorption
The Company being in the hospitality industry, particulars on
technological absorption or expenditure on research and development are
not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your Company earned Foreign Exchange
equivalent to Rs. 2088.42.lacs (previous year Rs. 2443.10 lacs) and
used foreign exchange to the extent of Rs. 348.24 lacs (previous year
Rs. 218.04 lacs).
15. ACKNOWLEDGEMENTS
Your Directors wish to thank Central and State Governments, especially
Department of Tourism, Company's Bankers, customers, suppliers for the
valuable cooperation and support.
The Board of Directors also expresses their sincere thanks to the
shareholders for the support and the confidence reposed in the Company.
The Board takes this opportunity to thank all employees of the Company
at all levels for their commitment and dedication.
Your Directors look forward to the bright future.
For and on behalf of the Board
Dr L.K. Malhotra
Chairman & Managing Director
New Delhi
Date : July 23, 2011
Mar 31, 2010
The Directors are pleased to present their 31st Annual Report together
with the Audited Accounts for the year ended 31st March 2010.
1. FINANCIAL RESULTS AND OPERATIONAL PERFORMANCE
2009-10 2008-09
Particulars ( Rs. in lacs) (Rs. in
lacs)
Total Income
Sales 7036.97 8209.27
Other Income 368.81 7405.78 289.55 8498.82
Less: Total Expenses 4871.00 5625.70
Gross Profit before
Interest,
Depreciation and Tax 2534.78 2873.12
Less : Financial
Charges 381.05 354.04
Depreciation 421.12 338.31
Deferred Revenue
Expenditure 1.40 1.40
803.57 693.75
Profit Before Tax 1731.21 2179.37
Less: Provision
for Tax 589.27 851.24
Net Profit
after Tax 1141.94 1328.13
Add : Profit
brought forward
from last year 3422.76 2801.63
Adjustment of last
years provision 1.49 (22.19)
Profit available
for appropriation 4566.19 4107.57
APPROPRIATIONS
Transferred to
General Reserves 300.00 300.00
Proposed Dividend
on equity shares
including interim
dividend 328.91 328.91
Tax on Dividend 55.90 55.90
Balance carried
to Balance Sheet 3881.38 3422.76
Sales and other incomes for the year under review at Rs. 7405.78 lacs
is lower than that of the previous year Rs. 8498.82 lacs by 12.86%.
Operating profit before depreciation and finance charges at Rs. 2534.78
lacs for the year under review as compared to Rs. 2873.12 lacs for the
previous year, is lower by 11.77 %
Net Profit after providing tax for the year under review is to Rs.
1141.94 lacs as compared to Rs. 1328.13 lacs for the previous year,
thus lower by 14.01% over the previous year.
2. BUSINESS REVIEW
The Hotel & Tourism industry is cyclical in nature and highly
susceptible to the macro -environmental changes. Aviation and
hospitality are the first to get impacted by adverse environment and
the last to recuperate. Often described as fragile industry, the demand
for the travel is highly susceptible to the event like economic slow
down, wars, disease outbreak and terrorism
The balance sheet of the hotel companies are under stress on account of
occupancy levels in major metro station including Delhi and Mumbai.
During the current financial year growth have fallen as compared to the
previous years. The ARR has also gone down across the major cities by
about 20%. The compound effect is expected to result in reduced
profitability to the tune of 20-25 percent. Despite the numerous
problems tourism industry was one of the largest foreign exchange
earners for India. Realizing the potential in India, international &
domestic hotel chains were rushing to cash on it. The entry of
multinationals and Indian Hotel chains expanding internationally only
reinforces the segments untapped business potential. The demand for
travel and tourism in India is expected to grow by 8.2 % between
2010-2019 and will place India in the third position in the world. The
common wealth game would be the good opportunity to showcase the rich
culture heritage of the country to the international community
3. DIVIDEND
The Board has already declared an interim dividend @ Rs. 1.50 per
equity share in the Board Meeting held on 25.01.2010 for the financial
year ended 31.03.2010.
The Board further recommended a Final Dividend @ Rs.1.50/- per equity
share in respect of the Financial Year under review.
