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Indo Count Industries Ltd (ICIL) -BSE
51.1 1.05 (2.10%) 19-Sep-2019 |10:05
PREV.CLOSE OPEN PRICE HIGH(Rs) LOW(Rs) VOLUME(Rs) 52AVG.RANGE MARKET CAP(Rs.Cr) P/E Div Yield (%) Eps (Rs)
50.05 51 51.5 50 4702 79.25 - 30 987.99 15.45 1.2 3.24
Directors Report

On behalf of the Board of Directors ("the Board"), it gives me immense pleasure to present the Thirtieth Annual Report on the business and operations of your Company together with the Audited Financial Statements for the year ended 31st March, 2019.

FINANCIAL RESULTS (As per IND AS)

(र In crore, except EPS)

Particulars

Standalone

Consolidated

2018-19 2017-18 2018-19 2017-18
Total Income 1,822.93 1,808.30 1,944.70 1,958.17
EBIDTA 160.94 265.34 166.23 262.15
Less: Finance Cost 33.71 32.74 35.60 34.74
Less: Depreciation & amortisation 32.58 30.46 35.27 33.06
Profit before Tax 94.65 202.14 95.36 194.35
Tax Expenses 35.43 71.06 35.52 69.08
Net Profit 59.22 131.08 59.84 125.27
Other comprehensive Income (net of tax) (28.58) 0.25 (32.60) (0.06)
Total Comprehensive Income 30.64 131.33 27.24 125.21
Basic & Diluted EPS (in C) 3.00 6.64 3.05 6.38
Cash Profit 96.37 181.69 99.17 176.25

OPERATIONAL AND FINANCIAL PERFORMANCE

During the year 2018-19, on a standalone and consolidated basis, there has been increase in sales volumes leading to 6% and 4% growth in turnover respectively. However, various factors such as increase in raw material cost, selling cost, employee benefit expenses and adverse forex movements resulted in fall in EBITDA and Net Profit for the year ended 31st March, 2019.

At a consolidated level, your Company achieved revenue from operations of C1,934.21 crore for FY 2018-19 as against C1,858.52 crore in the previous year. Your Company reported EBIDTA and Net Profit of C166.23 crore and C59.84 crore respectively for the year ended 31st March, 2019. EPS stood at C3.05 for the year ended 31st March, 2019.

On a standalone basis, revenue from operations stood at C1,812.54 crore for the year ended 31st March, 2019 as against C1,709.18 crore in the previous year. Further, your Company achieved EBIDTA and Net Profit of C160.94 crore and C59.22 crore respectively for the year ended 31st March, 2019.

The financial and operational performance overview and outlook is provided in detail in the Management Discussion and Analysis forming part of this Annual Report.

DIVIDEND

Your Directors are pleased to recommend a Final Dividend @ 30%

i.e. C0.60 per equity share of face value of C2/- each amounting to C11.84 crore subject to the approval of members of the Company at the ensuing Annual General Meeting.

The aforesaid dividend is in line with the Dividend Distribution Policy adopted by the Company.

DIVIDEND DISTRIBUTION POLICY

Pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("Listing Regulations"), the Board of Directors of your Company had approved Dividend Distribution Policy, which is given separately and forms part of this Annual Report.

The Dividend Distribution Policy is also uploaded on the website of the Company and web-link for the same is https://www.indocount . com/images/investor/Dividend-Distribution-Policy1.pdf

TRANSFER TO RESERVE

During the year under review, the balance of C2.5 crore under Capital Redemption Reserve has been transferred to Retained Earnings.

AWARDS AND RECOGNITIONS

Your Company is recipient of various awards, recognitions and accolades. We are happy to inform you that during the year under review, your Company was honoured with the prestigious "VASUNDHARA AWARD" from the Government of Maharashtra in recognition of your Company's contribution towards commitment & promotion of Environment, Energy Conservation / Natural Resources & Social / Welfare Activities in Maharashtra. Your Company was adjudged as the 2nd Best Company in the entire state of Maharashtra among all the large units. Further, your Company was conferred awards by large retailers in USA viz. "Platinum Certification Status" for Sheets & Fashion bedding category from JC Penney and Best Collaboration in Design & Product Development from KOHL'S.

