Vardhman Textiles Limited AR 2016-17 PDF
Vardhman Textiles Limited AR 2016-17 PDF
Vardhman Textiles Limited AR 2016-17 PDF
bonds of trust
01 02 03
CORPORATE STATUTORY FINANCIAL
OVERVIEW REPORTS STATEMENTS
Strengthening the
legacy of trust
22 65+ 350+
State-of-the-art Country global Key customers
manufacturing assets marketing presence across the globe
across six states in India
Driving excellence
for decades
We are Vardhman Group (Vardhman). Incorporated in 1973,
Vardhman Textiles Limited is the flagship company of Vardhman
Group, which is one of India’s largest textile conglomerates with
presence across the textile value chain viz., yarn, sewing thread,
fabric, fibre and garments.
4
DRIVING EXCELLENCE FOR DECADES ANNUAL REPORT 2016-17
Vardhman Yarns & Vardhman Acrylics VMT Spinning Co. VSSL VNGL
Threads (VYTL) (VAL) (VMT)
Business RMG/ Industrial/ Acrylic Fibre 100% Cotton Yarn Special Steels Garments
Specialty Threads
Capacity 41 TPD threads, 71K 20,000 TPA 46,320 spindles Rolling 150,000 MTPA 1.8 mn pieces
spindles (captive)
Market Status Unlisted Listed on NSE Unlisted Listed on BSE & NSE Unlisted
STEEL
FIBRE
GARMENTS
5
CORPORATE OVERVIEW
Fibre and yarn dyeing Nihon Sanmo, Japan Technical collaborations for foray into yarn and fibre dyeing
Gassed mercerised yarns Kyung Bang, South Korea Technical collaborations for foray into gassed mercerised yarns
Cotton yarns (ended in 2012) Toho Rayon, Japan Joint venture for making customised yarns for the Japanese market
Acrylic fibre Exlan and Marubeni Corp, Technology contract for the transfer of technology and equipment supply
(JV ended in 2009) Japan contract for the supply of proprietary and special plant and equipment
Fabric dyeing and finishing Tokai Senko, Japan Technical collaboration for forward integration into fabric processing
Sewing threads American & Efird (A&E) Inc., Joint Venture; A&E is now the majority shareholder in the JV with 89%
USA holding.
PAN-INDIA PRESENCE
Ludhiana
Hoshiarpur
Baddi
Malerkotla
38.50
Budhni,
61.47 Satlpur,
Mandideep
Jhagadia
Perundrai
Offices
Domestic Export
Manufacturing Facilities
6
PAN-INDIA PRESENCE ANNUAL REPORT 2016-17
CAPACITIES
Financial performance
1,726.13
1,304.81
5,613.96
1,349.18
899.38
114.33 crore 376.95 crore 405.43 crore
2015-16 2016-17 Y-o-Y growth 2015-16 2016-17 Y-o-Y growth 2015-16 2016-17 Y-o-Y growth
Our revenue increased, owing to Our EBIDTA increased owing to multiple Our PBT grew with growing revenues
increased domestic sales, new product efficiency enhancing measures across all and rationalised costs across the board.
launches, shifting to more value-added our manufacturing facilities.
products and widened global footprint.
EARNINGS PER SHARE FIXED TANGIBLE ASSETS (NET) BOOK VALUE PER SHARE
(`) (` in crore) (`)
712.66
163.67
2,573.87
2,499.95
594.64
109.00
Our earnings per share grew owing to Our fixed tangible assets declined due Our book value per share grew owing to
rising net profits. to depreciation of ` 324.85 crore in higher earnings.
FY 2016-17.
8
FINANCIAL PERFORMANCE ANNUAL REPORT 2016-17
1,228.09
3,985.85
281.57
3,689.92
221.84
868.60
Our stable net worth is a testimony Our net cash from operating We have responsibly contributed to the
to the stable earnings over a period activities increases owing to prudent exchequer over the period.
of time. growth strategies.
2015-16 2016-17
1,001.59
9
CORPORATE OVERVIEW
Robust business
model
1 Smart strategy
T S
PU
N Good governance 2
I
R
OU
3 Risk management
Technical tie-ups 4
5 Global corporates
Efficient logistics 6
7 Effective Talent Management
RESOURCES
Raw materials
Good industrial relations 8
Technology
Employees
9 Financial management
Suppliers
Relationships
Community participation 10
FINANCIAL CAPITAL
Own funds: ` 3,985.85 crore
Equity: ` 55.93 crore
Value added products
Reserves: ` 3,929.92 crore Compact Yarn Fibre Dyed
Long-term Borrowings: ` 1,143 crore
Cotton Lycra Gas Mercerised
Melange Yarn Fancy Yarns
ASSETS Cotton Dyed Slub Yarns
12 state-of-the-art production
plants strategically located in the PC Yarn Dyed Acrylic Yarns
states of Punjab, Himachal Pradesh Yarn Dyed Hand-knitted Yarns
and Madhya Pradesh.
10
ROBUST BUSINESS MODEL ANNUAL REPORT 2016-17
Strong cotton
procurement policy
Employee engagement
Raw material Ginning
and culture of
innovation
Customer-oriented
approach
Weaving/Knitting Spinning
Focus on diversified
and value-added
products
Technology
upgradation and
continuous process
Processing Garment/Apparel improvement
Integrated business
Specialised products model
Cotton Lyocell Cotton Viscose
Financial strength and
Cotton Bamboo Organic Cotton sustainability
Cotton Tencel Fair Trade Yarn
Consistently strong
Cotton Silk Contamination-free
Yarn credit rating
Cotton Modal
11
From routine Their insights, along with
encouragement and support, help
day-to-day operations usreach
combat business challenges and
new milestones.
to formulating critical
strategies for business
expansion or for
fulfilling sustainability
commitments, we are
powered by the enduring
bonds of trust with all
our stakeholders.
CORPORATE OVERVIEW
Chairman’s Review
WE FOCUS ON OPTIMUM
CAPACITY UTILISATION,
CUSTOMER SERVICE,
DIFFERENTIATION IN
PORTFOLIO AND UNIFORM
QUALITY STANDARDS TO KEEP
US AHEAD OF THE CURVE.
Dear Friends, which may enable the Government It may be pertinent to state that
India continues to be one of the to give relief to certain sectors where apparel is going to drive growth
world’s fastest growing economies tax rates are high. of the textile industry in Asian
in a largely volatile global economic economies as it is always followed
scenario. The Government is In the global textile sector, developed by spinning and fabric making to
implementing key reforms to drive countries like the US and European integrate the entire chain. In our
sustainable economic growth, Union are major buyers, whereas view, any country which intends to
despite challenges. There is focus emerging markets like China, develop a section of the industry
on developing infrastructure, India, Bangladesh, Vietnam focus independent of the growth of
increasing rural spending and giving on manufacturing, owing to lower apparel may succeed for a time, yet
Indian youth opportunities to attain cost in these regions. Among the may find difficulty in competing. A
relevant skills for employment or emerging nations, currently China vertically integrated industry provides
entrepreneurship. is a dominant player in the global a better chance for each country to
textile trade. However, this is likely remain competitive as also attractive
During FY 2016-17, the Government to change owing to increasing labour to world retail buyers. Obviously, the
took steps to shape a bigger and production cost in the region, preference goes to such countries as
and cleaner GDP through the offering a wide opportunity to India lead time due to fashion changes is
demonetisation initiative and by and other developing countries like fast coming down. A shorter supply
facilitating the passage of the Goods Bangladesh and Vietnam. chain management may become
and Services Tax (GST) Bill in the key for the success of any country in
Parliament. The countries that are able to offer grabbing a larger world share in this
a climate which makes apparel industry.
These steps may bring more of the industry more competitive, may
economy in the organised sector and presumably take a bigger share of The Government of India is finalising
also enhance the revenue collection, the world trade in textiles. the New Textile Policy, which we
14
CHAIRMAN’S REVIEW ANNUAL REPORT 2016-17
hope may address many of the the preferred partner of choice for installation of additional spindles at
concerns, which at present are all our stakeholders i.e. employees, Satlapur.
limiting the growth of this industry. clients, government and society.
We hope the Government will utilise We have emerged as one of the
the potential of this industry in Towards this vision, this year, we leading players in this sector through
creating millions of jobs by having a decided to reward our employees’ our team’s persistent efforts. We are
more holistic approach and plan of long association with the Company consistently investing in enhancing
action by going through those factors, as well as motivate the employees the capabilities of our people through
which affect our competitiveness in by creating a sense of participation focused training and coaching. We
relation to countries like Bangladesh and ownership among them, by identify high-potential individuals and
and Vietnam, which have significantly grant of Employee Stock Options. groom them for future leadership
exceeded their export of garments The ultimate objective is to achieve roles.
over India in the last few years. This is sustained growth of the Company
evident from the fact that Bangladesh and the creation of shareholder Partnering the community
and Vietnam have a 6% and 5.3% value by aligning the interests of During the year, as a part of our
share in apparel exports as against employees with the long-term corporate responsibility initiative, we
India’s share, which was 4.1% in 2015. interests of the Company. focused on education, healthcare
and community development. We
2016-17 in retrospect Investing for future assisted government schools near
During 2016-17, we increased our We focus on optimum capacity our locations by providing adequate
revenues by 2.04% and post-tax utilisation, customer service, infrastructure.
profit by 48.08%, driven by our cost- differentiation in portfolio and
efficient operations, better planning, uniform quality standards to keep us We provided medical facilities to
enhanced technology and coverage ahead of the curve. rural population in the vicinity of our
of cotton at the right time. plants, who have hardly any access
At VTL, we have incurred a capital to basic healthcare needs. We are
We sold 40% stake (of 51%) in our expenditure of around ` 2,000 crore also focusing on empowerment of
subsidiary Vardhman Yarns & in the last five years. Currently, we women near our plants by providing
Threads Limited (VYTL) for ` 413 operate at near 100% utilisation them with relevant employment
crore. This initiative is in line with our levels in the yarn business, catering opportunities.
strategy to focus more on our core to diverse customer requirements.
business (yarn and fabric). We are also consolidating our Our objective is to act as a change
fabric business and are focusing on agent and help bring the fruits
Looking at all relevant factors, expanding capacity in this space. of economic development to the
including the present debt to equity marginalised sections of India’s
of the Company, investments Going forward, we have a planned population.
planned in the next two-three years capital expenditure of ` 2,500 crore
as well as the increase in accumulated over three-four years towards the On behalf of the Board and the
free reserves (including a one-time ongoing schemes at Baddi, Himachal entire leadership team, I thank all our
cash inflow from the stake sale), we Pradesh, as well as proposed stakeholders, business partners as
considered it appropriate to reward expansion in Satlapur and Budhni in well as customers for their continued
our shareholders through a buyback Madhya Pradesh and modernisation guidance and support.
of 62,60,869 equity shares for ` 1,150/ in other units.
share aggregating to ` 720 crore. In all these years, we have crossed a
The proposed capex would be number of milestones, but I believe
In today’s competitive world, partially towards the ongoing that the journey continues...
employees are a company’s most expansion schemes for enhancing
important resource and asset. yarn dyed and printed fabric capacity Warm Regards,
The Company fully recognises this as well as increasing looms capacity.
fact and wants its employees to Shri Paul Oswal
participate and share the fruits of Further, it has been proposed to A fellow shareholder
growth and prosperity along with the increase fabric processing capacity, at
Company. We have a vision of being Budhni, Madhya Pradesh, along with
15
CORPORATE OVERVIEW
Management Message
16
MANAGEMENT REVIEW ANNUAL REPORT 2016-17
OUR WORKING CAPITAL CYCLE REDUCED BY 31 DAYS We thank our dynamic team for
TO 134 DAYS IN 2016-17 PRIMARILY OWING TO LOWER their continued hard work and
COTTON INVENTORY. WE ALSO REPAID DEBT WORTH innovation and for taking initiatives
` 556.44 CRORE DURING 2016-17. to strengthen our brand across
markets. We are also grateful to
our shareholders and the entire
stakeholder fraternity for their
continued support in our vision.
Warm regards,
We realigned standard operating invested in top-of-the-line equipment
protocols (manufacturing and non- to provide unique fabric finishes.
Sachit Jain, Suchita Jain and
manufacturing processes) in line
Neeraj Jain
with best global practices. We also Moreover, we improved our
institutionalised periodic operational technology platform, so that our
Joint Managing Directors
audits in line with Standard process automation, product quality
Operating Procedures (SOPs) and and monitoring processes can be
invested in real-time monitoring upgraded to deliver higher and
of operations for faster corrective better output. Our technological
action. We have also put in place a capabilities have accelerated
systematic asset review to trace and data-driven analytics and decision-
arrest technology obsolescence and making, enabling us to capitalise on
opportunities at a faster rate.
17
CORPORATE OVERVIEW
CUSTOMERS EMPLOYEES
We engage with our We provide attractive
customers on a continuous career opportunities for our
basis to understand their employees with recognitions
requirements and offer them and rewards.
bespoke solutions.
We provide continuous
We enjoy repeat business need-based trainings for skill
from existing clients on upgradation.
account of enduring
We have policies and
relationships.
governance framework to
We adhere to stringent quality manage both business needs
parameters to deliver best-in- and employee expectations.
class products.
We introduced employee stock
We continuously expanded options (ESOP) to reward our
our value-added product employees.
basket to cater to growing
We have a diverse workforce;
customer requirements.
we also focus on gender
diversity.
18
SUSTAINABLE VALUE FOR ALL ANNUAL REPORT 2016-17
19
Fabric of
excellence
We produce fabric for a diverse range of
apparel. We have made significant investments
to gain technical know-how from global leaders
to enrich our offerings. Our pursuit of excellence
is validated by our well-rounded versatile
product portfolio.
Fabric is a value-added component of
our business, which makes a significant
contribution to our profitability.
FABRIC OF EXCELLENCE ANNUAL REPORT 2016-17
21
CORPORATE OVERVIEW
Healthcare
We helped many hospitals procure medical equipment
with monetary contributions. Healthcare institutes
Education like CMC Ludhiana, Civil Hospital in Malerkotla and
Education leads to empowerment. We have undertaken Community Health Centre in Baddi benefited significantly
the following initiatives in the sphere of education: through our contributions. These hospitals procured
machines like a-scan, keratometer, digital x-ray machine,
Established Sri Aurobindo Public School in Baddi, HP, electric fowler bed, blood gas analyser, cell counter,
in 1996 and in Budhni, MP in 2016 to groom children semi-automatic analyser and so on. These greatly helped
into responsible citizens through conventional and underprivileged sections of society to avail quality
innovative teaching techniques healthcare at subsidised costs.
Set up Sri Aurobindo College of Commerce and
Management, Ludhiana, in 2004
Undertook several projects worth ` 3 crore in various
government schools, providing drinking water,
classrooms, desks, labs and so on; renovating existing
toilets; constructing water storage tanks; repairing
kitchens and sheds in various government schools in
the states of:
• Himachal Pradesh (Billanwali, Sandholi, Gullerwala,
Dharampur and Nalagarh)
• Punjab (Khanna, Nabha, Sherpur, Sangrur, Patiala,
Bugra Sakhewal and Manekwal)
Community Initiatives
• Madhya Pradesh (Khandabad, Mahukala, Pillikarar,
We participated in the Better Cotton initiative to empower
Hoshangabad and Talpura)
our farmers. We imparted technical assistance to 8,300
22
SUPPORTING THE COMMUNITY ANNUAL REPORT 2016-17
farmers. We provided them farming solutions and education and preventive healthcare measures near
integrated pest management techniques that helped our units, along with driving inclusive growth among
them to increase yield. marginalised communities. CARING FOR THE SICK
Environmental Initiatives
We are one of the companies, which has promoted
Nimbua Greenfield Punjab Limited, which is operational
since 2007 and works dedicatedly towards solid waste
treatment, storage and disposal in Punjab. Moreover, we
carried out several plantation activities near the Narmada
basin with the help of our Madhya Pradesh units.
Road Ahead
As a responsible corporate citizen, we will continue to
work towards enhancing the quality of life in and around
our manufacturing facilities. Our focus is on encouraging
23
STATUTORY REPORT
Economic overview the creation of Monetary Policy FY18 appear bright provided
Global economy Committee; redesigning of the policymakers create enablers for
The year 2016 ended with the Fiscal Responsibility and Budget strong and sustainable growth in
global GDP growth moderating Management (FRBM) framework; the medium to long term.
to 3.1% from 3.2% in 2015. Going passage of the Goods and Services
forward, the IMF expects this Tax (GST) bill; and finally, the policy
In an environment
growth to touch 3.5% in 2017, thrust towards a less-cash formal
on the back of multiple factors: economy. GST is expected to be of moderate global
projected fiscal stimulus in the US; a landmark step in transforming economic growth, the
firming up of global commodity India’s indirect tax framework, Indian economy was a
prices after the slump in 2015; bringing transparency and
and unchanged accommodative efficiency in tax administration.
study in contrast. The
monetary policy stance in most economy successfully
developed economies, barring The trend of benign inflation navigated global
the US. The US is expected to take and continued improvement in uncertainties, and
calibrated steps towards further twin deficits further bolstered
policy normalisation in 2017. the country’s macroeconomic emerged as a preferred
Despite the resilience exhibited by parameters. The country’s destination for foreign
global financial markets in the face economic prospects for investors.
of Brexit and the US Presidential
election outcome, high levels of
uncertainty continued to impact the
global risk appetite in 2016.
Indian economy
In an environment of moderate
global economic growth, the
Indian economy was a study in
contrast. The economy successfully
navigated global uncertainties, and
emerged as a preferred destination
for foreign investors. The year
2016-17 saw multiple reforms
being rolled out in India such as
24
MANAGEMENT DISCUSSION ANALYSIS ANNUAL REPORT 2016-17
25
STATUTORY REPORT
Imports in Bangladesh were 2016-17 while yield increased by country had opening stock of 0.56
projected to rise by 3% to 1.4 17% over 2015-16. As a result, million tons (33 lakh bales).
million tons in 2016-17, and in cotton production in India (for
Vietnam 20% to 1.16 million tons. year 2016-17) increased by 3.8% to On the demand side, consumption
5.97 million tons (351 lakh bales). was expected to be 5.32 million
Indian cotton dynamics Though, as per our estimates,
tons (313 lakh bales) in 2016-17
India accounts for one-third of the the country production is of 5.78
compared to 5.24 million tons (308
world’s cotton cultivation area. million tons (340 lakh bales).
Maharashtra, Gujarat, Andhra lakh bales) in 2015-16.
Pradesh and Telangana (also In 2016-17, imports were expected
known as the cotton basket of to be 0.289 million tons (17 lakh Cotton exports were projected to
India) produce nearly two-thirds bales) compared to 0.255 million fall from 1.156 million tons (68 lakh
of the cotton in India. Cotton is a tons (15 lakh bales) in 2015-16. bales) in 2015-16 to 1.02 million
major product of the Indian textile But strengthening of Indian cotton tons (60 lakh bales) in 2016-17. This
industry and it accounts for over prices and rise in demand pushed resulted in total demand declining
65% of total mill fibre consumption imports higher to 0.425 million tons to 6.43 million tons (368 lakh bales)
in the country. Among all the (25 lakh bales). in 2016-17 compared to 6.396
fabrics and yarns produced, cotton
million tons (376 lakh bales) in
is the main fabric. Including the opening stock of 0.73
million tons (43 lakh bales), the total 2015-16.
Better prices for competing crops, supply of cotton in 2016-17 was
delayed monsoon and yield losses estimated at 6.99 million tons (411 Closing stock in 2016-17 season
due to pests discouraged Indian lakh bales). This was nearly 2% less is expected to be 0.646 million
farmers, from planting cotton in as compared to 7.27 million tons tons (38 lakh bales).Going by our
2016-17. India’s cotton cultivation (419 lakh bales) in 2015-16. (Though estimates, closing stock will be of
area contracted by 11.6% in as per Vardhman’s estimates, the 0.476 million tons (28 lakh bales).
26
MANAGEMENT DISCUSSION ANALYSIS ANNUAL REPORT 2016-17
Share
1,600
+6.3%
56%
+5.6% 900
820
642 Values in USS Bn.
504
1,304.81
44% Apperal Export
333 457
256 700 Textile Exports
248 309 363 T&A Exports
The EU and USA are the largest markets for textile and apparel with a share of 36% and 14%, respectively. On the
supply side, China is the largest supplier of textile and apparel in the world with the major share of 40%. It is distantly
followed by countries like India, Italy, and Germany. Each of these countries have an approximate share of 5% in the
global textile and apparel exports.
MAJOR MARKETS FOR TEXTILE AND APPAREL (2014) MAJOR SUPPLIERS OF TEXTILE AND APPAREL (2014)
(%) (%)
36 China & HK
40
EU-28 14 India
5 Italy
USA
5 Germany
China & HK
Bangladesh
Japan 7 5
Turkey
Viet Nam 4
5
4 USA
Others 3 3
3 Vietnam
36
32
Others
Source: UN Comtrade
27
STATUTORY REPORT
Shift of manufacturing bases and industrial policy, it industrialised Indian textile scenario
emergence of new destinations rapidly and became a hub for The textile and apparel industry can
In the last three decades, the textile manufacturing. In the last two be broadly divided into
industry has witnessed a major two segments:
decades, China emerged as the
shift in its production bases. Till Yarn and fibre (include natural
world’s largest manufacturing
the 1980s, production of textile and man-made).
base for textiles. Since 2000, the
and apparel was concentrated in
nation has remained the largest Processed fabrics (including
USA and EU, but over the years,
production moved majorly to Asian exporter of textiles and apparels, woollen textiles, silk textiles,
countries. while enjoying around 40% of the jute textiles, cotton textiles
market share. During the same and technical textiles) and
The relocation was a result of period, other Asian economies such readymade garments (RMGs)
and apparel.
attractive low-cost manufacturing as India, Bangladesh, Indonesia,
advantages in these developing Pakistan, Vietnam, Cambodia Textile plays a major role in the
countries. In the US and Europe, and Thailand experienced an Indian economy. It contributes 14%
production costs increased upsurge in their textile and apparel to industrial production and 4% to
making alternative destinations GDP. With over 45 million people
manufacturing.
attractive for apparel and textile involved, it is one of the largest
manufacturers. Asian countries source of employment generation
Now, USA and Europe have
with their abundant and low-cost in the country. The textile industry
become the largest textile
labour force, vast natural resources accounts for nearly 15% of India’s
consumption bases in the world.
and favourable economic policies total exports. The size of India’s
attracted textile industries as And manufacturing is concentrated
textile market in 2015 was around
preferred production hubs. in Asian countries such as China USD 108.5 billion. It is expected to
and India (large consumption bases touch USD 226 billion market by
China made the most of this as well), Bangladesh, Vietnam, Sri 2023, growing at a CAGR of 8.7%
change. After China liberalised its Lanka and Pakistan, among others. between 2009-23.
28
MANAGEMENT DISCUSSION ANALYSIS ANNUAL REPORT 2016-17
29
STATUTORY REPORT
SECTION B: FINANCIAL DETAILS OF THE COMPANY 5. List of activities in which expenditure in 4 above has
1. Paid up Capital (INR) : ` 57,39,10,100 been incurred: Refer to Summary of CSR initiatives
on page 54-61
2. Total Turnover (INR) : ` 5,72,828.74 lakhs
SECTION C: OTHER DETAILS
3. Total profit after taxes (INR) :` 1,00,159.74 lakhs 1. Does the Company have any Subsidiary Company/
Companies? Yes
4. Total Spending on Corporate Social Responsibility
(CSR) as percentage of profit after tax (%) : 0.54%
30
BUSINESS RESPONSIBILITY REPORT ANNUAL REPORT 2016-17
2.
Do the Subsidiary Company/Companies (a) Details of the Director/Director responsible for
participate in the BR Initiatives of the parent implementation of the BR policy/policies
company? If yes, then indicate the number of
such subsidiary company(s) : No 1. DIN Number : 00340459
3. Do any other entity/entities (e.g. suppliers, 2. Name : Mr. Neeraj Jain
distributors etc.) that the Company does
business with, participate in the BR initiatives 3. Designation : Jt. Managing Director
of the Company? If yes, then indicate the
percentage of such entity/entities? [Less than (b) Details of the BR head
30%, 30-60%, More than 60%] : No
S.No. Particulars Details
SECTION D: BR INFORMATION 1 DIN number (if Applicable) 00340459
1. Details of Director/Directors responsible for 2 Name Neeraj Jain
BR : The Board Business Responsibility Committee
3 Designation Jt. Managing Director
is responsible for the implementation of the BR
4 Telephone number 8146668888
policies.
5 Email id neerajjain@vardhman.com
P1
Ethics, P2 P5
P3 P4 P6 P7 P8 P9
S. Transparency Sustainability Promotion
Questions Employee Stakeholder Environment Responsible Inclusive Customer
No. & in life-cycle of of human
Well Being engagement Protection Advocacy Growth Value
Sustainability products rights
Accountability
1.) Do you have policies Y N Y N N Y N Y N
for:
2.) Has the policy Y NA Y NA NA Y NA Y NA
been formulated in
consultation with the
relevant stakeholders?
3.) Does the policy conform NA NA Y OHSAS NA NA Y NA Y NA
to any national / 18001
international standards?
If yes, specify?
4.) Is it a board approved Y, BOD NA Y, CEO NA NA Y, CEO NA Y, BOD NA
policy? If yes, has
it been signed by
MD /owner /CEO /
appropriate Board
Director?
5.) Does the Company have Y NA Y NA NA Y NA Y NA
a specified committee
of the Board/Director/
Official to oversee the
implementation of the
policy?
6.) Indicate the link for NA NA NA Y NA NA
the policy to be viewed
online
7.) Has the policy been Y NA Y NA NA Y NA Y NA
formally communicated
to all relevant
internal and external
stakeholders?
8.) Does the company have Y NA Y NA NA Y NA Y NA
an in-house structure to
implement the policy?
31
STATUTORY REPORT
P1
Ethics, P2 P5
P3 P4 P6 P7 P8 P9
S. Transparency Sustainability Promotion
Questions Employee Stakeholder Environment Responsible Inclusive Customer
No. & in life-cycle of of human
Well Being engagement Protection Advocacy Growth Value
Sustainability products rights
Accountability
9.) Does the Company Y NA Y NA NA Y NA Y NA
have a grievance
redressal mechanism
related to the policy to
address stakeholders’
grievances related to
the policy?
10.) Has the company N NA Y NA NA Y NA N NA
carried out independent
audit /evaluation of the
working of this policy by
an internal or external
agency?
(b) If answer to the question at serial number 1 against any principal, is ‘No’, please explain why: (Tick up to 2 options)
No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
1 The company has not understood the Principles
2 The company is not at a stage where it finds itself in a
position to formulate and implement the policies on
specified principles
3 The company does not have financial or manpower
resources available for the task
4 It is planned to be done within the next 6 months
5 It is planned to be done within the next 1 year
6 Any other reason (please specify)
32
BUSINESS RESPONSIBILITY REPORT ANNUAL REPORT 2016-17
provides guidance in difficult situations involving conflict In our sustainable approach, we associated ourselves
of interest & moral dilemma and ensures compliance with Organic program in the year 2004 by introducing
with all applicable laws. All senior employees have to Organic cotton in our products. Later on, in year 2006,
read and understand this code and agree to abide by it. we associated ourselves with Fair-trade program.
The policy code of conduct is available at the company We become member of BCI (Better Cotton Initiative) in year
website at the link https://www.vardhman.com/investor- 2011. BCI aims to promote measurable improvements
desk#!company_information with the name Policies- in the key environmental and social impacts of cotton
Code of Conduct. cultivation worldwide to make it more sustainable
(economically, environmentally, and socially).
Vigil Mechanism/ Whistle Blower Policy: The Vigil
Mechanism of the Company, which also incorporates To further extend our outreach to farmers and after
a whistle blower policy in terms of the Uniform Listing understanding the BCI missions and objectives and
Agreement aims to provide a channel to the employees finding ourselves aligned with their direction, we
and Directors to report to the management concerns become implementing partner of BCI in Gujarat region
about unethical behavior, actual or suspected fraud in 2015. Better cotton works on the criteria that cotton is
or violation of the Codes of Conduct or policy. The produced by farmers who:
mechanism provides for adequate safeguards against
victimization of employees and Directors to avail of Minimize the harmful impact of crop protection
the mechanism and also provide for direct access to practices.
the Chairman/ Chairman of the Audit Committee in
exceptional cases. Use water efficiently and care for the availability of
water.
The vigil Mechanism/ whistle blower policy is available at Care for the health of the soil.
the company’s website at the following link: https://www.
vardhman.com/investor-desk#!company_information Conserve natural habitats.
with the name Policies- Vigil Mechanism Care for and preserve the quality of the fibre.
33
STATUTORY REPORT
impact on the environment by applying innovative Sewage Treatment Plants (STPs) dedicated to making
thinking to every step of manufacturing process. wastewater reusable
Building eco-friendly practices in daily processes is a part Water Re-Utilization (Recycling & Reusing) i.e. Zero
of our culture. This culture inspires us to try to make Liquid Discharge
more from fewer resources and minimize waste in every Vardhman has set up three Zero-liquid-discharge plants
form. We attempt to contribute to a better environment of capacity 3600 KLD & 400 KLD (2 no.) Units are recovering
by reducing water consumption, minimizing wastage and 16 lakhs liters of water through RO systems and reuse
using renewable energy resources over conventional ones. entire recovered water back into the manufacturing
process. Apart from this, the treated water is also used
Water for watering of green belts. The gardening system is
We are continuously working to improve our water completely powered by treated wastewater
efficiency and have metering systems across the water
distribution network. Our corporate EHS team regularly Energy
monitors the metering system. Energy conservation implies reducing energy consumption
at the organizational level. Energy conservation differs
Water Saving from efficient energy use, which refers to using less
We follow the EPA guidelines that state “USING WATER energy for a constant service. Vardhman has in the
EFFICIENTLY is directly proportional to WATER SAVINGS”. financial year 2016-17 has undertaken a number of
The Vardhman Group has developed a culture of saving measures to reduce energy consumption like installation
this precious asset. To save water we have: of new distribution transformers at optimum locations,
replacement of rewound motors with energy efficient
Designated a water efficiency coordinator. motors, optimization of compressed air consumption,
installation of AFPC panels and VFD’s for H-Plant fans,
Developed a mission statement and a plan to installation of LED lights on streets and boundary
achieve it walls etc.
Educated and involved employees in water efficiency
efforts. Principle 3: Employee Well-being
In a world where everything else is equal, human effort
Adopted Equipment Changes makes all the difference. We place immense value on
– high-efficiency plumbing fixtures, appliances our workforce and consider it our biggest, most valuable
and other equipment yield substantial savings asset. At Vardhman, we have a culture of empowerment
on water. that values and respects individual potential and helps
each one achieve it to the fullest. Our people own their
As a direct result of these initiatives, our residential jobs and not just perform them. We continuously strive
colonies are now consuming 150 litres per capita per to improve quality of work-life for total job satisfaction
day, earlier consumption used to vary between 180 – 190 and social harmony for the employees.
litres per capita per day.
1. Please indicate the Total number of employees.
Water Recharging 21,206
We are focused on recharging maximum rain water in
to the ground since 2005. We have set up 48 Rain Water 2. Please indicate the Total number of employees
Harvesting Systems (RWHS) within our premises. Rain hired on temporary/contractual/casual basis. 1813
water is directed from roof tops through channels and
then collected in a collection pit with filter. Through this, 3. Please indicate the Number of permanent women
the water is recharged into the ground through bore employees. 5,127
holes. Every year we recharge apprx 120,000 KLs of
water. 4. Please indicate the Number of permanent
employees with disabilities 19
Wastewater Re-Use
The textile industry is inherently water intensive and 5. Do you have an employee association that is
therefore wastewater generation is considerably high. recognized by management. No
However, at Vardhman we have invested heavily into
the best treatment technology to make wastewater 6. What percentage of your permanent employees is
reusable and recyclable. As of today, we have 8 Effluent members of this recognized employee association?
Treatment Plants (ETPs) of different capacities and 10 NA
34
BUSINESS RESPONSIBILITY REPORT ANNUAL REPORT 2016-17
7. Please indicate the Number of complaints relating The policies on the principle of Employee well-
to child labour, forced labour, involuntary labour, being are available on the company’s website at the
sexual harassment in the last financial year and following link:-
pending, as on the end of the financial year.
1. Child Labour - https://www.vardhman.
No. Category No of No of com/user_files/investor/Policy%20on%20
complaints complaints Prohibition%20of%20Child%20Labour.pdf
filed during pending as
the financial on end of the 2. Anti Sexual - https://www.vardhman.com/
year financial year
user_files/investor/Anti%20Sexual%20
Harassment%20Policy.pdf
1 Child labour/forced Nil Nil
labour/involuntary
3. onded Labour - https://www.vardhman.com/
B
labour
user_files/investor/Forced%20Bonded%20
2 Sexual harassment Nil Nil Labour%20Prohibition.pdf
3 Discriminatory Nil Nil
employment Principle 4: Stakeholder Engagement
Vardhman recognizes employees, Local communities
8. What percentage of your under mentioned surrounding our operations, business associates
employees were given safety & skill up-gradation (marginalized farmers, network of suppliers, agents and
training in the last year? dealers), customers and shareholders/investors as our
(a) Permanent Employees 59% key stakeholders.
(b) Permanent Women Employees 77%
(c) Casual/Temporary/Contractual Employees 74% Vardhman identifies communities (with a focus on
(d) Employees with Disabilities- 74% women and children from these communities) around
our manufacturing facilities and small farmers in our
inbound supply chain as disadvantaged, vulnerable &
marginalized stakeholders.
Vardhman regularly undertakes initiatives to serve the interest of its disadvantaged, vulnerable and marginalized
stakeholders. These are briefly described below:
35
STATUTORY REPORT
We have placed grievance redressal mechanisms in every f) Using the best of rainwater recharge
manufacturing unit and we try to ensure a harassment Recharging of practices within the industry
free work environment along with workplace health premises and ensures maximum quantity of
and safety. A Labour Welfare Officer is placed in every rainwater is arrested and regarded to ground
manufacturing unit who is available in the plant round through rain water harvesting wells.
the clock to take care of ensuring the basic amenities
of workers. Communication meetings between workers g) All the boiler fuel gases are passed through the
and senior officials are regularly conducted to redress bag filter and scrubber units.
the grievance of workers and maintain harmonious
relations between the management and workers. These steps lead to reduction of raw water
consumption, effluent generation, solid-waste
Prime importance is given towards maintaining better generation, hazardous waste generation and Green
working condition in the plants to take care of the health House Gases emissions and help to reduce the overall
& safety of employees. We are certified under OHSAS impact on our natural resources and environment.
18001 by NSAI.
We do not have any specific strategy or policy to
No complaint was received pertaining to human rights address global environmental issues but we are
violation during the past financial year. using Biofuels in place of fossil fuels to reduce
carbon emissions.
Principle 6: Protection and Restoration of the
Environment 3. Vardhman identifies and assesses potential
1. Vardhman’s Environment, Health and Safety environmental risks and provide training to employees.
policy extends to all its group companies and
manufacturing units.
We have facilities for proper management of e-waste,
spent oil and sludge. All these hazardous elements are
2. Climate change, global warming and environmental stored & maintained properly and sold to authorized
degradation pose unique challenges as well as dealer for recycling & disposing. We are not providing
opportunities for Vardhman. We are continually any formal training as such in this regard.
investing in new technologies, implementing
process improvements and innovating. To make 4. Vardhman have not registered any project related
progressive strides and guide us in our endeavor, to Clean Development Mechanism project.
we have deployed a dedicated team for devising
and implementing strategies for managing these 5. Vardhman has taken various clean and sustainability
risks and opportunities. Few of the steps taken in initiatives such as
this regard, are:
Clean Technology: We have been able to
a) Effluent Treating of all our discharge either decompose food waste generated from colonies,
through own ETP or CETP. Canteens & Hostels by installing Bio-gas plant at
two of our locations (Auro Textile & VF Budhni).
b) Zero Liquid discharge (ETP, RO, MEE) system for It produces 80 kg/day bio-gas which is utilized in
recycling of treated water for process usage. canteens and mess. In MP region, Solar Kitchen
Automation equipment is used for cooking. Solar
water heaters are being used in hostels and campus.
36
BUSINESS RESPONSIBILITY REPORT ANNUAL REPORT 2016-17
6. All the emissions are within the permissible limit of Vardhman believes in being an equal opportunity
State and Central Pollution Control Board. employer. We offer equal roles and responsibility to
women employees.
7. There is no show cause/legal notices received from
CPCB/ SPCB by our units.
The company has a detailed CSR policy in place and
the CSR activities are monitored by Board appointed
Company’s EHS policy is available on the website CSR committee. The key focus areas of Vardhman’s
at the following link: https://www.vardhman.com/
user_files/investor/EHS%20Policy.pdf
37
STATUTORY REPORT
CSR programs are promotion of education, preventive c. Other organizations- we also collaborate with
healthcare, rural development, skill enhancement, other public and private organizations like
environment protection and other areas as defined hospitals etc. to provide healthcare initiatives
in Schedule VII of the Companies Act 2013. to the underprivileged sections of the society.
2. The major CSR programs are being pursued in 3. Vardhman internally performs an impact
the areas in close proximity to our manufacturing assessment of its initiatives at the end of each year
locations so as to enable supervision and maximum to understand the efficacy of the program in terms
developmental impact. Programs under this of delivery of desired benefits to the community
principal are developed and executed by: and to gain insights for improving the design and
delivery of future initiatives.
a. In-house teams for awareness building and
contract farming projects with small and 4. Vardhman’s contribution towards community
marginalized farmers and local communities development projects carried under its CSR policy
during the reporting period (2016-17) is ` 5.41 crore.
b. Aurobindo Trust for community development
initiatives around our manufacturing facilities
in Punjab, Himachal Pradesh, Madhya Pradesh
and Gujarat.
38
BUSINESS RESPONSIBILITY REPORT ANNUAL REPORT 2016-17
5. Note on adoption of community development work practices that do not harm our society. We consistently work
by local communities to improve customer satisfaction. We deliver value proactively
by anticipating changes in customer’s desired needs.
At Vardhman all our manufacturing units
continuously engage with communities surrounding 1. Pending complaints at the end of the financial year
their operations through surveys and focused were of a routine nature and constituted 6-7% of
meetings. This is done to gauge the needs, priorities complaints pending for yarn business and 2% for
and expectations of the local community. Initiatives fabric business.
are thus designed and delivered in a transparent
manner in line with inputs from the community itself. 2. We disclose all the information on our labels in
compliance with the legal requirements and let
The company’s CSR policy and amended CSR policy is customers make an informed decision.
available on its website at the following link: https://
www.vardhman.com/investor-desk#!company_ 3. There is no case pending against the company
information with the name Policies-CSR and regarding unfair trade practices.
amended CSR policy 11.03.2016
4. As part of our stakeholder engagement strategy,
Principle 9: Providing Value to Customers and Vardhman engages with its customers and carries
Consumers consumer surveys for different products every year
Adding value is not always about money, or discounts. to know the customer satisfaction level so that
Understanding our customer is the key to add value. We necessary steps may be taken to enhance customer
try to understand what drives value for our customers satisfaction levels. There is a designated market
and offer best quality products with a prime focus of research department which routinely carries out
developing memorable customer experience. these surveys and gives inputs to business on taking
remedial action, if required.
We take care of the well-being of our customers as well as
the society. We take care of environment and implement
39
STATUTORY REPORT
Directors’ Report
Dear Members,
The Directors of your Company have pleasure in presenting their 44th Annual Report of the business and operations
of the Company along with the Audited Financial Statements for the year ended, 31st March, 2017.
1. Financial Results:
The financial performance of your Company for the year ended 31st March, 2017 is as under:-
(` in lakhs)
Particulars 2016-17 2015-16
Revenue from operations (Net) 5,72,828.74 5,61,395.80
Other Income 56,758.24 24,097.29
Profit before Depreciation, Interest & Tax (PBDIT) 1,72,613.76 1,34,918.69
Interest and Financial expenses 9,183.10 8,670.69
Profit before Depreciation and Tax (PBDT) 1,63,430.66 1,26,248.00
Depreciation & Amortisation 32,949.39 36,309.60
Profit before Tax (PBT) 1,30,481.27 89,938.40
Provision for Tax - Current 28,157.00 22,184.15
- Deferred Tax (Net of Adjustment) 3,194.83 114.43
- MAT Credit Entitlement (1,029.85) -
Profit after tax (PAT) 1,00,159.29 67,639.82
Other Comprehensive Income (21.76) (4.07)
Total Comprehensive Income for the period 1,00,137.53 67,635.75
Earnings per share (`)
- Basic 163.67 109.00
- Diluted 163.67 109.00
Note: The financial statements of the Company for the year ended 31st March, 2017, are the first the Company has prepared in
accordance with Indian Accounting Standards (Ind AS). The financial statements for the year ended 31st March, 2016 have been
restated in accordance with Ind AS for comparative information.
