Indian Oil Corporation Ltd
Chairman Speech
Dear IndianOil Investors,
My heartiest greetings to you on my personal behalf and on behalf of IndianOilPeople.
It is my pleasant duty once again to present to you the Integrated Annual Report of
your Company for the financial year 2018-19, focussing on the performance highlights of
the year and the high-growth agenda lined up for the future.
You will notice that, like last year, this year too we have followed the Integrated
Reporting format focussing on the Company’s six key capitals -- Financial Capital,
Manufactured Capital, Human Capital, Intellectual Capital, Social & Relationship
Capital and Natural Capital.
Without an iota of doubt, IndianOil’s strength as a successful enterprise stems
from its rich human capital. With a proud legacy of fuelling the growth of all segments of
the economy for the past six decades, the 33,000-strong team of lOCians is gearing to play
a leadership role in these exciting times as a new India rises on the global arena.
IndianOil People take pride in being future-ready by continuously upgrading their skills
and capabilities.
Your Company has kept its promises to the nation since inception, working for
self-sufficiency and security in energy and related areas. Surmounting many challenges, it
achieved sustained growth in sync with the nation to become India’s leading Maharatna
PSU and one of the largest commercial undertakings.
As the fastest growing economy in the world, India requires access to abundant energy,
delivered in new and affordable ways. IndianOil is fully geared for the challenge. Over
50,000 customer touch points of your Company spread across every nook and corner of the
nation provide energy solutions to a billion-plus customers to keep India on the move. And
we are further expanding our refining capacity, supply & distribution channels and
marketing network in line with the growing domestic demand.
Today, as a low-carbon future beckons on the horizon, IndianOil is engaged in building
a future full of clean and green energy. We are leading the industry in an unprecedented
quantum leap from BS-IV fuels to a world-standard BS-VI compliant regime by April 2020. In
line with global trends, we are investing in a big way in India’s emerging natural
gas economy with new products and offerings for diverse customer groups. We are deeply
committed to the sustainability principle and are progressively integrating alternative
energy and renewables in our operations as well as in our expanding bouquet of offerings.
Global and Indian economic scenario
• Global economic growth slowed down to 3.6% in 2018, from 3.8% in 2017
• Growth in emerging economies also decelerated to 4.5% in 2018, from 4.8% in 2017
• Economic deceleration due to rising trade protectionism, US-China trade
tensions, etc.
• Indian economy grew by 6.8% in 2018, fastest growing large economy
• Growth propelled by private spending, industry, manufacturing and capital
formation
• Retail inflation (CPI) slowed down to 3.41%, lowest in last seven years
The fount of your Company’s future-readiness is its world-class R&D Centre,
which gives shape to products and technologies of the future. Its rich repository of
intellectual capital has now crossed a major milestone of over a thousand patents.
INDUSTRY SCENARIO
The hydrocarbons sector has contributed enormously to global economic progress over the
last century. Today, however, it is facing competition from new and emerging energy
options and technologies. The 21st century is definitely going to witness
economies based on clean fuels, and low-carbon options will get progressively entrenched
in the energy mix, with policy backing. It is time for the oil & gas corporates to
once again reinvent themselves and continue to play a lead role, especially in those parts
of the world like India where primary energy consumption continues to register a dramatic
rise.
The need of the hour is to integrate new technologies like digitalisation, Artificial
Intelligence, Internet of Things, etc., in all segments of the industry, together with
innovative process technologies, to provide efficient, clean and green energy solutions
for all customer segments and businesses to ensure that nation’s economic growth is
not hampered in any way.
The domestic refining sector is attempting a very ambitious project of leap-frogging
from BS-IV to BS-VI fuels regime. Indian refiners are on track to usher in the cleanest
automotive fuels across the country from April 2020. In fact, IndianOil refineries have
completed over 90% of the BS-VI projects and should be ready to supply the upgraded fuels
well within the stipulated timeline. The success of this ambitious initiative will further
enhance India’s credentials as a world-class refining hub in Asia, with the fourth
largest refining capacity (249.4 MMTPA) in the world.
The country has robust supply & distribution channels, a 30,000-km network of oil
& gas pipelines, about 24,000 LPG distributors, and over 64,600 fuel stations, with
another 55,000 in the offing.
Road to reform: India’s fuels upgradation programme
• BS-IV fuels implementation across India: Completed by April 2017
• BS-VI fuels implementation in NCT: Completed by April 2018
• BS-VI implementation in NCR and Agra: Underway from April to Oct. 2019
• BS-VI fuels implementation across India: To be completed by April 2020
• Estimated investment of OMC refineries on BS-III to BS-VI conversion projects:
Rs. 53,500 crore
Global oil & gas scenario
• Global primary energy consumption grew by 2.3% in 2018, as against 1.9% in 2017
• Oil demand grew by 1.2%, with natural gas as the fastest growing fuel,
accounting for 44.5% of the increase in total energy demand
• Brent crude oil prices averaged $71.1 per barrel in 2018, registering a
significant increase of $16.7 per barrel over 2017
Indian oil & gas scenario
• India’s petroleum products consumption in 2018-19 was 211.6 MMT, with 2.7%
growth over 2017-18
• Petrol consumption rose by 8.1%, diesel by 3%, and LPG by 6.8%
• India’s refining capacity stood at 249.4 MMTPA at the end of 2018-19,
second largest in Asia
• Crude oil imports rose by 2.8% to 226.6 MMT
• Indian crude oil basket averaged at $69.8/barrel in 2018-19, 23.8% higher than
2017-18 level
INDIANOIL: STRENGTHENING CORE BUSINESS
Your Company’s performance in the financial year 2018-19 has been exceptional in
terms of both operational and financial parameters. Besides posting all-time high records
in the three major parameters - sales as well as refineries and pipelines throughputs -
the Company crossed the Rs. 6 lakh crore milestone in turnover for the year, with handsome
profits. With numero uno position in the downstream petroleum sector, the Company
continued with its legacy of putting the nation first and providing viable fuel solutions
to diverse customer groups, while at the same time strengthening its new verticals of
E&P, Petrochemicals and Gas.
Marketing
Your Company, which caters to nearly half of India’s petroleum consumption,
registered its best ever sales volumes in 201819. In the backdrop of India’s primary
energy demand outpacing global demand, rising infrastructure projects and a surge in
commercial vehicle sales led to record high diesel consumption in 2018-19. Matching this
pace of growth, IndianOil maintained its place at the top and did well in institutional
sales too, registering increase in market share in all products. Similarly, your
Company’s time-tested commitment and service to the defence forces and the security
eco-system of the nation have won many accolades.
IndianOil: Fuelling a billion dreams
• IndianOil’s turnover crossed Rs. 6 lakh crore milestone in 2018-19
• Sales, including exports, in 2018-19: 89.89 MMT
• Exports in 2018-19:5.24 MMT
• Number of customer touch-points crossed the
50,000 mark
• Total No. of fuel stations automated: 27,700
• New heights in aviation fuelling, with 116 AFSs.
As the industry leader in retail sales, IndianOil completed automation of its
countrywide fuel stations network during the year to enhance Q&Q (quality &
quantity) assurance to its customers. The ambitious Project Dhruva initiative
currently underway encompasses new technologies and services to achieve greater efficiency
in operations and a superior buying experience for your Company’s retail customers.
LPG for all: Clean fuel, better life
• Total LPG households in India: 26.5 crore
• PaHaL households receiving subsidy in their bank accounts: 24.5 crore
• PMUY target: Deposit-free LPG connections to 8 crore BPL households by 2020
• PMUY target achieved till now: 7.2 crore households
• LPG penetration achieved: Over 94%
• New Indane connections released in 2018-19: Over 2 crore, highest in a year
• IndianOil’s LPG sales surpassed 1 million tonnes a month
Over the last five years, your Company has had the privilege of spearheading mega
schemes like PaHaL LPG subsidy scheme, #GiveItUp campaign and PMUY
(Pradhan Mantri Ujjwala Yojana) that have made clean energy accessible across
socioeconomic divides.
IndianOil has been extending the reach of its Indane Superbrand to more
households every year. Leading the push for clean energy, the Company released the highest
ever number of new LPG connections in a year in 2018-19.
SERVO, another IndianOil Superbrand, achieved top position in the retail lubes
segment for the first time in recent years, besides registering impressive growth in
overall finished lubes. Your Company’s aviation fuelling business too gained higher
altitude with addition of nine more Aviation Fuel Stations (AFS) during the year.
Your Company exported 5.24 million tonnes of products in 2018-19. Product exports to
Nepal rose from 2.1 to 2.4
million tonnes and export of Indane Nanocut (additised LPG suited for high-temperature
industrial applications) to Bangladesh commenced during the year. IndianOil opened a new
representative office in Nepal in addition to existing offices in Myanmar and Bangladesh,
and full-fledged subsidiaries operating in Sri Lanka, Mauritius, Singapore and UAE.
Refineries
IndianOil refineries excelled in all major physical parameters and achieved a record
combined crude oil throughput during 2018-19. The refineries also registered the best ever
numbers in Specific Energy Consumption (MBN), Energy Intensity Index (Ell) and Fuel &
Loss.
A world-scale Polypropylene (PP) plant was commissioned at Paradip Refinery in Feb.
2019 to act as the mother unit in nurturing the downstream plastics processing industry in
the region. Work has also commenced on a Monoethylene Glycol (MEG) plant at Paradip
Refinery, which is envisaged as a key driver for the textiles industry in the region,
especially for polyester fibre. Two other major projects in progress are: capacity
expansion of IndianOil’s Barauni Refinery and an ATF production unit using the
in-house INDJet technology of IndianOil’s R&D Centre.
The energy for India’s rise
• Refineries throughput in 2018-19: 71.82 MMT
• Major projects commissioned during 2018-19:
• PP plant at Paradip Refinery: 680 KTA
• Major projects commenced during 2018-19:
• MEG plant at Paradip Refinery: 357 KTA
• Barauni Refinery expansion from 6 to 9 MMTPA
• ATF production unit using IndJet technology
• 4.6 MMT term contracts concluded for crudeoil from USA
For the first time, your Company concluded term contracts for sourcing crude oil from
USA during the year, besides enhancing its capabilities to process crude oil grades from a
wider and cheaper basket, with flexibility for sourcing additional volumes in term
contracts to manage contingencies.
Pipelines
During 2018-19, IndianOil’s crude oil & product pipelines clocked the highest
ever combined throughput, setting a new record for the fifth consecutive year. The
countrywide pipelines network provides immense competitive advantage to the Company in the
new era of digitally-aided logistics.