Some of the other accolades and recognitions received by your Company in past includes Gold Trophy from TEXPROCIL for highest exports in cotton made ups in FY 2016-17.

SHARE CAPITAL

As on 31st March, 2019, the Authorised Share Capital of your Company was C60 crore comprising of 27,50,00,000 equity shares of C2/- each and 50,00,000 preference shares of C10/- each. Further, the total issued, subscribed and paid up share capital of your Company stood at C394,799,340/- comprising of 197,399,670 Equity Shares of C2/- each. During the year under review, there has been no change in the Authorised, Issued, subscribed and paid-up share capital of your Company.

Your Company has not issued any equity shares with differential voting rights or sweat equity shares. Further, your Company does not have any employee stock option scheme or employee stock purchase scheme.

CREDIT RATING

As on 31st March, 2019, for long term bank facilities of your Company, Credit Rating assigned by CARE and ICRA is "AA-" with outlook as Negative. The said ratings signify high degree of safety regarding timely servicing of financial obligations.

Further, for the Company's short term bank facilities, ICRA and CARE reaffirmed the rating as "A1+" which signifies very strong degree of safety regarding timely payment of financial obligations and carry lowest credit risk.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company are prepared in accordance with Indian Accounting Standards notified under the Companies (Indian Accounting Standards) Rules, 2015. The Audited Consolidated Financial Statements of the Company for the year ended 31st March, 2019 along with Auditors' Report forms part of this Annual Report.

The Audited Financial Statements of the Company and subsidiaries will be available on the website of the Company at www.indocount.com . Further, a copy of the Audited Financial Statements of the Subsidiaries shall be made available for inspection at the registered office of the Company during business hours on any working day upto the date of Annual General Meeting. Any shareholder interested in obtaining a copy of separate Financial Statements of the subsidiaries shall make specific request in writing to the Company Secretary.

SUBSIDIARIES

As on 31st March, 2019, your Company has 6 direct subsidiaries viz. Pranavaditya Spinning Mills Limited, Indo Count Retail Ventures Private Limited, Indo Count Global Inc., USA, Indo Count UK Limited, Indo Count Australia Pty Ltd. and Indo Count Global DMCC (Formerly known as Hometex Global DMCC). Pursuant to the provisions of Section 129 (3) of the Companies Act, 2013 read with rules made thereunder, a statement containing salient features of the financial position of subsidiaries is given in Form AOC-1 attached as "Annexure 1" forming integral part of this Report. As required under Section 134 of the Companies Act, 2013, the said form also highlights performance of the subsidiaries.

Your Company does not have any Associate Company as defined under the Companies Act, 2013 and has not entered into any joint venture agreement during the year under review.

Though your Company does not have any material subsidiary pursuant to Regulation 16 of the Listing Regulations, it has adopted a policy for determining material subsidiaries, which can be accessed at https://www.indocount.com/images/investor/Policy- for-Determining-Material-Subsidiary-01.04.2019.pdf

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review, there were following changes at the Board level as given below:

i. Mr. Kailash R Lalpuria (DIN : 00059758) was appointed by the Board as a Whole Time Director designated as an Executive Director of the Company for a period of 3 years w.e.f. 4th May, 2018. His appointment was duly approved by the members of the Company at the Annual General Meeting held on 11th September, 2018. Mr. Kailash R. Lalpuria was also appointed as a Chief Executive Officer (CEO) of the Company w.e.f. 8th February, 2019 under section 203 of the Companies Act, 2013. With the said appointment his designation is "Executive Director & CEO".

ii. The designation of Mr. Mohit Jain (DIN : 01473966) was changed to Vice Chairman in Non-Executive Category w.e.f. 1st July, 2018 and the same was duly approved by the members of the Company at the Annual General Meeting held on 11th September, 2018.

iii. Mr. Sushil Kumar Jiwarajka (DIN : 00016680) was appointed as a Non-Executive Independent Director of the Company for a second term of five consecutive years w.e.f. 4th May, 2018.

iv. Dr. Sanjay Kumar Panda (DIN : 02586135) and Mr. Siddharth Mehta (DIN : 03072352) were appointed as Non-Executive Independent Directors of the Company for a first term of five consecutive years w.e.f. 3rd August, 2018.

