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17 September 2021 | 12:00

Industry >> Cement

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ISIN No INE481G01011 52Week High 8073 Book Value (Rs.) 1,530.34 Face Value 10.00
Bookclosure 18/08/2021 52Week Low 3754 EPS 189.26 P/E 40.75
Market Cap. 222609.93 Cr. P/BV 5.04 Div Yield (%) 0.48 Market Lot 1.00
Security Type Other


You can view full text of the latest Director's Report for the company.
Year End :2018-03 

Dear Shareholders,

The Directors present the Eighteenth Annual Report together with the Audited Accounts of your Company for the year ended 31st March, 2018.


The global cyclical upswing since mid - 2016 strengthened during the year. Among the advanced economies, notably Germany, Japan, Korea and the United States, growth in the third quarter of 2017 was higher than projected. Key emerging markets and developing economies like Brazil, China and South Africa also posted impressive growth. Global trade was significantly higher, supported by a good flow of investment, particularly among advanced economies and increased Asian manufacturing output. The stronger momentum experienced in 2017 is expected to carry into 2018 and 2019, with global growth rising to 3.9% for both years.

The International Monetary Fund (IMF) remained optimistic of India's potential and retained GDP growth forecast for the country at 6.7% in 2017 and 7.4% in 2018. In its World Economic Outlook Update, it also estimated that the Indian economy could grow 7.8% in 2019, making it the world's fastest-growing economy in 2018 and 2019, a ranking that it briefly lost to China in 2017. The economy's growth trajectory was sustained on the back of a series of reforms undertaken over the past year.

India is the world's second largest cement producer In anticipation of demand, ~ 90 million tonnes of capacity was added during the past five years. During the year, the industry reported a rise in cement demand and after seven years' the industry is likely to report historical demand growth multiple against GDP. The Government's thrust on infrastructure development remained the key growth driver Besides, revival in rural housing demand and accelerated execution under the low cost housing program, bolstered volume off-take. However demand from urban housing remained sluggish owing to the implementation of Real Estate (Regulation and Development) Act, 2016 (RERA) and the lingering impact of demonetization. FY 2017-18 was also a year of challenges as major States imposed a ban on sand mining, arising out of environmental concerns and entry of the unorganized sector. Sand is used as raw material by the construction industry and the ban impacted construction activity in Uttar Pradesh, Madhya Pradesh, Bihar, Tamil Nadu, Maharashtra and Rajasthan. The Hon'ble Supreme Court of India introduced a ban on the use of petcoke in Haryana, Rajasthan and Uttar Pradesh to curb pollution and even though the restriction was subsequently relaxed, there was a hike in import duty on petcoke from 2.5% to 10%. An increase in diesel prices pushed freight cost northwards. All of this resulted in increased operating costs.

India's cement sector growth is projected at around 8% in FY 2018-19, which is good as compared to the trends of the last few years. This is likely to be driven by a slew of infrastructure projects which have been announced by the government, among which are the construction of around 84,000 kilometers of roads by 2022 including the Bharatmala Project, construction of rural roads under the Pradhan Mantri Gram Sadak Yozana by 2019, Housing for All by 2022, the metro rail networks in several cities, bullet train and various irrigation projects. Regardless, the sector could face some headwinds in the form of higher fuel prices that could have a negative impact on margins.

It is against this background, that we share your Company's performance during 2017-18. The major highlight was the successful acquisition of the cement plants of Jaiprakash Associates Limited (JAL) and Jaypee Cement Corporation Limited (JCCL). This enabled your Company to further consolidate its position in the domestic cement industry. More information on the acquisition is detailed in the Corporate Development section of this report.


(Rs, in crores)







Net Turnover















Other Income





Total Expenditure





Profit before Interest, Depreciation and Tax (PBIDT)





Less: Depreciation





Profit before Interest and Tax (PBIT)










Profit before Impairment and Tax Expenses / share in profit of Associates





Stamp duty on acquisition of assets





Provision for diminution in value of Investment





Impairment of assets





Impairment on deconsolidation of subsidiary





Profit before Tax Expenses





Tax Expenses





Profit after Tax





Profit attributable to Non-controlling Interest





Profit attributable to Owner of the parent





INote: the figures for 2017-18 include those of the acquired cement units of JAL and JCCL and are therefore not strictly comparable with the previous years' figures.)

Net Turnover:

Your Company's net turnover at Rs, 29,363 crores is higher over the previous year, driven by higher sales volume and improvement in cement prices.