Pipelines: Arteries for energy flow
• Pipelines throughput during 2018-19: 88.53 MMT
• Pipelines length commissioned in 2018-19: 950 km
• Major among them:
• Paradip-Haldia-Durgapur LPG pipeline: 516 km
• Jaipur-Panipat naphtha pipeline: 344 km
• Total length of pipelines network: 14,231 km
• Combined throughput capacity: 94.2 MMTPA for liquid pipelines and 21.69 MMSCMD
for gas pipelines
• Major pipeline projects underway:
• Kandla-Gorakhpur LPG pipeline: 2,757 km
• Indradhanush gas grid in the northeast: 1,656 km
Work has commenced on two major pipeline projects with joint venture (JV) partners
during the year 2018-19. The Kandla-Gorakhpur LPG Pipeline, on completion, will be the
longest LPG pipeline in the world, and will directly feed 22 bottling plants en route. The
project will be executed by a JV of IndianOil, BPCL and HPCL. IndianOil has also formed a
JV, Indradhanush Gas Grid Ltd., with ONGC, OIL, GAIL and NRL to develop a gas pipelines
grid connecting all the State capitals of the northeast.
Other than its City Gas Distribution (CGD) projects and those with JV partners, 17
pipeline projects of the Company with a combined capex of about Rs. 24,000 crore are in
various stages of implementation. On their completion in the next three years,
IndianOil’s pipelines network will expand to about 21,500 km.
Research & Development
IndianOil’s R&D Centre is shaping into a game-changer in the ensuing
competitive scenario as your Company adds new technologies, products and services to its
bouquet of offerings.
The year 2018-19 saw your Company further build upon the confidence reposed by its
customers by developing and commercialising products and process technologies that cater
to the changing industry needs.
Inventing the future with world-class R&D
• Over four decades of R&D expertise in lubricants formulation, refinery
processes, pipeline transportation, catalysts & additives, alternative fuels, etc.
• Over 1,000 patents bled till date; 100 to 120 patents per annum in the last five
years
• Over 100 new lubricant formulations developed in 2018-19, 87% commercialised
• State-of-the-art Product Applications Development Centre for polymers business
• Support to start-ups in energy and social innovation sectors
Adding to the Company’s intellectual wealth, the R&D Centre crossed a stellar
milestone of filing its 1,001st patent recently. IndianOil’s IP
(Intellectual Property) portfolio currently comprises 794 active patents, of which 542
patents were granted abroad and 252 in India. Your Company has a higher commercialisation
rate for its patents than the global average. Several of the quality upgradation projects
implemented at IndianOil refineries for production of BS-VI fuels are based on deep
desulphurisation, isomerisation and dimerisation technology patents developed in-house.
The R&D Centre also commissioned a 5 tonnes-per-day plant at Faridabad for
converting organic waste to biogas with a methane content of over 80% based on a novel
bio- methanation technology developed in-house. The Centre is also commercialising a 2G
ethanol process, together with a novel enzyme, which reduces ethanol production costs by
30%.
Your Company incurred a capital expenditure of Rs. 28,200 crore in 2018-19; the capital
outlay for the current fiscal is Rs.25,083 crore.
BUILDING NEW BUSINESSES
Besides making significant investments in upstream assets and petrochemicals, which are
making significant additions to the Company’s business in terms of equity oil and
profitability, IndianOil is integrating natural gas and renewables in its energy value
chain in a big way to be ready for a low-carbon future.
Exploration & Production
With a balanced portfolio of producing, discovered and exploration assets, your Company
achieved significant progress in terms of 2P reserves, production volumes, equity oil and
revenues during the year 2018-19.
IndianOil currently has participating interest (PI) in 10 domestic and 12 overseas
E&P assets spread across 10 countries. The year 2018-19 was marked by acquisition of
PI in E&P assets in Oman, Abu Dhabi and Israel.
Heading upstream for energy security
• Balanced portfolio of E&P assets; 10 in India and 12 overseas
• Overseas assets spread across 10 countries: Canada, USA, Russia, Venezuela, Abu
Dhabi, Oman, Libya, Nigeria, Gabon and Israel
• Strategic tie-ups with over 20 reputed national & international energy
corporates
• Acquired participating interest in E&P assets in Oman, Abu Dhabi and Israel
in 2018-19
Petrochemicals
IndianOil is fast evolving into a petrochemicals major and has registered a robust
11.4% growth in sales in 2018-19. Backed by world-scale plants and world-class technology,
IndianOil’s PROPEL brand petrochemicals cover over 80% of a broad spectrum
applications in plastics and are exported to over 70 countries.
Your Company has invested heavily in this vertical over the last two decades, incurring
a capex of over Rs. 25,000 crore
Propelling growth with petrochemicals
• Petrochemicals sales in 2018-19: 2.64 MMT
• Production capacity enhanced to 3.15 MMT
• Major ongoing projects:
• MEG plant at Paradip
• Expansion of Naphtha Cracker at Panipat
• New projects envisaged till 2023-24
• Acrylic acid/Oxo-alcohol project at Gujarat
• PX/PTA project at Paradip
• Petcoke gassification in Paradip
• Textiles project in Eastern India
• PBR project at Panipat
in major petrochemical projects such as LAB plant at Gujarat, PX/PTA plant and Naphtha
Cracker at Panipat, and PP plant at Paradip. Among the major ongoing projects are MEG
plant at Paradip and capacity expansion of Naphtha Cracker at Panipat.
IndianOil has firm plans to invest Rs. 26,000 crore on various ongoing and new
petrochemical projects till 202324 to consolidate business. These projects include revamp/
augmentation of existing capacities and new projects as well as equity investment in Hindustan
Urvarak & Rasayan Ltd. (HURL).
The IndianOil Board has also accorded approval for a Plastics Park at Paradip through a
JV with Industrial Development Corporation of Odisha. Similarly, Board approval has been
obtained for land procurement and finalisation of a JV partner for a textiles project at
Bhadrak in Odisha. Industrial Promotion & Investment Corporation of Odisha has
allotted 60 acres of land for the textiles project.
Natural Gas
Natural gas is transforming into a major businessline for your Company, and the recent
commissioning of the state-of-the-art LNG import terminal at Ennore has given it a big
boost.
As the second largest player in this growing segment, IndianOil is building
infrastructure and retail networks to reach out to all user segments:
industry-transport-homes-commercial establishments.
Fuelling the future with natural gas
• Natural gas sales in 2018-19: 3.96 MMT
• Capacity of Ennore LNG terminal: 5 MMTPA
• Geographical Areas (GA) won by IndianOil on its own after 9th and 10th
round of CGD bidding: 17
• GA won in partnership with JVs: 23
• Total tally of GAs with IndianOil: 40
• Investments in CGD over next 8 years, including equity contribution inJVs: Rs.
10,000 crore
With a portfolio of about 60 R-LNG customers, besides supplies to the Company’s
own refineries at Mathura, Panipat and Koyali, IndianOil registered a 2.6% growth in
natural gas sales in 2018-19.
Besides being a JV partner in Indradhanush natural gas pipeline grid in the Northeast,
your Company is investing in two more joint ventures that are laying three gas pipelines
of a combined length of 3,760 km covering nine States.
Your Company is pursuing an ambitious agenda in city gas distribution (CGD) covering 40
Geographical Areas (GA) on its own as well as with reputed joint venture partners.
IndianOil’s investment on development of CGD networks in the next eight years is
likely to be about Rs. 10,000 crore.
Alternative Energy
Your Company is fully aligned to the country’s aspirations to transit to clean
energy and has planned Rs. 25,000 crore investment in green energy projects. Besides a
target to scale up its solar energy and wind-power portfolio to 260 MW by the year 2020,
IndianOil has initiated diversification into alternative, renewable energy and
bio-fuels-2G &3G ethanol, waste-to-energy and compressed bio-gas (CBG).
Your Company is spearheading the Government’s innovative SATAT (Sustainable
Alternative Towards Affordable Transportation) initiative launched in 2018 as a waste-
to-wealth measure. With similar calorific value and other properties, CBG has the
potential to replace CNG as an affordable fuel in automotive, industrial and commercial
uses by conversion of biomass, or any kind of organic waste. In fact, the evolving CBG
programme will go a long way in reducing India’s dependence on crude oil imports.
Green energy for a green future
• Rs. 25,000 crore investment planned in alternative energy and sustainable
development projects
• Solar energy and wind-power portfolio to be scaled up from 212 MW to 260 MW by
the year 2020
• LOIs issued for 96 plants to supply 782 tonnes per day of CBG under SATAT
initiative
• 5,000 more Company fuel stations converted to run on solar energy in 2018-19
• Cumulative installed capacity of Company’s 14,000+ solar-operated fuel
stations: 77 MW
FUTURE-READY CORPORATE
Your Company is implementing an ambitious Rs. 2 lakh crore investments plan in the next
5-7 years to evolve into a future- ready corporate that provides comprehensive energy
solutions to diverse user groups in an exciting phase of energy transition and technology
disruptions.
Besides focus on refinery expansions, new technologies for clean fuels & enhanced
outputs, and refinery-petrochemicals integration, IndianOil is aggressively leveraging its
R&D expertise to move into horizon technologies like 2G & 3G ethanol, bio-fuels,
coal gasification, H-CNG, Hydrogen fuel cells, battery technologies, etc. These
technologies, along with cleaner fuels and higher engine efficiencies, can offer
sustainable solutions to today’s energy challenges.
Keeping this in view, your Company is pursuing a number of new technologies and/or
pilot studies in the areas of refinery processes, petrochemicals & polymers,
alternative energy and bio-energy in collaboration with reputed partners in India and
abroad.
Going closer to consumption centres and consumers in an economical and
environment-friendly manner has been the philosophy behind IndianOil’s pipeline
network expansion. And, as the Company grows its LPG and LNG verticals rapidly, its gas
pipelines network too is set for phenomenal growth.
Your Company aspires to be a major player in natural gas, with leadership in the R-LNG
segment, and is taking steps to enhance its share in LNG sourcing, import terminals,
crosscountry pipelines, city gas distribution networks and bulk supplies by road-tankers.
Your Company is targeting its own equity oil & gas of 7 MMTPA from its upstream
portfolio by the year 2023-24 from 4.39 MMTPA currently, and is continuously on the
lookout for acquisition of stakes both in E&P companies as well as individual assets.
You may be aware that your Company had incorporated Hindustan Urvarak & Rasayan
Ltd. (HURL) in June 2016 as a joint venture with Coal India Ltd. and NTPC for revival
of three fertiliser plants at an estimate cost of Rs. 21,000 crore. Work is progressing at
a fast pace on the three plants located at Gorakhpur (Uttar Pradesh), Sindri (Jharkhand)
& Barauni (Bihar) and commercial production of neem-coated urea from all the three
plants is likely to commence in the first half of the year 2021.