Indian Accounting Standards (Ind AS): 2. Financial Analysis and Review of Operations:
The Ministry of Corporate Affairs (MCA), vide Production & Sales Review:
its notification in the Official Gazette dated During the year under review, your Company
16th February, 2015, notified the Ind AS applicable to has registered Revenue from Operations of
certain classes of Companies. Ind AS has replaced ` 5,72,828.74 Lakhs as compared to ` 5,61,395.80
the existing Indian GAAP prescribed under Section Lakhs in the previous year. The exports of the
133 of the Companies Act, 2013, read with Rule Company decreased from ` 2,27,486.33 Lakhs to
7 of the Companies (Accounts) Rules, 2014. Ind AS is ` 2,20,690.98 Lakhs showing a decrease of
applicable on the Company from 1st April, 2016, with 2.99% over the previous year. The business wise
a transition date of 1st April, 2015. performance is as under:-
40
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
41
STATUTORY REPORT
10 is due for remittance by the end of September, dividend/interest earned on its investments and
2017 to the Investor Education and Protection Fund profits made on sale of investments. During the
established by the Central Government. year, the Company has earned a net profit of
` 975.12 lakhs as compared to ` 357.01 lakhs in the
Further, according to the Rules, the shares in respect previous year.
of which dividend has not been paid or claimed by
the shareholders for seven consecutive years or Vardhman Acrylics Limited (VAL):
more shall also be transferred to the IEPF Authority. This subsidiary of the Company is engaged in
In accordance with new Rules, the Company sent the business of manufacturing of Acrylic Fibre.
notice to all shareholders whose shares are due to Presently, the Company holds 70.74% shares in this
be transferred to the IEPF Authority and published subsidiary. During the Financial Year 2016-17, VAL
requisite advertisement in the newspaper. recorded Revenue from operations of ` 36,842.96
lakhs against ` 44,759.18 lakhs in the previous year.
The details of these shares is provided on the The net profit of the company after comprehensive
website of Company, at www.vardhman.com income worked out to ` 4,099.14 lakhs as compared
to ` 4,080.18 lakhs in the previous year.
6. Consolidated Financial Statement:
ardhman Nisshinbo Garments Company
V
In accordance with the Companies Act, 2013 & Limited (VNGL):
Indian Accounting Standards (Ind AS) 110 on This subsidiary of the Company is a Joint Venture
‘Consolidated Financial Statements’ read with Ind partnership of 51:49 with Nisshinbo Textiles Inc.,
AS 111 on ‘Joint Arrangements’ and Ind AS 112 on Japan for manufacturing men’s shirts. During the
‘Disclosure of Interest in other entities’, the Audited year, the Revenue from Operations of the company
Consolidated Financial Statements is provided in was ` 5,828.84 lakhs as compared to ` 5,799.22
the Annual Report. lakhs in the previous year. The company incurred a
Net Loss of ` 53.88 lakhs as against a net profit of `
7.
ubsidiaries, Joint Ventures and Associate
S 153.36 lakhs in the previous year.
Companies:
During the year under review, Vardhman Yarns and Vardhman Yarns and Threads Limited (VYTL):
Threads Limited, a Joint Venture with American & Vardhman Yarns and Threads Limited, Joint
Efird Global, LLC (A&E) ceased to be Subsidiary of the Venture with American & Efird Global, LLC (A&E),
Company and has become an Associate Company. is an Associate Company of the Company. It is
No other Company has become or ceased to be engaged in the business of Threads Manufacturing
Company’s subsidiary, joint venture or associate and Distribution. During the year, the Company
company. Further, the Company does not have any has sold its 40% stake in VYTL to A&E and is now
material subsidiary. The details of the financials holding 11% stake in VYTL. A&E is the second
of the subsidiary and associate companies for the largest player in Threads Manufacturing and
financial year 2016-17 are as follows:- Distribution across the world. During the year
under review, the Revenue from Operations were
VMT Spinning Company Limited (VMT): ` 77,857.87 lakhs as against ` 72,863.26 lakhs in
This subsidiary of the Company is a Joint Venture the previous year registering an increase of 6.85%.
with Marubeni Corporation and Marubeni Hong The Net Profit for the year after comprehensive
Kong and South China Limited of Japan. The income worked out to ` 9,909.48 lakhs as compared
Revenue from operations of the company has to ` 8,991.66 lakhs during last year registering an
increased to ` 19,112.99 lakhs from ` 15,663.72 increase of 10.21%.
lakhs in the last year. The Net Profit of the Company
after comprehensive income worked out to ` 826.11 Vardhman Special Steels Limited:
lakhs as against ` 738.97 lakhs in the previous year Vardhman Special Steels Limited (VSSL) is an
registering an increase of 11.79%. Out of the total Associate Company of the Company. The Company
present paid-up capital of ` 2,070.02 lakhs, your holds 31.39% shares of VSSL. During the year, the
Company holds 89.44%. Revenue from Operations of the Company was
` 75,312.90 lakhs as compared to ` 72,551.41
VTL Investments Limited (VTL): lakhs in the previous year. The Net Profit for the
This 100% subsidiary of your Company is year after comprehensive income worked out to
engaged in the business of investment. The ` 1,891.01 lakhs as compared to ` 405.12 lakhs in
earnings of the company mainly comes from the previous year.
42
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
43
STATUTORY REPORT
10. Number of Board Meetings: New Delhi, as the Cost Auditors of the Company to
During the year under review, the Board met five conduct Cost Audit of the Accounts for the financial
(5) times and the intervening gap between any two year ended 2017-18. However, as per provisions of
meetings was within the period prescribed under Section 148 of the Companies Act, 2013, read with
Companies Act, 2013. The details of Board Meetings Companies (Cost Records and Audit) Rules, 2014,
are set out in Corporate Governance Report which the remuneration to be paid to the Cost Auditors
forms part of this Annual Report. is subject to ratification by Members at the Annual
General Meeting. Accordingly, the remuneration
11. Auditors and Auditors Report: to be paid to M/s Ramanath Iyer & Company, Cost
Statutory Auditors: Accountants, New Delhi, for financial year 2017-18
M/s S.C. Vasudeva & Company, the existing is placed for ratification by the Members.
Statutory Auditors of the Company have submitted
Auditors’ Report on the accounts of the Company The Cost Auditor’s Report for the Financial Year
for the accounting year ended 31st March, 2017. The 2017-18 will be forwarded to the Central
Auditors’ Report is self-explanatory and requires Government as required under law.
no comments.
12. Audit Committee & Vigil Mechanism:
Further, pursuant to Section 139 of the Companies Composition of Audit Committee:
Act, 2013 and the Rules made thereunder, it is The Audit Committee consists of Mr. Prafull Anubhai,
mandatory to rotate the statutory auditors on Independent Director, Dr. S.K. Bijlani, Independent
completion of the maximum term permitted Director, Mr. Shravan Talwar, Independent Director,
under the said section. The Audit Committee of Mr. D.B. Jain, Independent Director, Mr. A.K.
the Company has proposed, and on 10th May, Kundra, Independent Director and Mr. D.L. Sharma,
2017, the Board of Directors of the Company Director. Mr. Prafull Anubhai is the Chairman of
has recommended the appointment of Deloitte the Committee and Company Secretary of the
Haskins & Sells, LLP, Chartered Accountants (Firm Company is the Secretary of the Committee. All the
registration No. 117366W/W-100018) (‘Deloitte’) as recommendations made by the Audit Committee
the statutory auditors of the Company. Deloitte will were accepted by the Board.
hold office for a period of five consecutive years
from the conclusion of 44th Annual General Meeting Vigil Mechanism:
till the conclusion of 49th Annual General Meeting, Pursuant to provisions of Section 177(9) of the
subject to the approval of the Members of the Companies Act, 2013 the Company has established
Company. a “Vigil Mechanism” incorporating whistle blower
policy in terms of SEBI (Listing Obligations and
Secretarial Auditor: Disclosure Requirements) Regulations, 2015 for
M/s. B.K. Gupta & Associates, Company Secretary employees and Directors of the Company, for
in Practice, were appointed as Secretarial Auditors expressing the genuine concerns of unethical
of the Company by the Board of Directors of the behavior, actual or suspected fraud or violation of
Company in its meeting held on 9th May, 2016 for the code of conduct by way of direct access to the
the financial year 2016-17. Chairman/ Chairman of the Audit Committee.
44
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
45
STATUTORY REPORT
taken into account by the Board in determining the with the provisions of Regulation 23 of the SEBI
distribution of dividend to its shareholders and/or (Listing Obligations and Disclosure Requirements)
retaining profits earned by the Company. The policy Regulations, 2015. Accordingly, the disclosure
is enclosed as Annexure IV to the Board’s report of Related Party Transactions as required under
and is also available on the Company’s website at Section 134(3)(h) of the Companies Act, 2013 in
the link: https://www.vardhman.com/user_files/ Form AOC-2 is not applicable .
investor/Dividend%20Policy.pdf
The Policy on dealing with related party
17. Risk Management: transactions as approved by the Board may
The Risk Management Policy required to be be accessed on the Company’s website at
formulated under the Companies Act, 2013 and SEBI the link: http://www.vardhman.com/user_
(Listing Obligations and Disclosure Requirements) files/96c45534e3ab096d9bc682f8eebade
Regulations, 2015 has been duly formulated and 0344f915151436264609.pdf.
approved by the Board of Directors of the Company.
The aim of risk management policy is to maximize Your Directors draw attention of the Members to
opportunities in all activities and to minimize Note 45 to the standalone financial statement which
adversity. The policy includes identifying types of sets out related party disclosures.
risks and its assessment, risk handling, monitoring
and reporting, which in the opinion of the Board 20. P
articulars of Loans, Guarantees or Investments
may threaten the existence of the Company. made under Section 186 of the Companies
Act, 2013:
The Risk Management policy may be accessed on the Particulars of loans given, investments made,
Company’s website at the link: http://www.vardhman. guarantees given and securities provided along
com/user_files/a4c0a8b00e407cd507553ea with the purpose for which the loan or guarantee or
7db7f06e89de1272a1436265025 .pdf. security is proposed to be utilized by the recipient
are provided in the standalone financial statement
18. Internal Financial Controls & Its Adequacy: (Please refer to Note 4, 5, 9 and 12 to the standalone
The Company has in place adequate internal financial statement).
financial controls with reference to financial
statements. During the year, such controls were 21. C
onservation of Energy, Technology Absorption,
tested and no reportable material weakness in the Foreign Exchange Earnings and Outgo:
design or operation was observed. Energy conservation continues to be an area of
major emphasis in our Company. Efforts are made
A report on the Internal Financial Controls under to optimize the energy cost while carrying out the
clause (i) of sub-section 3 of section 143 of the manufacturing operations. Particulars with respect
Companies Act, 2013 as given by the Statutory to conservation of energy and other areas as per
Auditors of the Company forms part of Independent Section 134(3)(m) of the Companies Act, 2013 read
Auditor’s Report on Standalone Financial Statements with the Companies (Accounts) Rules, 2014, are
as Annexure B and to the Independent Auditor’s annexed hereto and form part of this report as
Report on Consolidated Financial Statements as Annexure V.
Annexure A.
22. Annual Return:
19. Particulars of Contracts or Arrangements made The extracts of Annual Return pursuant to the
with Related Parties: provisions of Section 92, 134 and Rule 12 of the
All contracts/arrangements/transactions entered by Companies (Management and Administration)
the Company during the financial year with related Rules, 2014 for the financial year 2016-17 in Form
parties were in the ordinary course of business MGT-9 is annexed hereto and form part of this
and on an arm’s length basis. During the year, report as Annexure VI.
the Company had not entered into any contract/
arrangement/transaction with related parties
which could be considered material in accordance
46
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
23. Human Resources /Industrial Relations: these financial statements relate on the date of this
Human resource is considered as the most valuable report.
of all resources available to the Company. The
Company continues to lay emphasis on building 26. Directors Responsibility Statement:
and sustaining an excellent organization climate Pursuant to the provisions of Section 134 (5) of the
based on human performance. The Management Companies Act, 2013 the Board hereby submit its
has been continuously endeavouring to build high responsibility Statement:
performance culture on one hand and amiable work
environment on the other hand. During the year, a. in the preparation of the annual accounts, the
the Company employed around 21,206 employees applicable accounting standards have been
on permanent rolls. followed along with the proper explanation
relating to material departures;
Pursuit of proactive policies for industrial relations
has resulted in a peaceful and harmonious situation b.
appropriate accounting policies have been
on the shop floors of the various plants. selected and applied consistently, and have made
judgments and estimates that are reasonable
24. Particulars of Employees and Related and prudent so as to give a true and fair view
Disclosures: of the state of affairs of the Company as at
The disclosures in respect of managerial 31st March, 2017 and of the profit of the Company
remuneration as required under section 197(12) for the year ended on 31st March, 2017;
read with Rule 5(1) of the Companies (Appointment
& Remuneration of Managerial Personnel) Rules, c. roper and sufficient care has been taken
p
2014 is annexed hereto and form part of this report. for the maintenance of adequate accounting
records in accordance with the provisions of
A statement showing the names and other the Companies Act, 2013, for safeguarding the
particulars of the employees drawing remuneration assets of the Company and for preventing and
in excess of the limits set out in Rule 5 (2) and 5 detecting fraud and other irregularities;
(3) of Companies (Appointment & Remuneration
of Managerial Personnel) Rules, 2014 is annexed d. the annual accounts have been prepared on a
hereto and form part of this report. going concern basis;
In terms of section 197(14) of the Companies e. t he Internal financial controls has been laid
Act, 2013, the Company does not have any down to be followed by the Company and that
Holding Company. However, the details regarding such internal financial controls are adequate
remuneration or commission received from and are operating effectively; and
subsidiary company by any Managing or Whole
Time Director is annexed hereto and form part of f. a proper system has been devised to ensure
this report. compliance with the provisions of all applicable
laws and such systems are adequate and
All the above details are provided in Annexure VII. operating effectively.
25. M
aterial Changes and Commitment, if any, 27. General Disclosures:
affecting the Financial Position of the Company Your Directors state that no disclosure or reporting
occurred between the end of the Financial Year is required in respect of the following items as there
to which this Financial Statements relate and were no transactions on these items during the year
the date of the Report: under review:
No material changes and commitments affecting
the financial position of the Company occurred 1.
Details relating to deposits covered under
between the end of the financial year to which Chapter V of the Act.
47
STATUTORY REPORT
2. Issue of equity shares with differential rights as 43rd Annual General Meeting. The Board has
to dividend, voting or otherwise. delegated necessary power to the Nomination
and Remuneration Committee to implement
3. o significant or material orders were passed
N
and administer the Plan once approved by the
by the Regulators or Courts or Tribunals
shareholders of the Company. Accordingly, the
which impact the going concern status and
Nomination and Remuneration Committee of
Company’s operations in future.
the Company has granted 6,14,000 Options out
4. No change in nature of Business of Company. of a total of 6,36,518 Options till date.
Your Directors further state that during the year 28. Acknowledgment:
under review, there were no cases filed pursuant Your Directors are pleased to place on record their
to the Sexual Harassment of Women at Workplace sincere gratitude to the Government, Financial
(Prevention, Prohibition and Redressal) Act, 2013. Institutions, Bankers, Business Constituents and
Shareholders for their continued and valuable
Buyback of Securities: co-operation and support to the Company and
During the year, the Company had bought back look forward to their continued support and co-
and extinguished 62,60,869 Equity shares of ` operation in future too.
10/- each at a price of ` 1,150 per share. The
paid-up capital of the Company post buyback They also take this opportunity to express their
is ` 57,39,10,100. deep appreciation for the devoted and sincere
services rendered by the employees at all levels of
Vardhman Textiles Limited Employee Stock the operations of the Company during the year.
Option Plan, 2016:
The Board of Directors in its meeting held on
9th May, 2016 approved introduction of an equity
based compensation scheme called “Vardhman
Textiles Limited Employee Stock Option Plan for and on behalf of the Board
2016” for its eligible employees subject to Place : Ludhiana (S.P. Oswal)
approval of Members of the Company in the Dated : 11th August, 2017 Chairman & Managing Director
48
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Index of Annexures
(forming part of Board Report)
49
STATUTORY REPORT
Annexure- I
50
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
FORM MR-3
Secretarial Audit Report
For The Financial Year Ended 31st March, 2017
Annexure- II
[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014]
To (v) T
he following Regulations and Guidelines prescribed
The Members, under the Securities and Exchange Board of India
Vardhman Textiles Limited Act, 1992 (‘SEBI Act’):-
Chandigarh Road, (a) T
he Securities and Exchange Board of
Ludhiana- 141010 India (Listing Obligations and Disclosure
Requirements) Regulations, 2015;
We have conducted the Secretarial Audit of the compliance
of applicable statutory provisions and the adherence to (b) T
he Securities and Exchange Board of India
good corporate practices by Vardhman Textiles Limited (Substantial Acquisition of Shares and
(hereinafter called the company). Secretarial Audit was Takeovers) Regulations, 2011;
conducted in a manner that provided us a reasonable
(c) T
he Securities and Exchange Board of India
basis for evaluating the corporate conducts/statutory
(Prohibition of Insider Trading) Regulations, 2015;
compliances and expressing my opinion thereon.
(d) T
he Securities and Exchange Board of India
Based on our verification of the Company’s books, (Issue of Capital and Disclosure Requirements)
papers, minutes books, forms and returns filed and Regulations, 2009- Not Applicable during the
other records maintained by the company and also Audit period;
the information provided by the Company, its officers,
(e) T
he Securities and Exchange Board of India
agents and authorized representatives during the
(Employee Stock Option Scheme and Employee
conduct of Secretarial Audit, We hereby report that in
Stock Purchase Scheme) Guidelines, 1999;
our opinion, the company has, during the audit period
covering the financial year ended on March 31, 2017 (f) The Securities and Exchange Board of
complied with the statutory provisions listed hereunder India (Issue and Listing of Debt Securities)
and also that the Company has proper Board-processes Regulations, 2008-Not Applicable during the
and compliance-mechanism in place to the extent, in the Audit period;
manner and subject to the reporting made hereinafter.
(g) T
he Securities and Exchange Board of India
(Registrars to an Issue and Share Transfer
We have examined the books, papers, minute books,
Agents) Regulations, 1993 regarding the
forms and returns filed and other records maintained
Companies Act and dealing with client;
by Vardhman Textiles Limited (“the Company”) for the
financial year ended on 31st March, 2017 according to (h) T
he Securities and Exchange Board of India
the provisions of: (Delisting of Equity Shares) Regulations, 2009-
Not Applicable during the Audit period; and
(i) The Companies Act, 2013 (the Act) and the rules
(i) The Securities and Exchange Board of India
made there under;
(Buyback of Securities) Regulations, 1998
(ii)
The Securities Contracts (Regulation) Act, 1956 (vi) We have relied on the representation made by the
(‘SCRA’) and the rules made there under; Company & its Officers for system and mechanism
formed by the Company for compliances under
(iii) The Depositories Act, 1996 and the Regulations and other applicable Acts as Environmental Laws &
Bye-laws framed there under; Labour Laws as per list attached herewith.
e have also examined compliance with the
W
(iv) F
oreign Exchange Management Act, 1999 and the
applicable clauses of the following:
rules and regulations made there under to the
extent of Foreign Direct Investment, Overseas Direct (i) Secretarial Standards (SS-1 and SS-2) issued by
Investment and External Commercial Borrowings The Institute of Company Secretaries of India.
51
STATUTORY REPORT
Annexure- II
(ii)
The Listing Agreements entered into by the pproval for the Buyback of Equity Shares of the
A
Company with Bombay Stock Exchange and Company
National Stock Exchange
Approval to issue Non- Convertible Debentures
uring the period under review the Company has
D
(NCDs)/ Bonds
generally complied with the provisions of the Act, Rules,
Regulations, Guidelines, Standards, etc. mentioned
We further report that during the audit period the
above.
company bought back equity shares aggregating to
We further report that ` 719.99 crore and has granted 6,07,500 employee stock
The Board of Directors of the Company is duly options to eligible employees under Vardhman Textiles
constituted with proper balance of Executive Directors, Stock Option Plan, 2016 exercisable into not more than
Non-Executive Directors and Independent Directors. The 6,07,500 equity shares in the company.
changes in the composition of the Board of Directors
that took place during the period under review were For B.K. Gupta & Associates
carried out in compliance with the provisions of the Act. Company Secretaries
Chairman & Managing Director
Adequate notice is given to all directors to schedule the
Board Meetings, agenda and detailed notes on agenda
were sent at least seven days in advance, and a system (Bhupesh Gupta)
exists for seeking and obtaining further information and Place : Ludhiana FCS No.:4590
clarifications on the agenda items before the meeting Dated : 10th May, 2017 C P No.:5708
and for meaningful participation at the meeting.
Majority decision is carried through while the dissenting List of Labour Laws and Environmental Laws Which
members views are captured and recorded as part of the Have Been Verified During Audit Period
minutes.
List of Labour Laws
We further report that there are adequate systems and The Factories Act, 1948
processes in the company commensurate with the size The Industrial Disputes Act, 1947
and operations of the company to monitor and ensure The Payment of Wages Act, 1936
compliance with applicable laws, rules, regulations and
The Minimum Wages Act, 1948
guidelines.
The Employee’s State Insurance Act, 1948
We further report that during the audit period the The Payment of Bonus Act, 1972
company has conducted two postal ballots to conduct its The Contract Labour (Regulation and Abolition) Act, 1970
business first from 24th October, 2016 to 22nd November,
The Apprentices Act, 1961
2016 and second from 2nd January, 2017 to 31st January,
2017.
List of Environmental Laws
We further report that during the audit period the The Environment (Protection) Act, 1986
company has passed the following Special resolutions The Public Liability Insurance Act, 1991
which is having major bearing in the Company’s affairs The Water (Prevention and Control of Pollution) Act, 1974
in pursuance of above referred laws, rules, regulations,
The Air (Prevention and Control of Pollution) Act, 1981
guidelines, standards, etc.
The Hazardous Waste (Management, Handling and Trans
Approval of Vardhman Textiles Limited Employee boundary Movements) Rules, 2008
Stock Option Plan 2016
52
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- II
Annexure- A
To
The Members,
Vardhman Textiles Limited
Chandigarh Road,
Ludhiana- 141010
1. Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is
to express an opinion on these secretarial records based on our audit.
2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about
the correctness of the contents of the secretarial records. The verification was done on the random test basis
to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we
followed provide a reasonable basis for our opinion.
3. e have not verified the correctness and appropriateness of financial records and Books of Accounts of the
W
Company.
4. Where ever required, we have obtained the Management representation about the compliance of laws, rules and
regulations and happening of events etc.
5.
The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the
responsibility of management. Our examination was limited to the verification of procedures on random test basis.
6. The Secretarial Audit report is neither an assurance as to the future viability of the company nor of the efficacy or
effectiveness with which the management has conducted the affairs of the Company.
(Bhupesh Gupta)
Place : Ludhiana FCS No.:4590
Dated : 10th May, 2017 C P No.:5708
53
STATUTORY REPORT
Annexure- III
Annual Report on Corporate Social Responsibility (CSR) activities for the financial year 2016-17:
54
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- III
Annexure- A
Manner in which the amount spent during the financial year is detailed below:
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
1. Construction of drinking water Sanitation/Safe Government Sr, 2.40 2.07 2.07 Through Trust
points along with hands washing Drinking Water Secondary School,
area (Civil + Sanitation Items). Gullarwala.
2. Construction of drinking water Sanitation/Safe Government 1.50 0.76 0.76 Through Trust
points along with hands washing Drinking Water Primary & Middle
area (Civil + Sanitation Items). School, Village
Batolikalan-Baddi
3. Renovation of drinking water Sanitation/Safe Govt. High & 12.22 9.57 9.57 Through Trust
points along with hands washing Drinking Water Primary School
area, Supply of School desks with and Promotion Thana, Baddi
bench of 57 Nos., Supply of Public of Education
Addressing System, Construction of
Class Room & repairing of existing
kitchen
4. Renovation of drinking water points Sanitation/Safe Government Middle 6.17 5.27 5.27 Through Trust
(Civil + Sanitation Items), Renovation Drinking Water School Village
of existing toilets (06 Nos.) Billanwali - Baddi.
5. Renovation of drinking water points Sanitation/Safe Government 11.73 8.84 8.84 Through Trust
along with hands washing area (Civil Drinking Water Primary/High
+ Sanitation Items), Construction of and Promotion School, Village
one class room, Supply of School of Education Sandholi
desks with bench 60 Nos.
6. Supply of Semi automatic analyzer Preventive Primary/Community 6.00 5.30 5.30 Through Trust
and Cell Counter Equipment. Healthcare Health Center,
Baddi.
7. Providing Public toilet for use of Sanitation/Safe Panchayat Road 4.00 2.54 2.54 Through Trust
general public in bazar situated on Drinking Water leading to Dakhru
Panchayat Road and renovating Majara Village, Baddi
culvert for proper discharge of toilet
8. Protection of National Heritage, Arts Art and Cultural Shoolini Mela, Solan 4.00 4.00 4.00 Through Trust
& Handicrafts, Funding for Mela Heritage
9. Green Area Development by Ensuring Timex to Unichem & 6.50 4.64 4.64 Through Trust
planting 5,000 tress environment MSM-TD Gate Area,
Sustainability approx. 0.7 Km far
from Vardhman
10. New Borewell with Supply Line for Drinking Water DhakruMajra (Ward 32.60 6.05 6.05 Through Trust
existing network & One Room for and Rural No.-08) Village and
Bore Well and Public Library cum Development Gullerwala Village
Community Hall construction
55
STATUTORY REPORT
Annexure- III
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
11. Renovation of 200 years old Ensuring Nalagarh Heritage 1.51 1.51 1.51 Through Trust
"Talab" & development of green environment Society; Higher
area for excursion of public., Sustainability & Education Institution
Promoting Education & personality rural sports Society, Govt.
development through sports College Nalagarh
(Stadium) in Govt. College Nalagarh
12 Providing 02 No. 360 Ltr Fridge, 01 Preventive Primary/Community 3.75 2.10 2.10 Through Trust
No. Defibrillator Instrument, 01 No. Healthcare Health Centre, Baddi
BOD Incubator in PHC
13 Supply of School Desks with Promotion of Govt. High School, 1.95 2.10 2.10 Through Trust
Benches 25 No. And Providing hand Education Dharampur (Bhup
washing area for existing toilets with Nagar)
overhead tank facility, repair of stair
including minor civil works
14 Building of 03 no. of New Promotion of Govt. Primary 25.30 0.00 0.00 Through Trust
Classrooms at First Floor with Education School, Baddi
Provision of Stairs, Providing
Drinking Water Point and school
desks
15 Construction of One class room with Promotion of Government Middle 18.55 0.00 0.00 Through Trust
benches, Repairing & finishing of Education School, Village
existing stairs & Boundary Wall Billanwali - Baddi
16 Providing Drinking Water Facility Promotion of Government High 2.45 0.76 0.76 Through Trust
for students, 50 no. of desks with Education School, Village
Benches for students Sandholi
17 Providing RO; Reconstruction of Existing Promotion of Government Sr, 17.80 0.41 0.41 Through Trust
toilet complex 10 No's (Boys+Girls+Staff); Education Secondary School,
Renovation of Drinking Water Points for Gullerwala
Primary School
18 Construction of Ladies Toilets with Sanitation Public Toilet (Ladies) 4.00 2.80 2.80 Through Trust
hand washing facility in ward no-7 in ward no.-7
(approx. 0.2 Km far
from Vardhman)
19 Promoting Rural Sports in Promoting Rural Gullerwala Khusti 0.21 0.21 0.21 Through Trust
Gullerwala Village through Gram Sports Dangal
Panchayat Gullerwala Khusti Dangal
Committee
20 Reconstruction of damaged floor Promotion of Govt. Sr. Sec. School, 22.50 0.00 0.00 Through Trust
in classroom and veranda area, Education Gullerwala
and repair of school entrance,
Construction of Toilets (12 No.),
Construction of New Kitchen area.
21 Medical Equipment Preventive Govt. Hospital 22.00 2.44 2.44 Through Trust
Healthcare (F.R.U), Nalagarh
56
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- III
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
22 Construction of 2 classrooms and Promotion of Govt. High School, 30.95 0.00 0.00 Through Trust
one computer lab Education Billanwali
23 Construction of 01 no. of Public Sanitation Tehsil Complex, 11.00 0.00 0.00 Through Trust
Toilet (Ladies & Gents) including Baddi
minor civil work on outside area and
provision of Septic Tank
24 Training to promote Rural Sports Promoting Rural Kabaddi 0.11 0.11 0.11 Through Trust
(National Kabaddi Tournament) Sports Tournament in
Karuana Village,
Baddi
25 Contribution to Nalagarh Heritage Art and Cultural Nalagarh Heritage 0.50 0.50 0.50 Through Trust
Society Heritage Society
26 Construction work at Sri Aurobindo Promotion of Sri Aurobindo Public 29.81 0.00 0.00 Through Trust
Public School Education School, Baddi
26a. Cost of Cement for above Civil Promotion of Baddi 38.78 38.78 Through Trust
Projects, Cost of Steel (TMT Bar & MS Education and
Channel) Preventive
Healthcare
27 Providing safe drinking water, Desks, Promotion of Government 3.24 2.89 2.89 Through Trust
chair & table and black boards, Education primary schools of
carpets, wall clocks and fans. Khanna region
Constructing toilet facility
28 Providing safe drinking water, Desks, Promotion of Government 3.65 2.31 2.31 Through Trust
chair & table and black boards, Education primary schools of
carpets, wall clocks and fans Nabha region.
29 Providing safe drinking water, Desks, Promotion of Government 0.27 0.20 0.20 Through Trust
wall clocks and fans. Education primary schools of
Barnala region.
30 Providing safe drinking water, Desks, Promotion of Government primary 3.02 1.94 1.94 Through Trust
chair & table and black boards, Education schools of Sherpur &
carpets, wall clocks and fans Bugra region.
31 Providing basic amenities in nearby Promotion of Govt. Primary 6.95 0.00 0.00 Through Trust
Govt. schools to uplift the education Education Schools in Bhogiwal,
system. Ranwa, Rajinder
Nagar etc.
32 Providing medical equipment in Preventive Civil Hospital, 6.50 1.60 1.60 Through Trust
hospital Healthcare Malerkotla, Sangrur
33 Providing Rooftop Solar Power Ensuring Kasturba Gandhi 1.60 0.00 0.00 Through Trust
System environment Balika Vidalya,
Sustainability Sangrur.
34 Providing medical equipment in Preventive Civil Hospital, 43.10 7.60 7.60 Through Trust
hospital Healthcare Malerkotla, Sangrur
57
STATUTORY REPORT
Annexure- III
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
35 Donation to CMC Urology Preventive CMC Urology 30.00 29.86 29.86 Direct
Department Healthcare Department,
Ludhiana
36 BCI cotton, Providing technical Rural 8732 farmers, 47 66.58 39.15 39.15 Through Trust
assistance to farmers of better Development villages, Rajkot,
farming and integrated pest Gujrat
management techniques
37 Providing Cotton Bags to farmers Ensuring 8732 farmers, 47 57.10 36.47 36.47 Through Trust
Environment villages, Rajkot,
Sustainability Gujrat
38 Aurobindo College Auditorium Promotion of 450.00 100.00 100.00 Through Trust
Education
39 Aurobindo Public School, Budhni Promotion of Aurobindo Public 105.35 44.29 44.29 Through Trust
Education School, Budhni
40 Vardhman Block at Govt. Primary Promotion of Govt Primary 125.00 28.39 28.39 Through Trust
School, Giaspura Education School, Giaspura,
Ludhiana,Punjab
41 Providing infrastructure & sanitation Promotion of Nishkam Vidhya 53.00 13.87 13.87 Through Trust
facility in Nishkam Vidhya Mandhir Education Mandhir, Model Town,
School Ludhiana, Punjab
42 Providing sanitation & benches Promotion of Govt. Sr. School 22.05 0.00 0.00 Through Trust
facility in Govt. Sr. School Sekhewal Education Sekhewal School
School
43 Sponsorship Contribution to 4 Promotion of Delhi 1.32 1.32 1.32 Direct
Children Education
44 Drinking facility & desks/benches at Promotion of Govt Primary 1.00 1.65 1.65 Through Trust
Manekwal school Education School, Manakwal,
Ludhiana,Punjab
45 Promotion of Indological Studies Art and Cultural Indological Studies at 10.00 10.00 10.00 Through Trust
at Bhogilal Leherchand Institute of Heritage Bhogilal Leherchand
Indology, Alipur, Delhi Institute of Indology,
Alipur, Delhi
46 Promoting Education by Promotion of Auro-Mira Vidya 25.00 25.00 25.00 Direct
constructing of girls hostel at Auro- Education Mandir, Kechla,
Mira Vidya Mandir, Kechla, Odisha Odisha
48 Promoting preventive health care by Preventive CMC Ludhiana 50.00 25.00 25.00 Direct
donating amount for construction of Healthcare
PHRC to CMC Ludhiana
49 Providing Drinking water supply Rural Machlikho, Talpura, 2.50 2.39 2.39 Through Trust
from the existing bore well 3 Development Village
locations in the village
50 Construction of a school shed in the Promoting Khandabad 5.00 0.00 0.00 Through Trust
primary school of village Beemkotti Education panchayat.
58
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- III
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
51 Providing Computer lab and Promoting Village Mahukala 2.25 1.18 1.18 Through Trust
construction of main gate at Pathal Education
kho High school
52 Providing safe drinking water to Rural Bus stand, Budni. 0.60 0.41 0.41 Through Trust
the commuters travelling through Development
Budhni to other areas.
53 Providing solar lights to the Mandi Ensuring Pillikarar 2.75 2.27 2.27 Through Trust
area of Pilikarar Panchayat. Environment
Sustainability
54 Plantation activities along the banks Ensuring Mahulaka, Berkhedi 2.00 0.00 0.00 Through Trust
of Narmada River Environment & other Panchayat.
Sustainability
55 Development of Nurseries and Women Talpura, Pillikarar 2.00 0.58 0.58 Through Trust
raising fruit plants and ornamental Empowerment
trees in the neighboring villages by
training 20 beneficiaries.
56 Promotion of Anganbadi by Promoting Neighboring villages 2.00 2.25 2.25 Through Trust
providing basic infrastructure and Education
study materials to 20 Anganbadies
in the neighboring villages.
57 Construction of boundary wall & Village Pillikarar Through Trust
modification of toilet in primary
Promoting
school, Pillikarar. 11.58 9.68 9.68
Education
58 Construction of boundary wall & Budni, Nagar Palika Through Trust
kitchen shed in HSTTC School, Budni
59 Providing safe drinking water to Promoting Village Mahukala 0.60 0.72 0.72 Through Trust
Pathal kho High school Education
60 Providing water cooler and Jain School, 1.60 1.60 1.60 Through Trust
Computers to the Jain School in Hoshangabad.
Hoshangabad. Promoting
61 Construction of boundary wall Education Village Talpura 1.50 1.20 1.20 Through Trust
around Anganbadi building in
Talpura Village.
62 Construction of a Paediatric block & Preventive St. Joseph's Hospital, 28.40 0.00 0.00 Through Trust
providing medical equipment to St. Healthcare Hoshangabad.
Joseph's Hospital, Hoshangabad
63 Construction of a Waiting Shed for Preventive St. Joseph's Hospital, 15.65 0.00 0.00 Through Trust
Attendants in St. Joseph's Hospital, Healthcare Hoshangabad
Hoshangabad
64 Providing Ventilator to the Preventive Govt. Hospital, 14.70 11.24 11.24 Through Trust
Government Hospital, Hoshangabad Healthcare Hoshangabad.
65 Construction of a shed for keeping Preventive Government 6.70 0.00 0.00 Through Trust
Deep Freezer in the mortuary in Healthcare Hospital,
Hoshangabad Hoshangabad.
59
STATUTORY REPORT
Annexure- III
(` in Lakhs)
S. CSR project or activity identified Sector in which Projects or Amount Amount Cumulative Amount
No. the project is programs outlay spent expenditure spent:
covered 1. L
ocal Area or (Budget) on the upto the Direct or
other project or projects or reporting through
2. S
pecify the state program programs period implementing
and district wise Subheads: agency
where project
or program was Direct expenditure on
undertaken projects/ programs
(including Overheads)
66 Providing water cooler in Govt. Preventive Govt. Hospital, 1.00 0.28 0.28 Through Trust
Hospital in Budhni Healthcare Budni
67 Modification of Mortuary in Govt. Preventive Govt. Hospital, 1.50 0.00 0.00 Through Trust
Hospital in Budhni Healthcare Budhni
68 Extension of boundary wall, HTTC Preventive Budhni 1.30 0.00 0.00 Through Trust
Healthcare
69 Narmada Seva Yatra Ensuring Narmada River Side 5.25 0.00 0.00 Through Trust
Environment
Sustainability
70 Construction of Science Lab Preventive Govt Higher 10.94 9.60 9.60 Through Trust
Healthcare Secondary School,
Mandideep
71 Participation in Construction of Rural Govt Piped Water 17.97 Awaited 0.00 Through Trust
piped water supply scheme in rural Development Supply near (permission
area of Obedullaganj Block in 55 Obedullaganj not
villages received
from govt)
72 Construction of classroom and Preventive Raja Bhopal Govt. 25.74 Awaited 0.00 Through Trust
various basic amenities Healthcare College (NOC for
land was not
received)
73 Construction of boundary walls of Preventive Veer Savarkar 17.97 6.90 6.90 Through Trust
college, Obedullaganj, Mandideep Healthcare College
74 Providing medical instruments Preventive Government 30.75 18.31 18.31 Through Trust
Healthcare Hospital, Mandideep
75 Converting one room into computer Preventive Government High 15.82 0.00 0.00 Through Trust
lab, 2 Water tanks, Submersible Healthcare School Village-Polah,
pump, Cycle shed, Furniture for Mandideep.
science lab.
76 Shed for Prayer, Main gate & Preventive Government High 22.67 0.00 0.00 Through Trust
boundary wall, Tree plantation Healthcare School Khanpura,
Obedullaganj, Raisen
77 Developing Green Belt area Ensuring AKVN Land Near 27.6 0.00 0.00 Through Trust
Environment Vardhman Yarns
Sustainability
Total Amount of Projects Approved by 1651.93 540.91 540.91
Board in FY 16-17 and their expenses
Note: In case of investments through Trust, investments have been made through Sri Aurobindo Socio Economic and Management Research Institute.
60
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- III
Annexure- B
Responsibility Statement
I, A.K. Kundra, Chairman of the CSR Committee of Vardhman Textiles Limited undertake that the implementation and
monitoring of CSR policy, is in compliance with CSR objectives of the Company.
SIGNED BY:
Place : Ludhiana (A.K. Kundra)
Dated : 10th May, 2017 Chairman of CSR Committee
61
STATUTORY REPORT
Annexure- IV
62
DIRECTORS’ REPORT ANNUAL REPORT 2016-17
Annexure- IV
2.2 Statutory Compulsions voting rights) other than equity shares. In the
Prevailing legal requirements, regulatory absence of any other class of shares and/or
conditions or restrictions laid down under the shares with differential voting rights, the entire
Applicable Laws including tax laws. distributable profit for the purpose of declaration of
dividend is considered for the equity shareholders.
B. Utilisation of Retained Earnings
The Company aims in ensuring sustainable wealth D. Periodic Review
creation for its shareholders and with this objective, This Policy would be subject to revision/
would utilise the retained earnings of the Company amendment in accordance with the guidelines
in a manner in which it is beneficial to Company as as may be issued by Ministry of Corporate
well as its stakeholders. The Company would aim at Affairs, Securities and Exchange Board of India
achieving the right balance between the distribution or other regulatory authority, from time to
of retained earnings among the shareholders time, on the subject matter.
and utilisation of the same for meeting other
requirements, including expansions. The Board will he Board reserves the right to review this
T
endeavour to maintain a reasonable dividend pay- policy on periodical basis, considering various
out of the Company’s profit after tax on standalone external and internal factors.
financials (other than extraordinary income).