The aforesaid appointment of Directors and re-designation of Mr. Mohit Jain were made by the Board pursuant to the recommendation of Nomination and Remuneration Committee(NRC) and were duly approved by the members of the Company at the Annual General Meeting held on 11th September, 2018.

The existing first term of Mr. Dilip J. Thakkar (DIN: 00007339), Mr. Prem Malik (DIN: 00023051) and Dr. (Mrs.) Vaijayanti Pandit (DIN: 06742237), Independent Directors is expiring on 15th August, 2019 and they are eligible for the re-appointment for a second term. Pursuant to the recommendation of Nomination and Remuneration Committee (NRC), and on the basis of performance evaluation the Board of Directors of the Company at its meeting held on 8th February, 2019, approved and recommended to the members of the Company, re-appointment of Mr. Dilip J. Thakkar, Mr. Prem Malik and Dr. (Mrs.) Vaijayanti Pandit as Non-Executive Independent Directors of the Company, not liable to retire by rotation, for a second term of five consecutive years w.e.f. 16th August, 2019 to 15th August, 2024. Accordingly, special resolutions for their re-appointment are included in the Notice of ensuing Annual General Meeting (AGM).

Mr. Pradyumna Natvarlal Shah (DIN : 00096793) and Mr. Anand Ramanna (DIN : 00040325) Independent Directors of the Company are not seeking re-appointment for a second term due to their advanced age and consequently, they shall cease to be Directors of the Company w.e.f. 16th August, 2019 due to expiry of their first term. The Board places on record its appreciation for the immense contributions and valuable guidance given by Mr. P. N. Shah and Mr. R. Anand during their long association as Board members of the Company.

Pursuant to the recommendation of NRC and subject to the approval of members of the Company, the Board of Directors of the Company at its meeting held on 22nd May, 2019, approved reappointment of Mr. Anil Kumar Jain (DIN:00086106) as a Wholetime Director designated as "Executive Chairman" of the Company, and re-appointment of Mr. Kamal Mitra as a Whole Time Director designated as "Director (Works)" of the Company, for a period of 3 years w.e.f. 1st October, 2019. Further, at the said board meeting, on the recommendation of NRC, the Board approved change in designation of Mr. Mohit Jain to Whole-time Director designated as "Executive Vice Chairman" of the Company, for a period of 3 years w.e.f. 1st July, 2019. The approval of members of the Company is sought in ensuing AGM for the said re-appointments/re-designation.

During FY 2018-19, Mr. Dilip Kumar Ghorawat resigned from the position of Chief Financial Officer of the Company w.e.f. close of working hours of 20th September, 2018. In accordance with the provisions of Section 203 of the Companies Act, 2013 ('Act') Mr. K. Muralidharan was appointed as Chief Financial Officer of the Company w.e.f. 2nd November, 2018 by the Board pursuant to recommendation of NRC.

Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Kamal Mitra, Director (Works) of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for the re-appointment. The Board recommends his re-appointment for consideration of the members at the ensuing Annual General Meeting.

As required under the provisions of Listing Regulations, Companies Act, 2013 and Secretarial Standard -2, details of Directors being appointed/re-appointed are provided in the Notice of Annual General Meeting.

All the Independent Directors of the Company have given declarations that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge duties with an objective independent judgment and without any external influence. In the opinion of the Board, all Independent Directors are independent of the management.

As on 31st March, 2019, Mr. Kailash R. Lalpuria, Executive Director & CEO, Mr. K. Muralidharan, Chief Financial Officer and Mrs. Amruta Avasare, Company Secretary are the Key Managerial Personnel of the Company in terms of Section 203 of the Companies Act, 2013.

NUMBER OF BOARD MEETINGS

During the year under review, Four (4) Board Meetings were held on 4th May, 2018, 3rd August, 2018, 2nd November, 2018 and 8th February, 2019. The maximum interval between any two consecutive Board Meetings did not exceed 120 days.