In step with the times
Your Company has a remarkable legacy of growing in step with the times. A certified Great
Pace to Work, IndianOil is continuously improving its human eco-system to achieve
cross-divisional synergy and a solutions-oriented approach. The human resource capital is
being leveraged in a big way to
make your Company a truly learning organisation with access to both natural and formal
developmental opportunities for all. E-learning is being mainstreamed across the
organisation and lOCians across functions are being actively encouraged to acquire new
knowledge and skills to be active partners of a 21st century organisation
focussed on growth opportunities of the future. With the enterprise getting increasingly
younger, new and innovative learning models are being deployed to enable lOCians to
continuously improve products and processes.
Your Company’s business strategy has always been in tune with technology and
innovations. We have installed the best of automation processes and the latest safety
systems at our installations. Optimised operations and logistics, smart terminals,
automated fuel supply points and a dedicated held force are helping us lead the
competition. We have now embarked on digital transformation of the organisation to serve
and sustain the trust of our billion-plus customers across 50,000+ customer touch-points.
Your Company’s 33,000-strong team represents a formidable array of talent and
skills, technical and managerial expertise, demographic diversity and a ‘can do’
attitude infused with the core values of Care, Innovation, Passion and Trust.
This signifies a very bright future for IndianOil. The idea is to create an eco-system of
growth for all-round excellence in our pursuit to create happy customers through
high-quality products and services, delivered efficiently.
Generations of lOCians have had one thing in common - a steadfast commitment to the
idea of India, and IndianOil as ‘The Energy of India.' As we complete 60 years
of our operations, I can confidently say that the best of IndianOil has just begun.
I look forward to your support and encouragement for the journey ahead.
(Sanjiv Singh)
Chairman
Indian Oil Corporation Ltd
Directors Reports
Dear Members,
It gives me immense pleasure to present the 60th Annual Report and the
second Integrated Annual Report of the Corporation for the financial year ended 31st
March 2019, along with the Audited Standalone and Consolidated Financial Statements and
Auditors' Report thereon on behalf of the Board. During the year, the Corporation
continued to achieve excellent performance on all operational parameters in all business
verticals, while meeting the energy needs and aspirations of the country.
PERFORMANCE REVIEW
FINANCIAL
| Particulars |
2018-19 |
2017-18 |
|
US$ Million |
Rs in Crore |
US$ Million |
Rs in Crore |
| Revenue from Operations (Inclusive of Excise Duty & Sale of Services) |
86,684 |
6,05,924 |
78,565 |
5,06,428 |
| EBITDA (Profit Before Exceptional Items, Finance Cost, Tax, Depreciation &
Amortisation) |
5,286 |
36,952 |
6,688 |
43,114 |
| Finance Cost |
616 |
4,311 |
540 |
3,483 |
| Depreciation |
1,075 |
7,514 |
1,096 |
7,067 |
| Profit Before Tax & Exceptional Items |
3,595 |
25,127 |
5,052 |
32,564 |
| Exceptional Items |
- |
- |
- |
- |
| Profit Before Tax |
3,595 |
25,127 |
5,052 |
32,564 |
| Tax Provision |
1,178 |
8,233 |
1,740 |
11,218 |
| Profit After Tax |
2,417 |
16,894 |
3,312 |
21,346 |
| Balance Brought Forward from Last Year |
|
|
|
|
| Less: Appropriations |
|
|
|
|
| Interim Dividend paid |
1,112 |
7,775 |
1,397 |
9,005 |
| Final Dividend paid |
271 |
1,896 |
74 |
474 |
| Dividend Distribution Tax |
284 |
1,985 |
298 |
1,921 |
| Insurance Reserve (Net) |
3 |
18 |
3 |
20 |
| Bond Redemption Reserve |
90 |
631 |
78 |
503 |
| CSR Reserve (Net) |
- |
- |
- |
(3) |
| General Reserve |
657 |
4,589 |
1,462 |
9,426 |
| Balance Carried to Next Year |
- |
- |
- |
- |
SHARE VALUE
|
2018-19 |
2017-18 |
|
US$ |
|
US$ |
|
| Cash Earnings Per Share |
0.37 |
25.85 |
0.47 |
29.98 |
| Earnings Per Share |
0.26 |
17.89 |
0.35 |
22.52 |
| Book Value Per Share |
1.71 |
118.35 |
1.78 |
116.23 |
Note: Exchange Rate used :-
For 2018-19: Average Rate 1 US$ = D69.90 and Closing Rate 1 US$ = D69.16 as on
31.03.2019 For 2017-18: Average Rate 1 US$ = D64.46 and Closing Rate 1 US$ = D65.18 as on
31.03.2018
PHYSICAL
| Particulars |
2018-19 |
2017-18 |
| Refineries Throughput |
71.82 |
69.00 |
| Pipelines Throughput |
88.53 |
85.68 |
| Product Sales (inclusive of Gas, Petrochemicals & Exports) |
89.89 |
88.76 |
The details of macro-economic, geo-political, financial, industry-specific information
affecting the business of the Corporation and the markets in which it operates are
provided in the Management Discussion & Analysis, which forms part of the Annual
Report
CHANGES IN SHARE CAPITAL / BUYBACK OF SHARES
The Board of your Corporation at its meeting held on 13th December, 2018,
had approved a Buyback of not exceeding 29,76,51,006 fully paid-up Equity Shares of face
value of Rs 10 each ("Equity Shares") from all the existing shareholders /
beneficial owners of equity shares as on the Record Date (25th December, 2018),
on proportionate basis, through the "Tender Offer" process at a price of Rs
149/- per equity share, payable in cash for an aggregate consideration not exceeding Rs
4,435 crore. The offer size was 5% of the aggregate of the fully paid-up equity share
capital and free reserves and 3.06% of the paid-up equity shares in the total paid- up
share capital of the Corporation as per the audited financial statements for the financial
year ended 31st March, 2018.
The Buyback Offer opened on 22nd January, 2019 and closed on 4th
February, 2019. The settlement of Buyback amount was completed on 12th
February, 2019 and 29,76,51,006 Equity Shares were bought back, which were cancelled and
extinguished on 14th February, 2019, thereby resulting in reduction of paid-up
share capital from Rs 9,711.81 crore to Rs 9,414.16 crore.
DISINVESTMENT BY THE PRESIDENT OF INDIA (PROMOTER)
The promoter of IndianOil, i.e., President of India (PoI), was holding 553,34,36,444
equity shares constituting 56.98% of the total equity share capital as on 1st
April, 2018. As part of the Government's disinvestment programme, the PoI, acting through
the MoP&NG, sold shares of the Corporation during the year, as per details given
below:-
1) In June, 2018, the PoI disinvested 2,18,90,396 equity shares in favour of Bharat 22
ETF (an exchange-traded fund comprising - 22 stocks managed by ICICI Prudential Mutual
Fund) whereby the PoI holding reduced to 551,15,46,048 equity shares constituting 56.75%
of the paid-up equity share capital of IndianOil.
2) In December, 2018, the PoI further disinvested 26,13,74,221 equity shares in favour
of CPSE ETF (an exchange-traded
fund comprising - 11 stocks managed by Reliance Nippon Life Asset Management Company)
whereby the PoI holding reduced to 525,01,71,827 equity shares constituting 54.06% of the
paid-up equity share capital of IndianOil.
3) In February, 2019, the PoI sold 17,78,54,068 shares under IndianOil's Buyback of
Shares, and consequently, the shareholding of PoI reduced to 5,07,23,17,759 equity shares
constituting 53.88% of the reduced paid-up equity share capital of IndianOil .
4) In February, 2019, the PoI disinvested 3,72,03,876 equity shares in favour of Bharat
22 ETF whereby the PoI holding further reduced to 503,51,13,883 equity shares constituting
53.48% of the paid-up equity share capital of IndianOil.
5) In March, 2019, the PoI further disinvested 12,29,64,424 equity shares in favour of
CPSE ETF, whereby the PoI holding reduced to 491,21,49,459 equity shares constituting
52.18% of the paid-up equity share capital of IndianOil.
DIVIDEND
The Board of Directors of your Corporation has recommended a Anal dividend of 10%,
i.e., Rs 1/- per equity share of Rs 10/- each, on the paid-up share capital in addition to
the interim dividends totalling to Rs 8.25 per share paid during 2018-19. This is the 52nd
consecutive year for which your Corporation has recommended payment of dividend. So far,
your Corporation has paid a cumulative dividend of Rs 59,077 crore, excluding the Anal
dividend of Rs 941.42 crore recommended for the current year, which is subject to approval
by members at the forthcoming AGM on 28th August, 2019. The Anal dividend shall
be paid to the members whose names appear in the Register of Members as well as the
Beneficial Ownership Position provided by NSDL/CDSL as at the close of 22nd
August 2019.
The Board of your Corporation has formulated a Dividend Distribution Policy and the
dividends declared/recommended during the year are in accordance with the said policy. The
Policy is annexed to the Directors' Report at Annexure-I and is also hosted on the
website of the Company, i.e., www.iocl.com
CONTRIBUTION TO EXCHEQUER
Your Corporation has consistently been the largest contributor to the Government
exchequer in the form of duties, taxes and dividend. During the year, Rs1,93,422 crore was
paid to the exchequer as against Rs1,90,670 crore paid in the previous year. An amount of
Rs1,01,395 crore was paid to the Central Exchequer and Rs92,027 crore to the State
Exchequer as against Rs1,03,362 crore and Rs87,308 crore paid in the previous year
respectively.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of the Companies Act, 2013 and the Accounting
Standards issued by the Institute of Chartered Accountants of India, your Corporation has
prepared the Consolidated Financial Statement for the group, including its subsidiaries,
joint venture entities and associates. The highlights of the Consolidated Financial
Results are as follows:
| Particulars |
2018-19 |
2017-18 |
|
US$ |
' |
US$ |
' |
|
Million |
in Crore |
Million |
in Crore |
| Revenue from Operations |
|
|
|
|
| (Inclusive of Excise Duty & Sale of Services) |
88,304 |
6,17,243 |
79,979 |
5,15,542 |
| Profit Before Tax |
3,709 |
25,927 |
5,344 |
34,450 |
| Profit After Tax |
2,471 |
17,274 |
3,510 |
22,626 |
| Less: Share of Minority |
(15) |
(103) |
68 |
437 |
| Profit for the Group |
2,486 |
17,377 |
3,442 |
22,189 |
Note: Exchange Rate used:-
For 2018-19: Average Rate 1 US$ = Rs69.90
For 2017-18: Average Rate 1 US$ = Rs64.46
INTERNATIONAL TRADE
In order to meet the crude oil requirement of its refineries, your Corporation imported
61.69 million metric tonnes of crude oil during the year, as against 58.01 million metric
tonnes in the previous year. The selection of crude oil is done from a diversified mix of
supply sources. The import of petroleum products during the year was 7.00 million metric
tonnes as against 6.53 million metric tonnes in the previous year. The Corporation also
exported petroleum and petrochemical products during the year. Your Corporation has made
alternate arrangements for sourcing of crude oil, including term contracts for US origin
crudes, to maintain uninterrupted operations at its refineries and to overcome the crude
oil supply concerns due to imposition of sanctions on trade with Iran.