E. Disclosure of Policy
C. Parameters for Various Classes of Shares The policy will be available on the Company’s
Currently, the Company does not have any other website and will also be disclosed in the Company’s
class of shares (including shares with differential Annual Report.
63
STATUTORY REPORT
Annexure- V
Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
required under the Companies (Accounts) Rules, 2014.
Steps Taken for Conservation of Energy:
All the units have taken various measures in conservation of energy. The thrust is to measure the existing system
parameters and then implement improvements. Emphasis is also given to optimise the operation of various
equipments which also lead to energy conservation.
Some of the significant energy efficiency measures and best practices adopted in the Group for the year 2016-17 are
given in the table below:
Technology Absorption:
Efforts made in Technology Absorption are furnished as under:
64
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Annexure- V
4. Expenditure on R&D:
(` in Lakhs)
Particulars (2016-17) (2015-16)
Capital 636.02 1,398.81
Recurring 94.44 78.85
Total 730.46 1,477.66
Total R & D expenditure as a Percentage of Turnover 0.13% 0.26%
Exports of Yarns diversified into new Products & Markets with continuous growth.
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Annexure- VI
IV. Share holding pattern (Equity Share Capital Breakup as percentage of Total Capital)
i) Category –wise share Holding
No. of shares held at the beginning of the year No. of shares held at the end of the year
% change
% of
Category of Shareholders % of Total during the
Demat Physicals Total Demat Physicals Total Total
Shares year
Shares
A. Promoters
1) Indian
a) Individual /HUF 14,61,658 0 14,61,658 2.30 12,83,095 0 12,83,095 2.23 (0.07)
b) Central Govt./ State Govt. (s) 0 0 0 0 0 0 0 0 0
c) Banks /FI 0 0 0 0 0 0 0 0 0
d) Any other (Specify)
Bodies corporate 2,51,55,246 0 2,51,55,246 39.52 2,27,96,397 0 2,27,96,397 39.72 0.20
LLP 1,29,78,058 0 1,29,78,058 20.39 1,14,13,130 0 1,14,13,130 19.89 (0.5)
Sub –total (A)(1):- 3,95,94,962 0 3,95,94,962 62.21 3,54,92,622 0 3,54,92,622 61.84 (0.37)
(2) Foreign
a) NRIs Individuals 0 0 0 0 0 0 0 0 0
b) Government 0 0 0 0 0 0 0 0 0
c) Institutions 0 0 0 0 0 0 0 0 0
d) Foreign Portfolio Investor 0 0 0 0 0 0 0 0 0
Sub –total (A)(2):- 0 0 0 0 0 0 0 0 0
Total Shareholding of promoter 3,95,94,962 0 3,95,94,962 62.21 3,54,92,622 0 3,54,92,622 61.84 (0.37)
(A)= (A) (1) +(A) (2)
B. Public Shareholding
1. Institutions
a) Mutual Funds 69,70,756 22,272 69,93,028 10.99 65,68,824 22,272 65,91,096 11.48 0.49
b) Venture Capital Funds 0 0 0 0 0 0 0 0 0
c) Alternate Investment Funds 0 0 0 0 5,583 0 5,583 0.01 0.01
d) Foreign Venture Capital 0 0 0 0 0 0 0 0 0
e) Foreign Portfolio Investors 76,95,357 8,694 77,04,051 12.10 63,16,096 8,694 63,24,790 11.02 (1.08)
f) Banks /FI 11,503 52,762 64,265 0.10 7,815 52,870 60,685 0.11 0.01
g) Insurance Companies 50,000 1,575 51,575 0.08 50,000 1,575 51,575 0.09 0.01
h) Provident Funds/ Pension Funds 0 0 0 0 0 0 0 0 0
i) Any Others (specify) 0 0 0 0 0 0 0 0 0
Sub-Total(B)(1) 1,47,27,616 85,303 1,48,12,919 23.27 1,29,48,318 85,411 1,30,33,729 22.71 (0.56)
67
STATUTORY REPORT
Annexure- VI
During the year, the Company had bought back and extinguished 62,60,869 Equity shares of ` 10/- each at a price of
` 1,150 per share. Equity shares of the Company, post buyback reduced from 6,36,51,879 to 5,73,91,010.
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STATUTORY REPORT
Annexure- VI
Investment and Trading Company Private Limited w.e.f. 1st April, 2015. Therefore, the Investments made by merged
companies got vested in Devakar Investment and Trading Company Private Limited.
Note: During the year, the Company had bought back and extinguished 62,60,869 Equity shares of ` 10/- each at a
price of ` 1,150 per share. Equity shares of the Company post buyback are reduced to 5,73,91,010 from 6,36,51,879.
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(iv) Shareholding pattern of top ten shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):-
S.No. Name Shareholding Date Increase/ Reason Cumulative Shareholding
Decrease in during
shareholding the year
Top Ten No. of Shares at % of total No. of shares % of total
Shareholders beg (01.04.2016)/ shares of the shares of the
end (31.03.2017) Company Company
1 IDFC Premier Equity 28,89,998 4.54 01-Apr-16
Fund 08-Apr-16 (35,420) Transfer 28,54,578 4.48
15-Apr-16 (54,578) Transfer 28,00,000 4.40
17-Jun-16 (2,50,000) Transfer 25,50,000 4.01
15-Jul-16 (5,29,448) Transfer 20,20,552 3.17
09-Sep-16 (6,082) Transfer 20,14,470 3.16
23-Sep-16 (56,834) Transfer 19,57,636 3.08
28-Oct-16 (55,238) Transfer 19,02,398 2.99
18-Nov-16 (8,17,395) Transfer 10,85,003 1.70
10-Dec-16 (92,688) Transfer 9,92,315 1.56
11-Dec-16 (30,685) Transfer 9,61,630 1.51
16-Dec-16 1,23,373 Transfer 10,85,003 1.70
13-Jan-17 (2,00,000) Transfer 8,85,003 1.39
20-Jan-17 (2,375) Transfer 8,82,628 1.39
27-Jan-17 56,023 Transfer 9,38,651 1.64
03-Feb-17 (1,50,000) Transfer 7,88,651 1.37
17-Feb-17 (50,000) Transfer 7,38,651 1.29
10-Mar-17 (373) Transfer 7,38,278 1.29
24-Mar-17 (25,084) Transfer 7,13,194 1.24
31-Mar-17 (63,666) Transfer 6,49,528 1.13
6,49,528 1.13 31-Mar-17 6,49,528 1.13
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STATUTORY REPORT
Annexure- VI
(iv) Shareholding pattern of top ten shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):- (Contd.)
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STATUTORY REPORT
Annexure- VI
* Ceased to be in the list of Top 10 shareholders as on 31.03.2017. The same is reflected above since the shareholder was one of the Top 10
shareholder as on 01.04.2016.
# Not in the list of Top 10 shareholders as on 01.04.2016. The same has been reflected above since the shareholder was one of the Top 10
shareholders as on 31.03.2017.
Note: During the year, the Company had bought back and extinguished 62,60,869 Equity shares of ` 10/- each at a price of ` 1,150 per
share on 25th January, 2017. Therefore, for computing %age of total share capital of the Company in the above table, total no. of shares
considered upto 24th January, 2017 are 6,36,51,879 and on or after 25th January, 2017 are 5,73,91,010.
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* Mrs. Suchita Jain has been appointed as Joint Managing Director of the Company w.e.f. 24 August, 2016. th
** During the year, IDBI Bank has withdrawn the nomination of Mr. Suresh Khatanhar, from the Board w.e.f. 19th November, 2016 and has
nominated Mr. Kumar Neel Lohit as the Nominee Director w.e.f. 28th November, 2016.
*** Ms. Karan Kamal Walia, Company Secretary resigned from the Company w.e.f. 11th May, 2017 and Mr. Sanjay Gupta has been appointed
as Company Secretary in her place w.e.f. 1st June, 2017
(V) Indebtedness:
Indebtedness of the Company including interest outstanding /accrued but not due for payment
(` in Lakhs)
Secured loans Unsecured Deposits Total
excluding loans indebtedness
deposits
Indebtedness at the beginning of the financial year
i) Principal amount 2,52,976.86 6,538.38 - 2,59,515.24
ii) Interest due but not paid - - -
iii) Interest accrued but not due 35.06 - 35.06
Total (i+ii+iii) 2,53,011.92 6,538.38 - 2,59,550.30
Change in indebtedness during the financial year
Addition 6,489.95 - - 6,489.95
Reduction 43,557.41 2,666.09 46,223.50
Net change (37,067.46) (2,666.09) - (39,733.55)
Indebtedness at the end of the financial year
i) Principal amount 2,15,780.07 3,872.29 2,19,652.36
ii) Interest due but not paid - - - -
iii) Interest accrued but not due 164.41 - - 164.41
Total (i+ii+iii) 2,15,944.48 3,872.29 - 2,19,816.77
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Annexure- VII
Details pertaining to remuneration as required under Section 197(12) of Companies Act, 2013 read with rule
5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
1. The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during
the financial year 2016-17 and ratio of the remuneration of each Director to the median remuneration of the
employees of the Company for the financial year 2016-17 are as under:
Sr. No. Name of Director/ Kmp and Remuneration of % Increase in Ratio of Remuneration
Designation Directors/ KMP for Remuneration in the of each Director/ KMP to
Financial Year 2016-17 Financial Year 2016-17 Median Remuneration of
(Amount In `) Employees
1. S.P. Oswal 26,65,69,201 45.56 840.91
Chairman & Managing Director
2. Sachit Jain 1,17,92,733 38.52 37.20
Joint Managing Director
3. Neeraj Jain 1,10,77,551 41.13 34.94
Joint Managing Director
4. Suchita Jain* 87,71,724 - 27.67
Joint Managing Director
5. D.L. Sharma - - -
Non- Executive Non- Independent
Director
6. Prafull Anubhai 4,45,000 25.35 1.40
Non- Executive Independent Director
7. A.K. Kundra 5,95,000 (5.56) 1.88
Non- Executive Independent Director
8. D.B. Jain 2,30,000 (29.23) 0.73
Non- Executive Independent Director
9. Shravan Talwar 95,000 (5.00) 0.30
Non-Executive Independent Director
10. R.M. Malla 2,05,000 17.14 0.65
Non- Executive Independent Director
11. S.K. Bijlani 2,60,000 30.00 0.82
Non- Executive Independent Director
12. Suresh Khatanhar 70,000
Nominee Director of IDBI Bank**
(25.00) 0.33
13. Kumar Neel Lohit 35,000
Nominee Director of IDBI Bank**
14. Rajeev Thapar 48,83,397 11.89 15.41
Chief Financial Officer
15. Karan Kamal Walia 8,97,057 12.70 2.83
Company Secretary
Note:
* Details not given as Mrs. Suchita Jain was appointed as Joint Managing Director of the Company w.e.f. 24th August, 2016.
** During the year, IDBI Bank has withdrawn the nomination of Mr. Suresh Khatanhar, from the Board w.e.f. 19th November, 2016 and has
nominated Mr. Kumar Neel Lohit as the Nominee Director w.e.f. 28th November, 2016.
2. The median remuneration of employees of the Company during the financial year was ` 3.17 lakhs.
3. In the financial year, there was an increase of 11.05% in the median remuneration of employees.
4. There were 21,206 permanent employees on the rolls of Company as on 31st March, 2017.
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STATUTORY REPORT
Annexure- VII
5. verage percentage increase made in the salaries of employees other than the managerial personnel in the last financial year 2016-17
A
was 10.62% whereas the increase in the managerial remuneration for the same financial year was 49.14%.
6. It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other
Employees.
Persons employed throughout the financial year, who were in receipt of remuneration which, in the aggregate,
was not less than ` 1,02,00,000/- per annum
Sr. Name of Designation/ Remun- Quali- Age Experience Date of Particulars of last
No. employee Nature of eration fication (Years) (Years) employ- employment
duties (in ` lakhs) ment
1. Mr. S.P. Oswal Chairman & 2,665.69 M.Com 74 50 08.10.1973 Chairman and
Managing Managing Director
Director (Vardhman Spinning
and General Mills
Limited)
2. Mr. Sachit Jain Joint 117.93 B. Tech, MBA 51 27 13.06.1994 Executive Director,
Managing VMT Spinning
Director Company Limited
3. Mr. Neeraj Jain Joint 110.78 B.Com, CA 50 25 31.03.2010 N.A.
Managing
Director
Persons employed for part of financial year, who were in receipt of remuneration for any part of that year,
at a rate which in aggregate, was not less than ` 8,50,000/- per month
Sr. Name of Designation/ Remun- Quali- Age Experience Date of Particulars of last
No. employee Nature of eration fication (Years) (Years) employ- employment
duties (in ` lac) ment
1. Suchita Jain Joint 87.72 M.Com 49 24 30.03.2005 N.A.
Managing
Director
Disclosure in respect of remuneration or commission received by Mr. Neeraj Jain, Joint Managing Director of
the company in VMT Spinning Company Limited (Subsidiary Company)
82
CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
This report on corporate governance forms part of Accepting change as a way of life.
the Annual Report. Corporate governance refers to a
Appreciating our role as a responsible
combination of laws, regulations, procedures, implicit
corporate citizen.
rules and good corporate practices that ensure that a
Company meets its obligations to optimize shareholders’
2. BOARD OF DIRECTORS/ BOARD MEETINGS:
value and fulfill its responsibilities to the community,
customers, employees, Government and other segments i. Composition as on March 31, 2017
of society. Your Company is committed on adopting the The Composition of Board and category of Directors
best practices of Corporate Governance as manifested are as follows:-
in the Company’s functioning to achieve the business
excellence by enhancing long-term shareholders’ value. Category Name of Directors
Efficient conduct of the business of the Company through Promoter Directors # S.P. Oswal- Chairman
commitment to transparency and business ethics in & Managing Director
discharging its corporate responsibilities is hallmark of # Sachit Jain- Joint
the best practices followed by the Company. This report Managing Director
# Suchita Jain- Joint
on Corporate Governance, besides being in compliance
Managing Director
of the mandatory SEBI (Listing Obligations & Disclosure
Executive Non- Independent Neeraj Jain- Joint
Requirements) Regulations, 2015, gives an insight into
Director Managing Director
the functioning of the Company.
Independent Directors Prafull Anubhai
A.K. Kundra
1. COMPANY’S PHILOSOPHY: S.K. Bijlani
Faith in bright future of Indian textiles and Shravan Talwar
hence continued expansion in areas “which we D.B. Jain
know best”. R.M. Malla
Non- Executive Non- D.L. Sharma
Total customer focus in all operational areas. Independent Director
Products to be of best available quality for Nominee Director of IDBI Kumar Neel Lohit*
premium market segments through TQM.
Relationship Inter-se:
Zero defect implementation.
Except Mr. S.P. Oswal, Mr. Sachit Jain and Mrs.
#
lobal orientation targeting - atleast 20%
G
Suchita Jain, none of the Director of the Company is
production for exports.
related to any other Director of the Company.
Integrated diversification/ product range
expansion. ii. Board Meetings:
World class manufacturing facilities with most During the financial year 2016-2017, the Board met
modern R & D and process technology. 5 (Five) times on the following dates:
83
STATUTORY REPORT
iii. A
ttendance of the Directors at the Board Meetings during the year and at last Annual General Meeting
of the Company as also the number of other Directorship/Chairmanship in Indian Public Limited
Companies are as follows:-
* During the year, IDBI Bank Limited has withdrawn the nomination of Mr. Suresh Khatanhar from the Board of the Company w.e.f.
19th November, 2016 and nominated Mr. Kumar Neel Lohit as Director of the Company. Thereafter, Mr. Kumar Neel Lohit has been
appointed as Nominee Director of the Company w.e.f. 28th November, 2016.
Video conferencing facility was provided to facilitate Directors travelling abroad or present at other locations to
participate in the Board meetings.
3. BOARD COMMITTEES:
i. Board Committees, their composition and terms of reference are provided as under:
Name of
Composition Terms of Reference
Committee
Audit Committee Prafull Anubhai (Chairman) The role of the Audit Committee is as per Section 177 of the Companies
Act, 2013 read with Regulation 18 of the SEBI (Listing Obligations and
S.K. Bijlani
Disclosure Requirements) Regulation, 2015.
D.L. Sharma
The Policy on dealing with related party transactions as
Shravan Talwar approved by the Board may be accessed on the Company’s
website at the link: http://www.vardhman.com/user_
D.B. Jain
files/96c45534e3ab096d9bc682f8eebade0344f915151436264609.pdf.
A.K. Kundra
Nomination and Prafull Anubhai (Chairman) he role of the Nomination and Remuneration Committee is as per
T
Remuneration Section 178 of the Companies Act, 2013 read with Regulation 19 of SEBI
A.K. Kundra
Committee (Listing Obligations and Disclosure Requirements) Regulations, 2015.
S.P. Oswal
Formulated and recommended Nomination and Remuneration Policy.
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CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
Name of
Composition Terms of Reference
Committee
Corporate Social A.K. Kundra (Chairman) Formulated and recommended CSR Policy of the Company indicating
Responsibility CSR activities proposed to be undertaken by the Company pursuant
Sachit Jain
Committee to the provisions of Schedule VII of the Companies Act, 2013 read
Neeraj Jain with CSR Rules, 2014. The CSR policy may be accessed on the
Company’s website at the link: http://www.vardhman.com/user_files/
D.L. Sharma
d622b1c8d626fabfcecf09e145cb1b4e9f4884761436264563.pdf.
Company Secretary and Compliance Officer of the Company is the Secretary of all Board Committees constituted
under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
ii. Meetings of Board Committees held during the year and Director’s attendance:
Board Committees Audit CSR Nomination & Remuneration Stakeholders Relationship
Meetings held 4 5 4 1
S.P. Oswal N.A. N.A. 4 N.A.
Sachit Jain N.A. 4 N.A. 0
Prafull Anubhai 4 N.A. 4 N.A.
S.K. Bijlani 4 N.A. N.A. N.A.
Neeraj Jain N.A. 5 N.A. N.A.
D.L. Sharma 3 2 N.A. 1
A. K Kundra 3 5 4 1
Suchita Jain N.A. N.A. N.A. N.A.
Shravan Talwar 2 N.A. N.A. N.A.
D.B. Jain 3 N.A. N.A. N.A.
R.M. Malla N.A. N.A. N.A. N.A.
Suresh Khatanhar* N.A. N.A. N.A. N.A.
Kumar Neel Lohit* N.A. N.A. N.A. N.A.
* During the year, IDBI Bank Limited has withdrawn the nomination of Mr. Suresh Khatanhar from the Board of the Company w.e.f. 19th
November, 2016 and nominated Mr. Kumar Neel Lohit as Director of the Company. Thereafter, Mr. Kumar Neel Lohit has been appointed
as Nominee Director of the Company w.e.f. 28th November, 2016.
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STATUTORY REPORT
Performance Evaluation
The performance evaluation of Non-Independent Directors of the Company, Chairman of the Company and
the Board as a whole, was done by Independent Directors by way of discussions on their performance and the
minutes of the meeting was submitted to the Chairman of the Company.
policy on the performance evaluation of Independent Directors, Board, Committees and other individual
A
Directors which includes criteria for performance evaluation of non-executive directors and executive directors
have been formulated by the Company.
4. DIRECTORS’ REMUNERATION:
i) Chairman and Managing Director / Executive Directors:
The Company pays remuneration to Chairman and Managing Director and Joint Managing Directors as approved
by the Board of Directors and the Members of the Company in the General Meeting.
A detail of remuneration paid to the Directors during the year 2016-17 is as given below:
(in ` Lakhs)
Perquisites & Retirement Gross
Name Designation Salary Commission
Allowances Benefit remuneration
S.P. Oswal Chairman & Managing 45.75 27.04 5.49 2,587.41 2,665.69
Director
Sachit Jain Joint Managing 41.00 30.71 5.22 41.00 117.93
Director
Neeraj Jain Joint Managing 37.50 30.98 4.80 37.50 110.78
Director
Suchita Jain* Joint Managing 28.37 27.40 3.58 28.37 87.72
Director
*Mrs. Suchita Jain has been appointed as Joint Managing Director of the Company w.e.f. 24th August, 2016. Therefore, the salary paid
to her is for part of the year commencing from 24th August, 2016.
The Directors are paid sitting fees @ ` 35,000/- per Board Meeting and @ ` 30,000/- per Committee Meeting. The
detail of sitting fees paid to the Directors during the Financial Year 2016-17 is given hereunder: -
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CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
* During the year, IDBI Bank Limited has withdrawn the nomination of Mr. Suresh Khatanhar from the Board of the Company w.e.f.
19th November, 2016 and nominated Mr. Kumar Neel Lohit as Director of the Company. Thereafter, Mr. Kumar Neel Lohit has been
appointed as Nominee Director of the Company w.e.f. 28th November, 2016.
No other director holds any share in the Equity Share Capital of the Company.
The Board had appointed M/s. B.K. Gupta & Associates, Practicing Company Secretaries as Scrutinizer to conduct
the postal ballot process in a fair and transparent manner. The details of the voting pattern is as follows:-
% of votes % of votes
No. of No. of No. of % of votes
polled on No. of votes in against
shares votes votes in favour on
Promoter/ Public outstanding in favour on votes
held polled against votes polled
shares polled
1 2 3 = (2/1)*100 4 5 6= (4/2)*100 7= (5/2)*100
Special Resolution
Promoter & Promoter 3,96,10,190 3,96,10,190 100 3,96,10,190 0 100.00 0.00
Group
Public 2,40,41,689 1,33,62,114 55.58 1,33,62,114 0 100.00 0.00
Total 6,36,51,879 5,29,72,304 83.22 5,29,72,304 0 100.00 0.00
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STATUTORY REPORT
he Board had appointed M/s. B.K. Gupta & Associates, Practicing Company Secretaries as Scrutinizer to conduct
T
the postal ballot process in a fair and transparent manner. The details of the voting pattern is as follows:-
% of votes % of votes
No. of No. of No. of % of votes
polled on No. of votes in against
shares votes votes in favour on
Promoter/ Public outstanding in favour on votes
held polled against votes polled
shares polled
1 2 3 = (2/1)*100 4 5 6= (4/2)*100 7= (5/2)*100
Resolution No. 1 –
Ordinary Resolution
Promoter & Promoter 3,96,10,190 3,86,37,242 97.54 3,86,37,242 0 100.00 0.00
Group
Public 2,40,41,689 1,34,50,935 55.95 1,34,42,693 8,242 99.94 0.06
Total 6,36,51,879 5,20,88,177 81.83 5,20,79,935 8,242 99.98 0.02
% of votes % of votes
No. of No. of No. of % of votes
polled on No. of votes in against
shares votes votes in favour on
Promoter/ Public outstanding in favour on votes
held polled against votes polled
shares polled
1 2 3 = (2/1)*100 4 5 6= (4/2)*100 7= (5/2)*100
Resolution No. 2 –
Ordinary Resolution
Promoter & Promoter 3,96,10,190 3,96,10,190 100.00 3,96,10,190 0 100.00 0.00
Group
Public 2,40,41,689 1,34,50,911 55.95 1,34,42,619 8,292 99.94 0.06
Total 6,36,51,879 5,30,61,101 83.36 5,30,52,809 8,292 99.98 0.02
% of votes % of votes
No. of No. of No. of % of votes
polled on No. of votes in against
shares votes votes in favour on
Promoter/ Public outstanding in favour on votes
held polled against votes polled
shares polled
1 2 3 = (2/1)*100 4 5 6= (4/2)*100 7= (5/2)*100
Resolution No. 3 –
Ordinary Resolution
Promoter & Promoter 3,96,10,190 3,86,37,242 97.54 3,86,37,242 0 100.00 0.00
Group
Public 2,40,41,689 1,34,50,935 55.95 1,34,42,638 8,297 99.94 0.06
Total 6,36,51,879 5,20,88,177 81.83 5,20,79,880 8,297 99.98 0.02
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CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
% of votes % of votes
No. of No. of No. of % of votes
polled on No. of votes in against
shares votes votes in favour on
Promoter/ Public outstanding in favour on votes
held polled against votes polled
shares polled
1 2 3 = (2/1)*100 4 5 6= (4/2)*100 7= (5/2)*100
Resolution No. 4 –
Special Resolution
Promoter & Promoter 3,96,10,190 3,96,10,190 100.00 3,96,10,190 0 100.00 0.00
Group
Public 2,40,41,689 1,34,50,935 55.95 1,34,43,397 7,538 99.94 0.06
Total 6,36,51,879 5,30,61,125 83.36 5,30,53,587 7,538 99.99 0.01
There is no immediate proposal for passing any resolution through Postal Ballot in the financial year 2017-18.
7. DISCLOSURES:
i. There was no materially significant related party transaction that may have any potential conflict with
interest of the Company at large.
ii. There has not been any non-compliance by the Company in respect of which penalties or strictures were
imposed by the Stock Exchanges or Securities and Exchange Board of India (SEBI) or any other Statutory
Authority during the last three years.
iii. The Company promotes ethical behaviour in all its business activities and has put in place a mechanism for
reporting illegal or unethical behaviour. The Company has a Vigil Mechanism and Whistle Blower Policy under
which the employees are free to report violations of applicable laws and regulations and the Code of Conduct.
The policy on “Vigil Mechanism and Whistle Blower” may be accessed on the Company’s website at the link:
http://www.vardhman.com/user_files/20b9bcdbd2cc01fde3e8e7d392d93573769de1941436265078.pdf
iv. T
he Company has complied with all the applicable requirements specified in Regulation 17 to 27 and 46 of
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
v. The Board of Directors of the Company has adopted (i) the Code of Practices and Procedures for Fair
Disclosure of Unpublished Price Sensitive Information and (ii) the Code of Conduct, as required under SEBI
(Prohibition of Insider Trading) Regulations, 2015.
vi. D
uring the year no case was filed pursuant to the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
vii. R
isk Management Policy as required under SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 has been duly formulated and approved by the Board of Directors of the Company. The
aim of Risk Management Policy is to maximize opportunities in all activities and to minimize adversity.
viii. F
urther, the Company has complied with all mandatory requirements of SEBI (Listing Obligations and
Disclosure Requirements), Regulations, 2015. The Company may also take up the non-mandatory
requirements of the Regulations in due course of time.
8. MEANS OF COMMUNICATION:
The Company communicates with the shareholders at large through its Annual Reports, publication of financial
results, press releases in leading newspapers, conducting analyst meets and by filing of various reports and
returns with the Statutory Bodies like Stock Exchanges and the Registrar of Companies. The Quarterly Financial
Results are published in prominent daily newspapers viz., “Business Standard” and “Desh Sewak”. The Financial
Results of the Company are also made available at the Company’s web-site www.vardhman.com.
89
STATUTORY REPORT
The Company has duly paid the listing fee to both the aforesaid Stock Exchanges for the financial year 2016-17.
Financial Year Share Prices of Vardhman Textiles Limited on NSE Share Prices of Vardhman Textiles Limited on BSE
2016-17 Highest (`) Lowest (`) Closing (`) %age Highest (`) Lowest (`) Closing (`) %age
change over change over
last month’s last month’s
closing closing
April 899.90 765.00 876.50 13.32 899.00 770.00 868.75 12.34
May 1,028.50 828.00 846.00 -3.48 1,028.00 829.75 845.50 -2.68
June 963.70 833.00 951.25 12.44 963.65 840.00 952.20 12.62
July 1,120.00 931.60 1,087.20 14.29 1,101.25 932.10 1,089.70 14.44
August 1,098.00 973.00 1,001.85 -7.85 1,105.00 970.95 1,001.30 -8.11
September 1,116.00 954.00 1,065.35 6.34 1,116.75 955.00 1,065.55 6.42
October 1,159.50 1,055.15 1,135.95 6.63 1,159.75 1,058.50 1,140.50 7.03
90
CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
Financial Year Share Prices of Vardhman Textiles Limited on NSE Share Prices of Vardhman Textiles Limited on BSE
2016-17 Highest (`) Lowest (`) Closing (`) %age Highest (`) Lowest (`) Closing (`) %age
change over change over
last month’s last month’s
closing closing
November 1,159.75 1030 1,103.45 -2.86 1,150.00 1,034.20 1,104.60 -3.15
December 1,129.75 1026 1,111.90 0.77 1,122.15 1,026.10 1,110.40 0.53
January 1,290.00 1090 1,263.70 13.65 1,289.75 1,085.00 1,265.05 13.93
February 1,387.45 1,256.7 1,329.10 5.18 1,383.35 1,263.70 1,331.85 5.28
March 1,404.00 1,250.8 1,312.65 -1.24 1,439.95 1,273.00 1,318.10 -1.03
1,400.00 9,500.00
1,200.00
9,000.00
1,000.00
8,500.00
8,00.00
600.00
8,000.00
400.00
7,500.00
200.00
0.00 7,000.00
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
NSE VTXL Price on NSE
1,400.00 30,000.00
1,200.00 9,000.00
1,000.00 28,000.00
800.00 27,000.00
600.00 26,000.00
400.00 25,000.00
200.00 24,000.00
0.00 23,000.00
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Jan-17
Feb-17
Mar-17
91
STATUTORY REPORT
Shareholders Shares
Range
Number of % to total Number of % to total
No. of shares
total holders holders shares held shares
Upto-500 19,206 89.84 19,28,039 3.36
501-1000 1,088 5.09 7,77,947 1.36
1001-2000 468 2.19 6,61,835 1.15
2001-3000 165 0.77 4,17,533 0.73
3001-4000 76 0.36 2,66,944 0.47
4001-5000 42 0.20 1,93,594 0.33
5001-10000 119 0.56 8,69,437 1.51
10001- above 213 0.99 5,22,75,681 91.09
Total 21,377 100.00 5,73,91,010 100.00
92
CORPORATE GOVERNANCE REPORT ANNUAL REPORT 2016-17
93
STATUTORY REPORT
94
STANDALONE ANNUAL REPORT 2016-17
To the Members of Vardhman Textiles Limited We have taken into account the provisions of the Act, the
accounting and auditing standards and matters which
Report on the Standalone Ind AS Financial Statements are required to be included in the audit report under the
We have audited the accompanying standalone Ind AS provisions of the Act and the Rules made thereunder.
financial statements of Vardhman Textiles Limited (‘the
Company’), which comprise the balance sheet as at 31 We conducted our audit in accordance with the
March 2017, the statement of profit and loss (including Standards on Auditing specified under Section 143(10)
other comprehensive income), the statement of cash of the Act. Those Standards require that we comply with
flows and the statement of changes in equity for the year ethical requirements and plan and perform the audit
then ended and a summary of the significant accounting to obtain reasonable assurance about whether the
policies and other explanatory information (herein after standalone Ind AS financial statements are free from
referred to as “standalone Ind AS financial statements”). material misstatement.
Management’s Responsibility for the Standalone An audit involves performing procedures to obtain audit
Financial Statements evidence about the amounts and the disclosures in the
The Company’s Board of Directors is responsible for standalone Ind AS financial statements. The procedures
the matters stated in Section 134(5) of the Companies selected depend on the auditor’s judgment, including
Act, 2013 (“the Act”) with respect to the preparation of the assessment of the risks of material misstatement
these standalone Ind AS financial statements that give of the standalone Ind AS financial statements, whether
a true and fair view of the financial position, financial due to fraud or error. In making those risk assessments,
performance including other comprehensive income, the auditor considers internal financial control relevant
cash flows and changes in equity of the Company in to the Company’s preparation of the standalone Ind
accordance with the accounting principles generally AS financial statements that give a true and fair view in
accepted in India, including the Indian Accounting order to design audit procedures that are appropriate
Standards (Ind AS) prescribed under Section 133 of the in the circumstances. An audit also includes evaluating
Act read with relevant rules issued thereunder. the appropriateness of the accounting policies used and
the reasonableness of the accounting estimates made
This responsibility also includes maintenance of adequate by the Company’s Directors, as well as evaluating the
accounting records in accordance with the provisions of overall presentation of the standalone Ind AS financial
the Act for safeguarding the assets of the Company and for statements.
preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting We believe that the audit evidence we have obtained is
policies; making judgments and estimates that are sufficient and appropriate to provide a basis for our audit
reasonable and prudent; and design, implementation opinion on the standalone Ind AS financial statements.
and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy Opinion
and completeness of the accounting records, relevant In our opinion and to the best of our information
to the preparation and presentation of the standalone and according to the explanations given to us, the
Ind AS financial statements that give a true and fair view aforesaid standalone Ind AS financial statements give
and are free from material misstatement, whether due the information required by the Act in the manner so
to fraud or error. required and give a true and fair view in conformity
with the accounting principles generally accepted in
Auditor’s Responsibility India including the Ind AS, of the financial position of
Our responsibility is to express an opinion on these the Company as at 31 March, 2017, and its financial
standalone Ind AS financial statements based on our performance including other comprehensive income, its
audit. cash flows and the changes in equity for the year ended
on that date.
95
FINANCIAL STATEMENTS
Report on Other Legal and Regulatory Requirements (g) with respect to the other matters to be
1. As required by the Companies (Auditor’s Report) included in the Auditor’s Report in accordance
Order, 2016 (“the Order”) issued by the Central with Rule 11 of the Companies (Audit and
Government of India in terms of sub-section (11) of Auditors) Rules, 2014, in our opinion and to the
section 143 of the Act, we give in the Annexure A, best of our information and according to the
which forms a part of this report, a statement on explanations given to us:
the matters specified in the paragraph 3 and 4 of
the order. i. the Company has disclosed the impact
of pending litigations on its financial
2. As required by Section 143(3) of the Act, we report position in its standalone Ind AS financial
that: statements. Refer Note No. 37 of
standalone Ind AS financial statements.
(a) we have sought and obtained all the
information and explanations which to the best ii. the Company did not have any long term
of our knowledge and belief were necessary contracts including derivative contracts for
for the purposes of our audit. which there were any material foreseeable
losses.
(b) in our opinion proper books of account as
required by law have been kept by the Company iii. there has been no delay in transferring
so far as it appears from our examination of amounts, required to be transferred, to
those books; the Investor Education and Protection
Fund by the Company; and
(c) the balance sheet, the statement of profit and
loss (including other comprehensive income) , iv. the Company has provided requisite
the statement of cash flows and the statement disclosures in its standalone Ind AS
of changes in equity dealt with by this Report financial statements as to holdings as
are in agreement with the books of account; well as dealings in Specified Bank Notes
during the period from 8 November, 2016
(d) in our opinion, the aforesaid standalone to 30 December, 2016 and these are in
Ind AS financial statements comply with the accordance with the books of accounts
Accounting Standards specified under Section maintained by the Company. Refer Note
133 of the Act read with relevant rule issued No. 55 of standalone Ind AS financial
thereunder; statements.
(e) on the basis of the written representations For S.C. Vasudeva & Co,
received from the directors as on 31 March Chartered Accountants
2017 taken on record by the Board of Directors, Firm Reg. No.000235N
none of the directors is disqualified as on 31
March 2017 from being appointed as a director
(Sanjiv Mohan)
in terms of Section 164 (2) of the Act;
Partner
M. No. 086066
(f) with respect to the adequacy of the internal
Ludhiana
financial controls over financial reporting of
the Company and the operating effectiveness 10th May, 2017
of such controls, refer to our separate report in
“Annexure B”; and
96
STANDALONE ANNUAL REPORT 2016-17
The Annexure referred to the Independent Auditors’ the Act were not, prima facie, prejudicial to the
Report to the members of the Company on the interest of the Company
Standalone Ind AS financial statements for the year
ended 31 March 2017, we report that: (b) The borrowers have been regular in the
payment of the principal and interest as
(i) a) The Company has maintained proper records stipulated.
showing full particulars, including quantitative
details and situation of fixed assets. (c) There are no overdue amounts in respect of
the loan granted to a body corporate listed in
b) According to the information and explanations the register maintained under section 189 of
given to us, the Company has adopted a policy the Act.
of physical verification of the fixed assets once
in every three years. Pursuant to the said (iv) According to the information and explanations
policy, the Company has physically verified given to us, the Company has complied with the
the entire block of Plant and Machinery during requirements of the section 186 of the Companies
the year under audit. Discrepancies noticed Act, 2013 pursuant to loans granted and investments
on such physical verification were not material made. The company has not granted loans to
and have been properly dealt with in the books directors or to the person in whom directors are
of account. interested. Therefore the provisions of the section
185 of the Companies Act, 2013 are not applicable
c) According to information and explanations to the company.
given to us and on the basis of our examination
of the records of the company, the title deeds (v) According to the information and explanations given
of immovable properties are held in the name to us, the Company has not accepted any deposits
of the company. covered under the provisions of sections 73 to 76,
other relevant provisions of the Companies Act,
(ii) According to the information and explanations 2013 and the rules framed there under. According
given to us, the inventories have been physically to the information and explanations given to us, no
verified by the management during the year. In our order under the aforesaid sections has been passed
opinion the frequency of verification is reasonable. by the Company Law Board, National Company Law
Tribunal or Reserve Bank of India or any Court or
According to the information and explanations given any other Tribunal on the Company.
to us, discrepancies noticed on physical verification
of inventory as compared to the book records were (vi) We have broadly reviewed the books of account
not material and have been dealt with in the books maintained by the company pursuant to the
of account. rules made by the Central Government for the
maintenance of cost records under section 148(1) of
(iii) According to the information and explanations the Act and are of the opinion that prima facie, the
given to us, we report that the Company has granted prescribed accounts and records have been made
loans to two companies covered in the register and maintained. We have, however, not made a
maintained under section 189 of the Companies detailed examination of such records with a view to
Act, 2013. determine whether they are accurate or complete.
(a) In our opinion, the rate of interest and other (vii) (a) According to the information and explanations
terms and conditions on which the loans had given to us and on the basis of the records of
been granted to the bodies corporate listed in the Company examined by us, in our opinion,
the register maintained under Section 189 of the Company has been regular in depositing
97
FINANCIAL STATEMENTS
(Amount in Lakhs)
Paid Financial
Sr. Total
Name of Statute under Unpaid Year to which Forum at which dispute is pending.
No. Demand
Protest it relates
1 Central Excise Act 1.02 - 1.02 2009-10 Commissioner Appeals, Bhopal
1944
2 Central Excise Act 26.67 8.00 18.67 2009-10 Customs Excise & Service Tax Appellate
1944 Tribunal, Delhi
3 Central Excise Act 216.06 - 216.06 2009-10 Customs Excise & Service Tax Appellate
1944 Tribunal, Delhi
4 Central Excise Act 34.59 - 34.59 2013-14 Customs Excise & Service Tax Appellate
1944 Tribunal, Chandigarh
5 Central Excise Act 4.26 - 4.26 2008-09 Hon’ble Supreme Court, New Delhi
1944
6 Central Excise Act 6.51 1.63 4.88 2008-09 Commissioner Appeals, Chandigarh
1944
7 Central Excise Act 5.80 1.00 4.80 2006-07 Customs Excise & Service Tax Appellate
1944 Tribunal, Delhi
8 Central Excise Act 66.66 1.94 64.72 Jan 2008 to Customs Excise & Service Tax Appellate
1944 March 2011 Tribunal, Delhi
9 Central Excise Act 4.95 2.88 2.07 2003-04, Commissioner Appeals, Chandigarh
1944 2004-05
10 Central Excise Act 1.57 1.39 0.18 2002-03 Assistant Commissioner, Central Excise,
1944 Ludhiana
11 Central Excise Act 112.00 - 112.00 2011-12 Customs Excise & Service Tax Appellate
1944 Tribunal, Delhi
12 Central Excise Act 2.59 - 2.59 Oct 2001 to Commissioner Appeals, Chandigarh
1944 April 2004
13 Central Excise Act 5.16 - 5.16 2015-16 Commissioner Appeals, Chandigarh
1944
14 Central Excise Act 0.37 - 0.37 2012-13 & Commissioner Appeals, Chandigarh
1944 2013-14
98
STANDALONE ANNUAL REPORT 2016-17
(Amount in Lakhs)
Paid Financial
Sr. Total
Name of Statute under Unpaid Year to which Forum at which dispute is pending.