Other Income:

Other income is 9% higher compared to the previous year Your Company received higher fiscal incentives under the Industrial Promotion Schemes of various States.

Operating Profit (PBIDT) and Margin:

PBIDT for the year at Rs, 6,478 crores is higher by 15% over the previous year The operating margin declined marginally due to increase in operating costs.

Cost Highlights:

(i) Energy Cost:

Overall energy cost rose by 23% from Rs, 763/t to Rs, 938/t, attributable to substantial increase in petcoke and coal prices. Imported petcoke prices went up by 45% from $66/t to $96/t. Energy costs were also impacted due to the ban on petcoke usage in thermal power plants in Rajasthan, Uttar Pradesh and Haryana.

Controlling costs is an on-going exercise at your Company. To mitigate the impact of rising fuel prices, your Company was engaged in a cost control program leading to the following efficiencies:

- Reduction in power consumption at cement plants by 3%;

- Improved thermal power plant efficiency by reducing auxiliary consumption power by 10%;

- Enhanced usage of waste heat recovery power to 8%;

- Increased power wheeling from integrated plants to grinding units to reduce dependency on grid;

- Entering into solar power purchase agreements to cut power costs at grinding units and to meet renewable energy obligations;

- Improved petcoke usage in acquired units in line with your Company's standards;

- Use of low cost fuels viz. industrial waste and lignite increased from 2% in the previous year to 5%. Around 2.52 lmt industrial waste has been used in the kilns.

(ii) Input material cost:

Raw materials cost saw a marginal uptick from Rs, 467/t to Rs, 473/t inspite of increase in slag and fly-ash prices and additional limestone royalty for the acquired assets.

This was achieved by shifting to alternative additives and identifying new sources of material.

(iii) Freight and Forwarding expenses:

Logistics cost increased from Rs, 1,074/t to Rs, 1,124/t, due to 7% higher diesel prices. Its impact was partially restricted with the reduction in average lead distance by 3% as a result of improved utilisation of new cement grinding capacities and integration of acquired capacities.

(iv) Employee costs:

Employee costs extended by 21% from Rs, 1,413 crores in the previous year to Rs, 1,706 crores, on account of normal annual increments, commissioning of new plants and acquired plants.


Depreciation for the year at Rs, 1,764 crores is higher by Rs, 496 crores over the previous year, mainly on account of the acquired assets and capitalisation of new assets commissioned.

Finance Cost:

Finance cost at Rs, 1,186 crores is up by Rs, 615 crores vis-a-vis Rs, 571 crores mainly due to the debt taken for acquiring the JAL and JCCL assets.

Your Company does not accept any fixed deposits from the public falling under Section 73 of the Companies Act, 2013 (the Act) and the Companies (Acceptance of Deposits) Rules, 2014.

Your Company has adequate liquidity and a strong Balance Sheet. CRISIL and India Ratings and Research has re-affirmed their credit rating as CRISIL AAA and IND AAA for Long Term and CRISIL A1 IND A1 for Short Term.

Income Tax:

Income tax expenses decreased in line with the decrease in taxable income.

Net Profit:

Profit after tax declined by 15% from Rs, 2,628 crores to Rs, 2,231 crores. The normalised PAT for the year is Rs, 2,420 crores, after adjusting the impact of stamp duty charged on acquired assets and a one-time charge for deferred tax due to the change in income-tax rates. Net profit is also impacted on account of an additional interest charge of Rs, 725 crores and depreciation of Rs, 500 crores related to acquired assets.

Cash Flow Statement

(Rs, in crores)



Sources of Cash

Cash from operations



Non-operating cash flow



Proceeds from issue of share capital



Proceeds from sale of Investment



Decrease in working capital






uses of Cash

Net capital expenditure



Increase in investment



Increase in working capital



Repayment of borrowings (net)












Increase / (Decrease) in cash & cash equivalents



Sources of Cash Cash from operations:

Cash from operations was higher compared to the previous year as a result of higher revenues.

Non-Operating Cash Flow:

Cash from non-operations was higher due to higher interest income coupled with higher income from the sale of investment in Mutual Funds.

uses of Cash Borrowings:

During the year, your Company raised Rs, 10,189 crores for repayment of transferred loans relating to the acquisition of JAL and JCCL's cement capacity. Your Company also redeemed Rs, 3,125 crores of debentures and Rs, 500 crores of preference shares issued in terms of the Scheme of Arrangement between JAL, JCCL, your Company and their respective shareholders and creditors (Scheme of Arrangement). Besides this, your Company raised Rs, 322 crores of long term debt in the form of external commercial borrowings for meeting its capex requirement.