OPERATIONAL PERFORMANCE
Refineries
During the year, the nine refineries of your Corporation performed exceedingly well in
physical parameters to achieve the highest ever crude oil throughput of 71.82 million
metric tonnes as against 69.00 million metric tonnes in 2017-18. A capacity utilisation of
103.8 per cent was achieved during the year as against 99.7 per cent during 2017-18. The
distillate yield of the refineries was 80.4 per cent, same as that of last year. The
refineries also achieved excellent energy parameters of Specific Energy Consumption,
Energy Intensity Index and Fuel & Loss at 71.3, 97.9 and 8.57 per cent as against
72.6, 98.5 and 8.75 per cent respectively registered for 2017-18.
In order to achieve more flexibility in refining operations, nine new crude oil grades
were included in IndianOil's crude oil basket, taking their number to 180. The refineries
are well poised to implement projects to rollout BS-VI fuels w.e.f. 01.04.2020 in the
entire country as well as to meet the IMO (International Maritime Organisation) 2020
guidelines to reduce the sulphur content in bunker fuel.
Pipelines
Your Corporation has an extensive network of pipelines across the length and breadth of
the country for supply of crude oil and products. As on 31.03.2019, the total length of
the pipelines was 14,231 km with capacity of 94.16 million tonnes of crude / product
pipelines and 21.69 MMSCMD of gas pipelines.
The pipelines of your Corporation achieved the highest ever throughput for the fifth
consecutive year, registering a throughput of 88.53 million tonnes as against 85.68
million tonnes in the previous year, registering a growth of 3.3%. The crude oil pipelines
achieved a throughput of 51.33 million metric tonnes as against 51.08 million metric
tonnes during the previous year. The petroleum product pipelines recorded the highest ever
throughput of 37.20 million metric tonnes as against 34.60 million metric tonnes achieved
last year, registering a growth of 7.50 per cent. The gas pipelines also achieved the
highest ever throughput of 1,834 MMSCM during the year, as against a throughput of 1,683
MMSCM in 2017-18.
Marketing
Your Corporation continued to match the pace of growth in the country and maintained
the top place in terms of market share and achieved the highest sales of 79.96 million
metric tonnes of petroleum products during the year, as against 77.13 million metric
tonnes during the previous year.
During the year, the Corporation commissioned 648 retail outlets (fuel stations,
including 335 Kisan Seva Kendra outlets in rural areas) taking their total number
to 27,702. All the retails outlets of the Corporation have been automated as on 31st
March, 2019. During the year, 5,033 retail outlets were solarised, which is the highest
number of retail outlets solarised in a year. Cumulatively, 14,173 retail outlets have
been solarised with an installed capacity of about 77 MW. A new initiative, fuel@doorstep
was launched during the year to ensure door-to-door delivery of products to specific
categories of institutional customers. The Corporation continued to meet the fuel
requirement of defence and railways during the year. In order to ensure uninterrupted
availability of petroleum products in Leh & Ladakh during winter season, when the
region gets isolated from rest of the country, the Corporation successfully completed
Advance Winter Stocking exercise much before the closure of roads. The Corporation also
maintained uninterrupted supply line of petroleum products, including ATF and LPG, in the
State of Kerala during floods.
During the year, the Corporation released the highest new domestic LPG connections to
more than 2 crore customers, out of which 1.68 crore connections were released under Pradhan
Mantri Ujjwala Yojana, to the women of poor households. To meet the increased demand
of LPG, the bottling capacity as well as storage capacity was augmented by 360 TMTPA and
7800 MT respectively and the highest number of 1,782 new LPG distributorships were
commissioned during the year.
SERVO, the leading lubricant brand of your Corporation, registered a growth of 4
per cent in overall finished lubricants and 8.7 per cent in retail lubricants to achieve
the top position in retail lube market. 123 SERVO grade approvals were obtained
from Original Equipment Manufacturers (OEMs) during the year.
The Aviation Service of the Corporation continued to maintain its leadership position
with a market share of 60 per cent. With the commissioning of nine new Aviation Fuel
Stations (AFS), your Corporation now has 116 AFS in the country.
Explosives & Cryogenics
During the year, the Explosives and Cryogenics businesses of your Corporation continued
with excellent performance and recorded the highest ever production and sales of
explosives and cryocans. The Explosives group manufactured and sold 1,83,194 metric tonnes
of explosives during the year, recording a growth of 3.6 per cent over the previous year's
volume of 1,76,757 metric tonnes. The Cryogenics group sold 29,555 units of cryocans and
cryovessels during 2018-19, as against previous year's sale of 28,782 units. During the
year, the Cryogenics group developed new equipment for aviation, lubricants and refineries
segments of the Corporation.
Research & Development
The R&D Centre of your Corporation plays a key role in supporting the business
interests of the Corporation by developing economical, environment-friendly and socially
responsible technology solutions. Apart from its core areas of fuels, lubricants &
refining, the Centre is also focussed on cutting-edge research in the areas of
Nanotechnology, Petrochemicals and Polymers, Biotechnology, Hydrogen Energy, Coal
Gassification/Liquefaction and Gas-to-Liquid.
During the year, 103 lubricant formulations were developed and 87% of them were
commercialised. 110 approvals were received from Original Equipment Manufacturers (OEMs)
during the year.
A pilot plant was set up during the year to demonstrate a novel technology to convert
greenhouse gas (CO2) to bio-fuel and high-value food supplement material
(Omega-3 fatty acids) in collaboration with LanzaTech, USA. The R&D Centre also
developed its own complete bio-methanation solution, including a best-in-class patented
inoculum, process design and technical service support module. A five tonnes-per-day
bio-methanation plant based on this technology was commissioned in March, 2018 at
Faridabad.
In its bid to provide clean air technologies, the R&D Centre developed and patented
the compact reforming process for producing Hydrogen-CNG (H-CNG) blends for use in
internal- combustion engines. Last year, the Hon'ble Supreme Court of India took
cognizance of this technology and directed IndianOil to operate a select number of buses
on Hydrogen CNG mixtures in a Delhi bus depot. The Centre is in the process of setting up
a four tonnes-per-day H-CNG production plant at an identified bus depot and the trials
would be conducted for a period of 6 months on 50 BS-IV compliant CNG buses.
The performance guarantee test-run of DHDS Unit at Gujarat Refinery employing in-house
developed diesel treating technology in collaboration with Engineers India Limited was
successfully carried out. The capacity of the DHDS Unit has been augmented for producing
diesel having sulphur below 10 ppmw.
The R&D Centre filed for 160 patents and was granted 107 patents (30 Indian and 77
overseas) during the year. IndianOil became the first oil & gas PSU to cross the
milestone of 1,000 patents filing in April, 2019 with 794 active patents in its portfolio.
PROJECTS
To maintain its leadership position, your Corporation recognises the importance of
developing countrywide infrastructure and has been consistently investing in several major
and minor projects. Across the Divisions, efforts are made to ensure that the projects are
implemented seamlessly. The projects are financed through an optimum mix of internal
accruals and borrowings from domestic as well as international markets whenever required.
During the year, the Corporation spent over Rs24,500 crore on capital projects at
standalone level. In addition, over Rs3,600 crore was spent on capital expenses through
Special Purpose Vehicle(SPV)/investment in Group companies. Most of the capex requirement
was met through internal accruals.
The details of the completed and ongoing projects are as under :-
Completed Projects
• Paradip-Haldia-Durgapur LPG pipeline
• Jaipur-Panipat naphtha pipeline
• ATF pipeline at Kolkata
• LPG bottling plants at Banka, Bihar and Bhatinda, Punjab.
• Raze, rebuild and revamp of bulk storage depot at Doimukh, Arunachal Pradesh and
a grassroots depot at Una, Himachal Pradesh
• 5-MMTPA LNG import terminal at Ennore (through a joint venture company)
Ongoing Projects costing more than D500 crore each
• Distillate yield improvement project at Haldia Refinery
• Polypropylene unit at Paradip Refinery
• Fuel quality upgradation project (BS-IV/VI) at Barauni Refinery
• BS-VI projects at all refineries
• INDMAX Unit alongwith associated facilities at Bongaigaon Refinery
• Atmospheric & Vacuum Unit and associated facilities of Barauni Refinery
expansion project
• Ethylene Glycol project at Paradip Refinery
• Naphtha Cracker unit expansion and Mono Ethylene Glycol &
Butadiene extraction unit revamp at Panipat Refinery
• Paradip-Hyderabad product pipeline
• Augmentation of Paradip-Haldia-Durgapur LPG pipeline and its extension up to
Patna and Muzaffarpur
• Ennore-Thiruvallur-Bengaluru-Puducherry-Nagapattinam- Madurai-Tuticorin natural
gas pipeline
• Haldia-Barauni crude oil pipeline and conversion of existing Haldia-Barauni
crude oil pipeline to product and gas pipelines.
• Koyali-Ahmednagar-Solapur product pipeline
• Paradip-Somnathpur-Haldia product pipeline
• Setting up of fertiliser plants at Barauni, Gorakhpur and Sindri through a Joint
Venture Company
Petrochemicals
During the year 2018-19, the Corporation recorded the highest Petrochemicals sales of
2.64 MMT (domestic and exports) as against a sale of 2.37 MMT in 2017-18, recording a
growth of 11.4 per cent. The Corporation's offerings include Polymers, Linear Alkyl
Benzene, Purified Terephthalic Acid, Glycols and Butadiene. The Corporation's PROPEL
brand is a leading brand in the Indian petrochemicals market.
During the year, the Corporation received approvals for its various polymer grades from
about 20 major Indian and international OEMs. With focus on developing import substitution
grades, three new polymer grades were rolled out during the year and 50 developmental
projects were taken up with customers and OEMs.
Natural Gas
The Corporation is making significant investments across the Natural Gas value chain to
build infrastructure and to enhance availability of the green fuel in the country. The
Corporation now has 60 customers using Re-gasified Liquified Natural Gas (R-LNG). During
the year, the R-LNG sale of the Corporation was 1.86 MMT. In addition, 2.10 MMT of R-LNG
was internally consumed in three of the Corporation’s refineries, viz., Panipat,
Mathura and Gujarat.