COMPANY'S POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Pursuant to Section 178 of the Companies Act, 2013, NRC has formulated "Nomination and Remuneration Policy" which deals inter-alia with appointment and remuneration of Directors, Key Managerial Personnel, Senior Management and other employees. The said policy is uploaded on the website of the Company and web-link thereto is https://www.indocount.com/images/investor/ Nomination-And-Remuneration-Policy1.pdf

The salient features of the policy are as under:

I) Criteria for Directors

a) Appointment:

i. NRC shall identify, ascertain and consider the integrity, qualification, expertise and experience of the person for the appointment as a Director of the Company and recommend to the Board his / her appointment. The Directors shall uphold ethical standards of integrity and probity and shall exercise their duties and responsibilities in the interest of the Company.

ii. A person proposed to be appointed as Director should possess adequate qualification, expertise and experience for the position he / she is considered for appointment. They shall possess appropriate core skills/expertise/ competencies/ knowledge in one or more fields of finance, law, management, sales and marketing, administration, CSR, research and in the context of business and/or the sector in which the Company operates. The NRC has the discretion to decide whether qualifications, expertise and experience possessed by a person are sufficient / satisfactory for the concerned position.

iii. Independent Director shall satisfy criteria of Independence specified under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the Listing Regulations and shall give declaration that he/she is not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact his ability to discharge his / her duties with an objective independent judgment and without any external influence. The NRC and the Board shall assess veracity of the said declaration and determine whether the directors are independent of the management.

iv. The Company shall comply with the provisions of the Act and Listing Regulations and any other laws if applicable for appointment of Director of the Company. The Company shall ensure that provisions relating to limit of maximum directorships, age, term etc. are complied with.

b) Remuneration of the Whole Time /Executive Director(s) / Managing Director :

i. The remuneration including commission payable to the Whole Time /Executive Director(s) / Managing Director shall be determined and recommended by the NRC to the Board for approval.

ii. While determining the remuneration of the Executive Directors, following factors shall be considered by the NRC/Board:

• Role played by the individual in managing the Company including responding to the challenges faced by the Company

• Individual performance and company performance so that remuneration meets appropriate performance benchmarks

• Reflective of size of the Company, complexity of the sector/ industry/company's operations and the Company's financial position

• Consistent with recognized best industry practices.

• Peer remuneration

• Remuneration involves balance between fixed and incentive pay reflecting performance objectives appropriate to the working of the Company and its goals.

• Remuneration is reasonable and sufficient to retain and motivate directors to run the Company successfully.

c) Remuneration to Non-Executive / Independent Directors:

i. Sitting Fees: Independent Directors are entitled for sitting fees for attending meetings of the Board and committees (excluding Share Transfer Committee) and Independent Directors Meeting as may be approved by the Board within the limit specified under the Act.

ii. Limit of Remuneration/Commission: The remuneration / commission of Non- Executive Directors shall be in accordance with the provisions of the Act and the Rules made thereunder for the time being in force. The Remuneration/ Commission shall be recommended by NRC which shall be approved by the Board within the limits approved by the members of the Company, subject to the same not exceeding 1% of the profits of the Company computed as per the applicable provisions of the Act.

II. Criteria for Key Managerial Personnel, Senior Management and other Employees

This section applies to the KMP (other than Managing Director,

Whole Time Directors/Executive Directors)

a) Appointment:

i. The NRC shall ascertain and consider the integrity, qualification, background and experience of the person for appointment as a KMP and at senior management position of the Company and recommend to the Board his / her appointment. The NRC has the discretion to decide whether qualifications, expertise and experience possessed by a person are sufficient / satisfactory for the concerned position.

b) Remuneration of Key Managerial Personnel and Senior

Management and other employees

i. The NRC shall decide and recommend to the Board, remuneration of KMP & Senior Management Personnel to ensure that it is competitive, reasonable and sufficient to motivate and retain the employee.

ANNUAL EVALUATION OF BOARD PERFORMANCE AND ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Criteria of performance evaluation of the Board & Directors are laid down by Nomination and Remuneration Committee (NRC) of the Company. Further, during the year under review, pursuant to the provisions of Companies (Amendment) Act 2017, NRC

decided to continue existing method of performance evaluation through circulation of performance evaluation sheets based on SEBI Guidance Note dated 5th January, 2017 and that only Board should carry out performance evaluation of Board, Committees and Individual Directors.