No. Demand
Protest it relates
15 Central Excise Act 0.19 - 0.19 2013-14 & Commissioner Appeals, Chandigarh
1944 2014-15
16 Central Excise Act 0.20 - 0.20 2014-15 & Commissioner Appeals, Chandigarh
1944 2015-16
17 Central Sales Tax 6.19 - 6.19 2009-10 Deputy Excise & Taxation Commissioner
Act,1956 Appeals, Jalandhar
18 Central Sales Tax 2.45 0.65 1.80 2005-06 Deputy Commissioner Of Sales Tax, Mumbai
Act,1956
19 Commercial Tax 6.10 1.06 5.04 2001-02 Assistant Commissioner, Commercial Tax,
Act, 1994 Bhopal
20 Entry Tax Act, 0.74 0.21 0.53 2001-02 Assistant Commissioner, Commercial Tax,
1976 Bhopal
21 Entry Tax Act, 11.26 3.16 8.10 2003-04 Assistant Commissioner, Commercial Tax,
1976 Bhopal
22 MP VAT Act,2002 51.46 20.59 30.87 2006-07 Appellate Board, Commercial Tax, Bhopal
23 MP VAT Act,2002 8.25 4.30 3.95 2010-11 Appellate Board, Commercial Tax, Bhopal
24 MP VAT Act,2002 5.95 3.34 2.61 2011-12 Appellate Board, Commercial Tax, Bhopal
25 MP VAT Act,2002 2.60 1.51 1.09 2012-13 Appellate Board, Commercial Tax, Bhopal
26 Punjab VAT Act, 1.10 0.28 0.82 2002-03 Joint Director Enforcement, Patiala
2005
27 The Finance Act 5.02 - 5.02 2007-08 to Commissioner Appeals,Chandigarh.
1994 2009-10
28 The Finance Act 11.22 - 11.22 2005-06 Commissioner Appeals, Chandigarh
1994
29 The Finance Act 0.66 - 0.66 2015-16 Commissioner Appeals, Chandigarh
1994
30 Income tax 12,397.35 6,873.59 5,523.76 2009-10 to Income tax Appellant Tribunal, Chandigarh
Act,1961 2011-12
31 Income tax 2,823.80 169.62 2,654.18 2012-13 Commissioner of Income tax, Appeals, Ludhiana
Act,1961
32 Income tax 3.81 - 3.81 2000-01 Income tax Appellant Tribunal, Chandigarh
Act,1961
(viii) According to the information and explanations for the purpose for which they were raised. The
given to us, the Company has not defaulted in company has not raised money by way of initial
repayment of loans or borrowings to a financial public offer or further public offer (including debt
institution, bank or government. The Company has instruments) during the year.
not issued any debentures during the year or in the
preceding year. (x) According to the information and explanations given
to us, no fraud by the company or on the company
(ix) In our opinion and according to the information by its officers or employees has been noticed or
and explanations given to us, the term loans taken reported during the course of our audit.
during the year by the Company have been applied
99
FINANCIAL STATEMENTS
(xi) According to the information and explanations given partly convertible debentures during the year under
to us and based on our examination of records of audit. Thus the provisions of paragraph 3(xiv) of the
company, the company has paid / provided for the Order are not applicable.
managerial remuneration in accordance with the
requisite approvals mandated by the provisions of (xv) According to information and explanations given to
section 197 read with Schedule V to the Act. us, and based on our examination of the records
of the company, the company has not entered
(xii) According to the information and explanation into non-cash transactions with director or person
given to us, the company is not a Nidhi Company. connected with him. Accordingly, provisions of
Therefore the provisions of paragraph 3(xii) of the paragraph 3 (xv) of the Order are not applicable.
Order are not applicable.
(xvi) According to the information and explanations given
(xiii) According to the information and explanations to us, the company is not required to be registered
given to us, and based on our examination of the under section 45-IA of the Reserve Bank of India
records of the company, transactions with the Act, 1934.
related parties are in compliance with section 177
and 188 of the Act, where applicable and the details For S.C. Vasudeva & Co,
of the transactions have been disclosed in the Chartered Accountants
standalone Ind AS financial statements as required Firm Reg. No.000235N
by the applicable accounting standards.
(Sanjiv Mohan)
(xiv) According to the information and explanations
Partner
given to us, the company has not made preferential
M. No. 086066
allotment or private placement of shares or fully or
Ludhiana
10th May, 2017
100
STANDALONE ANNUAL REPORT 2016-17
in accordance with the Guidance Note on Audit of Internal (2) provide reasonable assurance that transactions
Financial Controls over Financial Reporting (the “Guidance are recorded as necessary to permit preparation of
Note”) and the Standards on Auditing, issued by ICAI financial statements in accordance with generally
and deemed to be prescribed under section 143(10) of accepted accounting principles, and that receipts
the Companies Act, 2013, to the extent applicable to an and expenditures of the company are being
audit of internal financial controls, both applicable to an made only in accordance with authorizations of
audit of Internal Financial Controls and, both issued by management and directors of the company; and
the Institute of Chartered Accountants of India. Those
Standards and the Guidance Note require that we comply (3) provide reasonable assurance regarding prevention
with ethical requirements and plan and perform the audit or timely detection of unauthorized acquisition, use,
to obtain reasonable assurance about whether adequate or disposition of the company’s assets that could
internal financial controls over financial reporting was have a material effect on the financial statements.
established and maintained and if such controls operated
effectively in all material respects. Inherent Limitations of Internal Financial Controls
Over Financial Reporting
Our audit involves performing procedures to obtain Because of the inherent limitations of internal financial
audit evidence about the adequacy of the internal controls over financial reporting, including the possibility
financial controls system over financial reporting and of collusion or improper management override of
their operating effectiveness. Our audit of internal controls, material misstatements due to error or fraud
financial controls over financial reporting included may occur and not be detected. Also, projections of any
obtaining an understanding of internal financial controls evaluation of the internal financial controls over financial
over financial reporting, assessing the risk that a material reporting to future periods are subject to the risk that
weakness exists, and testing and evaluating the design the internal financial control over financial reporting may
and operating effectiveness of internal control based on become inadequate because of changes in conditions,
the assessed risk. The procedures selected depend on or that the degree of compliance with the policies or
the auditor’s judgment, including the assessment of the procedures may deteriorate.
risks of material misstatement of the standalone Ind AS
financial statements, whether due to fraud or error. Opinion
In our opinion, the Company has, in all material respects,
We believe that the audit evidence we have obtained is an adequate internal financial controls system over
sufficient and appropriate to provide a basis for our audit financial reporting and such internal financial controls
opinion on the Company’s internal financial controls over financial reporting were operating effectively as
system over financial reporting. at 31 March 2017, based on the internal control over
financial reporting criteria established by the Company
Meaning of Internal Financial Controls over considering the essential components of internal control
Financial Reporting stated in the Guidance Note on Audit of Internal Financial
A company’s internal financial control over financial Controls Over Financial Reporting issued by the Institute
reporting is a process designed to provide reasonable of Chartered Accountants of India.
assurance regarding the reliability of financial reporting
and the preparation of financial statements for external For S.C. Vasudeva & Co,
purposes in accordance with generally accepted Chartered Accountants
accounting principles. A company’s internal financial Firm Reg. No.000235N
control over financial reporting includes those policies
and procedures that;
(Sanjiv Mohan)
Partner
(1) pertain to the maintenance of records that, in
M. No. 086066
reasonable detail, accurately and fairly reflect the
Ludhiana
transactions and dispositions of the assets of the
company; 10th May, 2017
101
FINANCIAL STATEMENTS
Balance Sheet
as at 31st March, 2017
(Amount in Lakhs)
Note As at As at As at
Particulars
No. 31st March 2017 31st March 2016 1st April 2015
Assets
1. Non-current assets
(a) Property, Plant and Equipment 3(a) 245,141.10 248,903.62 249,527.54
(b) Capital work-in-progress 4,853.91 8,483.29 7,677.68
(c) Other Intangible Assets 3(b) 674.19 1,108.24 1,393.29
(d) Financial Assets
- Investments 4 97,219.10 106,983.92 60,064.79
- Loans 5 61.04 75.95 85.01
- Other financial assets 6 173.54 1,192.56 12,426.54
(e) Other non-current Assets 7 6,603.95 7,699.05 6,714.22
Total Non-current assets 354,726.83 374,446.63 337,889.07
2. Current assets
(a) Inventories 8 158,900.38 180,911.59 163,673.47
(b) Financial Assets
- Investments 9 67,060.37 59.22 9,963.64
- Trade receivables 10 71,790.98 76,999.63 81,406.86
- Cash and cash equivalents 11 3,822.39 21,368.82 5,908.75
- Bank Balance other than above 11A 224.72 6,308.14 11,646.02
- Loans 12 3,656.20 2,928.02 3,688.67
- Other financial assets 13 4,047.49 4,613.67 3,559.06
(c) Current tax assets (net) 4,513.57 2,191.25 1,139.55
(d) Other current assets 14 27,109.82 28,706.33 28,565.48
Total Current assets 341,125.92 324,086.67 309,551.50
Total Assets 695,852.75 698,533.30 647,440.57
Equity and Liabilities
Equity
(a) Equity Share capital 15 5,592.88 6,205.31 6,205.31
(b) Other Equity 16 392,991.86 362,786.73 311,173.16
Total Equity 398,584.74 368,992.04 317,378.47
Liabilities
1. Non-current liabilities
(a) Financial Liabilities
- Borrowings 17 71,935.28 102,223.85 131,468.40
- Other financial liabilities 18 48.78 19.12 1,299.49
(b) Provisions 19 889.91 592.82 514.71
(c) Deferred tax liabilities (Net) 20 23,840.02 20,638.93 20,524.52
(d) Other non-current liabilities 21 2,101.02 2,032.34 2,146.81
Total Non-current liabilities 98,815.01 125,507.06 155,953.93
2. Current liabilities
(a) Financial Liabilities
- Borrowings 22 105,505.99 101,682.13 60,579.67
- Trade payables 23 17,740.83 14,590.67 12,954.60
- Other financial liabilities 24 60,075.59 73,827.25 88,304.22
(b) Other current liabilities 25 14,701.70 13,412.79 11,599.13
(c) Provisions 26 428.89 521.36 670.55
Total Current liabilities 198,453.00 204,034.20 174,108.17
Total Equity and Liabilities 695,852.75 698,533.30 647,440.57
102
STANDALONE ANNUAL REPORT 2016-17
(Amount in Lakhs)
For the year ended For the year ended
Particulars Note No.
31st March 2017 31st March 2016
I. Revenue from operations 27 572,828.74 561,395.80
II. Other income 28 56,758.24 24,097.29
III. Total Income (I+II) 629,586.98 585,493.09
IV. Expenses :
Cost of materials consumed 29 283,669.41 266,715.11
Purchases of stock-in-trade 30 2,920.35 6,715.09
Changes in inventories of finished goods, work-in-progress and 31 (7,417.89) 1,220.20
stock-in-trade
Employee benefits expense 32 45,361.38 41,043.33
Finance costs 33 9,183.10 8,670.69
Depreciation and amortization expense 3 (a) & (b) 32,949.39 36,309.60
Other expenses 34 132,439.97 134,880.67
Total Expenses 499,105.71 495,554.69
V. Profit before tax (III-IV) 130,481.27 89,938.40
VI. Tax expense:
(1) Current tax 28,157.00 22,184.15
(2) Deferred tax 3,194.83 114.43
(3) Mat Credit Entitlement (1,029.85) -
VII. Profit for the year (V-VI) 100,159.29 67,639.82
VIII. Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss
- Remeasurements of the defined benefit plans (51.33) (6.22)
- Gain on Fair Valuation of Equity instruments carried 18.05 -
at Fair Value through Profit & Loss
(ii) Income tax relating to items that will not be reclassified 11.52 2.15
to profit or loss
B (i) Items that will be reclassified to profit or loss - -
(ii) Income tax relating to items that will be reclassified to - -
profit or loss
(21.76) (4.07)
IX. Total Comprehensive Income for the year (VII+VIII) 100,137.53 67,635.75
Earnings per equity share 42
Basic - Par value of ` 10 per share 163.67 109.00
Diluted - Par value of ` 10 per share 163.67 109.00
103
FINANCIAL STATEMENTS
(Amount in Lakhs)
For the year ended For the year ended
31st March 2017 31st March 2016
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before Exceptional items and tax 130,481.27 89,938.40
Adjustments for :
Depreciation and amortisation 32,949.39 36,309.60
Interest expense 11,252.47 13,014.39
Fair Valuation Gain on Investment (9,530.24) (3,871.07)
Subsidy Income (181.33) (150.20)
Prepayments of Leasehold land 8.15 8.15
Interest income (3,330.26) (5,529.83)
Dividend income (1,540.96) (16,181.65)
(Profit)/Loss on sale of Assets(Net) (6,158.37) (744.69)
(Profit)/Loss on sale of Investments (Net) (36,561.46) (671.46)
Provision no longer required written Back(Net) (349.59) (174.10)
Sundry balance written back - (116.54)
Excess income written off - 871.13
Amortisation of Processing Charges 86.93 91.62
Fixed assets written off 433.87 479.15
Bad debts written off 352.44 33.66
Allowances for doubtful trade receivables and advances 274.44 118.90
written back
(12,294.52) 23,487.05
Changes in Working capital 118,186.75 113,425.45
Adjustments for :
(Increase)/Decrease in Trade and other Receivables 7,310.96 10,141.14
(Increase)/Decrease in Inventories 22,011.20 (17,238.12)
Increase/(Decrease) in Trade Payables and other Liabilities 5,762.63 3,765.61
35,084.79 (3,331.38)
Cash generated from Operations 153,271.54 110,094.08
Net income tax paid (30,461.55) (30,461.55) (23,233.70) (23,233.70)
Net cash flow from/ (used in) operating activities 122,809.99 86,860.38
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed Assets (29,103.16) (37,112.92)
Proceeds from sale of Fixed Assets 8,318.58 1,198.16
Purchase of Investments (91,842.44) (45,484.66)
Purchase of shares of Subsidiary - -
Proceeds from sale of Investments 80,715.89 13,012.48
Interest received 5,188.89 4,239.07
Dividend received 1,540.96 16,181.65
Net Cash used in investing activities (25,181.29) (47,966.21)
104
STANDALONE ANNUAL REPORT 2016-17
(Amount in Lakhs)
For the year ended For the year ended
31st March 2017 31st March 2016
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds/ (Repayment) from Long Term Borrowings (Net) (43,644.34) (45,593.88)
Proceeds/ (Repayment) from Short Term Borrowings (Net) 3,823.86 46,020.37
Proceeds/ (Repayment) from Equity Share Capital (70,544.85) -
Capital Subsidy received 334.68 -
Dividend Paid (including taxes) (104.77) (15,867.72)
Interest Paid (11,123.12) (13,330.77)
Net Cash flow from/(used in) Financing Activities (121,258.54) (28,772.00)
Net Increase in cash and cash equivalents (23,629.84) 10,122.17
Cash and cash equivalents at the beginning of the year 27,676.95 17,554.77
Cash and cash equivalents at the end of the year 4,047.11 27,676.95
Bank Balances not considered as cash and cash equivalents 162.96 1,077.58
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10-05-2017
105
FINANCIAL STATEMENTS
Other Equity
(Amount in Lakhs)
Reserves & Surplus Equity
Other items
instruments
Capital of other
Particulars Capital Securities General Retained through other Total
Redemption comprehensive
reserve premium Reserve Earnings comprehensive
Reserve income
income
Balance as at 01 April 2016 124.32 - 20,990.54 186,302.34 155,280.53 93.07 (4.07) 362,786.73
Changes in equity for the year
ended 31 March 2017
Value of own shares reduced -
Profit for the year 100,159.29 100,159.29
Other comprehensive income 11.80 (33.57) (21.77)
for the year
Total Comprehensive Income 100,159.29 11.80 (33.57) 100,137.53
for the year
Transfer to Capital redemption (626.09) (626.09)
reserve on account of buyback of
equity shares
Transfer from Retained Earnings on 626.09 626.09
account of buyback of equity shares
Premium on buy back of shares (20,990.54) (48,941.86) (69,932.40)
(Net of ` 1448.21 Lakhs of premium
relating to own shares held through
trust)
Balance as at 31 March 2017 124.32 626.09 - 137,360.48 254,813.74 104.87 (37.64) 392,991.86
Balance as at 01 April 2015 124.32 - 20,990.54 186,302.34 103,662.89 93.07 - 311,173.16
Changes in equity for the year
ended 31 March 2016
Value of own shares reduced -
Profit for the year 67,639.82 67,639.82
Other comprehensive income (4.07) (4.07)
for the year
Total Comprehensive Income 67,639.82 (4.07) 67,635.75
for the year
Less: Interim Dividend on equity for (9,547.78) (9,547.78)
financial year 2015-16 (Amount per
share ` 15)
Equity Dividend for the financial (6,365.19) (6,365.19)
year 2014-15 (Amount ` 10 per
share)
Tax on Dividend (109.21) (109.21)
Balance as at 31 March 2016 124.32 - 20,990.54 186,302.34 155,280.53 93.07 (4.07) 362,786.73
106
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
107
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
ownership of the goods are transferred to the (ii) Post Employment Benefits
buyer and the entity retains neither continuing (a) Defined Contribution Plans:
managerial involvement to the degree usually Provident Fund
associated with ownership nor effective control Retirement benefit in the form of provident
over the goods sold. fund is a defined contribution scheme. The
Company has no obligation, other than the
(ii) Services contribution payable to the provident fund.
Revenue from the sale of services is recognised The Company recognizes contribution payable
on the basis of the stage of completion. When to the provident fund scheme as an expense,
the contract outcome cannot be measured when an employee renders the related service.
reliably, revenue is recognised only to the
extent that the expenses incurred are eligible Superannuation
to be recovered. Certain employees of the Company are
participants in a defined contribution plan.
(iii) Export Incentives The Company has no further obligations to the
Revenue in respect of the export incentives is Plan beyond its annual contributions which
recognized on post export basis. are periodically contributed to a trust fund,
the corpus of which is invested with the Life
(iv) Interest Insurance Corporation of India.
Income from interest is recognized using the
effective interest rate (EIR). EIR is the rate (b) Defined Benefit Plans
that exactly discounts the estimated future Gratuity
cash payments or receipts over the expected The Company provides for gratuity, a defined
life of the financial instrument or a shorter benefit retirement plan (‘the Gratuity Plan’)
period, where appropriate, to the gross covering eligible employees of the Company.
carrying amount of the financial asset. When The Gratuity Plan provides a lump-sum
calculating the effective interest rate, the payment to vested employees at retirement,
Company estimates the expected cash flows death, incapacitation or termination of
by considering all the contractual terms of the employment, of an amount based on the
financial instrument but does not consider the respective employee’s salary and the tenure of
expected credit losses. employment with the Company.
108
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
interest on the net defined benefit liability) and Advances paid towards the acquisition of
the return on plan assets (excluding amounts property, plant and equipment outstanding at
included in net interest on the net defined benefit each balance sheet date is classified as capital
liability) are recognised in Other Comprehensive advances under other non-current assets and
Income which are not reclassified to profit or the cost of assets not put to use before such date
loss in subsequent periods. are disclosed under ‘Capital work-in-progress’.
109
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
In case of stores and spares at weighted are deemed converted as of the beginning
average cost plus direct expenses. The of the period, unless issued at a later date.
cost includes cost of purchase and other Dilutive potential equity shares are determined
costs incurred in bringing the inventories independently for each period presented.
to their present location and condition.
(j) Income Taxes
In case of work in progress at raw material Income tax expense comprises current tax and
cost plus conversion costs depending deferred tax. Income tax expense is recognized
upon the stage of completion. in net profit in the statement of profit and
loss except to the extent that it relates to
In case of finished goods at raw material items recognized directly in equity or other
cost plus conversion costs, packing cost, comprehensive income, in which case it is also
excise duty (if applicable) and other recognized in equity or other comprehensive
overheads incurred to bring the goods to income respectively.
their present location and condition.
Current income tax for current and prior
(h) Borrowing Costs periods is recognized at the amount expected
Borrowing costs that are directly attributable to be paid to or recovered from the tax
to the acquisition, construction or production authorities, using the tax rates and tax laws that
of a qualifying asset are capitalized as part of have been enacted or substantively enacted
the cost of the asset. Other borrowing costs by the balance sheet date. Deferred income
are recognized as an expense in the period tax assets and liabilities are recognized for all
in which they are incurred. Borrowing costs temporary differences arising between the tax
consist of interest and other costs that an entity base of assets and liabilities and their carrying
incurs in connection with the borrowing of amounts in the financial statements except
funds. Borrowing cost also includes exchange when the deferred income tax arises from the
differences to the extent regarded as an initial recognition of an asset or liability in a
adjustment to the borrowing costs. transaction that is not a business combination
and affects neither accounting nor taxable
(i) Earnings per Share profit or loss at the time of the transaction.
Basic earnings per equity share is computed Deferred tax assets and liabilities are reviewed
by dividing the net profit attributable to the at each reporting date and are reduced to the
equity holders of the company by the weighted extent that it is no longer probable that the
average number of equity shares outstanding related tax benefit will be realized.
during the period. Diluted earnings per equity
share is computed by dividing the net profit Deferred income tax assets and liabilities are
attributable to the equity holders of the measured using tax rates and tax laws that
company by the weighted average number have been enacted or substantively enacted
of equity shares considered for deriving by the balance sheet date and are expected to
basic earnings per equity share and also the apply to taxable income in the years in which
weighted average number of equity shares those temporary differences are expected to
that could have been issued upon conversion be recovered or settled. The effect of changes
of all dilutive potential equity shares. The in tax rates on deferred income tax assets and
dilutive potential equity shares are adjusted liabilities is recognized as income or expense
for the proceeds receivable had the equity in the period that includes the enactment or
shares been actually issued at fair value (i.e. the substantive enactment date. A deferred
the average market value of the outstanding income tax asset is recognized to the extent
equity shares). Dilutive potential equity shares that it is probable that future taxable profit
110
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
will be available against which the deductible The foreign currency monetary items are
temporary differences and tax losses can be translated using the closing rate at the end of
utilized. The Company offsets current tax assets each reporting period. Non-monetary items
and current tax liabilities, where it has a legally that are measured in terms of historical cost in
enforceable right to set off the recognized a foreign currency shall be translated using the
amounts and where it intends either to settle exchange rate at the date of the transaction.
on a net basis, or to realize the asset and settle Exchange differences arising on the settlement
the liability simultaneously. of monetary items or on translating monetary
items at rates different from those at which
Minimum Alternate Tax credit is recognised as they were translated on initial recognition
deferred tax asset only when and to the extent during the period or in previous financial
there is convincing evidence that the Company statements shall be recognised in profit or loss
will pay normal income tax during the specified in the period in which they arise.
period. Such asset is reviewed at each Balance
Sheet date and the carrying amount of the MAT Foreign exchange differences recorded as an
credit asset is written down to the extent there adjustment to borrowing costs are presented
is no longer a convincing evidence to the effect in the statement of profit and loss, as a part of
that the Company will pay normal income tax finance cost. All other foreign exchange gains
during the specified period. and losses are presented in the statement of
profit and loss on net basis.
(k) Government Grants
The government grants are recognized only In respect of foreign branch, which is in the
when there is reasonable assurance that nature of integral foreign operations, all
the conditions attached to them shall be transactions are translated using the exchange
complied with, and the grants will be received. rate at the date of the transaction. The
Government grants related to assets are treated translation of monetary assets and liabilities
as deferred income and are recognized in the is performed using the exchange rate in
statement of profit and loss on a systematic effect at the balance sheet date. Fixed assets
and rational basis over the useful life of the are translated as at the date of transaction.
asset. Government grants related to revenue Depreciation is translated at the rates applied
are recognized on a systematic basis in the for translation of fixed assets.
statement of profit and loss over the periods
necessary to match them with the related costs (m) Dividends
which they are intended to compensate. Final dividends on shares are recorded as
a liability on the date of approval by the
(l) Foreign Currency Transactions shareholders and interim dividends are
(i) Functional and Presentation currency recorded as a liability on the date of declaration
The functional currency of the company is by the company’s Board of Directors.
Indian rupee. These financial statements are
presented in Indian rupee. (n) Leases
Leases under which the company assumes
(ii) Transaction and balances substantially all the risks and rewards of
The foreign currency transactions are recorded, ownership are classified as finance leases.
on initial recognition in the functional currency, When acquired, such assets are capitalized at
by applying to the foreign currency amount the fair value or present value of the minimum
spot exchange rate between the functional lease payments at the inception of the lease,
currency and the foreign currency at the date whichever is lower. Lease under which the risks
of the transaction.
111
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
and rewards incidental to ownership are not assets and the contractual terms of the financial
transferred to lessee is classified as operating asset give rise on specified dates to cash flows
lease. Lease payments under operating leases that are solely payments of principal and
are recognized as an expense on a straight line interest on the principal amount outstanding.
basis in net profit in the statement of profit and
loss over the lease term. (iii) Financial assets at fair value through profit
or loss (FVTPL)
(o) Financial instruments A financial asset is measured at fair value
A financial instrument is any contract that through profit and loss unless it is measured
gives rise to a financial asset of one entity at amortized cost or at fair value through other
and a financial liability or equity instrument of comprehensive income.
another entity.
(iv) Investments in subsidiaries, joint ventures
(i) Initial Recognition and measurement and associates
On initial recognition, all the financial assets The Company has adopted to measure
and liabilities are recognized at its fair value investments in subsidiaries, joint ventures and
plus or minus transaction costs that are associates at cost in accordance with Ind AS 27
directly attributable to the acquisition or issue and carrying amount as per previous GAAP at
of the financial asset or financial liability except the date of transition has been considered as
financial asset or financial liability measured at deemed cost in accordance with Ind AS 101.
fair value through profit or loss. Transaction
costs of financial assets and liabilities carried (v) Financial liabilities
at fair value through the Profit and Loss are The financial liabilities are subsequently
immediately recognized in the Statement of carried at amortized cost using the effective
Profit and Loss. interest method. For trade and other payables
maturing within one year from the balance
(ii) Subsequent measurement sheet date, the carrying amounts approximate
a. Non-derivative financial instruments fair value due to the short maturity of these
(i) Financial assets carried at amortised cost instruments.
A financial asset is subsequently measured at
amortised cost if it is held within a business b. Derivative financial instruments
model whose objective is to hold the asset in The Company holds derivative financial
order to collect contractual cash flows and the instruments such as foreign exchange forward
contractual terms of the financial asset give and option contracts to mitigate the risk of
rise on specified dates to cash flows that are changes in exchange rates on foreign currency
solely payments of principal and interest on exposures. The counterparty for these
the principal amount outstanding. contracts is generally a bank.
(ii) Financial assets at fair value through other Although the Company believes that these
comprehensive income (FVTOCI) derivatives constitute hedges from an
A financial asset is subsequently measured economic perspective, they may not qualify for
at fair value through other comprehensive hedge accounting under Ind AS 109, Financial
income if it is held within a business model Instruments. Any derivative that is either not
whose objective is achieved by both collecting designated a hedge, or is so designated but is
contractual cash flows and selling financial
112
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
ineffective as per Ind AS 109, is categorized as a measure fair value, maximising the use of
financial asset or financial liability, at fair value relevant observable inputs and minimising the
through profit or loss. use of unobservable inputs.
Derivatives not designated as hedges are Based on the three level fair value hierarchy,
recognized initially at fair value and attributable the methods used to determine the fair value
transaction costs are recognized in net profit in of financial assets and liabilities include quoted
the statement of profit and loss when incurred. market price, discounted cash flow analysis
Subsequent to initial recognition, these and valuation certified by the external valuer.
derivatives are measured at fair value through
profit or loss and the resulting exchange gains In case of financial instruments where the
or losses are included in other income. Assets/ carrying amount approximates fair value due
liabilities in this category are presented as to the short maturity of those instruments,
current assets/current liabilities if they are carrying amount is considered as fair value.
either held for trading or are expected to be
realized within 12 months after the balance (p) Impairment of assets
sheet date. a. Financial assets
The company recognizes loss allowances
c. Share capital and treasury shares using the expected credit loss (ECL) model for
(i) Ordinary Shares the financial assets which are not fair valued
Ordinary shares are classified as equity. through profit or loss.
Incremental costs directly attributable to the
issuance of new ordinary shares and share Loss allowance for trade receivables with no
options are recognized as a deduction from significant financing component is measured at
equity, net of any tax effects. an amount equal to lifetime ECL. For all other
financial assets, expected credit losses are
(ii) Treasury Shares measured at an amount equal to the 12-month
The equity shares of the company held by it ECL, unless there has been a significant
through a trust are presented as a deduction increase in credit risk from initial recognition
from total equity, until they are cancelled in which case those are measured at lifetime
or sold. ECL. The amount of expected credit losses
(or reversal) that is required to adjust the loss
(iii) Derecognition of financial instruments allowance at the reporting date to the amount
A financial asset is derecognized when the that is required to be recognised is recognized
contractual rights to the cash flows from as an impairment gain or loss in statement of
the financial asset expire or it transfers the profit or loss.
financial asset and the transfer qualifies for
derecognition under Ind AS 109. A financial b. Non-financial assets
liability is derecognized when the obligation Intangible assets and property, plant and
specified in the contract is discharged or equipment
cancelled or expired. Intangible assets and property, plant and
equipment are evaluated for recoverability
(iv) Fair value measurement of financial whenever events or changes in circumstances
instruments indicate that their carrying amounts may not
The fair value of financial instruments is be recoverable. For the purpose of impairment
determined using the valuation techniques testing, the recoverable amount (i.e. the higher
that are appropriate in the circumstances of the fair value less cost to sell and the value-in-
and for which sufficient data are available to use) is determined on an individual asset basis
unless the asset does not generate cash flows
113
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
that are largely independent of those from (r) Cash flow statement
other assets. In such cases, the recoverable The cash flow statement is prepared in
amount is determined for the Cash Generating accordance with the Indian Accounting
Unit to which the asset belongs. Standard (Ind AS) - 7 “Statement of Cash
flows” using the indirect method for operating
If such assets are considered to be impaired, activities.
the impairment to be recognized in the
statement of profit and loss is measured by (s) Provisions
the amount by which the carrying value of A provision shall be recognised when:
the assets exceeds the estimated recoverable (a) an entity has a present obligation as a
amount of the asset. An impairment loss is result of a past event;
reversed in the statement of profit and loss if
there has been a change in the estimates used (b) it is probable that an outflow of resources
to determine the recoverable amount. The embodying economic benefits will be
carrying amount of the asset is increased to its required to settle the obligation; and
revised recoverable amount, provided that this
amount does not exceed the carrying amount (c) a reliable estimate can be made of the
that would have been determined (net of any amount of the obligation.
accumulated amortization or depreciation)
had no impairment loss been recognized for If the effect of the time value of money
the asset in prior years. is material, provisions are discounted
using a current pre-tax rate that reflects,
(q) Cash and cash equivalents when appropriate, the risks specific to
The Cash and cash equivalent in the balance the liability. When discounting is used,
sheet comprise cash at banks and on hand and the increase in the provision due to
short-term deposits with a maturity period of the passage of time is recognised as a
three months or less from the balance sheet finance cost.
date, which are subject to an insignificant risk
of changes in value.
114
3(a). Property, Plant and Equipment
(Amount in Lakhs)
Original Cost Depreciation and Amortization Net Block
Balance Additions Disposals Other Balance Balance Depreciation Eliminated Other Balance Balance Balance
STANDALONE
Particulars as at adjustments as at 31st as at expense for on disposal adjustments as at 31st as at 31st as at 31st
1st April, March, 2017 1st April, the year of assets March, March, March,
Notes
2016 2016 2017 2017 2016
Tangible Assets:
Free-hold Land 6,558.79 1,949.68 89.33 (219.97) 8,639.11 - - - - - 8,639.11 6,558.79
Buildings # 93,178.57 6,691.47 1,138.04 540.17 98,191.83 22,851.36 2,881.66 638.93 158.96 24,935.13 73,256.70 70,327.21
Plant and Equipment 452,461.02 20,092.78 10,976.56 1,997.70 459,579.54 283,430.91 28,769.25 9,023.58 3,071.92 300,104.66 159,474.88 169,030.11
Furniture and Fixtures 2,329.61 436.91 26.96 634.06 2,105.50 1,566.64 143.18 12.94 423.34 1,273.54 831.96 762.97
Vehicles 1,528.84 295.21 119.78 12.75 1,691.52 606.98 176.48 78.52 1.37 703.57 987.95 921.86
Office equipment 3,444.78 867.15 18.68 (885.07) 5,178.32 2,142.10 515.42 21.28 (591.58) 3,227.82 1,950.50 1,302.68
Total 559,501.61 30,333.20 12,369.35 2,079.64 575,385.82 310,597.99 32,485.99 9,775.25 3,064.01 330,244.72 245,141.10 248,903.62
# Includes ` 248.20 lac (Previous Year ` 248.20 Lakhs) cost of Residential flats at Mandideep, the land cost of which has not been excluded from this cost. The depreciation for the year has been
taken on the entire cost of `248.20 Lakhs (Previous Year ` 248.20 Lakhs).
Freehold land includes ` Nil (Previous Year ` 31.00 Lakhs) for the cost of land at Baddi, (Himachal Pradesh) for which title deeds are yet to be executed in favour of the Company, though the
possession thereof has been taken by the company.
- Depreciation for the year includes net depreciation of ` Nil (Previous year (-) ` 57.73 Lakhs) pertaining to earlier years.
forming part of financial statements for the year ended 31st March, 2017
115
ANNUAL REPORT 2016-17
3(b). Other Intangible Assets
116
(Amount in Lakhs)
Original Cost Depreciation and Amortisation Net Block
Balance Additions Disposals Other Balance Balance Depreciation/ Eliminated Other Balance Balance Balance
Particulars as at adjustments as at 31st as at amortisation on disposal adjustments as at 31st as at 31st as at 31st
1st April, March, 2017 1st April, expense for of assets March, March, March,
Notes
2016 2016 the year 2017 2017 2016
Other Intangible
Assets:
Computer Softwares 1,833.07 65.44 - 103.61 1,794.90 1,041.58 302.50 - 67.52 1,276.56 518.34 791.49
Contribution to CETP 64.00 - - - 64.00 46.40 4.40 - - 50.80 13.20 17.60
Right to use Power 1,812.51 - - - 1,812.51 1,513.36 156.50 - - 1,669.86 142.65 299.15
lines
Total 3,709.58 65.44 - 103.61 3,671.41 2,601.34 463.40 - 67.52 2,997.22 674.19 1,108.24
Notes
forming part of financial statements for the year ended 31st March, 2017
117
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
118
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
(ii) Investment in Equity Fund/Liquid Funds/Debt Funds/
Monthly Income Plans (Quoted)
2,00,00,000 (31 March 2016:2,00,00,000 1st April 2015: Nil) 2,310.60 2,110.46 -
units of ` 10/- each of Reliance fixed horizon fund- XXIX-Series
1- Direct Growth Plan
3,00,00,000 (31 March 2016:3,00,00,000 1st April 2015: Nil) 3,453.57 3,156.27 -
units of ` 10/- each of Reliance fixed horizon fund- XXIX-Series
2- Direct Growth Plan
5,00,00,000 (31 March 2016:5,00,00,000 1st April 2015: Nil) 5,746.35 5,250.70 -
units of ` 10/- each of Kotak FMP Series 178 Direct Growth
5,00,00,000 (31 March 2016:5,00,00,000 1st April 2015: Nil) 5,714.95 5,219.80 -
units of ` 10/- each of Birla Sunlife Fixed Term Plan Series MX
(1128 Days)
2,50,00,000 (31 March 2016:Nil 1st April 2015: Nil) units of 2,507.48 - -
` 10/- each of Birla Sunlife Fixed Term Plan Series ok -Gr-
Direct (1135 Days)
5,00,00,000 (31 March 2016:5,00,00,000 1st April 2015: Nil) 5,658.10 5,213.10 -
units of ` 10/- each of ICICI Prudential FMP Series 77-1129
Days Plan W Direct Plan Cumulative
5,00,08,075.344 (31 March 2016: 5,00,08,075 1st April 2015: 5,717.82 5,224.84 -
Nil) units of ` 10/- each of Reliance Fixed Horizon Fund-XXIX-
Series 8 Direct Growth Plan
2,20,00,000 (31 March 2016:2,20,00,000 1st April 2015: Nil) 2,510.11 2,283.09 -
units of ` 10/- each of UTI Fixed Term Income Fund Series
XXIII-II (1100 Days) Direct Growth Plan
1,30,00,000 (31 March 2016:1,30,00,000 1st April 2015: Nil) 1,472.24 1,345.67 -
units of ` 10/- each of Kotak FMP Series 180-1099 Days
1,00,00,000 (31 March 2016:1,00,00,000 1st April 2015: Nil) 1,128.34 1,030.32 -
units of ` 10/- each of UTI Fixed Term Income Fund Series
XXIII-VII (1098 Days) Direct Growth Plan
3,00,00,000 (31 March 2016:3,00,00,000 1st April 2015: Nil) 3,293.52 3,011.70 -
units of ` 10/- each of Kotak FMP Series 191 Direct Growth
1,00,00,000 (31 March 2016:1,00,00,000 1st April 2015: Nil) 1,095.93 1,001.80 -
units of ` 10/- each of ICICI Prudential FMP Series 78-1115
Days Plan X Direct Plan Cumulative
2,50,00,000(31 March 2016:2,50,00,000 1st April 2015: Nil) 2,749.77 2,506.63 -
units of ` 10/- each of HDFC FMP 1114D Direct Growth
2,50,00,000 (31 March 2016:2,50,00,000 1st April 2015: Nil) 2,732.38 2,500.00 -
units of ` 10/- each of SBI Debt Fund Series- B -36(1131 Days)-
Direct Growth
119
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
# Nil (31 March 2016:1,00,00,000 1st April 2015: - 1,181.57 1,094.35
1,00,00,000) Units of `10/- each of SBI debt Fund Series -
(400 Day) Regular -Growth
# Nil (31 March 2016:2,50,00,000 1st April 2015: - 2,961.80 2,733.03
2,50,00,000)Units of `10/- each of SBI debt Fund Series
-Direct -(380 Day)Growth
# Nil (31 March 2016:1,50,00,000 1st April 2015: - 1,788.30 1,649.49
1,50,00,000) Units of `10/- each of SBI debt Fund Series -
Direct - (400 Day)Growth
2,50,00,000 (31 March 2016:Nil 1st April 2015: Nil) Units 2,517.45 - -
of `10/- each of SBI debt Fund Series - Direct - (1170 Day)
Growth
# Nil (31 March 2016:2,50,00,000 1st April 2015: - 2,976.88 2,751.58
2,50,00,000) Units of `10/- each of Dsp Blackrock FMP
# Nil (31 March 2016:2,50,00,000 1st April 2015: - 2,979.15 2,747.63
2,50,00,000) Units of `10/- each of Reliance Fixed
Horiozon Fund XXVI Series 2 Direct Growth Plan
# Nil (31 March 2016:2,50,00,000 1st April 2015: - 2,982.50 2,753.10
2,50,00,000) Units of `10/- each of BSL Fixed Term Plan
-Series KR - Growth Direct
# Nil (31 March 2016:2,54,82,906 1st April 2015: - 3,046.18 5,495.00
5,00,00,000) Units of `10/- each of ICICI Prudential FMP
Series 73-390 Direct Plan Cumulative
# Nil (31 March 2016: 3,00,00,000 1st April 2015: - 3,561.18 3,291.81
3,00,00,000) Units of `10/- each of UTI Fixed Term
Income Fund Series XVIII-I Direct Growth Plan
1,50,00,000 (31 March 2016: Nil 1st April 2015: Nil) Units 1,635.06 - -
of `10/- each of UTI Fixed Term Income Fund Series XXIV-
XIV (1831 Days)Direct Growth Plan
2,50,00,000 (31 March 2016: Nil 1st April 2015: Nil) Units 2,643.68 - -
of `10/- each of UTI Fixed Term Income Fund Series XXV-
11 (1097 Days)Direct Growth Plan
# Nil (31 March 2016: 2,00,00,000 1st April 2015: - 2,377.80 2,193.84
2,00,00,000) Units of `10/- each of Reliance Fixed
Horizon Fund- XXV- Series 33- Direct Plan Growth Plan
# Nil (31 March 2016: 2,50,00,000 1st April 2015: - 2,961.25 2,735.00
2,50,00,000) Units of `10/- each of Kotak FMP Series 149
Direct - Growth
120
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
3,50,00,000 (31 March 2016: Nil 1st April 2015: Nil) Units 3,507.49 - -
of `10/- each of Kotak FMP Series 202 Direct - Growth
5,00,00,000 (31 March 2016: 5,00,00,000 1st April 5,916.00 5,412.75 5,000.00
2015: 5,00,00,000) Units of `10/- each of SBI Debt Fund
Series-B (1105 DAYS) Direct Plan Growth FMP
3,00,00,000 (31 March 2016: 3,00,00,000 1st April 2015: 3,561.21 3,261.03 3,001.05
3,00,00,000) Units of `10/- each of ICICI Prudential FMP
Series 76-1108 Days Plan V Direct Plan Cumulative
25,000,000 (31 March 2016: Nil 1st April 2015: Nil) Units 2,516.80 - -
of `10/- each of ICICI Prudential FMP Series 80-1233
Days Plan O Direct Plan Cumulative
2,50,00,000 (31 March 2016: Nil 1st April 2015: Nil) Units 2,518.95 - -
of `10/- each of Reliance Fixed Horizon Fund- XXXIII-
Series 3- Direct Plan Growth Plan
2,50,00,000 (31 March 2016: Nil 1st April 2015: Nil) Units 2,515.83 - -
of `10/- each of Reliance Fixed Horizon Fund- XXXIIV-
Series 4- Direct Plan Growth Plan
Total 97,219.10 106,983.92 60,064.79
1. Aggregate amount of quoted investments 89,313.94 89,099.42 42,180.29
2. Aggregate Market Value of quoted investments 120,282.33 106,939.41 52,963.78
3. Aggregate amount of unquoted investments 7,905.16 17,884.50 17,884.50
# Investments having maturity period of less than 12 months from 31st March 2017 i.e. the balance sheet date have been reclassified as ‘ Current
Investment’ as per the requirement of Schedule III of the Companies Act, 2013
121
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
8 Inventories
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
(at cost or net realisable value, whichever is lower)
Raw materials (includes in transit ` 5,528.60 Lakhs, 31st March 87,556.00 116,562.34 98,380.88
2016: ` 1,493.95 Lakhs 1st April 2015: ` 2,971.32 Lakhs)
Work-in-progress 13,769.08 10,955.01 11,763.34
Finished Goods 44,671.14 40,067.32 40,479.19
Stores and Spares (includes in transit ` 1,469.44 Lakhs 31st 12,904.16 13,326.92 13,050.06
March 2016: ` 1,292.39 Lakhs 1st April 2015: ` 1,021.86 Lakhs)
Total 158,900.38 180,911.59 163,673.47
122
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
9 Investments (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Financial assets measured at fair value through Profit and loss
(i) Investment in Bonds/ Preference shares/ Debentures (quoted)
Nil (31 March 2016: Nil 1st April 2015: 25,00,000) 8.65% - - 2,500.00
NABARD Bonds of `100/- each
# 10,00,000 (31 March 2016: Nil 1st April 2015: Nil) 3% 1,000.00 - -
cumulative compulsorily convertible Preference Shares
of ` 100/- each of TATA Motors Finance Ltd.