The Corporation has been a pioneer in India through its ‘LNG at Doorstep' service.
During the year, the Corporation sold 36.12 TMT of LNG through trucks, registering a
growth of 30.5% over the previous year.
During the year, the Corporation imported 20 cargoes (1.32 MMT) of LNG, against 17
cargoes (1.13 MMT) in the previous year. The Corporation is expanding its LNG sourcing
infrastructure for catering to the growing demand in the country and has commissioned a
5-MMTPA LNG Import Terminal at Ennore near Chennai recently through a joint venture, which
is the first of its kind on the East coast of India.
The Corporation is operating / implementing City Gas Distribution (CGD) Networks in 11
Geographical Areas (GAs) through its two Joint Venture Companies, Green Gas Ltd. (GGL) in
Lucknow & Agra GAs and IndianOil-Adani Gas Pvt. Ltd. (IOAGPL) in Allahabad,
Chandigarh, Panipat, Daman, Ernakulam, Udham Singh Nagar, Dharwad, South Goa &
Bulandshahar GAs. The Corporation also participated in the 9th & 10th
rounds of CGD Bidding invited by the Petroleum & Natural Gas Regulatory Board (PNGRB)
and received authorisation for developing CGD Networks in 17 GAs on its own and in 12 GAs
through its JV Companies, GGL & IOAGPL.
Pipeline infrastructure is critical to the development of natural gas market in the
country and, therefore, the Corporation is laying several cross-country gas pipelines
independently and through JV companies.
Exploration & Production
Your Corporation is actively engaged in upstream Exploration & Production (E&P)
activities through Participating Interest (PI), joint ventures and wholly-owned
subsidiaries. The upstream portfolio
of the Corporation consists of 10 domestic blocks including 4 discovered small fields
(DSF) & 2 coal bed methane blocks, and 12 overseas blocks, with Participating Interest
(PI) ranging from 3 per cent to 100 per cent. The overseas E&P portfolio of the
Corporation is spread over 10 countries, viz., Canada, Gabon, Israel, Libya, Nigeria,
Oman, Russia, UAE, USA & Venezuela.
During the year, the Corporation's share of production from upstream assets increased
by 65 per cent compared to the previous year, registering an increase in volume from 2.66
MMT to 4.39 MMT. The Corporation's 2P reserves increased by 45 per cent during 2018-19
over 2017-18 (from 743 MMboe to 1,079 MMboe).
During the year, the Corporation, along with Bharat Petro Resources Ltd. was jointly
awarded Block Onshore 1 in U.A.E., offered during the Abu Dhabi Licencing Round 2018. The
Corporation alongwith its consortium partners was also awarded the licence for Block 32 in
Israel by the Government of Israel. Another consortium of IndianOil (with 90 per cent PI -
as lead operator) and Hindustan Oil Exploration Ltd. (with 10 per cent PI) emerged the
winner in the Umatara Cluster in Assam under the DSF Bid Round II.
The Corporation acquired 17 per cent PI in Mukhaizna Oil Field, Oman, through
acquisition of 100% share capital of Shell Exploration & Production Oman Ltd. from
Shell Overseas Holding Ltd. The transaction marked the entry of the Corporation into the
highly prospective Middle East region and is also consistent with the strategic objective
of adding high quality producing assets to its upstream portfolio.
The Corporation is targeting to raise equity oil & gas production from its
international and domestic acquisitions to 7 MMTPA by the year 2023-24 and further to 11
MMTPA by 2029-30 by suitable addition of new assets from time to time.
Overseas Business
Your Corporation has been constantly exploring various overseas opportunities in oil
& gas sector with special focus on neighbouring countries. MoUs were signed during the
year with partners in neighbouring countries of Bangladesh and Myanmar to explore the
possibility of joint cooperation in upstream and downstream hydrocarbons sector. The
Corporation is evaluating multiple opportunities in Bangladesh, Myanmar, Nepal, Saudi
Arabia, Azerbaijan and Africa.
Alternative Energy
Your Corporation has an installed capacity of 216 MW of renewable energy, including
167.6 MW of wind and 48.6 MW of solar (comprising 20.5 MW grid-connected solar PV and 28.1
MW off-grid solar). During the year, 14.2 MW of solar PV capacity was added and
installation of another 13 MW is in progress.
The Corporation has commissioned three waste-to-energy plants of 5 tonnes per day
capacity each under Swachh Bharat Abhiyan. The total power generated during the
year 2018-19 from these waste-to-energy plants was about 40,250 units (kWh).
Under the Government of India's ‘SATAT' (Sustainable Alternative Towards
Affordable Transportation) initiative, 5,000 Compressed Bio-Gas (CBG) plants are to be set
up by the year 2023, with production capacity of 15 MMTPA of CBG, which is 34 per cent of
India's natural gas consumption during 2017-18. The Corporation has issued Letters of
Intent to entrepreneurs for setting up 75 CBG plants. The technology for these plants
shall be facilitated by IndianOil and their expected capacity is 792 tonnes per day.
The Corporation is setting up a second generation ethanol plant at Panipat based on
ligno-cellulosic conversion of agricultural residue. Similar plants are also planned at
Gorakhpur (Uttar Pradesh) and Dahej (Gujarat).
Sustainable Development
In view of the recent developments on climate change and sustainable development goals,
there is an increased thrust on sustainable development. Your Corporation has taken
cognizance of the fact and has been pursuing carbon management through energy
conservation, energy efficiency, renewable energy & carbon sequestration; water
management through reducing consumption, recycling & rain-water harvesting; and waste
management through reduce, reuse & recycle initiatives.
The Corporation is replacing conventional lighting with LED lights across all its
installations. Cumulatively, 4.5 lakh conventional light fittings have been replaced with
LED. During the year, 2.1 lakh saplings were planted at various locations of the
Corporation. Waste paper recycling is another major initiative of the Corporation and
during the year 137 tonnes of waste paper was recycled through designated recyclers. The
Corporation has installed 608 rainwater harvesting systems to harvest 3 billion litres of
rainwater annually.
INFORMATION SYSTEMS & OPTIMISATION
Your Corporation migrated to SAP-HANA technology in January,
2019, becoming the first PSU and the largest installation in India to do so. IndianOil
is the first corporate in India to integrate SAP and TReDS platform, which is an
e-discounting platform to support financing of MSME receivables.
During the year, the first leg of service management of customerfacing ePIC portal was
launched. All service requests and grievance resolution activities across various lines of
business were brought on to the platform, resulting in significant improvement in single
day resolution of service requests.
The Optimisation group in the Corporation carries out analysis of demand forecast
covering purchase of crude oil cargoes through term contracts or spot purchases, logistics
arrangements, export of products, etc. not only to maintain supply of products across the
country but also to optimise corporate profitability. In order to reduce dependence on
procurement of crude oil from conventional sources, 12 million barrels of different
varieties of crude oil was procured from the USA during the year.
HEALTH, SAFETY & ENVIRONMENT (HSE)
Your Corporation is committed to conducting business with a strong environment
conscience, ensuring sustainable development, safe workplaces and enrichment of the
quality of life of its employees, customers and the community. All refineries of your
Corporation are certified to ISO:14064 standards for sustainable development as well as
for the Occupational Health & Safety Management System (OHSMS/OHSAS-18001), besides
having fully equipped occupational health centres. A majority of the pipeline
installations and some of the marketing installations of the Corporation are also
ISO-14001 certified. Compliance with safety systems & procedures and environmental
laws is monitored at the unit, division and corporate levels. The HSE activities of the
Corporation are reviewed periodically in Board meetings. During the year, safety audits
were carried out at various offices and locations and various training programmes were
conducted across the Corporation covering safety-related topics.
HUMAN RESOURCES
Your Corporation has a strong and dedicated workforce of 33,498, consisting of 17,704
executives and 15,794 non-executives as on 31st March 2019, including 2,869
women employees comprising 8.56 per cent of the total workforce.
Your Corporation scrupulously follows the Presidential Directives and Guidelines issued
by the Government of India regarding reservation in services for SC/ST/OBC/PWD (Persons
with Disabilities)/ Ex-servicemen to promote inclusive growth. Rosters are maintained as
per the directives and are regularly inspected by the Liaison Officer(s) of the
Corporation as well as the Liaison Officer of the Government of India to ensure proper
compliance. Grievance/Complaint Registers are also maintained at Division/ Region/Unit
level for registering grievances from OBC/SC/
ST employees and efforts are made to promptly dispose of the representations/grievances
received. In accordance with the Presidential Directive, the details of representation of
SC/ST/OBC in the prescribed format are attached at Annexure-II to the Report.
The provisions of 4 per cent reservation for Persons with Disabilities in line with
guidelines/instructions issued by the Government of India are implemented by the
Corporation. Necessary concessions/ relaxations in accordance with the rules in this
regard are extended to physically challenged persons in recruitment. The number of
employees with disabilities as on 31st March 2019 was 695, constituting 2.07
per cent of the total employee strength.
Your Corporation maintained cordial industrial relations during the year, and continued
to provide comprehensive welfare facilities to its employees to take care of their health,
efficiency, economic betterment, etc., and to enable them to give their best at the
workplace. Your Corporation supports participative culture in the management of the
enterprise and has adopted a consultative approach with the collectives, establishing a
harmonious relationship for industrial peace, thereby leading to higher productivity.
Your Corporation believes that holistic and meaningful employee engagement and their
right development will enhance employees' potential. With the focus on aligning various HR
policies with the Strategic Corporate Vision, many new initiatives have been undertaken in
the human resources function, aimed at both - employee engagement and making the employees
‘future-ready'. Some of these initiatives are as under:
e-Learning
A structured, technology-aided e-Learning platform catering to the functional learning
and development needs of the employees has been introduced, with an objective to provide
continuous functional inputs.
Sponsoring officers for higher studies
A policy has been framed to sponsor the talent to executive management programmes at
select management schools, namely IIMs - Ahmedabad, Bangalore, Calcutta, Lucknow and
MDI-Gurugram after they secure admission through the rigorous selection process of these
institutes.
Expanding horizons of Industry-Academia Partnership
With focus on strengthening ‘Industry-Academia' partnership, IndianOil
collaborated with the Institute of Chemical Technology (ICT) Mumbai to set up the ICT-IOC
Campus at Bhubaneswar. Admission process for the 5-year integrated M. Tech Programme,
through JEE-Main examination has been completed for a batch size of 60 students, which saw
an overwhelming response from students.
A unique ‘one-of-its-kind' Executive M. Tech. Programme for working professionals
has been developed jointly by ICT and IIT Kharagpur commencing in June, 2019.