The Final Dividend, together with the Interim Dividend, will make the
total dividend @ Rs.3.00 (30%) per share in respect of the Financial
Year. As per the provisions of the Income Tax Act 1961, the tax on
Dividend will be borne by the Company.
The overall distribution of Dividend for the year under review will be
Rs 384.81 lacs including corporate Dividend Tax.
4. DIRECTORS
Mr. Subhash Krishan Dayal Ghai, Mr. D. V. Malhotra and Mr. Harish C
Bhasin, Directors of the Company are due to retire by rotation at the
forthcoming Annual General Meeting and they, being eligible, offer
themselves for re-appointment.
Mr. B. N Malhotra and Mr. Kumud Malhotra resigned from the Directorship
of the Company w.e.f. 05.11.2009.
Mr. Gagan Malhotra who was the Vice President (Corporate Development)
of the Company joined as a Director of the company w.e.f. 25.01.2010 in
place of Mr. Kumud Malhotra.
5. MANAGEMENT DISCUSSION AND ANALYSIS
As required by Clause 49 of the Listing Agreement with the Stock
Exchange(s), Management Discussion and Analysis is annexed to the
Annual Report.
6. CHANGE OF NAME
The Franchise Agreement with International Hotels Group is coming to an
end in the month of September 2010 and as such your hotel will now be
known as "The Suryaa New Delhi" w.e.f. 1st September, 2010.
7. SUBSIDIARY COMPANY
CHL International, a close joint stock company, was incorporated in the
year 2001 at Dushanbe, Tajikistan under the Civil Code of the Republic
of Tajikistan with the main objective of construction of Hotels cum
Commercial Complex.
The project cost of hotel is US $ 29.08 million (126.72 million
Somoni). Out of it, its equity component is US $ 11.08 million (48.42
million Somoni) and loan component is US $ 18.00 million (78.30 million
Somoni).
During the period under review, your company acquired additional
interest in CHL International an erstwhile associate company, thus
making it a subsidiary w.ef. 30th October, 2009. The companys stake in
CHL International as on Balance Sheet date is 84.11% (21.03 million
somoni).
Your Companys contribution will be up to 70% of the share capital of
US $ 11.08 million, (48.42 million Somoni) amounting to US $ 7.76
million (33.87 million Somoni).
The Export & Import Bank of India (EXIM Bank) has sanctioned a term
loan of US$ 18.00 million for part financing/ setting up of /
developing 5 Star Hotel in Tajikistan. Your company has agreed to
furnish its corporate guarantee to the Exim Bank for the aforesaid
loan.
The Statement as required under Section 212 of the Companies Act, 1956
in respect of the subsidiary viz. CHL International is annexed and
forms an integral part of the Annual Report.
8. CONSOLIDATION OF FINANACIAL STATEMENT
The duly audited consolidated financial statement as required under the
Accounting Standard 21 and provisions of Clause 32 of the Listing
Agreement has been prepared after considering the audited financial
statement of your company and its subsidiary.
9. DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 217(2AA) of the Companies Act 1956, the Directors
confirm as under:
(i) that in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
(ii) the accounting policies have been applied consistently, judgments
and estimates made are responsible and prudent so as to give a true and
fair view of the state of affairs of the Company as at the end of the
accounting year and of the profit of the company for that period.
(iii) that proper and sufficient care for maintenance of adequate
accounting records in accordance with the provision of this Act for
safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities have been made.
(iv) that the annual accounts have been prepared on a going concern
basis.
10. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, a Report on
Corporate Governance together with Practicing Company Secretarys
certificate is annexed to the Annual Report.
11. (a) INFORMATION IN ACCORDANCE WITH THE PROVISION OF SECTION 217(2A)
OF THE COMPANIES ACT 1956
READ WITH THE COMPANIES (PARTICULARS OF EMPLOYEES RULES 1975, AS
AMENDED) EMPLOYED THROUGH OUT THE YEAR IS GIVEN BELOW:
Name Age Desig
nation Remun
eration Qualif
ication Experi
ence Date of
Joining Last Empl
oyment
includ
ing Dir
ectors
Commis
sion on
Profits
(Rs.
in lac)
Dr.