# 1,500 (31 March 2016:Nil 1st April 2015: Nil) Principal 1,500.00 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of ECL Finance limited
# 1,000 (31 March 2016:Nil 1st April 2015: Nil) Principal 1,110.72 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of ECL Finance limited
# 996 (31 March 2016:Nil 1st April 2015: Nil) Secured 988.53 - -
redeemable Non convertible Principal protected market
linked debentures of ` 1,00,000/- each of Reliance
Capital Ltd
1,500 (31 March 2016:Nil 1st April 2015: Nil) Principal 1,590.21 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of IIFL wealth Finance
limited
100 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 1,013.74 - -
` 1,000,000/- each of 7.17% NHAI 23 DEC 2021*
81 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 813.18 - -
` 1,000,000/- each of 7.18% NABARD 23 Mar 2020*
5 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 52.07 - -
` 1,000,000/- each of 7.47% PFC 16 Sep 2021*
7 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 73.43 - -
` 1,000,000/- each of 7.50% PFC 16 Aug 2021*
43 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 439.93 - -
` 1,000,000/- each of 7.60% Axis Bank 20 Oct 2023*
50 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 514.90 - -
` 1,000,000/- each of 7.60% ICICI 07 OCT 2023*
71 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 743.84 - -
` 1,000,000/- each of 7.63% PFC 14 Aug 2026*
50 (31 March 2016:Nil 1st April 2015: Nil)Bonds of 526.27 - -
` 1,000,000/- each of 7.95% HDFC Bank 21 Sep 2026*
66 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 666.51 - -
` 1,000,000/- each of 8.22% DAIMLER FINANCIAL
5 (31 March 2016:Nil 1st April 2015: Nil) Bonds of ` 1,000,000/- 52.04 - -
each of 8.38% LIC HOUSING FINANCE 27 Feb 2019*
100 (31 March 2016:Nil 1st April 2015: Nil) Bonds of ` 1,000,000/- 1,098.62 - -
each of 8.48% LIC HOUSING FINANCE 29 JUN 2026*
123
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
6492.73 (31 March 2016: 5914.18 1st April 2015: 3,910.64) 65.01 59.22 51.00
Units of `1,000/- each of BARODA PIONEER LIQUID FUND
PLAN A ddr*
26,700.657 (31 March 2016:Nil 1st April 2015: Nil) Units of 500.30 - -
`1,000/- each of Bank of India Axa Liquid Fund -Direct Plan-
Growth
5,17,523.56 (31 March 2016: Nil 1st April 2015: Nil) Units of 1,352.34 - -
`100/- each of Birla Sun Life Cash Plus-Direct-Growth*
124
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
125
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
10 Trade receivables
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Receivable from related parties (Refer Note 45)
- Unsecured, considered good 212.69 435.76 -
126
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
a) Balances with banks
- In current accounts 2,795.52 3,256.97 4,264.77
- In deposit accounts with maturity upto three months 980.00 18,005.50 1,576.99
b) Cheques on hand 18.53 84.12 16.66
c) Cash on hand 28.34 22.23 50.33
Total 3,822.39 21,368.82 5,908.75
12 Loans (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Financial assets at amortized cost
Loans to related parties (refer note 45)
Subsidiary companies 700.00 - -
Others 2,699.12 2,699.12 3,472.69
Loan to employees 257.08 228.90 215.98
Total 3,656.20 2,928.02 3,688.67
127
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
128
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
Particulars As at 31st March, 2017 As at 31st March, 2016 As at 1st April, 2015
Amount Amount Amount
Authorised Number Number Number
(In Lakhs) (In Lakhs) (In Lakhs)
Equity shares of ` 10/- each (par value) 90,000,000 9,000.00 90,000,000 9,000.00 90,000,000 9,000.00
Redeemable cumulative preference 10,000,000 1,000.00 10,000,000 1,000.00 10,000,000 1,000.00
shares of ` 10/- each (par value)
Total 100,000,000 10,000.00 100,000,000 10,000.00 100,000,000 10,000.00
Issued, subscribed and fully paid-up
Equity shares of ` 10/- each 55,928,808 5,592.88 62,053,138 6,205.31 62,053,138 6,205.31
Total 55,928,808 5,592.88 62,053,138 6,205.31 62,053,138 6,205.31
a Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the
reporting period :
Particulars As at 31st March, 2017 As at 31st March, 2016
Amount Amount
Equity shares Number Number
(In Lakhs) (In Lakhs)
At the beginning of the reporting period 63,651,879 6,365.19 63,651,879 6,365.19
Own shares held through trust (refer Note 39) (1,598,741) (159.88) (1,598,741) (159.88)
Net issued Share Capital at beginning of reporting period 62,053,138 6,205.31 62,053,138 6,205.31
Add: Issued during the reporting period - - - -
Less: Buyback during the reporting period (6,124,330) (612.43) - -
(net of 1,36,539 number of shares held through trust)
Outstanding at the end of the reporting period 55,928,808 5,592.88 62,053,138 6,205.31
(b) Rights, preferences and restrictions attached to (c) Rights, preferences and restrictions attached to
equity shares preference shares
The company has one class of equity shares having a The rate of dividend on preference shares will be
par value of `10/- each. Each holder of equity shares decided by the Board of Directors as and when
is entitled to one vote per share. The dividend issued. Preference shares as and when issued shall
proposed by the Board of Directors is subject to the have the cumulative right to receive dividend as and
approval of the shareholders in the ensuing annual when declared and shall have preferential right of
general meeting. repayment of amount of capital.
During the year ended March 31, 2017 the amount (d) Shares held by holding company or its ultimate
of dividend recognised as distributions to equity holding company or subsidiaries or associates
shareholders is Nil (Previous Year: ` 15 per share). of the holding company or the ultimate holding
company in aggregate.
In the event of liquidation of the company, the There is no holding /ultimate holding company of
holders of equity shares will be entitled to receive the Company.
any of the remaining assets of the company,
after distribution of all preferential amounts. The (e)
The Board of Directors of the Company at its
distribution will be in proportion to the number of meeting held on 24th September 2016 approved
equity shares held by the shareholders.
129
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
the buyback of upto 62,60,869 fully paid up equity Exchange(s). During the year, the Company had
shares of ` 10 each, at a price not exceeding ` bought back and extinguished 62,60,869 Equity
1,175 payable in cash,through the Tender Offer Shares of ` 10 each at a price of ` 1,150.00.
route, upto an aggregate amount not exceeding Consequently, ` 626.08 Lakhs were transferred to
` 720 crore from the open market through Stock Capital Redemption Reserve as per requirements
of section 69 of Companies Act, 2013.
(f) Aggregate number and class of shares alloted as fully paid up pursuant to contract(s) without payment
being received in cash, bonus shares and shares bought back for the period of five years immediately
preceding the reporting date.
Aggregate number Aggregate number
of shares as at of shares as at
31st March 2017 31st March 2016
Equity Shares alloted as fully paid up by way of bonus shares - -
Equity shares alloted as fully paid up pursuant to contract without payment - -
being received in cash
Equity Shares bought back by the Company (net of 1,36,539 number of 6,124,330 -
shares held through trust)
130
16 Other Equity
Amount(In Lakhs)
Reserves & Surplus
STANDALONE
the year
Total Comprehensive Income for 67,639.82 (4.07) 67,635.75
the year
Less: Interim Dividend on equity for (9,547.78) (9,547.78)
financial year 2015-16 (Amount per
share ` 15)
Equity Dividend for the financial year (6,365.19) (6,365.19)
2014-15 (Amount ` 10 per share)
Tax on Dividend (109.21) (109.21)
Balance as at 31 March 2016 124.32 - 20,990.54 186,302.34 155,280.53 93.07 (4.07) 362,786.73
131
ANNUAL REPORT 2016-17
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
132
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
133
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
22 Borrowings (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Working capital loans
- From banks (secured) 101,633.70 95,143.75 59,221.85
- From banks (unsecured) 3,872.29 6,538.38 1,357.82
Total 105,505.99 101,682.13 60,579.67
23 Trade payables
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Trade payables
Due to others (refer note 43) 17,261.15 14,572.12 12,843.46
Due to related parties (Refer Note 45) 479.68 18.55 111.14
Total 17,740.83 14,590.67 12,954.60
134
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
26 Provisions (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Provision for employee benefits :
Leave encashment 181.53 138.33 109.05
Gratuity (refer note 51) 247.36 383.03 561.50
Total 428.89 521.36 670.55
135
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
28 Other income
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Dividend Income from investment carried at cost - 15,376.50
Dividend income from investments- carried at fair value through Profit or Loss 1,540.96 805.15
Net gain on sale of investments- carried at fair value through Profit or Loss 1,622.58 671.46
Gain on Sale of investment in Joint Venture-carried at cost (Refer Note 54) 31,300.77 -
Gain on buyback of shares- carried at cost 3,638.11 -
Claims received (net of expenses) 167.28 152.96
Provisions no longer required written back 349.59 174.10
Capital Subsidy 181.33 150.20
Interest Income on employee loans 11.82 11.51
Gain on Fair valuation of Investments arrived at fair value through profit & loss 9,530.24 3,871.07
Net gain on disposal of property, plant and equipment 6,158.37 744.69
Miscellaneous 2,257.19 2,139.65
Total 56,758.24 24,097.29
30 Purchases of Stock-in-trade:
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Fabric 3.04 135.53
Yarn 2,917.22 6,576.74
Others 0.09 2.82
Total 2,920.35 6,715.09
136
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
33 Finance costs
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Interest expense (net) (Refer Note 49) 7,922.20 7,490.94
Other borrowing costs 1,260.90 1,179.75
Total 9,183.10 8,670.69
34 Other expenses
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Power and fuel 55,399.39 60,173.10
Consumption of stores and spare parts 3,756.46 3,346.15
Packing materials and charges 7,811.18 7,948.17
Dyes and Chemical consumed 18,586.26 19,656.86
Rent 228.91 223.32
Repairs and maintenance to buildings 3,363.05 2,394.34
Repairs and maintenance to machinery 15,900.18 14,329.92
Insurance 652.26 673.12
Rates and taxes 130.63 130.93
137
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Auditors remuneration:
Audit fee 36.80 36.80
Tax audit fee 9.20 9.16
Reimbursement of expenses 12.82 12.24
In other capacity 4.54 9.58
Bad debts written off 352.44 33.66
Excise duty consumed on sale of goods 51.65 53.99
Allowances for doubtful trade receivables and advances - (Net of written back) 274.44 118.90
Forwarding charges and octroi 8,488.99 8,419.28
Commission to selling agents 4,901.72 4,994.61
Assets Written off 433.87 -
Prior period items (net) (Refer Note 48) 144.65 280.55
Rebate and discount 986.29 1,123.92
Miscellaneous (Refer Note 50) 10,914.24 10,912.07
Total 132,439.97 134,880.67
35. First time adoption of Ind AS a) The Company has elected to consider carrying
This financial statement is the first financial statement amount of all items of property, plant and
that has been prepared in accordance with Ind AS equipments measured as per Indian GAAP as
together with the comparative period data as at and recognized in the financial statements as at the
for the year ended 31st March 2016, as described date of transition, as deemed cost at the date of
in the summary of significant accounting policies. transition. The effect of consequential changes
The transition to Ind AS has been carried out in arising on the application of other Ind AS has been
accordance with Ind AS 101–‘First time adoption of adjusted to the deemed cost of Property, Plant &
Indian Accounting Standards’ with 1st April 2015 as Equipment.
the transition date.
b) The Company has adopted to measure investments
This note explains the exemptions availed by the in subsidiaries, joint ventures and associates at cost
company on first time adoption of Ind AS and the in accordance with Ind AS 27 and therefore has
principal adjustments made by the Company in measured such investments in its separate opening
restating its Indian GAAP financial statements as at Ind AS balance sheet at carrying amount as per
1st April 2015 and financial statements as at and for Indian GAAP at the date of transition in accordance
the year ended 31st March 2016 in accordance with with Ind AS 101.
Ind AS 101.
c) The Company has availed the exemption of fair
Exemptions applied value measurement of financial assets or liabilities
Ind AS 101 allows first-time adopters certain at initial recognition and accordingly will apply fair
exemptions from the retrospective application of value measurement of financial assets or liabilities
certain requirements under Ind AS. The Company at initial recognition prospectively to transactions
has, accordingly, applied following exemptions: entered into on or after 01st April 2015.
138
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
d) The estimates at 1st April 2015 and at 31st March, were classified as long term investments or
2016 are consistent with those made for the current investments based on the intended
same dates in accordance with Indian GAAP (after holding period and realisability. Long term
adjustments to reflect any differences in accounting investments were carried at cost less provision
policies) apart from the following items under for other than temporary diminution in the
Indian GAAP did not require estimation: value of investments. Current investments
were carried at lower of cost and fair value.
- Fair values of Financial Assets & Financial Liabilities Ind AS requires such investments to be
measured at fair value except investments in
- Impairment of financial assets based on expected subsidiaries, associates and joint venture for
credit loss modal which exemption has been availed.
139
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
4. Derivative Instruments (31st March 2016 ` 271.00 Lakhs, 1st April 2015
The fair value of derivative instruments is ` 263.00 Lakhs) and deferred income for capital
recognized under Ind AS which was not subsidy (31st March 2016 ` 14.00 Lakhs, 1st
recognized under Indian GAAP. Derivative April 2015 ` 22.00 Lakhs) respectively. Further
instruments at fair value through profit or profit for the year ended 31st March 2016 has
loss reflect the positive change in fair value of been increased with ` 8.00 Lakhs on account of
those foreign exchange forward contracts that income of capital grant pertaining to financial
are not designated in hedge relationships, but year 2015-16.
are, nevertheless, intended to reduce the level
of foreign currency risk for expected sales and (ii) Under Indian GAAP, Government grant related
purchases. Accordingly, difference on account to Property, plant and equipment are reduced
of fair valuation of these instruments has been from the cost of respective asset. Under Ind
adjusted in retained earnings in accordance AS, Government grant related to Property,
with Ind AS. This has resulted in increase plant and equipment are treated as deferred
in retained earnings of ` 248.13 Lakhs and income and are recognized in the statement
` 689.76 Lakhs as at 31st March 2016 and 1st of profit and loss on a systematic basis over
April 2015 respectively and decrease in net the useful life of the asset. This has resulted in
profit of ` 442.33 Lakhs for the year ended increase in Property, Plant and Equipment (net
31st March 2016. of accumulated depreciation) (31st March 2016
1924.99 Lakhs,1st April 2015 ` 2050.28 Lakhs)
5. Borrowings with a corresponding adjustment in retained
Under Indian GAAP, transaction costs incurred earnings (31st March 2016 ` 72.56 Lakhs,
in connection with borrowings are amortised 1st April 2015 ` 88.76 Lakhs) and deferred
upfront and charged to profit or loss for the income for capital subsidy (31st March 2016
period. Under Ind AS, transaction costs are 1996.85 Lakhs, 1st April 2015 ` 2139.05 Lakhs).
included in the initial recognition amount of Further profit for the year ended 31st March
financial liability and charged to profit or loss 2016 has been increased with ` 16.90 Lakhs
using the effective interest method. This has on account of difference between income of
resulted in decrease in long term borrowings on capital grant amounting to ` 142.20 Lakhs and
account of unamortized amount of processing the depreciation amounting to ` 125.29 Lakhs
charges with a corresponding adjustment pertaining to financial year 2015-16 related to
in retained earnings of ` 272.34 Lakhs and the grant earlier decapitalized in fixed assets
` 258.08 Lakhs as at 31st March 2016 and 1st under Indian GAAP.
April 2015 respectively and increase in the net
profit for the year ended 31st March 2016 of 7. Proposed Dividend
` 14.26 Lakhs. Under Indian GAAP, proposed dividend
(including Dividend Distribution Tax) is
6. Capital grant recognized as a liability in the period to which
(i) Under Indian GAAP, certain capital grant it relates, irrespective of when it is declared.
received from Government as ‘Promoter Under Ind AS, proposed dividend is recognized
Contribution’ is shown under the head ‘Capital as a liability in the period in which it is declared
reserve’. Under Ind AS, such grant is treated as by the company (usually when approved by
deferred income and is recognized as income shareholders in a general meeting) or paid.
over the useful life of the assets for which such
grant is received. This has resulted in decrease In the case of the Company, the declaration of
in Capital reserve (31st March 2016 ` 285.00 dividend occurs after period end. Therefore,
Lakhs, 1st April 2015 ` 285.00 Lakhs) with a the liability for the year ended 31st March
corresponding adjustment in retained earnings 2015 recorded as proposed dividend as on 1st
140
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
April, 2015 along with dividend distribution & Surplus has been reduced with ` 1,268.85
tax amounting to ` 7697.09 Lakhs has been Lakhs as per Ind AS-32.
de-recognised with a corresponding
adjustment in the retained earnings. 11. Bill discounted against debtors
Under Indian GAAP, bills discounted against
8. Defined benefit obligation debtors were shown as contingent liability.
Under Ind AS, remeasurements i.e. actuarial However, the same falls under the category of
gains and losses are to be recognized in ‘Financial instruments’ under Ind AS. Therefore,
‘Other comprehensive income’ and are the bills discounted amounting to ` 8,807.06
not to be reclassified to profit and loss in a Lakhs and ` 13,724.98 Lakhs as on 31st March
subsequent period. Under the Indian GAAP, 2016 and 1st April 2015 respectively have
these remeasurements were forming part of been shown under ‘Short term borrowings’
the profit or loss. Therefore, actuarial gain/loss with a corresponding adjustment in ‘Trade
amounting to ` 6.22 Lakhs for the financial year receivables’. However, the same has no impact
2015-16 has been recognized in OCI (net of tax on the total equity as at 31st March, 2016 and
` 2.15 Lakhs) which was earlier recognised as 1st April, 2015.
Employee benefits expense. However, the
same has no impact on the total equity as at 12. Deferred tax
31st March, 2016. Under Indian GAAP, deferred tax was
recognized for the temporary timing differences
9. Sale of goods which focus on differences between taxable
a. Under Indian GAAP, sale of goods was presented profits and accounting profits for the period.
as net of excise duty. However, under Ind AS, Ind AS requires entities to account for deferred
sale of goods includes excise duty. Thus, sale taxes using the balance sheet approach,
of goods under Ind AS has increased by ` 53.99 which focuses on temporary differences
Lakhs with a corresponding increase in other between the carrying amount of an asset or
expenses. liability in the balance sheet and its tax base.
Further, the application of Ind AS has resulted
b. Under Indian GAAP, turnover discount was in recognition of deferred tax on certain
shown as expense. However under Ind AS temporary differences which was not required
revenue is to be shown as net of turnover under Indian GAAP. Accordingly, deferred
discount. Accordingly, turnover discount tax adjustments have been recognised in
amounting to ` 39.53 Lakhs has been reduced correlation to the underlying transactions in
from revenue with a corresponding adjustment retained earnings/OCI in accordance with Ind
in other expenses. AS. This has resulted decrease in retained
earnings of ` 1814.49 Lakhs and ` 676.91Lakhs
10. Treasury Shares as at 31st March 2016 and 1st April 2015
The Company is holding 15,98,741 equity respectively. The net profit has been decreased
shares of Vardhman Textiles Limited at cost of with ` 1137.58 Lakhs for the year ended 31st
` 1,428.72 Lakhs through a trust, which were March 2016 with a corresponding adjustment
received by it in its capacity as a shareholder of in ‘Deferred tax liability’.
Vardhman Holdings Limited, in accordance with
the ‘Scheme of Arrangement and Demerger’. 13. Statement of cash flows
The transition from Indian GAAP to Ind AS has
The Equity share capital has been reduced with not had a material impact on statement of cash
paid up value of ` 159.87 Lakhs and Reserve flows.
141
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at 31st March 2016 As at 1st April 2015
Note
Particulars As per Ind AS As per As per Ind AS As per
No.
Indian GAAP Adjustments Ind AS Indian GAAP Adjustments Ind AS
ASSETS
1 Non-current assets
(a) Property, Plant and Equipment 1,6 247,726.91 1,176.71 248,903.62 248,233.66 1,293.88 249,527.54
(b) Capital work-in-progress 8,483.29 8,483.29 7,677.68 7,677.68
(c) Other Intangible Assets 1,108.24 1,108.24 1,393.29 1,393.29
(d) Financial Assets - - - -
- Investments 2 100,501.34 6,482.58 106,983.92 57,476.60 2,588.18 60,064.79
- Loans 3 80.42 (4.47) 75.95 90.55 (5.54) 85.01
- Others financial assets 1,192.56 1,192.56 12,426.54 - 12,426.54
(e) Other non-current Assets 1,3 6,954.47 744.58 7,699.05 5,960.43 753.79 6,714.22
Total Non-current assets 366,047.23 8,399.39 374,446.63 333,258.75 4,630.31 337,889.07
2 Current assets
(a) Inventories 180,911.59 180,911.59 163,673.47 163,673.47
(b) Financial Assets - -
- Investments 2 59.21 0.01 59.22 9,940.31 23.33 9,963.64
- Trade receivables 11 68,192.56 8,807.07 76,999.63 67,681.88 13,724.98 81,406.86
- Cash and cash equivalents 21,368.82 - 21,368.82 5,908.75 - 5,908.75
- Bank Balance other than above 6,308.14 - 6,308.14 11,646.02 - 11,646.02
- Loans 3 2,939.84 (11.82) 2,928.02 3,700.18 (11.52) 3,688.67
- Other financial assets 4,613.67 - 4,613.67 3,559.06 3,559.06
(c) Current tax assets (net) 2,191.25 - 2,191.25 1,139.55 1,139.55
(d) Other current assets 1,3,10 30,114.68 (1,408.35) 28,706.33 29,974.15 (1,408.67) 28,565.48
Total Current assets 316,699.76 7,386.90 324,086.66 297,223.37 12,328.13 309,551.50
Total Assets 682,746.99 15,786.29 698,533.29 630,482.11 16,958.44 647,440.57
Equity And Liabilities
Equity
(a) Equity Share capital 10 6,365.19 (159.88) 6,205.31 6,365.19 (159.87) 6,205.31
(b) Other Equity 1 to 12 358,953.18 3,833.55 362,786.73 301,972.83 9,200.33 311,173.16
Total Equity 365,318.37 3,673.67 368,992.04 308,338.02 9,040.46 317,378.47
1 Liabilities
Non-current liabilities
(a) Financial Liabilities
- Borrowings 5 102,496.18 (272.34) 102,223.85 131,726.48 (258.08) 131,468.40
- Other financial liabilities 4 77.61 (58.49) 19.12 1,310.34 (10.85) 1,299.49
(b) Provisions 592.82 592.82 514.71 514.71
(c) Deferred tax liabilities (Net) 12 18,824.45 1,814.48 20,638.93 19,847.61 676.91 20,524.52
(d) Other non-current liabilities 6 171.00 1,861.34 2,032.34 135.95 2,010.85 2,146.81
Total Non-current liabilities 122,162.06 3,345.00 125,507.06 153,535.09 2,418.83 155,953.93
2 Current liabilities
(a) Financial Liabilities
- Borrowings 11 92,875.07 8,807.06 101,682.13 46,854.69 13,724.98 60,579.67
- Trade payables 14,590.67 14,590.67 12,954.60 12,954.60
- Other financial liabilities 4 74,016.90 (189.65) 73,827.25 88,983.13 (678.92) 88,304.22
(b) Other current liabilities 6 13,262.56 150.23 13,412.79 11,448.94 150.18 11,599.13
(c) Provisions 7 521.36 - 521.36 8,367.64 (7,697.09) 670.55
Total Current liabilities 195,266.56 8,767.64 204,034.20 168,609.00 5,499.15 174,108.17
Total Equity And Liabilities 682,746.99 15,786.30 698,533.30 630,482.11 16,958.44 647,440.57
Note:
The figures of Indian GAAP have been reclassified to confirm to presentation requirements of Division II of Schedule III of Companies Act, 2013 as
applicable to a company whose financial statements are required to be drawn up in compliance of the (Indian Accounting Standards) Rules, 2015
142
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
Reconciliation of Total Comprehensive Income for the year ended March 31, 2016
(Amount in Lakhs)
As per IND AS
Particulars Note No. As per IND AS
Indian GAAP Adjustments
Revenue from operations (net) 9 561,381.35 14.45 561,395.80
Other income 2,3,6 20,064.52 4,032.77 24,097.29
I. Total revenue 581,445.87 4,047.22 585,493.09
II. Expenses :
Cost of materials consumed 266,715.11 - 266,715.11
Purchases of stock-in-trade 6,715.09 - 6,715.09
Changes in inventories of finished goods, work-in- 1,220.20 - 1,220.20
progress and stock-in-trade
Employee benefits expense 3,8 41,038.05 5.28 41,043.33
Finance costs 5 8,684.95 (14.26) 8,670.69
Depreciation and amortization 1,6 36,192.45 117.15 36,309.60
Other expenses 1,4,9 134,415.73 464.94 134,880.67
Total Expenses 494,981.58 573.11 495,554.69
III. Profit/(loss) before tax (I-II) 86,464.29 3,474.11 89,938.40
IV. Tax expense:
(1) Current tax 8 22,182.00 2.15 22,184.15
(2) Deferred tax 12 (1,023.15) 1,137.58 114.43
V. Profit (Loss) for the period (III-IV) 65,305.44 2,334.38 67,639.82
VI. Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss
- Remeasurements of the defined benefit plans 8 (6.22) (6.22)
(ii) Income tax relating to items that will not be 8 2.15 2.15
reclassified to profit or loss
B (i) Items that will be reclassified to profit or loss - -
(ii) Income tax relating to items that will be -
reclassified to profit or loss
VII. Total Comprehensive Income for the period (V+VI) 65,305.44 2,330.31 67,635.75
143
36 (a) Financial Instruments by Category
144
(a) The carrying value and fair value of financial instruments at the end of each reporting period is as follows:
As at 31st March 2017
(Amount in Lakhs)
Notes
At Cost At At fair value through At fair value through OCI Total Total Fair
Amortized profit or loss carrying value
cost Designated Mandatory Equity Mandatory value
Particulars upon initial instruments
recognition designated
upon initial
recognition
Assets:
Investments (Non Current) 13,623.86 83,416.25 178.99 97,219.10 128,187.49
(Refer Note 4)
Loans (Non Current) (Refer Note 5) 61.04 61.04 61.04
Other financial non-current assets 173.54 173.54 173.54
(Refer Note 6)
Investments (Current) (Refer Note 9) - 67,060.37 67,060.37 67,060.37
Trade receivables (Refer Note 10) 71,790.98 71,790.98 71,790.98
Cash and Cash Equivalents 3,822.39 3,822.39 3,822.39
(Refer Note 11)
Other Bank Balances 224.71 224.71 224.71
(Refer Note 11A)
Loans (Current) (Refer Note 12) 3,656.20 3,656.20 3,656.20
Other financial assets (Current) 2,241.10 1,806.39 4,047.49 4,047.49
(Refer Note 13)
Total 13,623.86 81,969.96 - 152,283.01 178.99 - 248,055.82 279,024.21
Liabilities: - -
Borrowings (Non Current) - 71,935.28 71,935.28 71,935.28
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
At Cost At At fair value through At fair value through OCI Total Total Fair
STANDALONE
145
ANNUAL REPORT 2016-17
As at 31st March 2015
146
(Amount in Lakhs)
At Cost At At fair value through At fair value through OCI Total Total Fair
Amortized profit or loss carrying value
cost value
Designated Mandatory Equity Mandatory
Notes
Particulars upon initial instruments
recognition designated
upon initial
recognition
Assets:
Investments (Non Current) 24,457.98 35,445.87 160.94 60,064.79 70,848.28
(Refer Note 4)
Loans (Non Current) 85.01 85.01 85.01
(Refer Note 5)
Other financial non-current 12,426.54 12,426.54 12,426.54
assets (Refer Note 6)
Investments (Current) - 9,963.64 9,963.64 9,963.64
(Refer Note 9)
Trade receivables 81,406.86 81,406.86 81,406.86
(Refer Note 10)
Cash and Cash Equivalents 5,908.75 5,908.75 5,908.75
(Refer Note 11)
Other Bank Balances 11,646.02 11,646.02 11,646.02
(Refer Note 11A)
Loans (Current) 3,688.67 3,688.67 3,688.67
(Refer Note 12)
Other financial assets 3,559.06 3,559.06 3,559.06
(Current) (Refer Note 13)
Total 24,457.98 118,720.91 - 45,409.51 160.94 - 188,749.35 199,532.83
forming part of financial statements for the year ended 31st March, 2017
Liabilities: - -
Borrowings (Non Current) - 131,468.40 131,468.40 131,468.40
(Refer Note 17)
Other financial liabilities (Non 30.69 1,268.80 1,299.49 1,299.49
Current) (Refer Note 18)
Borrowings (Current) (Refer 60,579.67 60,579.67 60,579.67
Note 22)
Trade Payables (Refer Note 23) 12,954.60 12,954.60 12,954.60
Other financial liabilities 87,443.45 860.77 88,304.22 88,304.22
(Current) (Refer Note 24)
Total - 292,476.81 - 2,129.57 - - 294,606.38 294,606.38
FINANCIAL STATEMENTS
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices)
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable
inputs).
(ii) The following table presents fair value hierarchy of assets and liabilities measured at fair value:
As at 31st March 2017
(Amount in Lakhs)
Fair Value measurement using
Particulars Fair Value
Level 1 Level 2 Level 3
Long term Investments
Fair Value through OCI (Equity instruments designated 178.99 178.99
upon initial recognition)
Fair Value through Profit and Loss 83,416.24 83,416.24
Current Investments
Fair Value through Profit and Loss 67,060.36 3,416.20 63,644.16
Other financial current assets
- Derivative financial instruments 1,806.39 1,806.39
147
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
37. Contingent liabilities and Commitments (to the extent not provided for):-
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
I Contingent Liabilities
(i) Claims not acknowledged as debts 436.37 1,020.77 827.69
(ii) Bank Guarantees and Letters of Credit outstanding 11,254.86 6,030.86 8,781.05
(iii) Other monies for which the company is
contingently liable
a) The Company has contested the additional demand 15,635.13 Lakhs, 01.04.2015 ` 14,250.47 Lakhs) in
in respect of Sales Tax, Excise Duty etc., amounting this respect has not been made as the company has
to ` 666.43 Lakhs (31.03.2016 ` 1,194.71 Lakhs, filed various appeals with the appellate authorities
01.04.2015 ` 1,159.80 Lakhs). As against this a and the company is confident to get the desired
sum of ` 67.21 Lakhs (31.03.2016 ` 110.21 Lakhs, relief.
01.04.2015 ` 113.70 Lakhs) has been deposited
under protest and stands included under the head c) The company had taken over the textile undertaking
“Balance with government authorities in note-14 – of Vardhman Holdings Limited (formerly known
Other Current Assets “. The Company has filed an as Vardhman Spinning & General Mills Limited)
appeal with the Appellate Authorities and is advised by a scheme of Arrangement and De-merger. An
that the demand is not in accordance with law. No injunction was obtained against the London Branch
provision, therefore, has been made in accounts in of the said textile undertaking for preventing
respect thereof. disposal of assets upto the value of Pound Sterling
2.99 Lac as a result of a court case pending in London
b) The Company has contested the additional demand for alleged non-fulfilment of an agreement of
in respect of income tax amounting to ` 18,250.72 cotton purchase. The said matter had been decided
Lakhs (31.03.2016 ` 18,253.23 Lakhs, 01.04.2015 against the said textile undertaking and accordingly,
` 16,298.27 Lakhs). As against this a sum of ` Pound Sterling 0.48 Lac lying in the bank account
10,068.97 Lakhs (31.03.2016 ` 6,799.35 Lakhs, at London had been paid to the claimant pursuant
01.04.2015 ` 6,035.72 Lakhs) has been deposited/ to the Order of the Court. The said amount was
adjusted under protest and stands included in written off in the books of the said undertaking by
“Advance income tax” under the head “Current way of debit to the statement of Profit and Loss. No
Tax Assets”. Provision of ` 15,635.13 (31.03.2016 ` provision has been made for the balance decreed
148
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
amount by the undertaking in view of the fact that the said undertaking was prevented by force majure in fulfiling
its part of contract. The Company as successor to the textile undertaking is contesting this matter in Indian Courts
and is confident that there would not be any further liability in this regard.
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 01st April, 2015
(II) Commitments
Estimated amount of contracts remaining to be 8,071.34 5,923.71 12,151.21
executed on Capital Account and not provided for
(net of advances)
Exports obligations under Export Promotion Capital 16,057.27 50,392.70 49,512.28
Goods (EPCG) scheme#
# The Company has executed bonds for an aggregate amount of ` 95,411.71 Lakhs (31.03.2016 ` 1,17,933.85 Lakhs, 01.04.2015 ` 91,640.51
Lakhs) in favour of the President of India under section 59 (2) and 67 of the Customs Act,1962 and Central Excise and salt Act, 1944 for
fulfilment of the obligation under the said Acts. However, ` 16,057.27 Lakhs (31 March 2016: ` 50,392.70 Lakhs, 1 April 2015: ` 49,512.28 Lakhs)
is outstanding to be discharged against these bonds.
38. Amortisation of Intangible assets the year in terms of buy back announced by the
a. Softwares have been amortised @ 25% on company. The value of shares held at the end
straight line basis as the useful life has been of each reporting period has been adjusted in
estimated to be not more than four years. the equity in accordance with Ind AS 32.
b. Right to use power lines have been amortised (b) The aforesaid Trust is also holding 3,19,748
@ 20% on straight line basis as the useful life equity shares (31.03.2016- 3,19,748) of ` 10
thereof has been estimated to be not more each of Vardhman Special Steels Limited
than five years. which were allotted to it in the capacity of
a shareholder of the company by virtue of
c. Contribution to CETP has been amortised @ ‘Scheme of Arrangement & Demerger’ entered
20% on straight line basis as the useful life into by the company, Vardhman Special Steels
thereof has been estimated to be not more Limited and their respective shareholders and
than five years. creditors.
39. (a) The Company was holding its own 15,98,741 As the aforesaid shares are held by a Trust on
(31.03.2016- 15,98,741) equity shares of ` 10 behalf of the company and company not being
each through a Trust, which were received by registered owner of shares, the cost of these
it in its capacity as a shareholder of Vardhman shares is not reflected in Investments but same
Holdings Limited, in accordance with the has been valued at cost as reflected in other
‘Scheme of Arrangement and Demerger’. Out current asset.
of above 1,36,539 shares were tendered during
149
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(c) The detail of the amount recoverable from Mahavir Share Trust as at the close of the year is as under:
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 01st April, 2015
Cost of Shares (Vardhman Textiles Limited) 1,306.32 1,428.30 1,428.30
Cost of Shares (Vardhman Special Steels Limited) 357.10 357.10 357.10
Other recoverable 2.48 2.99 2.60
Total 1,665.90 1,788.41 1,788.02
The amount recoverable on account of equity shares of Vardhman Textiles Limited held by the trust has been
reduced from equity share capital & retained earnings.
40. Business segments have been identified based on the nature and class of products and services, assessment of
differential risks and returns. Accordingly, company is a single segment company operating in textile business
and disclosure requirements as contained in Ind AS- 108 ‘Operating Segments’ are not required in the Standalone
financial statements. However, the disclosure has been made in the Consolidated Financial Statements.
41. In accordance with Ind AS-36 on “Impairment of Assets” the Company has assessed as on the balance sheet date,
whether there are any indications with regard to the impairment of any of the assets. Based on such assessment
it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount has
not been made. Accordingly no impairment loss has been provided in the books of account.
(Amount in Lakhs)
Particulars 31.03.2017 31.03.2016
Net Profit after tax attributable to equity shareholders 100,159.29 67,639.82
Total (A) 100,159.29 67,639.82
Weighted average number of equity shares (No in lac) 611.94 620.53
Total (B) 611.94 620.53
Basic earning per Share (`) (A)/(B) 163.67 109.00
Diluted earning per Share (`)* (A)/(B) 163.67 109.00
Face value per equity share (`) 10.00 10.00
150
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
43. Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006
under the chapter on delayed payments to Micro & small enterprises.
(Amount in Lakhs)
Sr. As at As at As at
Particulars
No. 31st March, 2017 31st March, 2016 1st April, 2015
1 Principal amount remaining unpaid to any supplier - - -
as at the end of accounting period
2 Interest due on remaining unpaid to any supplier as - - -
at the end of the accounting period
3 The amount of interest paid along with the amounts - - -
of the payment made to the supplier beyond the
appointed day during accounting period
4 The amount of interest due and payable for the year - - -
5 The amount of interest accrued and remaining - - -
unpaid at the end of accounting year
6 The amount of further interest due and payable - - -
even in the succeeding year, until such date when
the interest dues as above are actually paid
Dues of Micro, Small and Medium enterprises have been determined on the basis of information collected by the
management. This has been relied upon by the auditors.