Your Company has repaid the existing long-term borrowings of Rs, 884 crores in keeping with repayment schedule.

Net Capital Expenditure:

Your Company spent over Rs, 1,900 crores on various capital expenditure during the year. These include the green field project at Manavar, District Dhar in Madhya Pradesh; Bara grinding unit in Uttar Pradesh; Waste Heat Recovery System (WHRS) in Chhattisgarh and capex related to modernisation.

Increase in Working Capital:

Working capital increased on account of initial working capital infusion for the acquired assets including the upfront royalty payment for transfer of mines.

Transfer to general Reserve:

Your Company proposes to transfer an amount of Rs, 1,600 crores to the General Reserve.


Despite completing a major acquisition during the year, your Directors have recommended a dividend of Rs, 10.50 per equity share (Rs, 10 per equity share in the previous year) of Rs, 10/- each for the year ended 31st March, 2018. The dividend distribution would result in a cash outgo of Rs, 347.61 crores (including tax on dividend of Rs, 59.27 crores) compared to Rs, 330.41 crores (including tax on dividend of Rs, 55.89 crores) paid for 2016-17.

In terms of the provisions of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) your Company has formulated a dividend distribution policy. The policy is given in Annexure I to this Report. It is also accessible from your Company's website

capital expenditure plan

Your Company commissioned a Greenfield clinker capacity of 2.5 MTPA at Manawar, District Dhar Madhya Pradesh. Your Company also commissioned a cement grinding facility of

1.75 MTPA capacity and an auto loading facility. This state-of-the-art manufacturing facility has been built with best in class safety standards. Another cement grinding facility of

1.75 MTPA capacity as well as a WHRS of 13 MW capacity is under erection and both are expected to be completed before September, 2018. The plant has been commissioned in record time of less than 365 days, setting a global benchmark for size of such capacity. Yet another benchmark is setting up the Greenfield plant at a capital cost of less than $90/mt.

During the year, your Company's Board of Directors approved the setting up of a 3.5 MTPA integrated cement plant at Pali, Rajasthan, at an investment of around Rs, 1,850 crores. Commercial production from the plant is expected to commence by June, 2020.

Capital expenditure during the next financial year is estimated at approximately Rs, 2,500 crores. This is for capacity expansion projects, waste heat recovery systems, regulatory requirements, plant infrastructure and routine maintenance.

RESEARCH AND Development

Your Company's Research and Development (R&D) activities are aimed at facilitating sustained growth of the business by developing new cement and concrete products, providing environment friendly and innovative solutions to cement manufacturing Units and to the ever increasing customer demands in concrete applications. Continuous product quality improvement, customization and enhancing cement plant productivity are its main forte as it leads to greater profitability customer value and delight.

Your Company's R&D Centre has a clear mission of integrating the latest scientific and technological developments in the field of cement and concrete. With this objective, your Company's R&D Centre provides comprehensive technical and analytical support to the business.

Your Company's R&D activities include basic as well as applied research for:

- Fostering a better understanding of advanced building materials based on cement;

- Providing a forum for closer customer-manufacturer interaction;

- Increased customer delight;

- Demonstrating and encouraging development of low cost energy-saving materials; and

- Bridging the gap between theory and practice.

Customers, Quality and Cost are core to all R&D product and process projects. This results in process optimization and debottlenecking, natural raw materials conservation and promotion of alternative fuels while complying with the increasingly stringent quality and environmental norms. It not only explores newer ways of preserving the environment and non-renewable resources but also encourages all the stakeholders to utilize resources responsibly. Towards this end, your Company has developed premium products that aid in limestone deposits and clinker conservation, energy savings, ensuring enhanced concrete durability and maintaining top product attributes and functionality.

Your Company's R&D Centre has:

- Developed and patented a new variant of green and low-temperature clinker;

- new type of high early and long-term strength cement;

- 3 types of high-early strength water saving cement.

Your Company has implemented in-house grinding aids technology in the Eastern Cluster to further reduce the clinker factor (clinker content in cement), extend the life of its limestone deposits and significantly reduce its carbon footprint.

Your Company's R&D has become future ready. It has created totally new capabilities in the area of Pollution Abatement and Carbon Capture, Nanotechnology of Cement and Concrete, Concrete Durability, Concrete Rheology 3D printable Concrete, Geopolymer Concrete, Modelling Cement & Concrete hydration and Chemical Admixtures for Cement and Concrete.