Benchmarking of HR Practices
An independent assessment was carried out by a renowned international consultant, as
per the People Capability Maturity Model (PCMM) on three inter-related components in HR -
People, Process and Technology.
The assessment has been done with a view to benchmark the Corporation’s HR
processes in areas like Staffing, Work Environment, Performance Management, Training &
Development, Competency Analysis & Development, Workforce Planning, Participatory
Culture, Mentoring, etc.
The study helped to identify the ‘strength areas' and ‘action areas for
improvement' in various HR processes and accordingly develop action plans - both
short-term and long-term.
Women Leadership Development
A ‘one-of-its-kind' initiative which aims at long-term all-round development of a
select group of women leaders at the middle management level was conceptualised and
introduced. The purpose of this unique endeavour was to facilitate enhancement of
leadership capacity of the participating women officers by developing greater
self-confidence, directing their passion to grow and contribute to the organisation,
understanding how other women leaders across varied industries have coped with their
professional careers (role models), building a support/network group amongst women
leaders, becoming more effective at the workplace, and developing an action plan for
performance excellence and goal achievement.
Hindi Implementation
Your Corporation is committed to implementation of Hindi at its various offices/
locations/units in day-to-day functioning. The provisions of Official Language Act, 1963
and Rules notified thereunder are complied with. Communications received in Hindi and any
application, appeal or representation written or signed by an employee in Hindi is replied
to in Hindi. Official Language Implementation Committees (OLIC) have been formed in all
offices/units to review the progress of implementation of official language policies.
RIGHT TO INFORMATION ACT
Your Corporation has put in place an elaborate mechanism across the organisation to
deal with matters related to Right to Information Act, 2005 since its inception. The
Corporation has designated one
Nodal Officer based at the Corporate Office and 31 First Appellate Authorities (FAAs),
42 Central Public Information Officers (CPIOs) and 42 Assistant Public Information
Officers (APIOs). The details of all the designated officials, third-party audit reports,
etc. are hosted and regularly updated on the website of the Corporation.
The Corporation has aligned with the online RTI portal launched by DoPT and all the
applications/appeals received through the portal are disposed of through the portal only.
Quarterly Reports/Annual Reports have been submitted through the online portal of Central
Information Commission (www.cic.gov.in) within the
prescribed time limit. A total of 7,539 requests and 918 first appeals were received
during the year and all have been disposed of within the stipulated time. 84 second
appeals were hied before the Central Information Commission, New Delhi, and all of them
have been disposed of after due follow-up without any adverse remarks from the Hon'ble
Commission.
COMPLIANCE WITH THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
&
REDRESSAL) ACT, 2013
The provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 have been implemented across the Corporation with the clear
objective of providing protection to women against sexual harassment at the workplace and
for redressal of complaints. Internal Complaints Committees have been set up at
Unit/Region/Head Office level, headed by senior level women executives to deal with sexual
harassment complaints, if any, and to conduct enquiries.
There were three complaints of sexual harassment pending as on 1st April
2018. During the year 2018-19, six complaints were received and four complaints were
disposed of. As on 31st March 2019, five complaints are pending.
Regular workshops are held especially for women employees, with the objective of
bringing awareness about their rights and facilities at the workplace and emphasising the
provisions of the Act. During the year, 62 workshops/awareness programmes were conducted.
Gender sensitisation programmes for male employees are also being conducted regularly.
Newly recruited employees in the Corporation are made aware of the provisions of the Act
and the measures adopted by the Corporation to prevent such incidents.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your Corporation has been actively engaged in various CSR activities over the years,
which cover the entire gamut of social welfare/upliftment activities across the nation.
The thrust areas under CSR inter-alia include health care and sanitation, education and
employment-enhancing vocational skills, empowerment of women and socially/economically
backward groups, etc. During the year, the Corporation spent the entire budget of Rs490.60
crore on various CSR activities. A report on the Corporation's CSR activities as per the
provisions of the Companies Act alongwith CSR highlights during the year is annexed at Annexure-III
to the report. The composition of the CSR Committee is provided in the Corporate
Governance Report. The CSR policy of the Corporation can be accessed at the website of the
Corporation on the link https://iocl.com/aboutus/Ioc_S&CSR_policy.pdf
VIGILANCE
The objective of the vigilance function is to ensure maintenance of the highest level
of integrity throughout the Corporation. The Vigilance department acts as a link between
the organisation and Chief Vigilance Commissioner. The Vigilance department takes
preventive, punitive and participative steps, with emphasis on the preventive and
participative aspects. During the year, 78 vigilance awareness programmes were conducted,
which were attended by about 2,000 employees.
Disciplinary action under applicable Conduct, Discipline and Appeal Rules, 1980 and
Certified Standing Orders are taken by the Corporation for irregularities/lapses. The
number of disciplinary matters related to vigilance cases disposed off during the year
2018-19 was 48. The number of such cases pending at the end of year was 46. The aforesaid
cases pertain to irregularities such as indiscipline, dishonesty, negligence in
performance of duty or neglect of work, etc. The Corporation continuously and regularly
endeavours to ensure fair and transparent transactions through technology interventions
and system/process review in consultation with Central Vigilance Commission and internal
vigilance set-up.
PUBLIC DEPOSIT SCHEME
The Public Deposit Scheme of the Corporation was closed with effect from 31st
August 2009. The Corporation has not invited any deposits from the public during the year
and no deposits are outstanding as on 31st March 2018 except the old cases
amounting to Rs55,000/-, which remain unpaid due to unsettled legal / court cases.
CORPORATE GOVERNANCE
Your Corporation received the prestigious "Certificate of Recognition" for
adopting and promoting exemplary Corporate Governance practices for 2017-18 from The
Institute of Company Secretaries of India at the 18th ICSI National Award for
Excellence in Corporate Governance.
The Corporate Governance Report highlighting the endeavours of your Corporation in
ensuring transparency, integrity and accountability in its functioning has been
incorporated as a separate section, forming a part of the Annual Report.
MANAGEMENT’S DISCUSSION & ANALYSIS REPORT
The Management's Discussion & Analysis (MDA) Report, as required under Corporate
Governance guidelines, has also been incorporated as a separate section forming a part of
the Annual Report.
BUSINESS RESPONSIBILITY REPORT
The Business Responsibility Report covering initiatives taken with environmental,
social and governance perspective has been prepared in accordance with the directives of
SEBI and forms a part of the Annual Report.
AUDIT COMMITTEE
The Audit Committee of your Corporation comprises three members, all of whom are
Independent Directors. The recommendations made by the Audit Committee during the year
were accepted by the Board. The other details of the Audit Committee, like its
composition, terms of reference, meetings held, etc., are provided in the Corporate
Governance Report.
The details of other Board Committees, their composition, meetings etc. are provided in
the Corporate Governance Report.
CODE OF CONDUCT
The Board of your Corporation has enunciated a Code of Conduct for the Directors and
Senior Management Personnel, which has been circulated to all concerned and has also been
hosted on the Corporation's website. The Directors and Senior Management Personnel have
affirmed compliance with the code of conduct for the financial year 2018-19.
RISK MANAGEMENT
Your Corporation considers risk management as a key element of its business operations
and has put in place effective systems to identify, analyse, monitor and mitigate risks to
ensure the organisation’s sustained growth and profitability. Accordingly, the
Corporation has re-visited and revised its ‘Enterprise Risk Management Policy' during
2018-19. The Corporation's Enterprise Risk Management involves risk identification,
assessment and categorisation (based on risk appetite) and is reviewed regularly by
risk-owners to optimise risks with appropriate mitigation plan. A Risk Management
Compliance Board comprising senior management personnel and headed by Chief Risk Officer
reviews the various risks associated with the Corporation's business. The Corporation has
constituted a Risk Management Committee comprising whole-time Directors, which oversees
risk management activities. A report is, thereafter, put up to the Audit Committee and the
Board.
INTERNAL FINANCIAL CONTROLS
Your Corporation has put in place adequate internal financial controls for ensuring the
efficient conduct of its business in adherence with laid-down policies; the safeguarding
of its assets; the prevention and detection of frauds and errors; the accuracy and
completeness of the accounting records; and the timely preparation of reliable financial
information, which is commensurate with the operations of the Corporation. The Corporation
also has a separate Internal Audit department headed by an Executive Director, who
directly reports to the Chairman. The Internal Audit department has a mix of officials
from finance and technical functions, who carry out extensive audit throughout the year.
The statutory auditors are also required to issue the Independent Auditor's Report on the
Internal Financial Controls over financial reporting of the Corporation under Clause (i)
of SubSection 3 of Section 143 of the Companies Act 2013. The report issued thereupon has
been attached alongwith the Standalone and Consolidated Financial Statements respectively.
REMUNERATION TO THE AUDITORS
The Office of the Comptroller & Auditor General of India had appointed the
Statutory Auditors for the financial year 2018-19. The Auditors’ remuneration for the
year was Axed at Rs200 lakhs plus applicable taxes for Statutory Audit. In addition,
reasonable out-of-pocket expenses incurred are also reimbursed at actuals. The total
amount paid to the Statutory Auditors for all services rendered by them to the Company
during 2018-19 was Rs434 lakhs.
COST AUDIT REPORT
Your Corporation maintains cost records as required under the provisions of the
Companies Act. The Corporation had appointed Cost Auditors for conducting the audit of the
cost records maintained by refineries, lube blending plants and other units for
the year 2018-19. A remuneration of Rs 18.50 lakhs and applicable
taxes was fixed by the Board for payment to the cost auditors for the year 2018-19,
which was ratified by the shareholders in the last AGM. The cost audit for the year
2017-18 was carried out for various units of the Corporation and the cost audit report was
hied by the Central Cost Auditor with the Central Government in the prescribed form within
the stipulated time period. The cost audit report for 2018-19 would also be hied within
the stipulated time.
SECRETARIAL AUDIT
The Secretarial Audit Report for the year 2018-19 confirms that the Corporation has
complied with the applicable provisions of the corporate laws, guidelines, rules, etc.,
which are within the purview of the Corporation. The report, duly certified by the
Secretarial Auditor, M/s.Ragini Chokshi & Co., Practising Company Secretaries is
attached at Annexure-IV to this Report.
The Secretarial Auditor has made an observation that the Corporation has not complied
with the requirements with regard to requisite number of Independent Directors on its
Board for the period 26.07.2018 to 31.03.2019 and with regard to appointment of Woman
Director on its Board for the period 06.07.2018 to 25.07.2018 and 12.03.2019 to
19.03.2019. In this regard, it is clarified that the Corporation being a Government
Company under the administrative control of the Ministry of Petroleum & Natural Gas,
the selection and appointment of Directors, (including Independent Directors and Woman
Director) vests with the Government of India as per the Government guidelines.