44. Leases :
The Company has leased facilities under cancellable and non-cancellable operating lease arrangements with
a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The
cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses
recognised during the year amounts to ` 161.57 Lakhs (31.03.2016 ` 156.74 Lakhs). The future minimum lease
payments in respect of the non-cancellable operating leases are:
(Amount in Lakhs)
As at As at
31st March,2017 31st March,2017
a) Not later than one year 127.90 118.22
b) later than one year but not later than five years 271.28 270.57
c) later than five years 3350.26 3401.87
151
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
152
(b) Description of the nature of transactions with the related parties :-
(Amount in Lakhs)
Enterprises over
Relative of Key
Key Management which KMP is able to
Subsidiaries Joint Venture Associates# Manageent Total Total
Personnel (KMP) exercise significant
Personnel (KMP)
STANDALONE
Particulars influence
Current Previous Current Previous Current Previous Current Previous Current Previous Current Previous Current Previous
Notes
Year Year Year Year Year Year Year Year Year Year Year Year Year Year
Purchase Processing 21,755.50 32,622.04 5.96 2.90 1,082.54 518.00 22,844.00 33,182.94
of goods
Sale processing of goods 1,296.14 1,022.92 1,398.36 1,602.38 641.94 499.88 3,336.44 3,125.18
Sale of DEPB licences - 368.53 - 368.53
Purchase of Property, Plant 20.45 14.77 2,821.63 0.51 2,842.08 15.28
& Equipment
Sale of Property, Plant & 114.31 229.16 1.59 - 6,298.00 45.90 6,413.90 275.06
Equipment
Donation paid 418.66 472.00 418.66 472.00
Rent paid 0.10 - 9.81 9.61 9.91 9.61
Reimbursement of 219.65 1,065.88 15.71 59.67 484.70 758.26 720.06 1,883.81
expenses paid
Reimbursement of 62.06 62.34 3.41 2.20 590.85 793.05 656.32 857.59
expenses received
Receipt against corporate 149.60 148.32 2.85 2.85 420.44 422.87 572.89 574.04
services agreement*
Payment against licenses 98.50 96.79 98.50 96.79
agreement*
Interest paid 4.61 29.85 4.61 29.85
Interest received 36.40 16.79 92.30 97.03 117.26 71.50 245.96 185.32
Rent received 11.03 10.72 30.20 22.51 41.23 33.23
Dividend received - 4,503.50 - 10,873.00 - - 15,376.50
Dividend paid 283.50 - 9,227.33 - 9,510.83
KMP Remuneration - 3,032.89 2,046.57 6.58 4.16 3,039.47 2,050.73
Loan given (Including 2,225.00 - 1,399.12 1,599.12 1,500.00 7,254.57 5,124.12 8,853.69
Opening Balance)
Loan received back 1,525.00 - 200.00 400.00 - 5,754.57 1,725.00 6,154.57
Closing Balance 700.00 - 1,199.12 1,199.12 1,500.00 1,500.00 3,399.12 2,699.12
Year end balance receivable - - 295.76 523.08 - 153.89 295.76 676.97
153
ANNUAL REPORT 2016-17
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
As at Movement As at Movement As at
1st April during 31st March during 31st march
2015 2015-16 2016 2016-17 2017
Deferred tax Liability
Impact of Depreciation 20,558.55 (510.88) 20,047.67 279.82 20,327.47
Fair valuation Gain on investments 903.79 1,339.70 2,243.50 3,300.38 5,543.88
MTM Gain on forex fluctuation 217.46 (189.66) 27.80 - 27.80
(A) 21,679.81 639.16 22,318.97 3,580.20 25,899.15
Deferred tax Asset
43B Disallowances 1,122.09 480.11 1,602.20 284.14 1,886.34
Provision for Doubtful Debt 33.21 44.62 77.83 94.97 172.80
(B) 1,155.30 524.73 1,680.03 379.11 2,059.14
Deferred tax liability (Net) (A-B) 20,524.52 114.43 20,638.93 3,201.09 23,840.02
154
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(c) Reconciliation of tax expense and the Profit before tax multiplied by statutory tax rate :
(Amount in Lakhs)
Particulars Current year Previous year
Accounting profit before tax 130,481.27 89,938.40
Tax at statutory income tax rate of 34.608% / 23.072% 41,120.61 31,125.88
(31 March 2016: 34.608%)
Tax effect of the amounts not deductible for computing taxable income
Depreciation difference (484.49) 138.89
Disallowances 668.07 (697.95)
Deductions/Exemption/Non Taxable items (9,773.21) (9,373.66)
Adjustment in Capital gain under Income Tax provisions (3,378.28) -
Fair valuation Gain on investments 3,294.15 1,339.70
MTM Gain on forex fluctuation - (189.66)
Provision for Doubtful Debt (94.97) (44.62)
MAT CREDIT Entitlement (1,029.85) -
Income tax expense 30,321.98 22,298.58
47. Disclosure required by Regulation 34 read with Special Steels Limited. The maximum amount
Schedule V of SEBI (Listing obligations and Disclosure outstanding during the year was ` 1,500 Lakhs
Requirements) Regulations,2015:- (31.03.2016 ` 1,954.57 Lakhs, 01.04.2015
` 6,535.74 Lakhs). The Balance outstanding as on
(i) The Company has given inter corporate 31.03.2017 is ` 1,500 Lakhs (31.03.2016 ` 1,500
deposits aggregating to ` Nil (31.03.2016 Lakhs, 01.04.2015 ` 2,554.57 Lakhs).
` NIL, 01.04.2015 ` 500 Lakhs) to M/s Vardhman
Acrylics Ltd. during the year. The maximum (iv) The Company has given inter corporate
amount outstanding during the year was ` Nil deposits aggregating to ` 200 Lakhs (31.03.2016
(31.03.2016 ` NIL, 01.04.2015 ` 500 Lakhs). ` 681.00 Lakhs, 01.04.2015 ` 1,636 Lakhs) to
The Balance outstanding as on 31.03.17 is ` Nil M/s Vardhman Nisshinbo Garments Company
(31.03.2016 ` Nil, 01.04.2015 ` Nil). Limited during the year. The maximum amount
outstanding during the year was ` 1199.12
(ii) The Company has given inter corporate Lakhs (31.03.2016 ` 1,199.12 Lakhs, 01.04.2015
deposits aggregating to ` 2,225 Lakhs ` 1,187.62 Lakhs). The Balance outstanding
(31.03.2016 ` NIL, 01.04.2015 ` 2,844 Lakhs) as on 31.03.17 is ` 1199.12 Lakhs(31.03.2016
to M/s VMT Spinning Company Limited during ` 1,199.12 Lakhs, 01.04.2015 ` 918.12 Lakhs).
the year. The maximum amount outstanding
during the year was ` 1,375 Lakhs (31.03.2016 (v) The Company has given inter corporate
` NIL, 01.04.2015 ` 1,098 Lakhs). The Balance deposits aggregating to ` Nil (31.03.2016 ` NIL,
outstanding as on 31.03.17 is ` 700 Lakhs 01.04.2015 ` 2,621.00 Lakhs) to M/s Vardhman
(31.03.2016 ` Nil, 01.04.2015 ` Nil). Yarns and Threads Limited during the year.
The maximum amount outstanding during the
(iii) The Company has given inter corporate deposits year was ` Nil (31.03.2016 ` NIL, 01.04.2015
aggregating to ` Nil (31.03.2016 ` 4,700 Lakhs, ` 861.00 Lakhs). The Balance outstanding as on
01.04.2015 ` 65,079 Lakhs) to M/s Vardhman 31.03.17 is ` Nil (31.03.2016 ` NIL, 01.04.2015
` NIL).
155
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Other Expenses 138.67 205.16
Finance Costs (7.65) (15.90)
Employee Benefits Expense 3.29 1.75
Cost of Materials Consumed 15.88 116.65
Other Income (28.61) (28.27)
Revenue From Operations 23.07 1.16
Net Prior period (Income)/Expense 144.65 280.55
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
(i) Related parties
- Subsidiaries 6.41 19.45
- Others 240.86 171.57
(ii) Current investments 1693.66 1,487.43
(iii) Long Term Investments 15.23 179.52
(iv) Deposits and others 1374.08 3,665.47
50. In accordance with the provisions of Section 135 of the Companies Act, 2013 the company has paid a sum of `
540.91 Lakhs (31.03.2016 ` 476.60 Lakhs) towards approved Corporate Social Responsibility (CSR) activities. The
said amount stands debited to the “Miscellaneous” under the head “other expenses”.
The following tables set out the disclosures in respect of the gratuity plan as required under Ind AS 19.
156
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
157
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(h) Principal actuarial assumption at the Balance Sheet Date (expressed as weighted average):
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in employee market.
(i) The quantitative sensitivity analysis on net liability recognized on account of change in significant assumptions:
(Amount in Lakhs)
Particulars As at 31.03.2017 As at 31.03.2016
Discount Rate
0.50% Increase (211.07) (164.19)
0.50% decrease 228.94 186.35
Future Salary increase
0.50% Increase 230.84 189.04
0.50% decrease (198.67) (175.98)
As per Actuarial Certificate, sensitivities due to mortality & withdrawals are not material & hence impact of
change has not been calculated.
(j) The following payments are expected contributions to the defined benefit plan in future years:
(Amount in Lakhs)
Particulars As at 31.03.2017 As at 31.03.2016
Within 1 year 590.88 667.14
1-5 years 1125.44 1033.00
Beyond 5 years 3153.22 2534.96
Total expected payments 4869.54 4235.10
(k) The average duration of the defined benefit plan obligation at the end of the reporting period is 13.65 years
(31 March 2016: 14.00 years).
158
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
52. Financial Risk Management The export sales of company comprise around
The principal financial assets of the Company 35% of the total sales of the company, Further
include loans, trade and other receivables, and the company also imports certain assets and
cash and bank balances that derive directly from material from outside India. The exchange
its operations. The principal financial liabilities of rate between the Indian rupee and foreign
the company, include loans and borrowings, trade currencies has changed substantially in recent
and other payables and the main purpose of these years and may fluctuate substantially in the
financial liabilities is to finance the day to day future. Consequently the company is exposed
operations of the company. to foreign currency risk and the results of
the company may be affected as the rupee
The Company is exposed to market risk, credit appreciates/ depreciates against foreign
risk and liquidity risk. The Company’s senior currencies. Foreign exchange risk arises
management oversees the management of these from the future probable transactions and
risks and that advises on financial risks and the recognized assets and liabilities denominated
appropriate financial risk governance framework in a currency other than company’s functional
for the Company. currency.
This note explains the risks which the company is The company measures the risk through a
exposed to and policies and framework adopted by forecast of highly probable foreign currency
the company to manage these risks: cash flows and manages its foreign currency
risk by appropriately hedging the transactions.
Market Risk The Company uses a combination of derivative
Market risk is the risk that the fair value of future financial instruments such as foreign exchange
cash flows of a financial instrument will fluctuate forward and option contracts to mitigate the
because of changes in market prices. Market prices risk of changes in exchange rates on foreign
comprise three types of risk: foreign currency risk, currency exposures.
interest rate risk, investment risk.
The following table summarizes the company’s
(i) Foreign currency risk exposure foreign currency risk from financial
The company operates internationally and instruments at the end of each reporting
business is transacted in several currencies. period:
159
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
160
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
10% Strengthening/weakening of USD against INR - -
10% Strengthening/weakening of Euro against INR - -
10% Strengthening/weakening of CHF against INR 50.45 49.62
10% Strengthening/weakening of GBP against INR - 1.47
10% Strengthening/weakening of JPY against INR 9.44 28.50
As the Company has no significant interest-bearing assets, the income and operating cash flows are substantially
independent of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates
relates primarily to the Company’s debt obligations with floating interest rates, which are included in interest bearing loans
and borrowings in these financial statements. The company’s fixed rate borrowings are carried at amortised cost. They are
therefore not subject to interest rate risk, since neither the carrying amount nor the future cash flows will fluctuate because
of a change in market interest rates.
At the reporting date the interest rate profile of the Company’s interest bearing financial instrument is at its fair value:
(Amount in Lakhs)
As at As at
Particulars
31st March 2017 31st March 2016
Variable rate instruments
Long term borrowings 71,935.28 1,02,223.85
Current maturities of long term debt 42,375.50 55,644.34
Short term borrowings 1,05,505.99 1,01,682.13
(Amount in Lakhs)
As at As at
Particulars
31st March 2017 31st March 2016
Increase/ decrease in 100 basis point 2,198.17 2,595.50
161
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
The company manages equity price risk by investing in fixed deposits/Fixed Maturity Plan, debt instruments
and Liquid funds. The company does not actively trade equity investments. Equity investments are mainly
held for strategic rather than trading purposes. Protection principle is given high priority by limiting company’s
investments to AA and higher rated companies and top rated money market instruments only.
Liquidity Risk
The financial liabilities of the company, other than derivatives, include loans and borrowings, trade and other
payables. The company’s principal sources of liquidity are cash and cash equivalents and the cash flow that is
generated from operations.
The company monitors its risk of shortage of funds to meet the financial liabilities using a liquidity planning tool.
The company plans to maintain sufficient cash and marketable securities to meet the obligations as and when
fall due.
The below is the detail of contractual maturities of the financial liabilities of the company at the end of each
reporting period:
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
Borrowings
0-1 years 1,47,881.49 1,57,326.47
2-3 years 56,436.68 68,447.28
3-5 years 15,684.00 34,049.00
More than 5 years - -
Trade Payables
0-1 years 17,740.83 14,590.67
2-3 years - -
3-5 years - -
More than 5 years - -
Other Financial liabilities
0-1 years 17,700.08 18,182.92
2-3 years 48.78 19.12
3-5 years - -
More than 5 years - -
Credit Risk
Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The
maximum exposure to the credit risk at the reporting date is primarily from trade receivables which are typically
unsecured. Credit risk on cash and bank balances is limited as the company generally invests in deposits with
banks and financial institutions with high credit ratings assigned by credit rating agencies. Investments primarily
include investment in liquid mutual fund units, bonds, fixed maturity plan etc. issued by institutions having
proven track record. The Company’s credit risk in case of all other financial instruments is negligible.
162
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
The company assesses the credit risk based on external credit ratings assigned by credit rating agencies. The
company also assesses the creditworthiness of the customers internally to whom goods are sold on credit terms
in the normal course of business. The credit limit of each customer is defined in accordance with this assessment.
Outstanding customer receivables are regularly monitored and any shipments to overseas customers are
generally covered by letters of credit.
The impairment analysis is performed on client to client basis for the debtors that are past due at the end of each
reporting date. The company has not considered an allowance for doubtful debts in case of trade receivables that
are past due but there has not been a significant change in the credit quality and the amounts are still considered
recoverable.
The following is the detail of revenues generated from top five customers of the company and allowance for
lifetime expected credit loss:
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
(a) Revenue from top five customers
- Amount of sales 53,988.02 64,284.26
- % of total sales 9.42 11.51
(b) Allowance for doubtful debt
- Balance at the beginning of the period
- Recognized during the year 202.77 18.79
- Amount written off 294.02 183.98
- Balance at the end of the period 496.79 202.77
The maximum exposure to credit risk at the reporting date is the carrying value of trade receivables as disclosed
at Note 10.
The company manages its capital structure and makes adjustments in light of changes in economic conditions
and the requirements of the financial covenants which otherwise would permit the banks to immediately call
loans and borrowings. In order to maintain or adjust the capital structure, the company may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares.
163
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The
Company’s gearing ratio was as follows:
(Amount in Lakhs)
Financial Year Financial Year
Particulars
ended 31.03.2017 ended 31.03.2016
Borrowings 2,19,816.77 2,59,550.32
Less: Cash and cash equivalents 4,047.11 27,676.96
Net debt 2,15,769.66 2,31,873.36
Total equity 3,98,584.74 3,68,992.04
Capital and Net debt 6,14,354.40 6,00,865.40
Gearing ratio 35.12% 38.59%
Further, there have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current year
ended 31st March 2017.
There were no changes in the objectives, policies or processes for managing capital during the year ended 31 March 2017 and
31 March 2016.
54. During the financial year 2016-17, the company has sold its 40% equity stake in Vardhman Yarns & Threads Limited (VYTL),
equivalent to 22,802,541 equity shares, to its Joint Venture partner namely American & Efird Global(A & E) for a consideration
of ` 413.01 crore. Gain on sale of such investment amounting to ` 313.00 crore has been shown under the head ‘Other Income’
(refer note no. 28). Accordingly now the company holds 11% equity stake in VYTL equivalent to 62,69,699 equity shares at a cost
of ` 27.49 crore. In view of changed situation, the investment is also re-classified as ‘Investment in Associates’.
(Amount in Lakhs)
Other
Particulars SBNs* denomination Total
notes
Closing cash in hand as on 8th November 2016 37.84 3.57 41.41
(+) Permitted receipts - 1,04.40 1,04.40
(+) Withdrawal from Banks - 27.26 27.26
(-) Permitted payments - 66.63 66.63
(-) Amount deposited in Bank (37.84) 26.26 64.10
Closing cash in hand as on 30th December 2016 - 42.34 42.34
*For the purpose of this clause, the term ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of
India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E) dated 8 November 2016.
164
STANDALONE ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
31st March 2017 31st March 2016 1st April 2015
Current Assets
Financial Assets
Trade receivables 71,790.98 76,999.63 81,406.86
Non-Financial Assets
Inventory 1,58,900.38 1,80,911.59 1,63,673.47
Total Current Assets Pledged as Security 2,30,691.36 2,57,911.22 2,45,080.33
Non Current Assets
Property, Plant & Equipment 2,45,141.10 2,48,903.62 2,49,527.54
Total Non Current Assets Pledged as Security 2,45,141.10 2,48,903.62 2,49,527.54
Total Assets Pledged as Security 4,75,832.46 5,06,814.84 4,94,607.87
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10-05-2017
165
FINANCIAL STATEMENTS
166
CONSOLIDATED ANNUAL REPORT 2016-17
required and give a true and fair view in conformity with of our knowledge and belief were necessary
the accounting principles generally accepted in India for the purposes of our audit of the aforesaid
including the Ind AS, of the consolidated financial position consolidated Ind AS financial statements.
of the Group, as at 31 March 2017 and its consolidated
financial performance including other comprehensive (b) In our opinion, proper books of account as
income, its consolidated cash flows and the consolidated required by law relating to preparation of
changes in equity for the year then ended. the aforesaid consolidated Ind AS financial
statements have been kept so far as it appears
Other Matter from our examination of those books.
We did not audit the Ind AS financial statements/financial
information of two subsidiaries, whose Ind AS financial (c) The consolidated balance sheet, the
statements/financial information reflect total assets of consolidated statement of profit and loss,
` 59,505.09 Lakhs as at 31st March, 2017, total revenue the consolidated statement of cash flows and
of ` 37,921.85 Lakhs, total comprehensive income of ` consolidated statement of changes in equity
4,925.25 Lakhs, and net cash flows amounting to ` 816.32 dealt with by this Report are in agreement with
Lakhs for the year ended 31st march, 2017 as considered the relevant books of account maintained for
in the consolidated Ind AS financial statements. The the purpose of preparation of the consolidated
consolidated Ind AS financial statements also include Ind AS financial statements.
the group’s share of total comprehensive income of
` 3653.17 Lakhs for the year ended 31st March, 2017, (d) In our opinion, the aforesaid consolidated
as considered in the Consolidated Ind AS Financial Ind AS financial statements comply with the
Statements, in respect of two associate and one joint Accounting Standards specified under Section
venture, whose Ind AS financial statement/financial 133 of the Act, read with relevant rules issued
information have not been audited by us. These Ind AS thereunder.
financial statements/financial information have been
audited by other auditors whose reports have been (e) On the basis of the written representations
furnished to us by the Management and our opinion on received from the directors of the Holding
the consolidated Ind AS financial statements, in so far as Company as on 31 March 2017 taken on
it relates to the amounts and the disclosures included record by the Board of Directors of the
in respect of these subsidiaries and associates and our Holding Company and the reports of the
report in terms of sub sections (3) and (11) of Section statutory auditors of its subsidiary companies
143 of the Act, insofar as it relates to the aforesaid incorporated in India, none of the Directors of
subsidiaries and associates, is based solely on the the Group companies incorporated in India is
reports of the other auditors. disqualified as on 31 March 2017 from being
appointed as a Director of that company in
Our opinion on the Consolidated Ind AS Financial terms of Section 164(2) of the Act.
Statements, and our report on Other Legal and
Regulatory Requirements below, is not modified in (f) With respect to the adequacy of the internal
respect of the above matters with respect to our reliance financial controls over financial reporting of
on the work done and reports of other auditors. the Group and the operating effectiveness of
such controls, refer to our separate report in
Report on Other Legal and Regulatory Requirements “Annexure A”; and
1. As required by Section 143(3) of the Act, we report,
that: (g) with respect to the other matters to be
included in the Auditor’s Report in accordance
(a)
We have sought and obtained all the with Rule 11 of the Companies (Audit and
information and explanations which to the best Auditors) Rules, 2014, in our opinion and to the
167
FINANCIAL STATEMENTS
best of our information and according to the iv. the Company has provided requisite
explanations given to us: disclosures in its consolidated Ind AS
financial statements as to holdings as
i. the consolidated Ind AS financial well as dealings in Specified Bank Notes
statements disclose the impact of pending during the period from 8 November, 2016
litigations on the consolidated financial to 30 December, 2016 and these are in
position of the Group. accordance with the books of accounts
maintained by the Company.
ii. the Company did not have any long term
contracts including derivative contracts For S.C. Vasudeva & Co,
for which there were any material Chartered Accountants
foreseeable losses; and Firm Reg. No.000235N
168
CONSOLIDATED ANNUAL REPORT 2016-17
assurance about whether adequate internal financial or disposition of the company’s assets that could
controls over financial reporting was established and have a material effect on the financial statements.
maintained and if such controls operated effectively in
all material respects. Inherent Limitations of Internal Financial Controls
Over Financial Reporting
Our audit involves performing procedures to obtain Because of the inherent limitations of internal financial
audit evidence about the adequacy of the internal controls over financial reporting, including the possibility
financial controls system over financial reporting and of collusion or improper management override of
their operating effectiveness. Our audit of internal controls, material misstatements due to error or fraud
financial controls over financial reporting included may occur and not be detected. Also, projections of any
obtaining an understanding of internal financial controls evaluation of the internal financial controls over financial
over financial reporting, assessing the risk that a material reporting to future periods are subject to the risk that
weakness exists, and testing and evaluating the design the internal financial control over financial reporting may
and operating effectiveness of internal control based become inadequate because of changes in conditions,
on the assessed risk. The procedures selected depend or that the degree of compliance with the policies or
on the auditor’s judgment, including the assessment of procedures may deteriorate.
the risks of material misstatement of the Ind AS financial
statements, whether due to fraud or error. Opinion
In our opinion, the Holding Company, its subsidiary
We believe that the audit evidence we have obtained is companies, its associates and its joint venture, which are
sufficient and appropriate to provide a basis for our audit companies incorporated in India, have, in all material
opinion on the Company’s internal financial controls respects, an adequate internal financial controls system
system over financial reporting. over financial reporting and such internal financial
controls over financial reporting were operating
Meaning of Internal Financial Controls over effectively as at 31 March 2017, based on the internal
Financial Reporting control over financial reporting criteria established by
A company’s internal financial control over financial the Company considering the essential components of
reporting is a process designed to provide reasonable internal control stated in the Guidance Note on Audit
assurance regarding the reliability of financial reporting of Internal Financial Controls Over Financial Reporting
and the preparation of financial statements for external issued by the ICAI.
purposes in accordance with generally accepted
accounting principles. A company’s internal financial Other Matter
control over financial reporting includes those policies Our aforesaid reports under section 143(3)(i) of the Act on
and procedures that the adequacy and operating effectiveness of the internal
financial controls over financial reporting in so far as it
(1) p
ertain to the maintenance of records that, in reasonable relates to two subsidiary companies, two associate and
detail, accurately and fairly reflect the transactions and one joint venture, which are companies incorporated
dispositions of the assets of the company; in India, is based on the corresponding reports of the
auditors of such companies incorporated in India
(2) provide reasonable assurance that transactions
are recorded as necessary to permit preparation of For S.C. Vasudeva & Co,
financial statements in accordance with generally Chartered Accountants
accepted accounting principles, and that receipts Firm Reg. No.000235N
and expenditures of the company are being
made only in accordance with authorizations of
(Sanjiv Mohan)
management and directors of the company; and
Partner
M. No. 086066
(3) provide reasonable assurance regarding prevention
Ludhiana
or timely detection of unauthorized acquisition, use,
10th May, 2017
169
FINANCIAL STATEMENTS
(Amount in Lakhs)
Note As at As at As at
Particulars
No. 31st March 2017 31st March 2016 1st April 2015
ASSETS
1 Non-current assets
(a) Property, Plant and Equipment 3(a) 257,132.13 260,333.22 260,267.68
(b) Capital work-in-progress 4,902.67 8,601.30 7,932.64
(c) Goodwill 3(c) 1,254.48 1,259.18 1,259.18
(d) Other Intangible Assets 3(b) 674.18 1,108.24 1,393.29
(e) Investment in associates and joint ventures 4(a) 7,516.79 19,896.85 28,182.07
(f) Financial Assets
- Investments 4(b) 85,875.40 95,338.00 49,874.16
- Loans 5 61.97 81.36 87.76
- Others financial assets 6 204.71 1,269.97 12,426.13
(g) Other non-current Assets 7 7,839.34 9,049.21 8,027.87
Total Non-current assets 365,461.67 396,937.33 369,450.78
2 Current assets
(a) Inventories 8 175,280.68 192,512.48 175,740.07
(b) Financial Assets
- Investments 9 93,439.88 16,027.77 27,658.48
- Trade receivables 10 73,349.58 77,759.39 82,017.73
- Cash and cash equivalents 11 4,228.68 21,536.43 6,332.10
- Bank Balance other than above 11A 236.37 6,350.11 11,669.55
- Loans 12 2,971.30 3,033.43 3,702.56
- Other financial assets 13 4,960.52 5,352.15 4,102.10
(c) Current tax assets (net) 2,125.80 1,302.93 493.20
(d) Other current assets 14 29,599.89 30,518.73 31,551.13
Total Current assets 386,192.70 354,393.42 343,266.92
Total Assets 751,654.37 751,330.75 712,717.70
Equity and Liabilities
Equity
(a) Equity Share capital 15 5,490.53 6,091.91 6,091.91
(b) Other Equity 16 421,831.90 393,896.90 351,600.43
(c) Non-controlling interests
- Equity Share capital 2,562.75 2,931.50 2,931.50
- Other Equity 8,655.89 7,373.29 8,145.32
Total Equity 438,541.07 410,293.60 368,769.16
Liabilities
1 Non-current liabilities
(a) Financial Liabilities
- Borrowings 17 74,270.02 103,972.03 133,475.34
- Other financial liabilities 18 48.78 19.12 1,299.49
(b) Provisions 19 969.22 635.54 769.77
(c) Deferred tax liabilities (Net) 20 27,118.77 23,774.26 22,932.38
(d) Other non-current liabilities 21 2,103.04 2,049.78 2,167.27
Total Non-current liabilities 104,509.83 130,450.73 160,644.25
2 Current liabilities
(a) Financial Liabilities
- Borrowings 22 106,632.17 103,075.47 60,716.20
- Trade payables 23 24,515.22 18,033.07 19,645.55
- Other financial liabilities 24 61,787.17 75,291.37 90,355.62
(b) Other current liabilities 25 15,203.75 13,640.98 11,897.43
(c) Provisions 26 465.16 545.53 689.49
Total Current liabilities 208,603.47 210,586.42 183,304.29
Total Equity and Liabilities 751,654.37 751,330.75 712,717.70
The accompanying notes are integral part of these financial statements
As per our report of even date For and on behalf of the Board of Directors
For S. C. Vasudeva & Co.,
Chartered Accountants
Firm Regn. No.: 000235N
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10.05.2017
170
CONSOLIDATED ANNUAL REPORT 2016-17
(Amount in Lakhs)
Note For the year ended For the year ended
Particulars
No. 31st March 2017 31st March 2016
I. Revenue from operations 27 606,676.59 589,527.50
II. Other income 28 49,152.00 11,048.59
III. Total income (I+II) 655,828.59 600,576.09
Expenses :
Cost of materials consumed 29 301,580.33 279,846.53
Purchases of stock-in-trade 30 539.50 1,859.83
Changes in inventories of finished goods, work-in-progress and stock-in-trade 31 (9,081.82) 1,007.10
Employee benefits expense 32 47,884.72 43,379.47
Finance costs 33 9,294.99 8,886.41
Depreciation and amortization expense 3 34,339.74 37,424.85
Other expenses 34 143,162.91 145,803.61
IV. Total Expenses 527,720.37 518,207.80
V. Profit before non controlling interests and share of profit of associate and 128,108.22 82,368.29
joint venture (III-IV)
VI. Share of profit of associates/ joint ventures 3,685.53 4,783.49
VII. Profit before tax (V+VI) 131,793.75 87,151.78
VIII. Tax expense:
(1) Current tax 30,263.40 23,897.60
(2) Deferred tax 3,342.30 842.54
(3) Mat Credit Entitlement (1,239.63) 4.20
IX. Profit for the year (VII-VIII) 99,427.68 62,407.44
X. Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss
-Remeasurements of the defined benefits plans (61.29) 14.25
-Gain on Fair Valuation of Equity instruments carried at Fair Value through 6.35 -
Other Comprehensive Income
-Share of other comprehensive income from associate/ joint venture (9.32) 13.61
(ii) Income tax relating to items that will not be reclassified to profit or loss 18.94 (4.70)
B (i) Items that will be reclassified to profit or loss - -
(ii) Income tax relating to items that will be reclassified to profit or loss - -
(45.32) 23.16
Total Comprehensive Income for the year (IX+X) 99,382.36 62,430.60
Profit attributable to:
- Owners of the parent 98,141.44 61,459.31
- Non-controlling interest 1,286.24 948.13
99,427.68 62,407.44
Other Comprehensive Income attributable to:
- Owners of the parent (41.69) 21.05
- Non-controlling interest (3.63) 2.11
(45.32) 23.16
Total Comprehensive Income attributable to:
- Owners of the parent 98,099.75 61,480.36
- Non-controlling interest 1,282.61 950.24
99,382.36 62,430.60
Earnings per equity share 42
Basic - Par value of ` 10 per share 163.10 100.89
Diluted - Par value of ` 10 per share 163.10 100.89
The accompanying notes are integral part of these financial statements
As per our report of even date For and on behalf of the Board of Directors
For S. C. Vasudeva & Co.,
Chartered Accountants
Firm Regn. No.: 000235N
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10.05.2017
171
FINANCIAL STATEMENTS
(Amount in Lakhs)
For the year ended For the year ended
31st March 2017 31st March 2016
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before Exexceptional items and tax 131,793.75 87,151.78
Adjustments for :
Depreciation and amortisation 34,339.74 37,424.85
Income from associates (3,685.53) (4,783.49)
Interest expense 11,622.01 13,272.73
Fair Valuation Gain on Investments (9,967.74) (5,683.13)
Subsidy Income (189.33) (154.20)
Prepayments of Leasehold land 8.15 23.48
Interest income (3,121.66) (5,592.29)
Dividend income (1,462.11) (1,069.99)
(Profit)/Loss on sale of Assets(Net) (6,415.33) (745.31)
(Profit)/Loss on sale of Investments (Net) (28,109.57) (469.27)
Provision no longer required written Back(Net) (360.71) 542.38
Amortisation of Processing Charges 92.75 92.86
Fixed assets written off 438.35 21.22
Bad debts written off 358.75 33.81
Allowances for doubtful trade receivables and advances 274.44 118.97
written back
(6,177.79) 33,032.62
Changes in Working capital 125,615.96 120,184.40
Adjustments for :
(Increase)/Decrease in Trade and other Receivables 5,845.83 11,011.61
(Increase)/Decrease in Inventories 18,374.22 (16,355.52)
Increase/(Decrease) in Trade Payables and other Liabilities 10,279.47 1,513.41
34,499.52 (3,830.50)
Cash generated from Operations 160,115.48 116,353.90
Net income tax paid (30,865.96) (30,865.96) (24,844.50) (24,844.50)
Net cash flow from/ (used in) operating activities 129,249.52 91,509.40
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed Assets (30,994.04) (38,881.22)
Proceeds from sale of Fixed Assets 8,654.85 1,219.62
Purchase of Investments (108,748.38) (49,876.32)
Proceeds from sale of Investments 90,333.75 22,823.41
Interest received 4,971.69 4,342.83
Dividend received 1,462.11 15,230.49
Net Cash used in investing activities (34,320.02) (45,141.19)
172
CONSOLIDATED ANNUAL REPORT 2016-17
(Amount in Lakhs)
For the year ended For the year ended
31st March 2017 31st March 2016
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds/ (Repayment) from Long Term Borrowings(Net) (41,812.67) (45,542.92)
Proceeds/ (Repayment) from Short Term Borrowings(Net) 3,884.69 45,935.38
Proceeds/ (Repayment) from Equity Share Capital (68,838.80) -
Dividend Paid (including taxes) (93.11) (23,287.94)
Interest Paid (11,491.10) (13,587.84)
Net Cash flow from/(used in) Financing Activities (118,350.99) (36,483.32)
Net Increase in cash and cash equivalents (23,421.48) 9,884.89
Cash and cash equivalents at the beginning of the year 27,886.54 18,001.65
Cash and cash equivalents at the end of the year 4,465.06 27,886.54
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10.05.2017
173
(Amount in Lakhs)
174
As at 31st March 2017 As at 31st March 2016
Particulars (Amount in (Amount in
Number Number
Lakhs) Lakhs)
Equity Share Capital
Balance at the beginning of reporting period 62,517,879 6,251.79 62,517,879 6,251.79
Own shares (Refer Note) (1,598,741) (159.88) (1,598,74) (159.88)
Net issued Share Capital at beginning of reporting period 60,919,138 6,091.91 60,919,138 6,091.91
Changes in equity share capital
Buyback of shares (including of 1,36,539 number of shares held through trust) (6,013,803) (601.38) - -
Balance at the closing of reporting period 54,905,335 5,490.53 60,919,138 6,091.91
Other Equity
(Amount in Lakhs)
Reserves & Surplus Equity Other items Total
Capital Capital Statutory Securities General Retained instruments of other
Particulars reserve Redemption Reserve U/s premium Reserve Earnings through other comprehensive
Reserve 45 IC of RBI comprehensive income
income
Balance as at 01 April 2016 2,152.47 - 367.70 20,990.54 195,557.08 174,525.38 282.68 21.05 393,896.90
Profit for the year 98,141.44 98,141.44
Other comprehensive income for the (41.69) (41.69)
year
Total Comprehensive Income for the 98,141.44 (41.69) 98,099.76
year
Transfer to Statutory Reserve & Capital (2,085.52) (2,085.52)
redemption reserve on account of
buyback of equity shares
Transfer from Retained Earnings 195.03 195.03
Transfer from Retained Earnings on 1,890.50 1,890.50
account of buyback of equity shares
Premium on buy back of shares (Net of (20,990.54) (49,174.21)
`| 1448.21 Lakhs of premium relating to (70,164.76)
own shares held through trust)
Balance as at 31 March 2017 2,152.47 1,890.50 562.73 - 146,382.87 270,581.29 282.68 (20.64) 421,831.90
Balance as at 01 April 2015 2,152.47 - 296.20 20,990.54 195,557.08 132,321.46 282.68 - 351,600.43
Profit for the year 61,459.31 61,459.31
Other comprehensive income for the 21.05 21.05
year
Total Comprehensive Income for the 61,459.31 21.05 61,480.36
year
Amount transferred from surplus in 71.50 71.50
statement of profit and loss
Amount transferred to statutory reserve (71.50) (71.50)
from statement of profit and loss
Interim Dividend on equity for financial (9,547.78) (9,547.78)
year 2015-16 (Amount per share ` 15)
Equity Dividend for the financial year (6,365.18) (6,365.18)
2014-15 (Amount ` 10 per share)
Dividend tax on dividend from associates (2,244.89) (2,244.89)
Dividend distribution tax (net of Non- (1,026.04) (1,026.04)
controlling interest)
Consolidated Statement of Changes in Equity
FINANCIAL STATEMENTS
Balance as at 31 March 2016 2,152.47 - 367.70 20,990.54 195,557.08 174,525.38 282.68 21.05 393,896.90
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
175
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
operating policy decisions of the investee, estimates could change from period to
but is not control or joint control over those period. Actual results could differ from those
policies. estimates. Appropriate changes in estimates
are made as management becomes aware
A joint venture is a type of joint arrangement of changes in circumstances surrounding the
whereby the parties that have joint control estimates. Changes in estimates are reflected
of the arrangement have rights to the net in the financial statements in the period in
assets of the joint venture. Joint control is the which changes are made. Differences between
contractually agreed sharing of control of an actual results and estimates are recognised
arrangement, which exists only when decisions in the period in which the results are known/
about the relevant activities require unanimous materialised.
consent of the parties sharing control.
(d) Revenue Recognition
The investment in associate and joint venture Revenue is recognised at the fair value of the
is accounted for using the equity method in the consideration received or receivable. The
consolidated financial statements. amount disclosed as revenue is inclusive of
excise duty and net of returns, trade discounts,
Under the equity method, the investments value added tax and amount collected on
are initially recognised at cost and adjusted behalf of third parties.
thereafter to recognise the group’s share of the
post-acquisition profits or losses of the investee The company recognizes revenue when the
in profit and loss, and the group’s share of other amount of revenue can be measured reliably
comprehensive income of the investee in other and it is probable that the economic benefits
comprehensive income. Dividends received or associated with the transaction will flow to the
receivable from associates and joint ventures entity.
are recognised as a reduction in the carrying
amount of the investment. (i) Sales of goods
Revenue from the sale of goods is recognised
Unrealised gains on transactions between the when the significant risks and rewards of
group and its associates and joint ventures are ownership of the goods are transferred to the
eliminated to the extent of the group’s interest buyer and the entity retains neither continuing
in these entities. Unrealised losses are also managerial involvement to the degree usually
eliminated unless the transaction provides associated with ownership nor effective control
evidence of an impairment of the asset over the goods sold.
transferred.
(ii) Services
(c) Use of Estimates and Judgements Revenue from the sale of services is recognised
The preparation of the financial statements in on the basis of the stage of completion. When
conformity with Ind AS requires management to the contract outcome cannot be measured
make estimates, judgments and assumptions. reliably, revenue is recognised only to the
These estimates, judgments and assumptions extent that the expenses incurred are eligible
affect the application of accounting policies to be recovered.
and the reported amounts of assets and
liabilities, the disclosures of contingent assets (iii) Export Incentives
and liabilities at the date of the financial Revenue in respect of the export incentives is
statements and reported amounts of revenues recognized on post export basis.
and expenses during the period. Accounting
176
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
177
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
Freehold land is carried at cost. All other items of profit and loss. Assets to be disposed off are
of Property, plant and equipment are stated at reported at the lower of the carrying value or
cost, less accumulated depreciation. The Cost the fair value less cost to sell.
of an item of Property, Plant and Equipment
comprises: (g) Intangible Assets
Intangible assets are stated at cost less
(a) its purchase price including import duties and accumulated amount of amortization.
non-refundable purchase taxes after deducting
trade discounts and rebates. Intangible assets are amortized over their
respective individual estimated useful lives on
(b) any attributable expenditure directly a straight-line basis, from the date that they
attributable for bringing an asset to the location are available for use. The estimated useful life
and the working condition for its intended use of an identifiable intangible asset is based on
and a number of factors including the effects of
obsolescence, etc. The amortization method
(c) the initial estimate of the costs of dismantling and useful lives are reviewed periodically at
and removing the item and restoring the site on end of each financial year.
which it is located, the obligation for which an
entity incurs either when the item is acquired (h) Inventories
or as a consequence of having used the item Inventories are valued at cost or net realizable
during a particular period for purposes other value, whichever is lower. The cost in respect
than to produce inventories during that period. of the various items of inventory is computed
as under:
Depreciation is provided on Straight Line
Method on the basis of useful lives of such In case of raw materials at weighted
assets specified in Schedule II to the Companies average cost plus direct expenses. The
Act, 2013 except the assets costing ` 5,000/- cost includes cost of purchase and other
or below on which depreciation is charged @ costs incurred in bringing the inventories
100% per annum on proportionate basis. to their present location and condition.