Your Company has successfully completed the application process for the NABL (National Accreditation Board for Testing and Calibration Laboratories) accreditation i.e. the test results of your Company's Central R&D Laboratories will automatically be recognized by the Bureau of Indian Standards, the Government of India and all its regulatory bodies, as well as by your Company's customers and competitors. Your Company's R&D test results will be issuable with NABL accreditation stamp.

Your Company's R&D actively collaborates with Aditya Birla Science and Technology Company Private Limited (ABSTCPL) and Academia. It represents your Company in national and international cement and concrete conferences and seminars.

human resources

Your Company's human resources is the strong foundation for creating many possibilities for its business. During the year, your Company added greater employee talent through seamless integration of acquired assets. The rapid ramp-up of manufacturing units and markets was the highlight of our people effort.

Continuous people development through the Sales & Service Academy and Cement Manufacturing Excellence Academy, for developing knowledge and skills coupled with the Talent Management practices will deliver the talent needs of the organization. Your Company's employee engagement score reflects high engagement and pride in being part of the organization. The first batch of participants of StepAhead, your Company's flagship program for developing Sales leaders created in association with Xavier School of Management, (earlier Xavier Labour Relations Institute), graduated during the year.

As on 31st March 2018, your Company's employee strength stood at 19,681 employees.


The Safety excellence journey is a continuing process at your Company. Safety of the people working for and on behalf of your Company is an integral part of business. Your Company's Managing Director chairs the Safety Board, they review the safety performance of your Company on a regular basis. In addition, there are eight safety sub-committees headed by senior leaders to closely monitor various key performance indicators related to safety. During the year, more than 6,00,000 safety observations have been carried out. Corporate safety audit by cross functional teams and structural stability assessment by third parties is carried out across your Company's locations and around 95% of identified high-priority points have been completed to ensure that the structures across our units are safe.


In terms of the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules,

2014, the Board of Directors of your Company has constituted a Corporate Social Responsibility (CSR) Committee which is chaired by Mrs. Rajashree Birla. The other Members of the Committee are Mr. G. M. Dave, Independent Director; Mr. O. P. Puranmalka, Non-Executive Director and Mr. K. K. Maheshwari, Managing Director. Dr. Pragnya Ram, Group Executive President, Corporate Communication & CSR is a permanent invitee to the Committee. Your Company also has in place a CSR Policy which is available on your Company's website viz.

Your Company's CSR activities are focused on Social Empowerment & Welfare, Infrastructure Development, Sustainable Livelihood, Health Care and Education. Various activities have been initiated during the year in neighboring villages around its plant locations. It infused over Rs, 60.71 crores, over 2% of the average net profits of the last three years for the purposes of CSR.

A report on CSR activities is attached as Annexure III forming part of this report.

subsidiary, joint venture or associate companies

In the matter of your Company's wholly-owned subsidiary, Gotan Lime Stone Khanij Udyog Private Limited (GKUPL), the Supreme Court of India has directed the State of Rajasthan to frame and notify its policy relating to transfer of mining lease and thereafter pass appropriate order in respect of the mining lease of GKUPL. The State Government has notified the new policy related to transfer of new mining lease, based on which your Company has requested the Government to consider reinstatement of the mines in its favour.

The audited financial statements of your Company's subsidiaries and joint ventures viz. Dakshin Cements Limited, Harish Cement Limited, GKUPL, Bhagwati Lime Stone Company Private Limited, UltraTech Cement Middle East Investments Limited, UltraTech Cement Lanka (Pvt.) Limited, PT UltraTech Mining Indonesia and PT UltraTech Investments Indonesia as well as related information are available on the website of your Company viz. and also available for inspection during business hours at the registered office of your Company. During the year UltraTech Cement SA (PTY) and UltraTech Cement Mozambique Limitada, subsidiaries of your Company were closed.

Any Member, who is interested in obtaining a copy of the audited financial statements of your Company's subsidiaries may write to the Company Secretary at the Registered Office of your Company.

In accordance with the provisions of Section 129(3) of the Act, read with the Companies (Accounts) Rules, 2014, a report on the performance and financial position of each of the subsidiaries, joint venture or associate companies is attached as Annexure IV to this Report.


Details of Loan, Guarantee and Investment covered under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 are given in the Notes to the standalone financial statements.


Information on conservation of energy, technology absorption and foreign exchange earnings and outgo, required to be disclosed pursuant to Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 is given in Annexure V to this Report.