REPORTING OF FRAUDS BY AUDITORS
The Auditors in their report for the year, have not reported any instance of fraud
committed by the officers/employees of the Corporation.
PUBLIC PROCUREMENT POLICY FOR MICRO AND SMALL ENTERPRISES (MSEs) ORDER 2012
In line with the Public Procurement Policy of the Government of India, as amended, your
Corporation is required to procure minimum 25% of total procurement of Goods and Services
from MSEs, out of which 5% is earmarked for procurement from MSEs owned by SC/ ST
entrepreneurs and 3% from MSEs owned by women. The procurement from MSEs (excluding crude
oil, petroleum products & natural gas) during 2018-19 was as under:
| PARAMETERS |
TARGETS |
| ACTUAL |
| Total Procurement from MSEs |
|
|
| (General, Reserved SC/ST & Women) |
25% |
29.07% |
| Procurement from Reserved |
5% (Sub-target |
0.5% |
| SC/ST MSEs |
out of 25%) |
| Procurement from Women-owned MSEs |
3% (Sub-target out of 25%) |
0.11% |
The deficit of 4.5% and 2.89% under the sub-targets was due to non-availability of
vendors in the sub-category; however, the target was achieved by procurement from other
micro and small enterprises in line with the policy.
Several initiatives were undertaken to identify the entrepreneurs for procurement of
goods and services from MSEs owned by SC/ST enterprises by way of conducting vendor
development programmes.
SUBSIDIARIES, JOINT VENTURES & ASSOCIATES
During the year, a new Joint Venture Company, viz. Indradhanush Gas Grid Ltd. between
your Corporation, ONGC Ltd., GAIL (India) Ltd., Oil India Ltd. and Numaligarh Refinery
Ltd. was incorporated in August, 2018 for the purpose of laying Natural Gas pipeline
connecting Guwahati to major cities in north-east. The equity holding of partners is 20
per cent each.
As required under the provisions of the Companies Act, 2013, a statement on the
performance and financial position of each of the subsidiaries, joint venture companies
and associates is provided as an annexure to the Consolidated Financial Statement. The
financial statements of the subsidiaries have also been hosted on the website of the
Corporation i.e. www.iocl.com under ‘Financial
Performance' section.
In accordance with the provisions of the SEBI guidelines, your Corporation has framed a
policy for determining material subsidiaries, which can be accessed on the Corporation's
website at the link https://www.iocl.com/InvestorCenter/Policy_on_
Material_Subsidiary.pdf
RELATED PARTY TRANSACTIONS (RPTs)
In line with the provisions of the Companies Act, 2013 & SEBI guidelines, a policy
on material RPTs has been framed, which can be accessed on the link https://www.iocl.com/InvestorCenter/
Policy_on_related_party_transactions.pdf. Your Corporation has undertaken transactions
with related parties during the year in the ordinary course of business. In line with the
RPT Policy, approval of the Audit Committee & Board, as the case may be, was obtained
for such RPTs. As per the threshold mentioned in the policy, there was no material RPT
during the year. The disclosures related to RPTs in accordance with applicable accounting
standards are provided at Note-37 of the Standalone Financial Statement.
The details of contracts or arrangements with related parties referred to under Section
188 (1) of the Companies Act, 2013 in the prescribed Form AOC-2 are attached at Annexure-V
of the report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO
Your Corporation recognises energy conservation as one of the most important parameter
amongst various operating parameters and accords high importance to the same at all its
refineries and operating units. The performance of units under the parameter is monitored
on a continuous basis and efforts are made to further enhance by incorporating the latest
technologies and global best practices. As a result of various energy conservation
measures undertaken during the year, the energy performance parameter (indexed to the
complexity of operations) in terms of MBN* of the refineries was 71.3, which is the best
ever achieved, as against 72.6 in the previous year. Under pipeline operations, various
initiatives were taken during 2018-19, which resulted in improvement of Specific Energy
Consumption of Pipelines by 11.4 per cent.
In accordance with the provisions of the Companies Act, 2013 and rules notified
thereunder, the details relating to Energy Conservation, Technology Absorption and Foreign
Exchange earnings and outgo are annexed at Annexure-VI to the report.
*MBN-(MBTU/BBL/NRGF) is calculated as Thousand British Thermal Units per Barrel per
Energy Factor.
PARTICULARS OF EMPLOYEES
The provisions of Section 197 of the Companies Act, 2013 and rules notified thereunder,
regarding particulars of employees drawing remuneration in excess of limits specified are
exempt for Government Companies.
BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL
The following changes occurred in the Board / Key Managerial Personnel of the
Corporation:-
Appointment
1. Shri Gurmeet Singh was appointed as Director(Marketing) w.e.f. 26.07.2018
2. Smt.Indrani Kaushal was appointed as Government Director w.e.f. 26.07.2018 and
ceased to be Director w.e.f.
12.03.2019 consequent upon change of nomination by the Govt. of India. She was
re-appointed as Government Director w.e.f. 28.05.2019.
3. Shri Akshay Kumar Singh was appointed as Director(Pipelines) w.e.f. 14.08.2018.
4. Smt. Sushmita Dasgupta was appointed as Government Director w.e.f. 20.03.2019.
5. Shri Parindu K. Bhagat, whose term as Independent Director ended on 01.12.2018, was
re-appointed as Independent Director for another term of one year w.e.f. 02.12.2018 based
on letter received from MoP&NG.
6. Shri Sandeep Kumar Gupta was appointed as Chief Financial Officer w.e.f. 18.05.2019.
Cessation
7. Shri Sanjay Kapoor ceased to be Independent Director w.e.f.
02.12.2018 consequent upon completion of his term.
8. Shri A.K.Sharma ceased to be Director(Finance) w.e.f.
01.02.2019 consequent upon his superannuation. Based on directive from MoP&NG, Shri
A.K.Sharma was re-appointed as Director(Finance) w.e.f. 18.02.2019 for a period of 3
months and has ceased to be Director(Finance) w.e.f. 18.05.2019.
9. Smt. Sushmita Dasgupta, Government Director ceased to be Director w.e.f. 28.05.2019.
The Corporation has received the Certificate of Independence from all the Independent
Directors confirming that they meet the criteria prescribed for Independent Directors
under the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 (SEBI LODR).
A separate meeting of Independent Directors was held during the year as per provisions
of the Companies Act, 2013 and SEBI LODR.
Dr. S.S.V.Ramakumar, Director (R&D) and Shri Ranjan Kumar Mohapatra, Director
(Human Resource), are liable to retire by rotation and being eligible are proposed to be
re-appointed at the forthcoming Annual General Meeting.
A brief profile of the Directors proposed to be appointed / reappointed at the
forthcoming AGM is provided in the notice of the AGM.
BOARD MEETINGS
During the year, 12 meetings of the Board of Directors were held. The details of the
meetings attended by each Director are provided in the Corporate Governance Report and
hence not repeated to avoid duplication.
PERFORMANCE EVALUATION OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
The provisions of Section 134(3)(p) of the Companies Act, 2013 require a listed entity
to include a statement indicating the manner of formal evaluation of performance of the
Board, its Committees and of individual Directors. However, the said provisions are exempt
for Government Companies as the performance evaluation of Directors is carried out by the
Administrative Ministry i.e. Ministry of Petroleum and Natural Gas (MoP&NG) as per
laid down evaluation methodology.
POLICY FOR SELECTION AND APPOINTMENT OF DIRECTORS AND THEIR REMUNERATION
The provisions of Section 134(3)(e) of the Companies Act, 2013 regarding the policy on
Directors appointment and remuneration including criteria for determining qualifications,
positive attributes, independence of a Director and other matters provided in Sec 178(3)
are exempted for Government Companies.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant and material orders were passed by the regulators or courts or tribunals
that impact the going concern status of the Corporation and its operations in future
except for notice issued by National Green Tribunal and Haryana State Pollution Control
Board with regard to air and water pollution caused by PTA Unit of Panipat Refinery. The
Corporation’s response in the matter has been hied and the matter is being
followed-up for resolution.
VIGIL MECHANISM / WHISTLE-BLOWER POLICY
The Corporation has framed a whistle-blower policy wherein the employees are free to
report any improper activity resulting in violation of laws, rules, regulations or code of
conduct by any of the employees, to the Competent Authority or Chairman of the Audit
Committee, as the case may be. Any complaint received is reviewed by the Competent
Authority or Chairman of the Audit Committee as the case may be. The policy provides that
the confidentiality of those reporting violations shall be maintained and they shall not
be subjected to any discriminatory practice. No employee has been denied access to the
Audit Committee. During the year, the Whistle Blower Policy was amended to enable
employees to report leakage / misuse of Unpublished Price Sensitive Information in
violation of IndianOil's Insider Trading Code. The policy on Vigil
Mechanism/Whistle-Blower can be accessed on the Corporation's website at the link https://www.iocl.com/InvestorCenter/Whistle_
Blower_policy.pdf
DETAILS OF LOANS / INVESTMENTS / GUARANTEES
Your Corporation has provided loans/guarantees to its subsidiaries, joint ventures
& associates and has made investments during the year in compliance with the
provisions of the Companies Act, 2013 and rules notified thereunder. The details of such
investments made and loans/guarantees provided as on 31st March 2019 are
provided in the Standalone Financial Statement under Notes 4, 5, 36 and 42.
EXTRACT OF ANNUAL RETURN
As required under the provisions of the Companies Act, 2013, the extract of Annual
Return for the financial year ended 31st March 2019 in the prescribed form
MGT-9 has been prepared and hosted on the website of the Corporation www.iocl.com.
COMPLIANCE WITH SECRETARIAL STANDARDS
Your Corporation complies with the applicable Secretarial Standards issued by the
Institute of Company Secretaries of India (ICSI).
CREDIT RATING OF SECURITIES
The Credit rating assigned by Rating Agencies for the various debt instruments of the
Corporation is provided in the Corporate Governance Report.
INVESTOR EDUCATION & PROTECTION FUND (IEPF)
The details of unpaid/unclaimed dividend and shares transferred to the IEPF in
compliance with the provisions of the Companies Act, 2013 has been provided in the
Corporate Governance Report.
MATERIAL CHANGES AFFECTING THE COMPANY
There have been no material changes and commitments affecting the financial position of
the Corporation between the end of the financial year and date of this report. There has
been no change in the nature of business of the Corporation.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the requirement under clause (c) of sub-section (3) of Sec 134 of the
Companies Act, 2013 with respect to the Directors'
Responsibility Statement, it is hereby confirmed that:
(a) in the preparation of the Annual Accounts, the applicable accounting standards had
been followed along with proper explanation relating to material departures;
(b) the Directors had selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the company at the end of the financial year and of
the profit and loss of the company for that period;
(c) the Directors had taken proper and sufficient care 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;
(d) the Directors had prepared the annual accounts on a going concern basis; and
(e) the Directors had laid down internal financial controls to be followed by the
company and that such internal financial controls are adequate and were operating
effectively.