Advances paid towards the acquisition of In case of stores and spares at weighted
property, plant and equipment outstanding average cost plus direct expenses. The
at each balance sheet date is also classified cost includes cost of purchase and other
as capital advances under other non-current costs incurred in bringing the inventories
assets and the cost of assets not put to use to their present location and condition.
before such date are disclosed under ‘Capital
work-in-progress’. In case of work in progress at raw material
cost plus conversion costs depending
Subsequent expenditures relating to property, upon the stage of completion.
plant and equipment is capitalized only when
it is probable that future economic benefits In case of finished goods at raw material
associated with these will flow to the Company cost plus conversion costs, packing cost,
and the cost of the item can be measured excise duty (if applicable) and other
reliably. Repairs and maintenance costs are overheads incurred to bring the goods to
recognized in net profit in the statement their present location and condition.
of profit and loss when incurred. The cost
and related accumulated depreciation are (i) Borrowing Costs
eliminated from the financial statements upon Borrowing costs that are directly attributable
sale or retirement of the asset and the resultant to the acquisition, construction or production
gains or losses are recognized in the statement
178
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
of a qualifying asset are capitalized as part of to be paid to or recovered from the tax
the cost of the asset. Other borrowing costs authorities, using the tax rates and tax laws that
are recognized as an expense in the period have been enacted or substantively enacted
in which they are incurred. Borrowing costs by the balance sheet date. Deferred income
consist of interest and other costs that an entity tax assets and liabilities are recognized for all
incurs in connection with the borrowing of temporary differences arising between the tax
funds. Borrowing cost also includes exchange base of assets and liabilities and their carrying
differences to the extent regarded as an amounts in the financial statements except
adjustment to the borrowing costs. when the deferred income tax arises from the
initial recognition of an asset or liability in a
(j) Earnings per Share transaction that is not a business combination
Basic earnings per equity share is computed and affects neither accounting nor taxable
by dividing the net profit attributable to the profit or loss at the time of the transaction.
equity holders of the company by the weighted Deferred tax assets and liabilities are reviewed
average number of equity shares outstanding at each reporting date and are reduced to the
during the period. Diluted earnings per equity extent that it is no longer probable that the
share is computed by dividing the net profit related tax benefit will be realized.
attributable to the equity holders of the
company by the weighted average number Deferred income tax assets and liabilities are
of equity shares considered for deriving measured using tax rates and tax laws that
basic earnings per equity share and also the have been enacted or substantively enacted
weighted average number of equity shares by the balance sheet date and are expected to
that could have been issued upon conversion apply to taxable income in the years in which
of all dilutive potential equity shares. The those temporary differences are expected to
dilutive potential equity shares are adjusted be recovered or settled. The effect of changes
for the proceeds receivable had the equity in tax rates on deferred income tax assets and
shares been actually issued at fair value (i.e. liabilities is recognized as income or expense
the average market value of the outstanding in the period that includes the enactment or
equity shares). Dilutive potential equity shares the substantive enactment date. A deferred
are deemed converted as of the beginning income tax asset is recognized to the extent
of the period, unless issued at a later date. that it is probable that future taxable profit
Dilutive potential equity shares are determined will be available against which the deductible
independently for each period presented. temporary differences and tax losses can be
utilized. The Company offsets current tax assets
(k) Income Taxes and current tax liabilities, where it has a legally
Income tax expense comprises current tax and enforceable right to set off the recognized
deferred tax. Income tax expense is recognized amounts and where it intends either to settle
in net profit in the statement of profit and on a net basis, or to realize the asset and settle
loss except to the extent that it relates to the liability simultaneously.
items recognized directly in equity or other
comprehensive income, in which case it is also Minimum Alternate Tax credit is recognised as
recognized in equity or other comprehensive deferred tax asset only when and to the extent
income respectively. there is convincing evidence that the Company
will pay normal income tax during the specified
Current income tax for current and prior period. Such asset is reviewed at each Balance
periods is recognized at the amount expected Sheet date and the carrying amount of the MAT
credit asset is written down to the extent there
179
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
180
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
181
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
182
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
the assets exceeds the estimated recoverable (s) Cash flow statement
amount of the asset. An impairment loss is The cash flow statement is prepared in
reversed in the statement of profit and loss if accordance with the Indian Accounting
there has been a change in the estimates used Standard (Ind AS) - 7 “Statement of Cash
to determine the recoverable amount. The flows” using the indirect method for operating
carrying amount of the asset is increased to its activities.
revised recoverable amount, provided that this
amount does not exceed the carrying amount (t) Provisions
that would have been determined (net of any A provision shall be recognised when:
accumulated amortization or depreciation) (a) an entity has a present obligation as a result of
had no impairment loss been recognized for a past event;
the asset in prior years.
(b) it is probable that an outflow of resources
(r) Cash and cash equivalents embodying economic benefits will be required
The Cash and cash equivalent in the balance to settle the obligation; and
sheet comprise cash at banks and on hand and
short-term deposits with a maturity period of (c) a reliable estimate can be made of the amount
three months or less from the balance sheet of the obligation.
date, which are subject to an insignificant risk
of changes in value. If the effect of the time value of money is
material, provisions are discounted using
a current pre-tax rate that reflects, when
appropriate, the risks specific to the liability.
When discounting is used, the increase in
the provision due to the passage of time is
recognised as a finance cost.
183
3(a). Property, Plant and Equipment
184
(Amount in Lakhs)
Original Cost Depreciation and Amortization Net Block
Balance Additions Disposals Other Balance Balance Depreciation Eliminated Other Balance Balance Balance
as at adjustments as at 31st as at expense for on disposal adjustments as at as at as at
Particulars
1st April, March, 1st April, the year of assets 31st 31st 31st
2015 2016 2015 March, March, March,
Notes
2016 2016 2015
Tangible Assets:
Free-hold Land 6,240.02 238.23 5.16 (151.15) 6,624.24 - - - - - 6,624.24 6,240.02
Buildings 91,727.35 6,082.63 28.95 28.29 97,752.74 22,024.98 2,728.73 11.37 32.52 24,709.82 73,042.92 69,702.37
Plant and Equipment 459,847.67 30,372.13 3,166.83 1,884.17 485,168.80 278,196.53 33,487.21 2,783.22 1,226.34 307,674.18 177,494.62 181,651.14
Furniture and Fixtures 2,279.23 192.30 4.55 42.72 2,424.26 1,509.91 176.87 3.12 38.30 1,645.37 778.89 769.32
Vehicles 1,532.08 286.24 177.65 (0.22) 1,640.89 605.72 173.82 133.17 0.02 646.35 994.54 926.36
Office equipment 3,022.40 871.56 16.57 140.91 3,736.48 2,050.19 429.74 15.66 120.25 2,344.02 1,392.46 972.21
Computer equipment 45.18 3.76 - - 48.94 38.92 4.47 - - 43.39 5.55 6.26
Total 564,693.93 38,046.85 3,399.71 1,944.72 597,396.35 304,426.25 37,000.84 2,946.54 1,417.43 337,063.13 260,333.22 260,267.68
(Amount in Lakhs)
Original Cost Depreciation and Amortization Net Block
Balance Additions Disposals Other Balance Balance Depreciation/ Eliminated Other Balance Balance Balance
Particulars as at adjustments as at 31st as at amortisation on disposal adjustments as at 31st as at 31st as at 31st
1st April, March, 2017 1st April, expense for of assets Refer note- March, March, March,
2015 2016 the year 32 2017 2017 2016
Tangible Assets:
Free-hold Land 6,624.24 1,949.68 89.33 (217.93) 8,702.51 - - - - - 8,702.51 6,624.24
Buildings 97,752.74 6,776.14 1,143.08 540.17 102,845.63 24,709.82 3,016.11 643.72 158.96 26,923.25 75,922.38 73,042.92
Plant and Equipment 485,168.80 22,000.93 11,908.31 1,997.70 493,263.72 307,674.18 29,989.49 9,857.55 3,071.92 324,734.20 168,529.52 177,494.62
Furniture and Fixtures 2,424.26 441.75 32.13 634.06 2,199.82 1,645.37 146.41 17.82 423.34 1,350.62 849.20 778.89
Vehicles 1,640.89 300.53 122.45 12.75 1,806.22 646.35 187.84 80.09 1.37 752.73 1,053.49 994.54
Office equipment 3,736.48 885.16 18.69 913.62 5,516.57 2,344.02 536.49 10.95 (591.58) 3,461.14 2,055.43 1,392.46
Computer equipment 48.94 14.56 10.31 - 53.19 43.39 -* 9.79 - 33.60 19.59 5.55
Total 597,396.35 32,368.75 13,324.29 2,053.14 614,387.66 337,063.13 33,876.34 10,619.92 3,064.00 357,255.54 257,132.13 260,333.22
#Includes ` 248.20 lac (Previous Year ` 248.20 lac) cost of Residential flats at Mandideep, the land cost of which has not been excluded from this cost. The depreciation
for the year has been taken on the entire cost of ` 248.20 lac (Previous Year ` 248.20 lac).
Freehold land includes ` Nil (Previous Year ` 31.00 lac) for the cost of land at Baddi, (Himachal Pradesh) for which title deeds are yet to be executed in favour of the
Company, though the possession thereof has been taken by the company.
forming part of financial statements for the year ended 31st March, 2017
- Depreciation for the year includes net depreciation of ` Nil (Previous year (-) 57.73 Lakhs) pertaining to earlier years.
FINANCIAL STATEMENTS
3(b). Other Intangible Assets
(Amount in Lakhs)
Original Cost Depreciation and Amortization Net Block
Balance Additions Disposals Other Balance Balance Depreciation/ Eliminated Other Balance Balance Balance
Particulars as at adjustments as at 31st as at amortisation on disposal adjustments as at 31st as at 31st as at 31st
1st April, March, 2017 1st April, expense for of assets March, March, March,
CONSOLIDATED
(Amount in Lakhs)
Original Cost Depreciation and Amortization Net Block
Balance Additions Disposals Other Balance Balance Depreciation/ Eliminated Other Balance Balance Balance
Particulars as at adjustments as at 31st as at amortisation on disposal adjustments as at 31st as at 31st as at 31st
1st April, March, 1st April, expense for of assets March, March, March,
2015 2016 2015 the year 2016 2016 2015
Intangible Assets:
Computer Softwares 1,758.10 74.97 - - 1,833.07 814.26 227.32 - - 1,041.58 791.49 943.84
Contribution to - 64.00 - - 64.00 - 46.40 - - 46.40 17.60 -
CETP
Right to use Power 1,812.51 - - - 1,812.51 1,363.06 150.30 - - 1,513.36 299.15 449.45
lines
Total 3,570.61 138.97 - - 3,709.58 2,177.32 424.02 - - 2,601.34 1,108.24 1,393.29
185
ANNUAL REPORT 2016-17
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
3 (c) Goodwill
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Carrying Value at the beginning 1,259.18 1,259.18 1,259.18
Additions - - -
Disposal 4.70 - -
Carrying Value at the end 1,254.48 1,259.18 1,259.18
186
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
187
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
1,00,00,000 (31 March 2016:1,00,00,000 1st April 2015: Nil) 1,128.34 1,030.32 -
units of ` 10/- each of UTI Fixed Term Income Fund Series
XXIII-VII (1098 Days) Direct Growth Plan
3,00,00,000 (31 March 2016:3,00,00,000 1st April 2015: Nil) 3,293.52 3,011.70 -
units of ` 10/- each of Kotak FMP Series 191 Direct Growth
1,00,00,000 (31 March 2016:1,00,00,000 1st April 2015: Nil) 1,095.93 1,001.80 -
units of ` 10/- each of ICICI Prudential FMP Series 78-1115
Days Plan X Direct Plan Cumulative
2,50,00,000(31 March 2016:2,50,00,000 1st April 2015: Nil) 2,749.77 2,506.63 -
units of ` 10/- each of HDFC FMP 1114D Direct Growth
2,50,00,000 (31 March 2016:2,50,00,000 1st April 2015: Nil) 2,732.38 2,500.00
units of ` 10/- each of SBI Debt Fund Series- B -36(1131
Days)- Direct Growth
188
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
189
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
190
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
1. Aggregate amount of quoted investments 85,253.39 94,722.35 49,258.51
2. Aggregate Market Value of quoted investments 85,253.39 94,722.35 49,258.51
3. Aggregate amount of unquoted investments 622.01 615.66 615.66
# Investments having maturity period of less than 12 months from 31st March 2017 i.e. the balance sheet date have been reclassified as ‘ Current
Investment’ as per the requirement of Schedule III of the Companies Act, 2013
191
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
8 Inventories
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
(at cost or net realisable value, whichever is lower)
Raw materials (includes in transit ` 9,791.35 Lakhs 31st March 99,176.65 125,228.44 107,795.08
2016 ` 3,868.90 Lakhs,
1st April 2015 ` 5,596.05 Lakhs)
Work-in-progress 14,321.85 11,404.43 12,312.21
Finished Goods 47,885.44 41,721.04 42,156.30
Stores and Spares (includes in transit ` 1,469.44 Lakhs 31st 13,991.24 14,339.91 14,134.08
March 2016 ` 1,292.39 Lakhs
1st April 2015 ` 1,023.51 Lakhs)
Trading goods in transit (Fibre) - 484.37 425.02
Less: Unrealised profit on consolidation 94.50 665.71 1,082.62
Total 175,280.68 192,512.48 175,740.07
9 Investments (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Financial assets measured at fair value through Profit
and loss
(i) Investment in Bonds/ Preference shares/ Debentures
(quoted)
10,00,000 (31 March 2016: Nil 1st April 2015: Nil) 3% 1,000.00 - -
cumulative compulsorily convertible Preference Shares of
` 100/- each of TATA Motors Finance Ltd.
5,00,000 (31 March 2016: 5,00,000 1st April 2015: Nil) 500.05 502.80
Preference Shares of ` 100/- each of L& T
Redemable Preference Shares
1,500 (31 March 2016:Nil 1st April 2015: Nil)Principal 1,500.00 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of ECL Finance limited
1,000 (31 March 2016:Nil 1st April 2015: Nil) Principal 1,110.72 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of ECL Finance limited
996 (31 March 2016:Nil 1st April 2015: Nil)Secured 988.53 - -
Redeemable Non convertible Principal protected market
linked debentures of ` 1,00,000/- each of Reliance Capital Ltd
1,500 (31 March 2016:Nil 1st April 2015: Nil)Principal 1,590.21 - -
protected Market Linked redeemable Non Convertible
Debentures of ` 1,00,000/- each of IIFL wealth Finance limited
100 (31 March 2016:Nil 1st April 2015: Nil) Bonds of 1,013.74 - -
` 1,000,000/- each of 7.17% National Highway Authority of
India 23 DEC 2021*
192
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
193
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
194
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
195
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
196
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
197
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
10 Trade receivables
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Receivable from related parties
- Unsecured, considered good 212.69 435.75 -
Receivable from others
- Unsecured, considered good 73,136.89 77,323.64 82,017.73
- Doubtful 501.62 207.60 23.63
Less: Allowances for doubtful trade receivables 501.62 207.60 23.63
Total 73,349.58 77,759.39 82,017.73
198
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
12 Loans (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Financial assets at amortized cost
Loans to related parties
Others 2,699.12 2,788.99 3,472.69
Loan to employees 272.18 244.44 229.87
Total 2,971.30 3,033.43 3,702.56
199
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period :
During the year ended March 31, 2017 the amount (d) Shares held by holding company or its ultimate
of dividend recognised as distributions to equity holding company or subsidiaries or associates of the
shareholders is Nil (Previous Year: ` 15 per share). holding company or the ultimate holding company
in aggregate.
In the event of liquidation of the company, the
holders of equity shares will be entitled to receive There is no holding /ultimate holding company of
any of the remaining assets of the company, the Company.
after distribution of all preferential amounts. The
distribution will be in proportion to the number of
equity shares held by the shareholders
200
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(e) The Board of Directors of the Company at its Exchange(s). During the year, the Company had
meeting held on 24th September, 2016 approved bought back and extinguished 62,60,869 Equity
the buyback of upto 62,60,869 fully paid up equity Shares (inclusive of 1,10,527 shares held by
shares of ` 10 each, at a price not exceeding Subsidiary) of ` 10 each at a price of ` 1150.00
` 1,175 payable in cash,through the Tender Offer Consequently, ` 626.08 Lakhs were transferred to
route, upto an aggregate amount not exceeding Capital Redemption Reserve as per requirements of
` 720 crore from the open market through Stock section 69 of Companies Act, 2013.
(f) Aggregate number and class of shares alloted as fully paid up pursuant to contract(s) without payment
being received in cash, bonus shares and shares bought back for the period of five years immediately
preceding the reporting date.
201
16 Other Equity
202
(Amount in Lakhs)
Reserves & Surplus
Equity
Capital Capital Statutory Securities General Retained Other items
instruments Total
reserve Redemption Reserve premium Reserve Earnings of other
Particulars through other
Reserve U/s 45 IC comprehensive
comprehensive
income
Notes
of RBI income
Balance as at 01 April 2016 2,152.47 - 367.70 20,990.54 195,557.08 174,525.38 282.68 21.05 393,896.90
Profit for the year 98,141.44 98,141.44
Other comprehensive income for (41.69) (41.69)
the year
Total Comprehensive Income for 98,141.44 (41.69) 98,099.75
the year
Transfer to Statutory Reserve & (2,085.52) (2,085.52)
Capital redemption reserve on
account of buyback of equity shares
Transfer from Retained Earnings 195.03 195.03
Transfer from Retained Earnings on 1,890.50 1,890.50
account of buyback of equity shares
Premium on buy back of shares (Net of (20,990.54) (49,174.21) (70,164.76)
` 1448.21 Lakhs of premium relating to
own shares held through trust)
Balance as at 31 March 2017 2,152.47 1,890.50 562.73 - 146,382.87 270,581.29 282.68 (20.64) 421,831.90
Balance as at 01 April 2015 2,152.47 - 296.20 20,990.54 195,557.08 132,321.46 282.68 - 351,600.43
Profit for the year 61,459.31 61,459.31
Other comprehensive income for 21.05 21.05
the year
Total Comprehensive Income for 61,459.32 21.05 61,480.36
the year
Amount transferred from surplus in 71.50 71.50
statement of profit and loss
Amount transferred to statutory (71.50) (71.50)
reserve from statement of profit
forming part of financial statements for the year ended 31st March, 2017
and loss
Interim Dividend on equity for (9,547.78) (9,547.78)
financial year 2015-16 (Amount per
share ` 15)
Equity Dividend for the financial year (6,365.18) (6,365.18)
2014-15 (Amount ` 10 per share)
Dividend tax on dividend from (2,244.89) (2,244.89)
associates
Dividend distribution tax (net (1,026.04) (1,026.04)
of Non-controlling interest)
Balance as at 31 March 2016 2,152.47 - 367.70 20,990.54 195,557.08 174,525.38 282.68 21.05 393,896.90
FINANCIAL STATEMENTS
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
203
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
22 Borrowings (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Working capital loans
- From banks (secured) 102,759.89 96,537.09 59,358.38
- From banks (unsecured) 3,872.29 6,538.38 1,357.82
Total 106,632.17 103,075.47 60,716.20
204
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
23 Trade payables
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Total outstanding dues of micro enterprises and small 49.93 65.96 34.27
enterprises (refer note 43)
Due to related parties 475.89 18.55 111.14
Due to others 23,989.40 17,948.56 19,500.14
Total 24,515.22 18,033.07 19,645.55
# Unpaid dividends do not include any amount due and outstanding required to be credited to the Investors’ Education and Protection Fund
205
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
26 Provisions (Current)
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Provision for employee benefits :
Leave encashment 198.79 152.20 114.79
Gratuity (refer note 51) 266.37 393.33 574.70
Total 465.16 545.53 689.49
28 Other income
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Dividend income from investments carried at fair value through Profit and Loss 1,636.43 1,069.99
Net gain on sale of investments carried at fair value through Profit and Loss 2,885.80 1,005.66
Gain on Sale of investment in Joint Venture (refer note 56) 25,223.77 -
Claims received (net of expenses) 169.44 153.01
Provisions no longer required written back 360.71 212.22
Capital Subsidy 189.33 154.20
Interest Income on employee loans 11.82 11.51
Gain on Fair valuation of Investments carried at fair value through Profit & Loss 9,967.74 5,683.13
Net gain on disposal of property, plant and equipment 6,415.33 745.31
Miscellaneous 2,291.63 2,013.56
Total 49,152.00 11,048.59
206
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
30 Purchases of Stock-in-trade:
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Fabric 3.04 101.10
Yarn 29.01 1,755.91
Others 507.45 2.82
Total 539.50 1,859.83
33 Finance costs
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Interest expense (net) (Refer Note 49) 7,960.09 7,674.39
Other borrowing costs 1,334.90 1,212.02
Total 9,294.99 8,886.41
207
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
34 Other expenses
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
Power and fuel 59,612.79 64,376.50
Consumption of stores and spare parts 3,925.06 3,693.93
Packing materials and charges 8,186.81 8,229.32
Dyes and Chemical consumed 18,783.03 19,656.86
Rent 229.01 223.97
Repairs and maintenance to buildings 3,639.20 2,520.57
Repairs and maintenance to machinery 16,788.98 15,215.82
Insurance 691.84 716.23
Rates and taxes 476.96 427.19
Auditors remuneration:
Audit fee 41.08 38.54
Tax audit fee 10.06 9.54
Reimbursement of expenses 13.38 12.53
In other capacity 5.23 13.85
Bad debts written off 358.75 33.81
Excise duty consumed on sale of goods 3,249.62 3,566.23
Allowances for doubtful trade receivables and advances (Net of written back) 274.44 118.97
Forwarding charges and octroi 9,463.13 8,659.80
Commission to selling agents 5,051.20 5,140.50
Assets Written off 438.35 21.22
Prior period items (net) (Refer Note 48) 141.05 280.55
Rebate and discount 1,019.87 1,123.92
Miscellaneous (Refer Note 50) 10,763.07 11,723.76
Total 143,162.91 145,803.61
35. First time adoption of Ind AS restating its Indian GAAP financial statements as at
This financial statement is the first financial 1st April 2015 and financial statements as at and for
statement that has been prepared in accordance the year ended 31st March 2016 in accordance with
with Ind AS together with the comparative period Ind AS 101.
data as at and for the year ended 31st March
2016, as described in the summary of significant Exemptions applied
accounting policies. The transition to Ind AS has Ind AS 101 allows first-time adopters certain
been carried out in accordance with Ind AS 101– exemptions from the retrospective application of
‘First time adoption of Indian Accounting Standards’ certain requirements under Ind AS. The Company
with 1st April 2015 as the transition date. has, accordingly, applied following exemptions:
This note explains the exemptions availed by the a) The Company has elected to consider carrying
company on first time adoption of Ind AS and the amount of all items of property, plant and
principal adjustments made by the Company in equipments measured as per Indian GAAP as
208
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
209
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
210
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
211
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
on account of applicability of Ind AS. Accordingly, in the balance sheet and its tax base. Further, the
investment and the share of profit in associates and application of Ind AS has resulted in recognition of
joint ventures will also change in the consolidated deferred tax on certain temporary differences which
financial statements. This has resulted increase was not required under Indian GAAP. Accordingly,
in investment in associates and Joint ventures deferred tax adjustments have been recognised
amounting to ` 127.80 Lakhs and 2119.46 Lakhs as in correlation to the underlying transactions in
on 31st March 2016 and 1st April 2015 respectively. retained earnings/OCI in accordance with Ind AS.
This has also resulted in decrease in profit and OCI This has resulted in decrease in retained earnings
for the year ended 31st March 2016 with ` 24.91 of ` 3207.53 Lakhs and ` 1450.62 Lakhs as at
Lakhs and 5.19 Lakhs respectively 31st March 2016 and 1st April 2015 respectively.
This has also resulted in decrease in net profit of
13. Deferred tax ` 1757.56 Lakhs for the year ended 31st March 2016
Under Indian GAAP, deferred tax was recognized with a corresponding adjustment in ‘Deferred tax
for the temporary timing differences which focus on liability’.
differences between taxable profits and accounting
profits for the period. Ind AS requires entities to 14. Statement of cash flows
account for deferred taxes using the balance sheet The transition from Indian GAAP to Ind AS has not
approach, which focuses on temporary differences had a material impact on statement of cash flows.
between the carrying amount of an asset or liability
212
35 (a) Reconciliation of Equity as on 31st March 2016 and 1st April 2015
(Amount in Lakhs)
As at 31st March 2016 As at 1st April 2015
GAAP GAAP
ventures * JV) ventures * JV)
Notes
ASSETS A B C=A+B D E=C+D A B C=A+B D E=C+D
Non-current assets
(a) Property, Plant 1,6 284,390.08 (24,024.71) 260,365.36 (32.14) 260,333.22 284,024.31 (23,826.34) 260,197.97 69.72 260,267.68
and Equipment
(b) Capital work-in- 9,429.77 (828.47) 8,601.30 - 8,601.30 8,323.54 (390.90) 7,932.64 - 7,932.64
progress
(c) Goodwill 1,259.18 1,259.18 - 1,259.18 1,259.18 - 1,259.18 - 1,259.18
(d) Other Intangible 1,687.64 (579.40) 1,108.25 1,108.24 2,249.27 (855.97) 1,393.30 - 1,393.29
Assets
(e) Investment in 12 941.77 18,827.28 19,769.05 127.80 19,896.85 778.28 25,284.33 26,062.61 2,119.46 28,182.07
associates and
joint ventures
(f) Financial Assets
-Investments 2 88,548.49 (2,717.38) 85,831.11 9,506.89 95,338.00 45,701.06 (217.69) 45,483.37 4,390.80 49,874.16
-Loans 3 91.84 (5.31) 86.53 (5.17) 81.36 100.19 (6.47) 93.72 (5.96) 87.76
-Others financial 1,269.97 - 1,269.97 - 1,269.97 12,403.57 22.55 12,426.13 - 12,426.13
assets
(g) Other non-current 1,3 7,811.35 (701.11) 7,110.24 1,938.98 9,049.20 7,117.38 (1,052.72) 6,064.65 1,963.21 8,027.87
Assets
Total Non-current 395,430.09 (10,029.10) 385,400.98 11,536.36 396,937.33 361,956.77 (1,043.21) 360,913.56 8,537.23 369,450.77
assets
Current assets
(a) Inventories 205,629.32 (13,116.84) 192,512.48 - 192,512.48 191,575.32 (15,835.26) 175,740.07 - 175,740.07
(b) Financial Assets
-Investments 2 23,703.39 (8,500.45) 15,202.94 824.83 16,027.77 40,382.47 (12,981.79) 27,400.69 257.78 27,658.48
-Trade receivables 11 82,573.34 (13,621.00) 68,952.34 8,807.06 77,759.39 80,951.20 (12,658.45) 68,292.75 13,724.98 82,017.73
-Cash and cash 24,587.13 (3,050.70) 21,536.43 - 21,536.43 8,606.11 (2,274.01) 6,332.10 - 6,332.10
equivalents
-Bank Balance other 6,350.11 - 6,350.11 - 6,350.11 11,669.55 - 11,669.55 - 11,669.55
forming part of financial statements for the year ended 31st March, 2017
than above
-Loans 3 1,873.93 1,171.88 3,045.81 (12.39) 3,033.43 2,809.10 905.54 3,714.64 (12.07) 3,702.56
-Other financial 5,531.21 (179.06) 5,352.15 - 5,352.15 4,324.98 (222.87) 4,102.10 - 4,102.10
assets
(c) Current tax assets 1,132.24 170.68 1,302.92 - 1,302.93 581.49 (88.29) 493.20 - 493.20
(net)
(d) Other current 1,3,10 34,079.86 (2,168.50) 31,911.36 (1,392.63) 30,518.73 34,986.34 (2,042.26) 32,944.08 (1,392.95) 31,551.13
assets
Total Current assets 385,460.55 (39,294.00) 346,166.55 8,226.87 354,393.42 375,886.57 (45,197.40) 330,689.17 12,577.74 343,266.92
TOTAL ASSETS 780,890.64 (49,323.11) 731,567.53 19,763.23 751,330.75 737,843.34 (46,240.61) 691,602.73 21,114.97 712,717.70
EQUITY AND
LIABILITIES
Equity
(a) Equity Share 10 6,251.79 (0.00) 6,251.79 (159.87) 6,091.91 6,251.79 6,251.79 (159.87) 6,091.91
213
ANNUAL REPORT 2016-17
capital
(Amount in Lakhs)
214
As at 31st March 2016 As at 1st April 2015
liabilities (net)
Total Current 221,081.25 (19,263.11) 201,818.13 8,768.29 210,586.42 189,647.39 (11,412.84) 178,234.55 5,069.72 183,304.29
liabilities
TOTAL EQUITY AND 780,890.64 (49,323.11) 731,567.53 19,763.24 751,330.76 737,843.34 (46,240.61) 691,602.73 21,114.97 712,717.70
LIABILITIES
* Under Indian GAAP, investment in two companies i.e. Vardhman Yarns and Threads Ltd. and Vardhman Nisshinbo Garments Company Limited were considered as
investments in subidiaries. However under Ind AS, these companies have been considered as Joint ventures. Accordingly all assets and liabilities pertaining to Joint
ventures which were consolidated line by line in Indian GAAP are excluded and investment in Joint ventures has been accounted using the equity method.
Note: The figures of Indian GAAP have been reclassified to confirm to presentation requirements of Division II of Schedule III of Companies Act, 2013 as applicable to a
company whose financial statements are required to be drawn up in compliance of the (Indian Accounting Standards) Rules, 2015
FINANCIAL STATEMENTS
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
35 (b) Reconciliation of Total Comprehensive Income for the year ended March 31, 2016
(Amount in Lakhs)
Income
As per and As per
Note Ind AS As per Ind
Indian Expenses Indian
Particulars No. Adjustments AS
GAAP of Joint GAAP
ventures *
A B C=A+B D E=C+D
Revenue from operations (net) 9 666,451.78 (80,445.95) 586,005.83 3,521.67 589,527.50
Other income 2,3,6 5,874.81 (675.59) 5,199.22 5,849.37 11,048.59
Share of profit of associates/ joint ventures 12 163.49 4,644.89 4,808.38 -24.89 4,783.49
I. Total revenue 672,490.08 (76,476.65) 596,013.43 9,346.15 605,359.58
II. Expenses :
Cost of materials consumed 301,887.02 (22,040.49) 279,846.53 - 279,846.53
Purchases of stock-in-trade 1,891.45 (31.62) 1,859.83 - 1,859.83
Changes in inventories of finished goods, 3,183.39 (2,176.29) 1,007.10 - 1,007.10
work-in-progress and stock-in-trade
Employee benefits expense 3,8 51,665.34 (8,312.15) 43,353.19 26.28 43,379.47
Finance costs 5 9,774.55 (875.12) 8,899.43 -13.02 8,886.41
Depreciation and amortization 1,6 40,180.29 (2,857.26) 37,323.03 101.83 37,424.85
Other expenses 1,4,9 173,520.19 (31,729.00) 141,791.19 4,012.41 145,803.60
Total Expenses 582,102.23 (68,021.93) 514,080.30 4,127.50 518,207.80
- - -
III. Profit/(loss) before tax (I-II) 90,387.85 (8,454.72) 81,933.12 5,218.64 87,151.78
IV. Tax expense: - -
(1) Current tax 8 28,237.32 (4,330.82) 23,906.50 -4.70 23,901.80
(2) Deferred tax 13 (1,000.78) 85.75 (915.03) 1,757.58 842.54
V. Profit (Loss) for the period (III-IV) 63,151.31 (4,209.65) 58,941.66 3,465.77 62,407.44
VI. Other Comprehensive Income - -
A. Items that will not be reclassified to - -
profit or loss
-Remeasurements of the defined benefits 8 - - 14.25 14.25
plans
-Gain on Fair Valuation of Equity - - -
instruments carried at FVOCI
-Share of other comprehensive income 12 18.80 18.80 -5.19 13.61
from associate/ joint venture
Income tax relating to items that will not be 8 - - -4.70 (4.70)
reclassified to profit or loss
B. Items that will be reclassified to profit - -
or loss
Income tax relating to items that will be - -
reclassified to profit or loss
VII. Total Comprehensive Income for the 63,151.31 (4,190.85) 58,960.46 3,470.13 62,430.60
period (V+VI)
* Under Indian GAAP, investment in two companies i.e. Vardhman Yarns and Threads Ltd. and Vardhman Nisshinbo Garments Company Limited were
considered as investments in subidiaries. However under Ind AS, these companies have been considered as Joint ventures. Accordingly all incomes
and expenses pertaining to Joint ventures which were consolidated line by line in Indian GAAP are excluded and share in total comprehensive income
in Joint ventures has been accounted using the equity method.
215
36 (a) Financial Instruments by Category
216
(a) The carrying value and fair value of financial instruments at the end of each reporting period is as follows:
As at 31st March 2017
(Amount in Lakhs)
Notes
At Cost At At fair value through At fair value through OCI Total Total Fair
Amortized profit or loss carrying value
cost Designated Mandatory Equity Mandatory value
Particulars upon initial instruments
recognition designated
upon initial
recognition
Assets:
Investments (Non Current) (Refer 85,253.39 622.01 - 85,875.40 85,875.40
Note 4)
Loans (Non Current) (Refer Note 5) 61.97 61.97 61.97
Other financial non-current assets 204.71 204.71 204.71
(Refer Note 6)
Investments (Current) (Refer Note 9) 93,439.88 93,439.88 93,439.88
Trade receivables (Refer Note 10) 73,349.58 73,349.58 73,349.58
Cash and Cash Equivalents (Refer 4,228.68 4,228.68 4,228.68
Note 11)
Other Bank Balances (Refer Note 236.37 236.37 236.37
11A)
Loans (Current) (Refer Note 12) 2,971.30 2,971.30 2,971.30
Other financial assets (Current) 3,443.89 1,516.62 4,960.52 4,960.52
(Refer Note 13)
Total - 84,496.50 - 180,209.90 622.01 - 265,328.41 265,328.41
Liabilities:
Borrowings (Non Current) (Refer - 74,270.02 74,270.02 74,270.02
forming part of financial statements for the year ended 31st March, 2017
Note 17)
Other financial liabilities (Non 48.78 48.78 48.78
Current) (Refer Note 18)
Borrowings (Current) (Refer Note 106,632.17 106,632.17 106,632.17
22)
Trade Payables (Refer Note 23) 24,515.22 24,515.22 24,515.22
Other financial liabilities (Current) 61,787.17 61,787.17 61,787.17
(Refer Note 24)
Total - 267,253.37 - - - - 267,253.37 267,253.37
FINANCIAL STATEMENTS
As at 31st March 2016
(Amount in Lakhs)
At Cost At At fair value through At fair value through OCI Total Total Fair
Amortized profit or loss carrying value
CONSOLIDATED
cost value
Notes
Designated Mandatory Equity Mandatory
Particulars upon initial instruments
recognition designated
upon initial
recognition
Assets:
Investments (Non Current) 94,722.34 615.66 95,338.00 95,338.00
(Refer Note 4)
Loans (Non Current) (Refer 81.36 81.36 81.36
Note 5)
Other financial non-current 1,269.97 1,269.97 1,269.97
assets (Refer Note 6)
Investments (Current) (Refer 16,027.77 16,027.77 16,027.77
Note 9)
Trade receivables (Refer 77,759.39 77,759.39 77,759.39
Note 10)
Cash and Cash Equivalents 21,536.43 21,536.43 21,536.43
(Refer Note 11)
Other Bank Balances (Refer 6,350.11 6,350.11 6,350.11
Note 11A)
Loans (Current) (Refer 3,033.43 3,033.43 3,033.43
Note 12)
Other financial assets 5,352.15 5,352.15 5,352.15
(Current) (Refer Note 13)
Total - 115,382.84 - 110,750.12 615.66 - 226,748.61 226,748.61
forming part of financial statements for the year ended 31st March, 2017
Liabilities:
Borrowings (Non Current) 103,972.03 103,972.03 103,972.03
(Refer Note 17)
Other financial liabilities (Non 19.12 19.12 19.12
Current) (Refer Note 18)
Borrowings (Current) (Refer 103,075.47 103,075.47 103,075.47
Note 22)
Trade Payables (Refer Note 23) 18,033.07 18,033.07 18,033.07
Other financial liabilities 75,056.06 235.31 75,291.37 75,291.37
(Current) (Refer Note 24)
Total - 300,155.75 - 235.31 - - 300,391.06 300,391.06
217
ANNUAL REPORT 2016-17
As at 1st April 2015
218
(Amount in Lakhs)
At Cost At At fair value through At fair value through OCI Total Total Fair
Amortized profit or loss carrying value
cost value
Designated Mandatory Equity Mandatory
Notes
Particulars upon initial instruments
recognition designated
upon initial
recognition
Assets:
Investments (Non Current) 49,258.51 615.66 49,874.16 49,874.16
(Refer Note 4)
Loans (Non Current) (Refer 87.76 87.76 87.76
Note 5)
Other financial non-current 12,426.13 12,426.13 12,426.13
assets (Refer Note 6)
Investments (Current) (Refer - 27,658.48 27,658.48 27,658.48
Note 9)
Trade receivables (Refer Note 82,017.73 82,017.73 82,017.73
10)
Cash and Cash Equivalents 6,332.10 6,332.10 6,332.10
(Refer Note 11)
Other Bank Balances (Refer 11,669.55 11,669.55 11,669.55
Note 11A)
Loans (Current) (Refer Note 3,702.56 3,702.56 3,702.56
12)
Other financial assets 4,102.10 4,102.10 4,102.10
(Current) (Refer Note 13)
Total - 120,337.92 - 76,916.98 615.66 - 197,870.56 197,870.56
forming part of financial statements for the year ended 31st March, 2017
Liabilities: - -
Borrowings (Non Current) 133,475.34 133,475.34 133,475.34
(Refer Note 17)
Other financial liabilities (Non 30.69 1,268.80 1,299.49 1,299.49
Current) (Refer Note 18)
Borrowings (Current) (Refer 60,716.20 60,716.20 60,716.20
Note 22)
Trade Payables (Refer Note 23) 19,645.55 19,645.55 19,645.55
Other financial liabilities 89,462.64 892.98 90,355.62 90,355.62
(Current) (Refer Note 24)
Total - 303,330.41 - 2,161.78 - - 305,492.20 305,492.20
FINANCIAL STATEMENTS
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices)
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable
inputs).
(ii) The following table presents fair value hierarchy of assets and liabilities measured at fair value:
As at 31st March 2017
(Amount in Lakhs)
Fair Value measurement using
Particulars Fair Value
Level 1 Level 2 Level 3
Long term Investments
Fair Value through OCI (Equity instruments designated 622.01 622.01
upon initial recognition)
Fair Value through Profit and Loss 85,253.39 85,253.39
Current Investments
Fair Value through Profit and Loss 93,439.88 3,416.19 90,023.69
Other financial current assets
-Derivative financial instruments 1,516.62 1,516.62
219
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
37. Contingent liabilities and Commitments (to the extent not provided for):-
I. Contingent liabilities
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 1st April, 2015
Contingent Liabilities
Claims not acknowledged as debts 436.37 1,020.77 827.69
Bank Guarantees and Letters of Credit outstanding 11,757.30 6,623.17 10,832.04
Other monies for which the company is contingently liable
a) The Company has contested the additional demand as the company has filed various appeals with the
in respect of Sales Tax, Excise Duty etc., amounting appellate authorities and the company is confident
to ` 1133.72 Lakhs (31.03.2016 ` 1745.07 Lakhs, to get the desired relief.
01.04.2015 ` 1698.58 Lakhs). As against this a
sum of ` 134.61 Lakhs (31.03.2016 ` 165.95 Lakhs, c) The company had taken over the textile undertaking
01.04.2015 ` 170.14 Lakhs) has been deposited of Vardhman Holdings Limited (formerly known
under protest and stands included under the head as Vardhman Spinning & General Mills Limited)
“Balance with government authorities in note-14 – by a scheme of Arrangement and De-merger. An
Other Current Assets “. The Company has filed an injunction was obtained against the London Branch
appeal with the Appellate Authorities and is advised of the said textile undertaking for preventing
that the demand is not in accordance with law. No disposal of assets upto the value of Pound Sterling
provision, therefore, has been made in accounts in 2.99 Lakhs as a result of a court case pending in
respect thereof. London for alleged non-fulfilment of an agreement of
cotton purchase. The said matter had been decided
b) The Company has contested the additional demand against the said textile undertaking and accordingly,
in respect of income tax amounting to ` 18296.44 Pound Sterling 0.48 Lakhs lying in the bank account
Lakhs (31.03.2016 ` 18346.15 Lakhs, 01.04.2015 at London had been paid to the claimant pursuant
` 17480.88 Lakhs). Provision of ` 15683.93 to the Order of the Court. The said amount was
Lakhs (31.03.2016 ` 15709.65 Lakhs, 01.04.2015 written off in the books of the said undertaking by
` 14821.69 Lakhs) in this respect has not been made way of debit to the statement of Profit and Loss. No
220
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
provision has been made for the balance decreed amount by the undertaking in view of the fact that the said
undertaking was prevented by force majure in fulfiling its part of contract. The Company as successor to the textile
undertaking is contesting this matter in Indian Courts and is confident that there would not be any further liability
in this regard.
II. Commitment
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 01st April, 2015
Estimated amount of contracts remaining to be executed 8,187.20 7,187.40 12,284.06
on Capital Account and not provided for (net of advances)
Exports obligations under Export Promotion Capital 17,312.46 51,854.36 52,063.36
Goods (EPCG) scheme#
#The Company has executed bonds for an aggregate amount of ` 101304.77 Lakhs (31.03.2016 ` 122888.68 Lakhs, 01.04.2015 ` 94274.63
Lakhs) in favour of the President of India under section 59 (2) and 67 of the Customs Act,1962 and Central Excise and salt Act, 1944 for
fulfilment of the obligation under the said Acts. However, ` 17312.46 Lakhs (31 March 2016: ` 51854.36 Lakhs, 1 April 2015: ` 52063.36 Lakhs) is
outstanding to be discharged against these bonds.