Disclosures pertaining to remuneration and other details as required under Section 197(12) read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached as Annexure VI. In accordance with the provisions of Section 197(12) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names and other particulars of employees drawing remuneration in excess of the limits set out in the aforesaid Rules, forms part of this Report. However, in line with the provisions of Section 136(1) of the Act, the Report and Accounts as set out therein, are being sent to all Members of your Company excluding the aforesaid information. Any Member, who is interested in obtaining these particulars, may write to the Company Secretary at the Registered Office of your Company.


In terms of Regulation 34(2)(f) of the Listing Regulations, a Business Responsibility Report forms part of the Annual Report.


During the financial year, your Company entered into related party transactions which were on arm's length basis and in the ordinary course of business. There are no material transactions with any related party as defined under Section 188 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014. All related party transactions have been approved by the Audit Committee of your Company and are reviewed by it on periodic basis.

The policy on Related Party Transactions as approved by the Audit Committee and the Board is available on your Company's website viz.

The details of contracts and arrangement with related parties of your Company for the financial year ended 31stMarch, 2018 is given in Note 38 to the standalone financial statements of your Company.


The audited accounts for the year under review are in conformity with the requirements of the Act and the Accounting Standards. The financial statements reflect fairly the form and substance of transactions carried out during the year under review and reasonably present your Company's financial condition and results of operations.

Your Directors confirm that:

i. in the preparation of the Annual Accounts, applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. the accounting policies selected have been applied consistently and judgments and estimates are made that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31st March, 2018 and of the profit of your Company for the year ended on that date;

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting frauds and other irregularities;

iv. the Annual Accounts of your Company have been prepared on a going concern basis;

v. your Company had laid down internal financial controls and that such internal financial controls are adequate and were operating effectively;

vi. your Company has devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


Re-appointment of Director

Mr. Kumar Mangalam Birla (DIN: 00012813) retires from office by rotation and being eligible, offers himself for re-appointment. A brief resume of Mr Birla forms part of the Notice of the ensuing AGM.

Meetings of the Board

The Board of Directors of your Company met 6 times during the year to deliberate on various matters. The meetings were held on 24th April, 2017, 18th July, 2017, 18th October, 2017, 9th December, 2017, 18th January, 2018 and 19th March, 2018. Further details on the Board of Directors are provided in the Corporate Governance Report forming part of this Annual Report.

Independent Directors' Statement

Independent Directors on your Company's Board have submitted declarations of independence to the effect that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1) (b) of the Listing Regulations.

Formal Annual Evaluation

The evaluation framework for assessing the performance of Directors of your Company comprises of contributions at the meetings, strategic perspective or inputs regarding the growth and performance of your Company, among others.

Pursuant to the provisions of the Act and the Listing Regulations, the Directors have carried out the annual performance evaluation of the Board, Independent Directors, Non-Executive Directors, Executive Directors, Committees and the Chairman of the Board.

The NRC and the Board have laid down the manner in which formal annual evaluation of the performance of the Board, its Committees and individual Directors has to be made. It includes circulation of evaluation forms separately for evaluation of the Board and its Committees, Independent Directors/Non-Executive Directors/Executive Directors and the Chairman of your Company.

The process of the annual performance evaluation broadly comprises:

Board and Committee Evaluation:

Evaluation of Board as a whole and the Committees is done by the individual Directors, followed by submission of collation to the NRC and feedback to the Board.

Independent / Non-Executive Directors Evaluation:

Evaluation done by Board members excluding the Director being evaluated is submitted to the Chairman of your Company and individual feedback provided to each Director.

Chairman/Executive Director Evaluation:

Evaluation as done by the individual Directors is submitted to the Chairperson of the NRC and subsequently to the Board.

The details of program for familiarization of Independent Directors of your Company are available on your Company's website viz.

Policy on Appointment and Remuneration of Directors and Key Managerial Personnel and Remuneration Policy

The NRC has formulated the Remuneration policy of your Company which is attached as Annexure VII to this report.

audit committee

The Audit Committee comprises of Mr. S. B. Mathur, Mr. G. M. Dave, Mrs. Renuka Ramnath, Mr. D. D. Rathi and Mrs. Alka Bharucha. The Committee comprises of majority of independent directors with Mr Mathur being the Chairman. Mr. K. K. Maheshwari, Managing Director and Mr Atul Daga, Whole-time Director & CFO are the permanent invitees.

Further details relating to the Audit Committee are provided in the Corporate Governance Report, forming part of this Annual Report.

During the year under review, all recommendations made by the Audit Committee were accepted by the Board.