An assessment sheet based on SEBI Guidance Note, containing the parameters of performance evaluation along with rating scale was circulated to all the Directors. The Directors rated the performance against each criteria. Thereafter, consolidated score was arrived. Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the Board has carried out performance evaluation of its own, evaluation of working of the Committees and performance evaluation of all Directors in aforesaid manner.

A meeting of Independent Directors of the Company was held on 2nd November, 2018, in which Independent Directors inter-alia evaluated performance of Executive Chairman, Vice Chairman, other Whole-time Directors and the Board and committees as a whole through performance evaluation sheets.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134 (3) (c) and 134(5) of the Companies Act, 2013, your Directors, to the best of their knowledge and belief and according to the information and explanations obtained by them, state and confirm that:

1. In the preparation of the annual accounts for the year ended 31st March, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. Such accounting policies as mentioned in the notes to the Financial Statements for the year ended 31st March, 2019 have been selected and applied consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2019 and of the profit of the Company for the year ended on that date;

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. The annual financial statements for the year ended 31st March, 2019 have been prepared on a going concern basis;

5. Internal financial controls to be followed by the Company have been laid down and that the said financial controls were adequate and were operating effectively;

6. Proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems were adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITY

The key philosophy of all our Corporate Social Responsibility (CSR) initiatives is guided by our belief "Every Smile Counts..." Our CSR projects focus on participatory and collaborative approach with the community. Over a period of 5 years, your Company has carried out CSR activities in the areas of Education, Healthcare, Women empowerment and Water and Sanitation.

In compliance with the provisions of the Companies Act, 2013, your Company has adopted a Corporate Social Responsibility (CSR) policy which is available on web-link https://www.indocount.com/images/ investor/ICIL-CSR-Policy.pdf

Your Company implements the CSR projects through 'Indo Count Foundation' and has also collaborated with other trusts for carrying out CSR Activities. The Report on CSR activities implemented by your Company during the year under review is provided as "Annexure 2" to this Report.

AUDIT COMMITTEE

Mr. Dilip J. Thakkar and Mr. Siddharth Mehta, Independent Directors were appointed as members of the Audit Committee w.e.f. 8th February, 2019. As on 31st March, 2019, the Audit Committee comprises of 6 Directors / Members out of which 5 are Independent Directors and 1 is Executive Director. The said Composition is as per Section 177 of the Companies Act, 2013 and Regulation 18 of the Listing Regulations. More details on Audit Committee are given in Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board.

STATUTORY AUDITORS

In accordance with the provisions of Section 139 of the Companies Act, 2013, at the Annual General Meeting held on 21st August, 2017, M/s. Suresh Kumar Mittal & Co., Chartered Accountants (Firm Registration No. 500063N) were appointed as the Statutory Auditors of the Company for a period of 5 years commencing from the conclusion of 28th Annual General Meeting (AGM) till the conclusion of 33rd AGM subject to the ratification by the members at every AGM.

The requirement to place the matter relating to appointment of Auditors for ratification by members at every Annual General Meeting was omitted vide notification dated 7th May, 2018, issued by the Ministry of Corporate Affairs. Accordingly, no resolution is proposed for ratification of appointment of Auditors in ensuing AGM of the Company.

The Company has received a letter from M/s. Suresh Kumar Mittal & Co., Chartered Accountants confirming that they are eligible for continuing as Statutory Auditors of the Company.

AUDITORS' REPORT

The Auditors' Report on standalone and consolidated financial statements for the year ended 31st March, 2019 forms integral part of this Annual Report. The Auditors' Report does not contain any qualifications, reservations, adverse remarks, disclaimer or emphasis of matter. Notes to the Financial Statements are self-explanatory and do not call for any further comments.

The Statutory Auditors of the Company have not reported any fraud under Section 143 (12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment for the time being in force).

SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with rules thereunder, the Board has appointed M/s. Kothari H. & Associates, Practicing Company Secretaries to conduct Secretarial Audit of the Company for the year ended 31st March, 2019. The Secretarial Audit Report issued by them in Form No. MR-3 is provided as "Annexure 3" to this Report. The Secretarial Audit Report does not contain any qualifications, reservations or adverse remark.

SEGMENT

The Company operates only in a single segment i.e. Textile Segment. PUBLIC DEPOSITS

During the year under review, your Company has not accepted any deposits from public, under Chapter V of the Companies Act, 2013.