38. Amortisation of Intangible assets the year in terms of buy back announced by
a. Softwares have been amortised @ 25% on the company. During the year the value of
straight line basis as the useful life has been remaining shares has been adjusted by debit
estimated to be not more than four years. to equity & retained earnings in accordance
with IND AS 32.
b. Right to use power lines have been amortised
@ 20% on straight line basis as the useful life (b) The aforesaid Trust is also holding 3,19,748
thereof has been estimated to be not more equity shares (31.03.2016- 3,19,748) of ` 10
than five years. each of VSSL which were allotted to it in the
capacity of a shareholder of the company by
c. Contribution to CETP has been amortised @ virtue of ‘Scheme of Arrangement & Demerger’
20% on straight line basis as the useful life entered into by the company, Vardhman
thereof has been estimated to be not more Special Steels Limited and their respective
than five years. shareholders and creditors.
39. (a) The Company was holding its own 15,98,741 As the aforesaid shares are held by a Trust on
(31.03.2016- 15,98,741) equity shares of ` 10 behalf of the company and company not being
each through a Trust, which were received by registered owner of shares, the cost of these
it in its capacity as a shareholder of Vardhman shares is not reflected in Investments but same
Holdings Limited, in accordance with the has been valued at cost as reflected in other
‘Scheme of Arrangement and Demerger’. Out current asset..
of above 1,36,539 shares were tendered during
221
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(c) The detail of the amount recoverable from Mahavir Share Trust as at the close of the year is as under:
(Amount in Lakhs)
As at As at As at
Particulars
31st March, 2017 31st March, 2016 01st April, 2015
Cost of Shares (VTXL) 1,306.32 1,428.30 1,428.30
Cost of Shares (VSSL) 357.10 357.10 357.10
Other recoverable 2.48 2.99 2.60
Total 1,665.90 1,788.41 1,788.02
The amount recoverable on account of equity shares of VTXL held by the trust has been reduced from equity
share capital & retained earnings.
40. Segment Information as required by Ind AS- 108 ‘Operating Segments’ on Segment Reporting as compiled on the
basis of the consolidated financial statements is disclosed below :
The company has identified two segments as reportable segments viz textiles and fibre
(Amount in Lakhs)
Textiles Fibre Unallocated Total
Current Previous Current Previous Current Previous Current Previous
Year Year Year Year Year Year Year Year
REVENUE
External sales 5,86,529.21 5,67,666.20 19,905.30 21,539.19 242.08 322.11 6,06,676.59 5,89,527.50
Inter-segment sales 6.20 - 16,878.10 23,220.01 27,846.10 25,615.02 44,730.40 48,835.03
Other income 8,706.25 6,076.56 2,239.45 2,154.89 66.29 60.42 11,011.99 8,291.87
Total revenue 5,95,241.66 5,73,742.76 39,022.85 46,914.09 28,154.47 25,997.55 6,62,418.98 6,46,654.40
RESULT
Segment results 93,994.79 81,268.98 5,749.82 6,176.98 9,472.78 5,614.96 1,09,217.39 93,060.92
Unallocated Corporate (31,871.32) (2,977.26)
Expenses (Net)
Operating profit 1,41,088.71 96,038.18
Interest expense 9,294.98 8,886.40
Income tax - Current 30,263.39 23,897.59
- Mat Credit entitlement (1,239.63) 4.20
- Deferred 3,342.30 842.54
- Fringe benefit -
Profit from ordinary 99,427.67 62,407.45
activities
Extraordinary loss / -
(income)
Net profit 99,427.68 62,407.44
OTHER INFORMATION
Segment assets 4,96,397.02 5,25,088.16 39,185.99 39,533.08 17,423.25 18,397.11 5,53,006.26 5,83,018.35
222
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
Textiles Fibre Unallocated Total
Current Previous Current Previous Current Previous Current Previous
Year Year Year Year Year Year Year Year
Unallocated Corporate 1,98,527.75 1,68,312.39
Assets
Total assets 4,96,397.02 5,25,088.16 39,185.99 36,901.28 17,423.25 19,729.95 7,51,534.01 7,51,330.74
Segment Liabilities 45,918.02 41,583.00 7,498.01 4,012.00 3,212.06 3,141.18 56,628.09 48,736.18
Unallocated Corporate 5,528.03 5,499.82
Liabilities
Total liabilities 45,918.02 41,583.00 7,498.01 5,112.61 3,212.06 1,765.34 62,156.12 54,236.00
Capital expenditure 29,838.46 39,928.00 109.07 569.18 3.72 123.47 29,951.25 40,620.65
Depreciation & 32,701.96 35,701.45 460.62 441.62 656.59 779.21 33,819.17 36,922.28
Amortisation
Non-cash expenses - - - - -
other than depreciation
& amortisation
41. In accordance with Ind AS-36 on “Impairment of Assets” the Company has assessed as on the balance sheet date,
whether there are any indications with regard to the impairment of any of the assets. Based on such assessment
it has been ascertained that no potential loss is present and therefore, formal estimate of recoverable amount
has not been made. Accordingly no impairment loss has been provided in the books of account
223
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
Particulars 31.03.2017 31.03.2016
Net Profit after tax attributable to equity shareholders 98,141.44 61,459.32
Total (A) 98,141.44 61,459.32
Weighted average number of equity shares (No in lac) 601.71 609.12
Total (B) 601.71 609.12
Basic earning per Share (`) (A)/(B) 163.10 100.89
Diluted earning per Share (`) * (A)/(B) 163.10 100.89
Face value per equity share (`) 10.00 10.00
* There are no potential equity shares
43. The Company owes dues of ` Nil (previous year ` 4.47 Lakhs) towards Micro and Small Enterprises, which are
outstanding for more than 45 days as at 31st March, 2017. This information as required to be disclosed under
the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties
have been identified on the basis of information available with the company
44. Leases :
The Company has leased facilities under cancellable and non-cancellable operating leases arrangements with
a lease term ranging from one to five years, which are subject to renewal at mutual consent thereafter. The
cancellable arrangements can be terminated by either party after giving due notice. The lease rent expenses
recognised during the year amounts to ` 177.00 Lakhs (31.03.2016 ` 172.06 Lakhs). The future minimum lease
payments in respect of the non-cancellable operating leases are:
(Amount in Lakhs)
Particulars 31-Mar-17 31-Mar-16
Within one year 154.46 145.02
After one year but not more than five years 333.00 332.29
More than five years 4,491.99 4,559.03
224
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
225
(b) Description of the nature of transactions with the related parties :-
226
(Amount in Lacs)
Enterprises over
Relative of Man-
Key Manangement which KMP is able
Associates Joint Venture agement Person- Total Total
Personnel (KMP) to exercise signifi- Notes
Particulars nel (KMP)
cant influence
Current Previous Current Previous Current Previous Current Previous Current Previous Current Previous
Year Year Year Year Year Year Year Year Year Year Year Year
Purchase/processing of 1,082.54 518.00 5.96 2.90 - - - - - - 1,088.50 520.91
goods
Purchase of DEPB 6.55 - - - - - - - - - 6.55 -
licences
Sale/processing of goods 670.75 508.43 1,398.36 1,602.38 - - - - - - 2,069.11 2,110.81
Sale of DEPB licences 368.53 - - - - - - - - - 368.53
Purchase of fixed assets 2,821.63 0.99 - - - - - - - - 2,821.63 0.99
Sale of fixed assets 6,356.78 45.90 1.59 - - - - - - 6,358.37 45.90
Donation paid - - - - - - - - 418.66 472.00 418.66 472.00
Rent paid 0.10 - - - - - - - 9.81 9.61 9.91 9.61
Reimbursement of 484.70 758.26 15.71 59.67 - - - - - - 500.41 817.94
expenses paid
Reimbursement of 590.89 793.05 3.41 2.20 - - - - - - 594.30 795.24
expenses received
Receipt against corporate 420.44 422.87 2.85 2.85 - - - - - - 423.29 425.72
service agreement*
Payment against licence - - - - - - - - 156.00 154.04 156.00 154.04
agreement
Interest paid - 0.03 - - - - - - - - - 0.03
Interest received 117.56 71.50 92.30 97.03 - - - - - - 209.86 168.53
Rent received 34.41 22.51 - - - - - - - - 34.41 22.51
Dividend received - 10,873.00 - - - - - - - - - 10,873.00
Dividend paid - - - - - - - - - 9,277.33 - 9,277.33
KMP Rmuneration - - - - 3,183.44 2,169.45 - - - - 3,183.44 2,169.45
forming part of financial statements for the year ended 31st March, 2017
Notes
forming part of financial statements for the year ended 31st March, 2017
227
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(c) Reconciliation of tax expense and the Profit before tax multiplied by statutory tax rate :
(Amount in Lakhs)
Particulars Current year Previous year
Accounting profit before tax 1,31,793.75 87,151.78
Tax at statutory income tax rate of 34.608% / 23.072% (31 March 2016: 44,836.45 29,649.04
34.608%)
Tax effect of the amounts not deductible for computing taxable income
Depreciation difference (400.12) 185.45
Disallowances (3,655.33) 962.45
Deductions/Exemption (6,285.99) (7,291.77)
MAT Credit Entitlement (1,239.63) 4.20
Adjustment in capital gain under Income Tax Provision (3,686.77) -
Fair valuation Gain on investments 3,547.65 1,929.65
MTM Gain on forex fluctuation - (189.66)
43B Disallowances (426.73) (420.43)
Provision for Doubtful Debt (94.97) (44.62)
Others (228.49) (39.97)
Income tax expense 32,366.07 24,744.34
47. Disclosure required by Regulation 34 read with Schedule V of SEBI (Listing obligations and Disclosure Requirements)
Regulations,2015:-
(i) The Company has given inter corporate deposits aggregating to ` Nil (31.03.2016 ` 4,700 Lakhs, 01.04.2015
` 65,079 Lakhs) to M/s Vardhman Special Steels Limited. The maximum amount outstanding during the year
was ` 1,500 Lakhs (31.03.2016 ` 1,954.57 Lakhs, 01.04.2015 ` 6,535.74 Lakhs). The Balance outstanding as
on 31.03.2017 is ` 1,500 Lakhs (31.03.2016 ` 1,500 Lakhs, 01.04.2015 ` 2,554.57 Lakhs).
(ii) The Company has given inter corporate deposits aggregating to ` 200 Lakhs (31.03.2016 ` 681.00 Lakhs,
01.04.2015 ` 1,636 Lakhs) to M/s Vardhman Nisshinbo Garments Company Limited during the year. The
maximum amount outstanding during the year was ` 1199.12 Lakhs (31.03.2016 ` 1,199.12 Lakhs, 01.04.2015
` 1,187.62 Lakhs). The Balance outstanding as on 31.03.17 is ` 1199.12 Lakhs(31.03.2016 ` 1,199.12 Lakhs,
01.04.2015 ` 918.12 Lakhs).
(iii) The Company has given inter corporate deposits aggregating to ` Nil (31.03.2016 ` NIL, 01.04.2015 ` 2,621.00
Lakhs) to M/s Vardhman Yarns and Threads Limited during the year. The maximum amount outstanding
during the year was ` Nil (31.03.2016 ` NIL, 01.04.2015 ` 861.00 Lakhs). The Balance outstanding as on
31.03.17 is ` Nil (31.03.2016 ` NIL, 01.04.2015 ` NIL).
228
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
For the year ended For the year ended
Particulars
31st March, 2017 31st March, 2016
(i) Related parties 211.16 336.01
(ii) Current investments 1757.18 1,489.48
(iii) Long Term Investments 15.23 179.52
(iv) Deposits and others 1589.15 1657.05
50. In accordance with the provisions of Section 135 of the Companies Act, 2013 the company has paid a sum of
` 592.34 Lakhs (31.03.2016 ` 491.44 Lakhs) towards approved CSR activities. The said amount stands debited to
the “Miscellaneous” under the head “other expenses”.
The following tables set out the disclosures in respect of the gratuity plan as required under Ind AS 19.
229
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
The above liability includes current liability of ` 266.37 Lakhs (previous year ` 393.32 Lakhs)
230
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(h) Principal actuarial assumption at the Balance Sheet Date (expressed as weighted average):
(Amount in Lakhs)
Particulars Current Year Previous Year
Discount Rate (per annum) 7.35% 8.00%
Rate of increase in compensation levels (per annum) 6.00% 6.00%
Expected Average remaining working lives of employees (years) 26.94 26.87
Method Used Projected Unit Projected Unit
Credit Credit
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in employee market.
(i) The quantitative sensitivity analysis on net liability recognized on account of change in significant
assumptions:
(Amount in Lakhs)
Particulars As at 31.03.2017 As at 31.03.2016
Discount Rate
0.50% Increase (221.35) (172.63)
0.50% decrease 240.01 195.44
Future Salary increase 0.00 0.00
0.50% Increase 242.02 198.26
0.50% decrease (209.15) (184.60)
As per Actuarial Certificate, sensitivities due to mortality & withdrawals are not material & hence impact of
change has not been calculated.
(j) The following payments are expected contributions to the defined benefit plan in future years:
(Amount in Lakhs)
Particulars As at 31.03.2017 As at 31.03.2016
Within 1 year 645.84 712.76
1-5 years 1,185.85 1,089.73
Beyond 5 years 3,315.14 2,661.67
Total expected payments 5,146.83 4,464.16
(k) The average duration of the defined benefit plan obligation at the end of the reporting period is
13.65 years (31 March 2016: 14.00 years).
231
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
52. Financial Risk Management The export sales of company comprise around
The principal financial assets of the Company 35% of the total sales of the company, Further
include loans, trade and other receivables, and the company also imports certain assets and
cash and bank balances that derive directly from material from outside India. The exchange
its operations. The principal financial liabilities of rate between the Indian rupee and foreign
the company, include loans and borrowings, trade currencies has changed substantially in recent
and other payables and the main purpose of these years and may fluctuate substantially in the
financial liabilities is to finance the day to day future. Consequently the company is exposed
operations of the company. to foreign currency risk and the results of
the company may be affected as the rupee
The Company is exposed to market risk, credit appreciates/ depreciates against foreign
risk and liquidity risk. The Company’s senior currencies. Foreign exchange risk arises
management oversees the management of these from the future probable transactions and
risks and that advises on financial risks and the recognized assets and liabilities denominated
appropriate financial risk governance framework in a currency other than company’s functional
for the Company. currency.
This note explains the risks which the company is The company measures the risk through a
exposed to and policies and framework adopted by forecast of highly probable foreign currency
the company to manage these risks: cash flows and manages its foreign currency
risk by appropriately hedging the transactions.
Market Risk The Company uses a combination of derivative
Market risk is the risk that the fair value of future financial instruments such as foreign exchange
cash flows of a financial instrument will fluctuate forward and option contracts to mitigate the
because of changes in market prices. Market prices risk of changes in exchange rates on foreign
comprise three types of risk: foreign currency risk, currency exposures.
interest rate risk, investment risk.
The following table summarizes the company’s
(i) Foreign currency risk exposure foreign currency risk from financial
The company operates internationally and instruments at the end of each reporting
business is transacted in several currencies. period:
232
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
233
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
10% Strengthening/weakening of USD against INR 59.86 47.37
10% Strengthening/weakening of Euro against INR 0.42 0.60
10% Strengthening/weakening of CHF against INR 51.36 49.90
10% Strengthening/weakening of GBP against INR - 1.47
10% Strengthening/weakening of JPY against INR 9.44 28.69
As the Company has no significant interest-bearing assets, the income and operating cash flows are substantially
independent of changes in market interest rates. The Company’s exposure to the risk of changes in market
interest rates relates primarily to the Company’s debt obligations with floating interest rates, which are included
in interest bearing loans and borrowings in these financial statements. The company’s fixed rate borrowings are
carried at amortised cost. They are therefore not subject to interest rate risk, since neither the carrying amount
nor the future cash flows will fluctuate because of a change in market interest rates.
At the reporting date the interest rate profile of the Company’s interest bearing financial instrument is at its fair value:
234
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at
Particulars
31st March 2017 31st March 2016
Variable rate instruments
Long term borrowings 74,270.02 1,03,972.03
Current maturities of long term debt 42,933.50 55,979.34
Short term borrowings 1,06,632.17 1,03,075.47
(Amount in Lakhs)
As at As at
Particulars
31st March 2017 31st March 2016
Increase/ (decrease) in 100 basis point 2,238.36 2,630.26
The company manages equity price risk by investing in fixed deposits/Fixed Maturity Plan, debt instruments
and Liquid funds. The company does not actively trade equity investments. Equity investments are mainly
held for strategic rather than trading purposes. Protection principle is given high priority by limiting company’s
investments to AA and higher rated companies and top rated money market instruments only.
Liquidity Risk
The financial liabilities of the company, other than derivatives, include loans and borrowings, trade and other
payables. The company’s principal sources of liquidity are cash and cash equivalents and the cash flow that is
generated from operations.
The company monitors its risk of shortage of funds to meet the financial liabilities using a liquidity planning tool.
The company plans to maintain sufficient cash and marketable securities to meet the obligations as and when
fall due.
235
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
The below is the detail of contractual maturities of the financial liabilities of the company at the end of each
reporting period:
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
Borrowings
0-1 years 1,49,565.67 1,59,054.81
1-5 years 73,430.43 1,03,962.36
More than 5 years 1,025.00 282.00
Trade Payables
0-1 years 24,515.22 18,033.07
1-5 years - -
More than 5 years - -
Other Financial liabilities
0-1 years 18,853.67 19,312.02
1-5 years 48.78 19.12
More than 5 years - -
Credit Risk
Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The
maximum exposure to the credit risk at the reporting date is primarily from trade receivables which are typically
unsecured. Credit risk on cash and bank balances is limited as the company generally invests in deposits with
banks and financial institutions with high credit ratings assigned by credit rating agencies. Investments primarily
include investment in liquid mutual fund units, bonds, fixed maturity plan etc. issued by institutions having
proven track record. The Company’s credit risk in case of all other financial instruments is negligible.
The company assesses the credit risk based on external credit ratings assigned by credit rating agencies. The
company also assesses the creditworthiness of the customers internally to whom goods are sold on credit terms
in the normal course of business. The credit limit of each customer is defined in accordance with this assessment.
Outstanding customer receivables are regularly monitored and any shipments to overseas customers are
generally covered by letters of credit.
The impairment analysis is performed on client to client basis for the debtors that are past due at the end of each
reporting date. The company has not considered an allowance for doubtful debts in case of trade receivables that
are past due but there has not been a significant change in the credit quality and the amounts are still considered
recoverable.
The following is the detail of revenues generated from top five customers of the company and allowance for
lifetime expected credit loss:
236
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
As at As at
Particulars
31 March 2017 31 March 2016
(a) Revenue from top five customers
- Amount of sales 83,411.79 1,00,319.72
-% of total sales 34.33% 40.56%
(b) Allowance for doubtful debt
-Balance at the beginning of the period 202.76 18.79
-Recognized during the year 294.02 183.97
-Amount written off - -
-Balance at the end of the period 496.78 202.76
The maximum exposure to credit risk at the reporting date is the carrying value of trade receivables as disclosed
at Note 10.
The company manages its capital structure and makes adjustments in light of changes in economic conditions
and the requirements of the financial covenants which otherwise would permit the banks to immediately call
loans and borrowings. In order to maintain or adjust the capital structure, the company may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares.
The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The
Company’s gearing ratio was as follows:
(Amount in Lakhs)
Financial Year Financial Year
Particulars
ended 31.03.2017 ended 31.03.2016
Borrowings 2,23,835.69 2,63,026.84
Less: Cash and cash equivalents 4,465.05 27,886.54
Net debt 2,19,370.64 2,35,140.30
Total equity 4,38,541.07 4,10,293.62
Capital and Net debt 6,57,911.71 6,45,433.92
Gearing ratio 33.34% 36.43%
Further, there have been no breaches in the financial covenants of any interest-bearing loans and borrowing in
the current year ended 31st March 2017.
There were no changes in the objectives, policies or processes for managing capital during the year ended 31
March 2017 and 31 March 2016.
237
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
Other
Particulars SBNs* denomination Total
notes
Closing cash in hand as on 8th November 2016 39.42 3.61 43.03
(+) Permitted receipts - 1,07.51 1,07.51
(+) Withdrawal from Banks - 27.26 27.26
(-) Permitted payments - 68.62 68.62
(-) Amount deposited in Bank 39.42 26.26 65.68
Closing cash in hand as on 30th December 2016 - 43.50 43.50
*For the purpose of this clause, the term ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of
India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E) dated 8 November 2016.
238
2. Summarized financial information and performance of Joint venture and associates
(a) Summarized Financial Information
(Amount in Lakhs)
CONSOLIDATED
(ii) Non Financial 604.80 864.84 897.06 7,390.04 15,991.27 5,250.50 1.65 1.40 1.13 4,223.70 4,761.90 6,094.31
Liabilities
Total Current 2,919.47 2,699.62 2,292.25 11,169.87 18,012.17 7,693.65 1.65 1.40 1.13 29,813.81 30,486.69 33,782.79
Liabilities
Total Liabilities 4,780.51 4,989.75 4,628.31 21,742.60 28,722.63 14,897.52 1.65 1.40 1.13 41,459.34 43,465.55 44,294.58
(A+B)
Net Assets (I-II) 533.99 587.87 434.50 45,891.69 35,982.20 52,653.14 11.97 12.03 12.31 19,808.08 17,917.09 17,511.95
239
ANNUAL REPORT 2016-17
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
56. During the financial year 2016-17, the company has sold its 40% equity stake in Vardhman Yarns & Threads
Limited (VYTL), equivalent to 22,802,541 equity shares, to its Joint Venture partner namely American & Efird
Global(A & E) for a consideration of ` 413.01 crore Gain on sale of such investment amounting to ` 252.23 crore
has been shown under the head ‘Other Income’
240
CONSOLIDATED ANNUAL REPORT 2016-17
Notes
forming part of financial statements for the year ended 31st March, 2017
58. For Disclosure mandated by Schedule III of Companies Act 2013, by way of additional information, refer
below:
(Amount in Lakhs)
Net Assets i.e total assets Share in other compre- Share in Total compre-
Share in profit/(loss)
minus total liabilities hensive income hensive income
As % of As % of As % of
Name of Enterprise As % of
consoliated consoliated consoliated
consoliated Amount Amount Amount Amount
profit or profit or profit or
net assets
loss loss loss
Parent
Vardhman Textiles 90.89% 3,98,584.71 100.74% 1,00,159.27 48.02% (21.76) 100.76% 1,00,137.51
Limited
Subsidaries
Indian
Vardhman Arcylics Limited 6.74% 29,541.49 4.13% 4,110.52 25.11% -11.38 4.12% 4,099.14
VMT Spinning Co.Limited 2.38% 10,448.21 0.83% 828.97 6.31% (2.86) 0.83% 826.11
VTL Investment Limited 1.15% 5,055.43 0.98% 975.12 - - 0.98% 975.12
Foreign NIL NIL NIL NIL NIL NIL NIL NIL
Non Controlling Interest 2.56% 11,225.86 1.29% 1286.24 8.01% (3.63) 1.29% 1,282.61
in subsidaries
Associates (Investment
as per the equity
method)
Indian
Vardhman Special Steels 0.41% 1,788.97 0.63% 624.05 16.31% (7.39) 0.62% 616.66
Limited
Vardhman Spinning & 0.00% 6.67 0.00% (0.03) 0.00% - 0.00% (0.03)
General Mills Limited
241
FINANCIAL STATEMENTS
Notes
forming part of financial statements for the year ended 31st March, 2017
(Amount in Lakhs)
Net Assets i.e total assets Share in other compre- Share in Total compre-
Share in profit/(loss)
minus total liabilities hensive income hensive income
As % of As % of As % of
Name of Enterprise As % of
consoliated consoliated consoliated
consoliated Amount Amount Amount Amount
profit or profit or profit or
net assets
loss loss loss
Joint Ventures
(investment as per the
equity method)
Indian
Vardhman Nisshimbo 0.17% 762.33 -0.03% (25.99) 3.29% (1.49) -0.03% (27.48)
Garments Company
Limited
Vardhman Yarns & 1.13% 4958.8 3.11% 3087.5 0.97% (0.44) 3.11% 3087.06
Threads Limited
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10-05-2017
242
CONSOLIDATED ANNUAL REPORT 2016-17
FORM AOC-1 PURSUANT TO SECTION 129(3) OF COMPANIES ACT, 2013 RELATING TO SUBSIDIARY COMPANIES
STATEMENT PURSUANT TO SECTION 129 (3) OF THE COMPANIES ACT, 2013 RELATED TO ASSOCIATE COMPANIES AND JOINT VENTURES
Part B
Name of Associates Vardhman Special Steels Limited
1. Latest audited Balance Sheet Date 31.03.2017
2. Shares of Associate/Joint Ventures held by the company on the
year end
No. 5,825,000
Amount of Investment in Associates/Joint Venture ` 582.50 Lakhs
Extend of Holding % 31.39%
3. Description of how there is significant influence More than 20% shares of Vardhman Special Steels
Limited are held by the Company.
4. Reason why the associate/joint venture is not consolidated -
5. Net worth attributable to Shareholding as per latest audited 6,217.73 lakhs
Balance Sheet
6. Profit / Loss for the year
i. Considered in Consolidation 593.59 lakhs
i. Not Considered in Consolidation N.A.
243
FINANCIAL STATEMENTS
STATEMENT PURSUANT TO SECTION 129 (3) OF THE COMPANIES ACT, 2013 RELATED TO ASSOCIATE COMPANIES AND JOINT VENTURES
Part B
Name of Associates Vardhman Spinning & General Mills Limited
1. Latest audited Balance Sheet Date 31.03.2017
2. Shares of Associate/Joint Ventures held by the company on the
year end
No. 25,000
Amount of Investment in Associates/Joint Venture ` 2.50 Lakhs
Extend of Holding % 50%
3. Description of how there is significant influence More than 20% shares of Vardhman Spinning & General
Mills Limited are held by the Company.
4. Reason why the associate/joint venture is not consolidated 0
5. Net worth attributable to Shareholding as per latest audited 5.98 Lakhs
Balance Sheet
6. Profit / Loss for the year
i. Considered in Consolidation -0.03 Lakhs
i. Not Considered in Consolidation N.A.
STATEMENT PURSUANT TO SECTION 129 (3) OF THE COMPANIES ACT, 2013 RELATED TO ASSOCIATE COMPANIES AND JOINT VENTURES
Part B
Name of Associates Vardhman Yarns and Threads Limited
1. Latest audited Balance Sheet Date 31.03.2017
2. Shares of Associate/Joint Ventures held by the company on the
year end
No. 6,270,699
Amount of Investment in Associates/Joint Venture ` 627.06 Lakhs
Extend of Holding % 11.00%
3. Description of how there is significant influence Joint Venture with American & Efird, Global LLC
4. Reason why the associate/joint venture is not consolidated -
5. Net worth attributable to Shareholding as per latest audited 5,048.09 Lakhs
Balance Sheet
6. Profit / Loss for the year
i. Considered in Consolidation 1,090.04 Lakhs
i. Not Considered in Consolidation N.A.
(Sanjiv Mohan) Karan Kamal Walia Rajeev Thapar Sachit Jain S.P. Oswal
Partner Company Secretary Chief Financial Officer Joint Managing Director Chairman and
M. No. 086066 DIN : 00746409 Managing Director
DIN: 00121737
Place : Ludhiana
Dated: 10.05.2017
244
ANNUAL REPORT 2016-17
Notice
Notice is hereby given that the 44TH ANNUAL GENERAL Managing Director in consultation with the Auditors and
MEETING of Vardhman Textiles Limited will be held on reimbursement of out of pocket expenses incurred by
Friday, the 22nd day of September, 2017 at 09:00 a.m. them for the purpose of audit of the Company.”
at the Registered Office of the Company situated at
Chandigarh Road, Ludhiana, to transact the following SPECIAL BUSINESS:
businesses:- Item No. 5 – Ratification of Method of Valuation of
Options granted under Vardhman Textiles Limited
ORDINARY BUSINESS: Employee Stock Option Plan 2016 under SEBI (Share
Item No. 1 – Adoption of financial statements Based Employee Benefits) Regulations, 2014
To receive, consider and adopt the Audited Balance
Sheet as at 31st March, 2017, Statement of Profit and To consider and if thought fit, to pass, with or without
Loss for the year ended 31st March, 2017, together with modification(s), the following resolution as a Special
Report of the Auditors and Directors thereon. Resolution:-
245
NOTICE
Board of Directors of the Company, to conduct the audit 4. The Members holding shares in physical mode are
of the cost records of the Company for the financial year requested to notify the change in their address,
ending 31st March, 2018, be paid the remuneration of ` if any, at the earliest to the Registrar & Transfer
5,16,880/-. Agent/Company. However, members, holding
shares in electronic mode may notify the change in
RESOLVED FURTHER THAT Mr. S.P. Oswal, Chairman their address, if any, to their respective Depository
& Managing Director and Mr. Rajeev Thapar, Chief Participants.
Financial Officer, be and are hereby severally authorized
to do all acts and take all such steps as may be necessary 5. The information pursuant to Regulation 36 of the SEBI
or expedient to give effect to this resolution.” (Listing Obligations and Disclosure Requirements)
Regulations, 2015 regarding the Director seeking re-
By Order of the Board appointment in the Annual General Meeting is also
being annexed hereto separately and forms part of
Place: Ludhiana (Sanjay Gupta) the Notice. The Director has furnished the requisite
Dated: 11 August, 2017
th
Company Secretary declaration for his re-appointment.
246
ANNUAL REPORT 2016-17
The Members are requested to support this Green on 21st September, 2017 (5:00 p.m.). During
Initiative by registering/ updating their e-mail this period, shareholder’s of the Company,
addresses with the Depository Participant (in case holding shares either in physical form or in
of shares held in dematerialized form) or with dematerialized form, as on the cut-off date
Registrar & Transfer Agent, Alankit Assignments of 15th September, 2017, may cast their vote
Limited, New Delhi (in case of shares held in physical electronically. The e-voting module shall be
form). disabled by CDSL for voting after end of voting
period on 21st September, 2017. Once the vote
10. The Annual Report 2016-17 is being sent through on a resolution is cast by the shareholder, the
electronic mode only to the Members whose shareholder shall not be allowed to change it
email addresses are registered with the Company/ subsequently.
Depository Participant(s), unless any Member has
requested for a physical copy of the report. For (ii) Shareholders who have already voted prior to
members who have not registered their email the meeting date would not be entitled to vote
addresses, physical copies of the Annual Report at the meeting venue.
2016-17 are being sent by permitted mode.
(iii) The shareholders should log on to the e-voting
11. The Securities and Exchange Board of India (SEBI) website www.evotingindia.com.
has mandated the submission of the Permanent
Account Number (PAN) by every participant in (iv) Click on Shareholders.
the securities market. Members holding shares
in electronic form are, therefore, requested to (v) Now Enter your User ID
submit their PAN to their Depository Participant(s).
Members holding shares in physical form are a. For CDSL: 16 digits beneficiary ID,
required to submit their PAN details to the Registrar
and Share Transfer Agent. b. For NSDL: 8 Character DP ID followed by 8
Digits Client ID,
12. Voting through electronic means:
In compliance with the provisions of Section 108 c. Members holding shares in Physical Form
of the Companies Act, 2013 and Rule 20 of the should enter Folio Number registered
Companies (Management and Administration) with the Company.
Rules, 2014, and Regulation 44 of the SEBI
(Listing Obligations and Disclosure Requirements (vi) Next enter the Image Verification as displayed
Regulations), 2015, the Company is pleased to and Click on Login.
provide members a facility to exercise their right
to vote at the 44th Annual General Meeting (AGM) (vii) If you are holding shares in demat form and
by electronic means and the business may be had logged on to www.evotingindia.com and
transacted through e-Voting Services provided by voted on an earlier voting of any company,
Central Depository Services (India) Limited (CDSL). then your existing password is to be used.
247
NOTICE
(viii) If you are a first time user follow the steps given below:
For Members holding shares in Demat Form and Physical Form
PAN Enter your 10 digit alpha-numeric PAN issued by Income Tax Department (Applicable for
both demat shareholders as well as physical shareholders)
Members who have not updated their PAN with the Company/Depository Participant
are requested to use the the first two letters of their name and the 8 digits of the
sequence number in the PAN field. Sequence number is printed on Attendance slip
provided with the Annual report.
In case the sequence number is less than 8 digits enter the applicable number of 0’s
before the number after the first two characters of the name in CAPITAL letters. Eg. If
your name is Ramesh Kumar with sequence number 1 then enter RA00000001 in the
PAN field
Dividend Bank Details Enter the Dividend Bank Details or Date of Birth (in dd/mm/yyyy format) as recorded in your
OR Date of Birth (DOB) demat account or in the company records in order to login.
If both the details are not recorded with the depository or Company please enter the
member id / folio number in the Dividend Bank details field as mentioned in instruction (v).
(ix) After entering these details appropriately, (xiii) On the voting page, you will see “RESOLUTION
click on “SUBMIT” tab. DESCRIPTION” and against the same the
option “YES/NO” for voting. Select the option
(x) Members holding shares in physical form will YES or NO as desired. The option YES implies
then directly reach the Company selection that you assent to the Resolution and option
screen. However, members holding shares NO implies that you dissent to the Resolution.
in demat form will now reach ‘Password
Creation’ menu wherein they are required (xiv) Click on the “RESOLUTIONS FILE LINK” if you
to mandatorily enter their login password in wish to view the entire Resolution details.
the new password field. Kindly note that this
password is also to be used by the demat (xv) After selecting the resolution you have
holders for voting for resolutions of any decided to vote on, click on “SUBMIT”. A
other company on which they are eligible confirmation box will be displayed. If you
to vote, provided that company opts for wish to confirm your vote, click on “OK”, else
e-voting through CDSL platform. It is strongly to change your vote, click on “CANCEL” and
recommended not to share your password accordingly modify your vote.
with any other person and take utmost care
to keep your password confidential. (xvi) Once you “CONFIRM” your vote on the
resolution, you will not be allowed to modify
(xi) For Members holding shares in physical your vote.
form, the details can be used only for
e-voting on the resolutions contained in (xvii) You can also take out print of the voting done
this Notice. by you by clicking on “Click here to print”
option on the Voting page.
(xii) Click on the EVSN: 170819049 for <VARDHMAN
TEXTILES LIMITED> on which you choose (xviii) If Demat account holder has forgotten the
to vote. login password then Enter the User ID and the
image verification code and click on Forgot
Password & enter the details as prompted by
the system.
248
ANNUAL REPORT 2016-17
(xix) Shareholders can also cast their vote using any, should be uploaded in PDF format
CDSL’s mobile app “m-Voting” available for in the system for the scrutinizer to verify
android based mobiles. The m-Voting app can the same.
be downloaded from Google Play Store. Apple
and Windows phone users can download the (xxi) Any person, who acquires shares of the
app from the App Store and the Windows Company and become Member of the
Phone Store, respectively. Please follow the Company after dispatch of the Notice and
instructions as prompted by the mobile app holding shares as on the cut-off date i.e.
while voting on your mobile. 15th September, 2017 may follow the same
instructions as mentioned above for e-Voting.
(xx) Note for Non – Individual Shareholders and
Custodians (xxii) In case you have any queries or issues
regarding e-voting, you may refer the
Non-Individual shareholders (i.e. other Frequently Asked Questions (“FAQs”)
than Individuals, HUF, NRI etc.) and and e-voting manual available at www.
Custodian are required to log on to evotingindia.com, under help section or write
www.evotingindia.com and register an email to helpdesk.evoting@cdslindia.com
themselves as Corporates.
13. M/s. B.K. Gupta & Associates, Company Secretaries
A scanned copy of the Registration Form have been appointed as the Scrutinizer to scrutinize
bearing the stamp and sign of the entity the e-voting process in a fair and transparent
should be emailed to helpdesk.evoting@ manner (including the ballot forms received from
cdslindia.com. members who do not have access to the e-voting
process). The Scrutinizer shall upon the conclusion
After receiving the login details a of E-voting period, unblock the votes in presence
compliance user should be created using of at least two witnesses not in employment of the
the admin login and password. The Company and make a report of the votes cast in
Compliance user would be able to link the favour or against, if any, forthwith to the Chairman
account(s) for which they wish to vote on. of the Company.
The list of accounts should be mailed to 14. The Results of the resolutions passed at the AGM
helpdesk.evoting@cdslindia.com and on of the Company will be declared within 48 hours
approval of the accounts they would be of conclusion of AGM. The results declared along
able to cast their vote. with the Scrutinizer’s report shall be simultaneously
placed on the Company’s website www.vardhman.
A scanned copy of the Board Resolution com and on the website of CDSL and will be
and Power of Attorney (POA) which they communicated to the stock exchanges.
have issued in favour of the Custodian, if
15. MEMBERS HOLDING EQUITY SHARES IN ELECTRONIC FORM, AND PROXIES THEREOF, ARE REQUESTED TO
BRING THEIR DP ID AND CLIENT ID FOR IDENTIFICATION.
249
NOTICE
ITEM NO. 5 OF the SPECIAL BUSINESS: ITEM NO. 6 OF THE SPECIAL BUSINESS:
Pursuant to the provisions of Section 62(1)(b) and other Pursuant to the provisions of the Section 148 of the
applicable provisions of Companies Act, 2013 and SEBI Companies Act, 2013 read with Companies (Audit and
(Share Based Employee Benefits) Regulations, 2014, Auditors) Rules, 2014, the Cost Audit is required to be
the Members in their 43rd Annual General Meeting conducted in respect of the Cost Accounts maintained
held on 5th September, 2016 had approved Vardhman by the Company. Upon the recommendations of Audit
Textiles Limited Employee Stock Option Plan, 2016. Committee, the Board of Directors in its meeting held on
However, method to be used by Company for Valuation 10th May, 2017 had appointed M/s. Ramanath Iyer & Co.,
of its Options under the Scheme was not disclosed in 808, Pearls Business Park, Netaji Subhash Place, New
the explanatory statement to the notice of 43rd Annual Delhi as Cost Auditors of the Company to conduct Cost
General Meeting. In this regard, the National Stock Audit for Financial Year ending 31st March, 2018.
Exchange of India requires that the method of valuation
of Options used by the Company for grant of Options i.e. Accordingly, the consent of the Members is solicited for
Fair Valuation Method shall be ratified by the Members passing an Ordinary Resolution as set out at Item No. 6
in the next Annual General Meeting. of the notice for ratification of payment of remuneration
of ` 5,16,880/- to the Cost Auditors for the Financial
Accordingly, your approval is solicited for ratification Year ending 31st March, 2018. The Board commends the
of Method of Valuation of Options by passing Special Ordinary Resolution as set out at Item No. 6 of the Notice
Resolution as set out at Item No. 5 of the notice. for approval by the Members.
Information pursuant to Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 regarding the Director seeking appointment/ re-appointment in the Annual General Meeting.
250
NOTICE
NOTICE
Corporate Information
Board of Directors
Mr. Ashok Kumar Kundra Mrs. Suchita Jain
Mr. Shri Paul Oswal
Joint Managing Director
Chairman & Managing Director Mr. Darshan Lal Sharma
Mr. Sachit Jain
Mr. Kumar Neel Lohit Mr. Devendra Bhushan Jain
Joint Managing Director
Nominee of IDBI
Mr. Rajender Mohan Malla
Mr. Neeraj Jain
Mr. Prafull Anubhai
Mr. Shravan Talwar Joint Managing Director
Dr. Subash Khanchand Bijlani
2017 2017
I/We hereby record my/ our presence at the 44th Annual General Meeting of Vardhman Textiles Limited held at the Registered Office of the Company
I/We hereby record my/ our presence at the 44th Annual General Meeting of Vardhman Textiles Limited held at the Registered Office of the Company situated at Chandigarh Road, Ludhiana-141 010 on Friday, the 22nd day of September, 2017 at 09:00 a.m.
situated at Chandigarh Road, Ludhiana-141 010 on Friday, the 22nd day of September, 2017 at 09:00 a.m.
NOTE: Please read instructions given at Point No. 12 of the Notice of 44th Annual General Meeting annexed in the Annual Report for 2016-17 of the
NOTE: Please read instructions given at Point No. 12 of the Notice of 44th Annual General Meeting annexed in the Annual Report for 2016-17 of the Company, carefully before voting electronically.
Company, carefully before voting electronically.