Your Company has in place a vigil mechanism for directors and employees to report instances and concerns about unethical behavior, actual or suspected fraud or violation of your Company's Code of Conduct. Adequate safeguards are provided against victimization of those who avail of the mechanism and direct access to the Chairman of the Audit Committee in exceptional cases is provided to them.

The vigil mechanism is available on your Company's website viz.


The CCI by its order dated 31st August, 2016, imposed a penalty on eleven companies, including your Company. The CCI order is pursuant to the directions issued by the Competition Appellate Tribunal (COMPAT) by its Order dated 11th December, 2015 setting aside the original CCI order dated 20th June, 2012 and remitting the matter to CCI for fresh adjudication of the issue and passing a fresh order. Your Company filed an appeal against the CCI Order before COMPAT. COMPAT has granted stay on the CCI order on condition that your Company deposit 10% of the penalty, amounting to Rs, 117.56 crores, which has since been deposited.

In a separate matter, the CCI by its order dated 19th January, 2017 has imposed a penalty of Rs, 68.30 crores on your Company pursuant to a reference filed by the Government of Haryana. Your Company has filed an appeal against the said CCI order before COMPAT. COMPAT has granted stay on the said CCI order.

The Government has made changes in the constitution and operations of Tribunals, under which all matters with COMPAT have been transferred to the National Company Law Appellate Tribunal (NCLAT). Hearing of order dated 31st August, 2016 is completed at NCLAT and the order is awaited.

Your Company backed by a legal opinion, believes that it has a good case in both the matters and accordingly no provision

AUDITORS Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the Companies (Audit and Auditors) Rules, 2014, M/s. BSR & Co. LLP, Chartered Accountants, Mumbai (Registration No: 101248W/W-100022) and M/s. Khimji Kunverji & Co., Chartered Accountants, Mumbai (Registration No: 105146W) had been appointed as Joint Statutory Auditors of your Company for a term of five years until the conclusion of the 20th and 21st AGM respectively. In terms of the provisions of the Act, your ratification to their appointment as Joint Statutory Auditors of your Company is being sought at the ensuing AGM and forms part of the Notice convening the AGM. The Joint Statutory Auditors have confirmed that they are not disqualified to act as Auditors and are eligible to hold office as Auditors of your Company.

The observations made in the Auditor's Report are self-explanatory and therefore, do not call for any further comments under Section 134(3)(f) of the Act.

Cost Auditors

In terms of the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Board of Directors of your Company have on the recommendation of the Audit Committee appointed M/s. D. C. Dave & Co., Cost Accountants, Mumbai and M/s. N. D. Birla & Co., Cost Accountants, Ahmadabad, to conduct the cost audit of your Company for the financial year ending 31st March, 2019, at a remuneration as mentioned in the Notice convening the AGM.

As required under the Act, the remuneration payable to cost auditors has to be placed before the Members at a general meeting for ratification. Hence, a resolution seeking your ratification for the remuneration payable to the Cost Auditors forms part of the Notice of the ensuing AGM.

Secretarial Auditor

In terms of the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. BNP & Associates, Company Secretaries, Mumbai as Secretarial Auditors for conducting Secretarial Audit of your Company for the financial year ended 31st March, 2018. The report of the Secretarial Auditor is attached as Annexure VIII. The

Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Your Company is in compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India.

EXTRACT OF Annual Return

In terms of the provisions of Section 92 (3) of the Act read with the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return of your Company for the financial year ended 31st March, 2018 is given in Annexure IX to this Report.

OTHER Disclosures

- There were no material changes and commitments affecting the financial position of your Company between the end of the financial year and the date of this report.

- Your Company has not issued any shares with differential voting rights.

- There was no revision in the financial statements.

- There has been no change in the nature of business of your Company.

- Your Company has not issued any sweat equity shares.

- During the year your Company has not received any complaints under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

cautionary statement

Statements in the Directors Report and the Management Discussion and Analysis describing the Company's objectives, projections, estimates, expectations or predictions may be “forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Company's operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in your Company's principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which your Company conducts business and other factors such as litigation and labour negotiations. Your Company is not obliged to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent development, information or events or otherwise.


Your Directors express their deep sense of gratitude to the banks, financial institutions, stakeholders, business associates, Central and State Governments for their support and look forward to their continued assistance in future. We thank our employees for their contribution to your Company's performance. We applaud them for their superior levels of competence, dedication and commitment to your Company.

For and on behalf of the Board

Kumar Mangalam Birla


(DIN: 00012813)

Mumbai, 25th April, 2018