CORPORATE GOVERNANCE REPORT

As per Regulation 34(3) read with Schedule V of the Listing Regulations, your Company has complied with the requirements of corporate governance. A Corporate Governance Report along with Statutory Auditors' Certificate confirming compliance of corporate governance for the year ended 31st March, 2019 is provided separately and forms integral part of this Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, Management Discussion and Analysis containing Information inter-alia on industry trends, your company's performance, future outlook, opportunities and threats for the year ended 31st March, 2019, is provided in a separate section forming integral part of this Annual Report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) of the Act, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, Extract of the Annual Return in Form No. MGT-9 for the year ended 31st March, 2019 is annexed as an "Annexure 4" and is also available on the website of the Company at https://www.indocount.com/images/ investor/Form-MGT.9-Extract-of-Annual-Return-for-the-year-ended- March-31-2019 2.pdf Further, pursuant to Section 134(3)(a) of the Act, a copy of Annual Return for the year ended 31st March, 2019 will be hosted on the website of the Company at www.indocount.com .

SECRETARIAL STANDARDS

During the year under review, your Company has complied with all the applicable secretarial standards. The same has also been confirmed by Secretarial Auditors of the Company.

BUSINESS RESPONSIBILITY REPORT

Pursuant to the Regulation 34 of the Listing Regulations, Business Responsibility Report (BRR) for the year ended 31st March, 2019 is hosted on your Company's website and the web-link thereto is as given below: https://www.indocount.com/images/investor/

Business-Responsibilitv-Report-2018-20191.pdf.

RELATED PARTY TRANSACTIONS

All Related Party Transactions entered during FY 2018-19 were on arm's length basis and in the ordinary course of business and in compliance with the applicable provisions of the Companies Act, 2013 and the Listing Regulations. There were no material related party transactions during the year under review that would require approval of shareholders under Listing Regulations. The prior omnibus approval of Audit Committee is obtained for all Related Party Transactions. A statement of all Related Party Transactions is reviewed by the Audit Committee on a quarterly basis. Your Company has adopted a policy on Related Party Transactions which has been uploaded on the Company's website and can be accessed at https://www.indocount.com/images/investor/Policy on Related Party Transactions.pdf

Pursuant to Section 134 of the Companies Act, 2013, particulars of contracts / arrangements with Related Parties are provided in Form AOC-2 as "Annexure 5" to this Report.

PARTICULARS OF LOANS, INVESTMENTS, GUARANTEES, SECURITIES UNDER SECTION 186 OF THE COMPANIES ACT, 2013

During the year under review, your Company has neither given loan to any bodies corporates or any other persons nor provided any corporate guarantee or security under section 186 of the Companies Act, 2013.

As regards investments, during the year under review, your Company has made investment of AED 27,00,000 (equivalent to C5.22 crore) in the shares of Indo Count Global DMCC (Formerly known as Hometex Global DMCC), a wholly owned subsidiary of your Company and has made investment in certain mutual funds.

Particulars of investments and disclosure required under Section 186(4) of the Companies Act, 2013 are provided in the notes to the standalone financial statements.

RISK MANAGEMENT

Your Company recognizes that risk is an integral part of the business and is committed to manage the risks in a proactive and efficient manner. Your Company has adopted Risk Management Policy for risk identification, assessment and mitigation. Major risks identified by the Company are systematically addressed through mitigating actions on a continuous basis. Some of the risks that the Company is exposed to are financial risks, raw material price risk, regulatory risks, Forex risks and economy risks. Risk factors and its mitigation are covered extensively in the Management Discussion and Analysis. The Internal Audit Reports and Risk Management Framework are reviewed by the Audit Committee.