L.K. 66 CMD 96.00 Ph.D 45
years 15.07.1985 Managing
Director
Mal
hotra Ashraf &
Malhotra,
Kuwait
Mr.
Luv 37 ED 76.00 Master 12
Years 11.09.1998 GM (Coord
ination)
Malh
otra Degree
in CHL
Limited
Econo
mics
The appointment is contractual. Their Gross remunerations comprise of
salary, allowances, medical expenses, leave travel assistance, and
other perquisites are subject to the Companies Act 1956 and also
subject to the provisions of Income Tax Act and Rules. Dr. L.K.
Malhotra is related to Mr. D.V. Malhotra, Mr. A. K. Malhotra, and Mr.
Luv Malhotra.
Mr. Luv Malhotra is related to Dr L.K. Malhotra.
(b) INFORMATION IN ACCORDANCE WITH THE PROVISION OF SECTION 217(2A) OF
THE COMPANIES ACT 1956 READ WITH THE COMPANIES (PARTICULARS OF
EMPLOYEES RULES 1975, AS AMENDED) EMPLOYED PART OF THE YEAR IS GIVEN
BELOW:
Name Age Desi
gnation Salary & Qualif
ication Exper
ience Date of Last
Employment
Perqui
site Joining
(Rs in
lac)
Mr.
Ga
gan 42 Director 22.77 B.Sc., 17
Years 02.04.2007 VP
Malh
otra Univer
sity
of (Corporate
Michi
gan,
USA Development)
CHL Ltd
Mr. Gagan Malhotra resigned from the post of VP (Corporate Development)
of the company w.e.f. 23.01.2010. He joined the Board w.e.f. 25.01.2010
in place Mr. Kumud Malhotra.
12. SECRETARIAL AUDIT
As directed by Security and Exchange Board of India (SEBI), Secretarial
Audit is being carried out by Practicing Company Secretary. The finding
of the Secretarial Audit have been satisfactory.
13. AUDITORS REPORT
As regards Auditors observations, the notes on accounts are
self-explanatory and do not call for any further clarification.
14. AUDITORS
Statutory Auditors
M/s G Rai & Co. Chartered Accountants, Auditors of the company, retire
at the close of the Annual General Meeting and is eligible for
re-appointment. The Company has received confirmation from the firm
that the appointment will be within the limits prescribed under section
224(1) (B) of the Companies Act, 1956. The Audit Committee/ Board has
recommended their appointment. The necessary resolution is being placed
before the shareholder for the approval.
Internal Auditors
M/s L.N. Malik & Co. have been conducting periodic internal audit of
all operations of the company. Internal Audit Reports are being laid
down before the Audit Committee for their review and for recommendation
to the Board.
15. PARTICULARS AS PER COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF DIRECTORS) RULES 1988
Conservation of Energy
Efforts on energy conservation are being pursued continuously. Regular
repairs and maintenance of all equipment/ materials are carried out to
ensure optimum efficiency. To give thrust on energy conservation,
Ãoptimum utilization of natural lightÃ, is focused on and energy saving
lights and devices are fitted in wherever necessary and feasible. Your
company, being engaged in the hotel business, details as per Form ÃA
are not applicable
Technology Absorption
The company being in the hospitality industry, particulars on
technological absorption or expenditure on research and development are
not applicable.
Foreign Exchange Earnings and Outgo
During the year under review, your company earned Foreign Exchange
equivalent to Rs. 2443.10 lacs (previous year Rs. 3483.07 lacs) and
used foreign exchange to the extent of Rs. 218.04 lacs (previous year
Rs. 481.95 lacs).
16. ACKNOWLEDGEMENTS
Your Directors wish to thank Central and State Governments, especially
Department of Tourism, Companys Bankers, customers, suppliers for the
valuable cooperation and support.
The Board of Directors also express their sincere thanks to the
shareholders for the support and the confidence reposed in the company.
The Board takes this opportunity to thank all employees of the company
at all levels for their commitment and dedication.
Your Directors look forward to the bright future.
For and on behalf of the Board
New Delhi Dr L.K. Malhotra
Date : July 30, 2010 Chairman and Managing Director
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