Further, as a matter of good Corporate Governance, though not mandatory, pursuant to Regulation 21 of the Listing Regulations, the Board of Directors of your Company at its meeting held on 8th February, 2019 constituted Risk Management Committee comprising of Mr. Kailash R. Lalpuria, Executive Director & CEO as Chairman, Mr. Prem Malik, Mr. Siddharth Mehta, Non-Executive Independent Directors and Mr. K. Muralidharan, Chief Financial Officer as its Members.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Pursuant to the provisions of Section 177 (10) of the Companies Act,

2013 and Regulation 22 of the Listing Regulations, your Company has established a vigil mechanism for the Directors and employees of the Company to report concerns about unethical behaviour, actual or suspected incidents of fraud or violation of Code of Conduct. The details of Vigil Mechanism/ Whistle Blower Policy are provided in the Corporate Governance Report. The Vigil Mechanism/Whistle Blower Policy may be accessed on the Company's website at https:// www.indocount.com/images/investor/Whistle-Blower-Policy-Vigil- Mechanism.pdf

POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

Your company always endeavours and provide conductive work environment that is free from discrimination and harassment including sexual harassment. Your Company has zero tolerance towards sexual harassment at workplace and has adopted a policy for prevention of Sexual Harassment of Women at workplace. The Company has set up an Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to look into complaints relating to sexual harassment at workplace of any woman employee. During the year under review, no complaints pertaining to sexual harassment were received and no complaint was pending as on 31st March, 2019.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING & OUTGO

Information on Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo required under Section 134(3) (m) of the Companies Act, 2013 read with rules thereunder is given as "Annexure 6" forming part of this Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information required pursuant to Section 197 (12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,

2014 regarding remuneration of Directors, Key Managerial Personnel and other related disclosure is given as "Annexure 7" to this Report.

Information required under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 viz. Details of top ten employees of the Company in terms of remuneration drawn during FY 2018-19 and particulars of employees drawing remuneration in excess of the limits specified in Rule 5(2) of the said rules is provided in Annexure forming part of this report. As per the provisions of Section 136 of the Companies Act, 2013, the Annual Report and Accounts are being sent to the members of the Company excluding the said Annexure. Any member interested in obtaining a copy of said Annexure may write to the

Company Secretary at the Registered Office of the Company. The said annexure will be available for inspection by the members at the Registered Office of the Company twenty one days before and upto the date of ensuing Annual General Meeting during the business hours on working day.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company maintains adequate internal control system and procedures commensurate with its size and nature of operations. The internal control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorisation of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances.

The internal control system includes a well-defined delegation of authority and a comprehensive Management Information System coupled with quarterly reviews of operational and financial performance, a well-structured budgeting process with regular monitoring of expenses and Internal audit. The Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.

SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS

During the year under review, no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of your Company between the end of the financial year 2018-19 and the date of this report.

GENERAL

Your Directors state that Cost audit was not applicable to the Company during the year under review, however, pursuant to the Order made by the Central Government for the maintenance of cost records under section 148(1) of the Act, the prescribed accounts and records have been made and maintained. There was no change in the general nature of business of your Company.

ACKNOWLEDGEMENTS AND APPRECIATION

Your Directors wish to place on record their appreciation for dedicated service and contribution made by the employees of the Company at all levels.

Your Directors would also like to place on record their appreciation for the continued co-operation and support received by the Company during the year from its customers, suppliers, bankers, financial institutions, business partners and other stakeholders.

On behalf of the Board of Directors
ANIL KUMAR JAIN
Date: 22nd May, 2019

Executive Chairman

Place: Mumbai DIN: 00086106

   

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Investor_trading@globecapital.com /  igr@globecapital.com (For Trading)     globedp@globecapital.com (For DP)    Investor_pms@globecapital.com (For PMS)     
commigr@globecapital.com (For Commodities)
Equity SEBI Registration No INZ000177137. Exchange Registration Nos NSE : TM No. - 06637, Clearing No.- M50302 | BSE : Clearing No.- 3179 | MSEI : TM Code-1004, Clearing Member Code- 4 | SEBI Registration for DP : IN-DP-NSDL-97-99, NSDL- DP ID: IN300966, CDSL DP ID: 12020600 | SEBI Research Analysts Registration No. INH100001187 | SEBI PMS Registration No. INP00000236
* Through subsidiary Globe Commodities Ltd. --> Commodity SEBI Regn. No. - INZ000024939, Exchange Regn. Nos. - MCX CM ID: 8550 TM ID: 10735, NCDEX CM ID: M50011 TM ID: 00012, NMCE ID: CL0111, ICEX ID: 1009, NCDXSPOT-CR-07-10011,
** Through step in subsidiary Globe Comex International DMCC --> DGCX **TM Id.1064, CM Id.3064*
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