(f) the Directors had devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems were adequate and operating effectively.
ANNEXURE-I
DIVIDEND DISTRIBUTION POLICY
PREAMBLE:
The shares of Indian Oil Corporation Limited (the "Company") are listed on
National Stock Exchange of India Limited, Mumbai and BSE Limited, Mumbai. As per the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, the
Company is required to formulate a Dividend Distribution Policy which shall be disclosed
in its Annual Report and on its website.
The Board of Directors of the Company ("the Board") has approved the Dividend
Distribution Policy of the Company ("the policy").
OBJECTIVE:
The Company strives for maximisation of shareholders' value and believes that this can
be attained by driving growth. The policy endeavours to strike an optimum balance between
rewarding shareholders through dividend and ensuring that sufficient profits are retained
for growth of the Company and other needs. The objective of the policy is to lay down a
consistent approach to dividend declaration.
PARAMETERS FOR DIVIDEND DISTRIBUTION:
• The Company has only one class of shares i.e. Equity shares and, hence, the
parameters disclosed hereunder apply to the same.
• The Board while considering payment of dividend for a financial year may,
interalia, consider the following factors:-
• Profit for the financial year as well as general reserves of the Company
• Projections of future profits and cash flows
• Borrowing levels and the capacity to borrow
• Present and future Capital expenditure plans of the Company including
organic/inorganic growth avenues.
• Applicable taxes including tax on dividend
• Compliance with the provisions of the Companies Act or any other statutory
guidelines including guidelines issued by Govt. of India
• Past dividend trend for the Company and the industry
• State of economy and capital markets
• Any other factor as may be deemed fit by the Board
• The profits for a year may be adjusted at the discretion of the Board, for the
purpose, to exclude exceptional or one off items or non-cash items resulting from change
in law, accounting policies, accounting standards or otherwise.
• The Company would endeavor to pay minimum annual dividend of 30% of Profit After
Tax (PAT) or 5% of net worth, whichever is higher subject to the maximum dividend
permitted under the extant legal provisions.
• In case the Company declares a lower or no dividend for a
particular year due to inadequacy or absence of profits/ reserves or otherwise, the
reasons and justification thereof shall be disclosed to the shareholders through Annual
Report of the Company.
• The company is committed to continuous growth and has plans requiring
significant capital outlay. The retained earnings, after distribution of dividend, shall
primarily be utilized towards this purpose.
• Dividend shall be recommended by the Board for approval of shareholders of the
Company for payment. However, the Board may also consider payment of interim dividend as
and when it feels appropriate.
GENERAL:
• In the event of the policy being inconsistent with any new regulatory provision,
such regulatory provision shall prevail upon the corresponding provision of this policy
and the policy shall be construed to be amended accordingly from the effective date of
such provision.
• The Company reserves its right to alter, modify, add, delete or amend any or all
of the provisions of the policy as it may deem fit or in accordance with the guidelines as
may be issued by SEBI, Government of India or any other regulatory authority. The change
in the policy shall, however, be disclosed alongwith the justification thereof on the
Company’s website and in the ensuing Annual Report in accordance with the extant
regulatory provisions.
ANNEXURE-II
SC/ST/OBC REPORT-I
Annual Statement showing the representation of SCs, STs and OBCs as on 1st
January 2019 and number of appointments made during the preceding calender year
Name of the Public Enterprises : Indian Oil Corporation Limited
| Groups |
Representation of SCs/STs/OBCs (As on
1.1.2019) |
Number of appointments made during the calendar year
2018 |
|
By Direct Recruitment |
By Promotion |
By Deputation/ Absorption |
|
Total No. of Employees |
SCs |
STs |
OBCs |
Total |
SCs |
STs |
OBCs |
Total |
SCs |
STs |
Total |
SCs |
STs |
| 1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
11 |
12 |
13 |
14 |
15 |
| Executives |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| A |
17848 |
2965 |
1337 |
3826 |
1292 |
215 |
111 |
384 |
2656 |
442 |
186 |
0 |
0 |
0 |
| Non-executives |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| B |
5605 |
960 |
588 |
388 |
0 |
0 |
0 |
0 |
454 |
109 |
38 |
0 |
0 |
0 |
| C |
9591 |
1805 |
716 |
2394 |
479 |
68 |
59 |
201 |
1375 |
252 |
69 |
0 |
0 |
0 |
| D (Excluding Sweeper) |
409 |
79 |
20 |
121 |
182 |
37 |
5 |
60 |
0 |
0 |
0 |
0 |
0 |
0 |
| D (Sweeper) |
5 |
2 |
0 |
1 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
| Total (Executives plus Non-executives) |
33458 |
5811 |
2661 |
6730 |
1953 |
320 |
175 |
645 |
4485 |
803 |
293 |
0 |
0 |
0 |
SC/ST/OBC REPORT-II
Annual Statement showing the representation of SCs, STs and OBCs in various group A
services as on 1st January 2019 and number of appointments made in the service
in various grades in the preceding calender year
Name of the Public Enterprises : Indian Oil Corporation Limited
| Pay Scale(in |
Representation of SCs/STs/OBCs |
Number of appointments made during the calendar year
2018 |
| rupees) |
(As on 1.1.2019) |
By Direct Recruitment |
By Promotion |
By Deputation/ Absorption |
|
Total No. of Employees |
SCs |
STs |
OBCs |
Total |
SCs |
STs |
OBCs |
Total |
SCs |
STs |
Total |
SCs |
STs |
| 1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
11 |
12 |
13 |
14 |
15 |
| 50000-160000 |
38 |
5 |
2 |
14 |
23 |
3 |
2 |
6 |
0 |
0 |
0 |
0 |
0 |
0 |
| 60000-180000 |
5936 |
938 |
452 |
1857 |
1269 |
212 |
109 |
378 |
142 |
28 |
8 |
0 |
0 |
0 |
| 70000-200000 |
3174 |
507 |
219 |
758 |
No recruitment is made in this Group. |
575 |
105 |
51 |
0 |
0 |
0 |
| 80000-220000 |
3241 |
579 |
252 |
632 |
No recruitment is made in this Group. |
635 |
108 |
42 |
0 |
0 |
0 |
| 90000-240000 |
1775 |
291 |
151 |
293 |
No recruitment is made in this Group. |
468 |
90 |
42 |
0 |
0 |
0 |
| 100000-260000 |
1452 |
319 |
128 |
202 |
No recruitment is made in this Group. |
333 |
62 |
26 |
0 |
0 |
0 |
| 120000-280000 |
1247 |
224 |
105 |
64 |
No recruitment is made in this Group. |
240 |
29 |
13 |
0 |
0 |
0 |
| 120000-280000 |
667 |
78 |
24 |
4 |
No recruitment is made in this Group. |
160 |
13 |
4 |
0 |
0 |
0 |
| 120000-280000 |
242 |
20 |
3 |
2 |
No recruitment is made in this Group. |
78 |
6 |
0 |
0 |
0 |
0 |
| 150000-300000 |
76 |
4 |
1 |
0 |
No recruitment is made in this Group. |
25 |
1 |
0 |
0 |
0 |
0 |
| G.Total |
17848 |
2965 |
1337 |
3826 |
1292 |
215 |
111 |
384 |
2656 |
442 |
186 |
0 |
0 |
0 |
ANNEXURE-III
HIGHLIGHTS OF CSR ACTIVITIES DURING 2018-19
IndianOil has been actively engaged in a gamut of social welfare/ upliftment activities
across the nation, in addition to reaching essential fuels viz. Kerosene, LPG, Petrol,
Diesel, etc. to the nook and corner of the country. IndianOil's key Corporate Social
Responsibility (CSR) thrust areas include ‘Safe drinking water and protection of
water resources', ‘Healthcare and sanitation', ‘Education and
employment-enhancing vocational skills’, ‘Empowerment of women and
socially/economically backward groups', etc. IndianOil has a long standing CSR legacy,
which started much before the CSR legislation (Companies Act, 2013) came into force in
2014-15. The CSR projects of IndianOil are undertaken mostly for improving the quality of
life in various communities, which invariably include marginalized / underprivileged
sections of the society, viz. schedule caste, schedule tribe, other backward caste,
physically handicapped, etc. With Pan-India presence, IndianOil undertakes CSR activities
across the country, from Leh in J&K in the North, to the North Eastern States, to the
aspirational/ backward districts/ naxal affected areas, to Gujarat in the West and Tamil
Nadu/Kerala in the South. For the year 201819, entire CSR budget allocation of Rs490.60
crore was spent, thereby achieving 100% budget utilization.
KEY CSR INITIATIVES IN 2018-19
1. IndianOil Vidushi
With an objective to help girls from the under-privileged sections of the society to
gain admission in prestigious Engineering Institutes viz. IITs, NITs, CETs, IIITs, etc.,
IndianOil started a unique program "IndianOil Vidushi" in July, 2018 at 2
residential centres viz. Bhubaneswar (Odisha) & Noida (Uttar Pradesh). While the
Bhubaneswar centre caters to the students of Odisha, Jharkhand & Chhattisgarh, the
Noida centre primarilly caters to the students from J&K, Uttarakhand, Himachal Pradesh
and Punjab. The students are provided specialized coaching and mentoring after class XIIth
to succeed in JEE Main, JEE Advanced & other Central and State Engineering Entrance
Examinations. Maximum 30 girls are selected for each centre through written test and
personal interview on merit-cum-means basis. The entire cost for specialized coaching,
study material, boarding, food & other consumables, blanket, hygiene kit, dress set,
health insurance etc. is borne by IndianOil. During 2018-19, 30 girl students were
enrolled for Bhubaneswar Centre and 26 girls for Noida Centre. Out of 56 girls, 46 cleared
JEE Main, out of which 17 girls cleared JEE Advanced and will have the opportunity to join
various IITs.
3. Aids & Assistive devices to Divyangjan
Assistive devices like tricycles, wheel chairs, crutches, walking sticks, Braille kits
for visually impaired, hearing aids, artificial limbs, etc. were provided to more than
20,000 Divyangjan across 21 states of India in association w ith Artificial Limbs
Manufacturing Corporation (ALIMCO). The beneficiaries were selected and their disabilities
were assessed through assessment camps organized in the villages near the target
locations. The training to use these assistive devices were also provided at the
distribution camps.
4. IndianOil Gyanodaya Scheme in Govt. ITIs & Polytechnics
IndianOil Gyanodaya Scheme was launched in 2017 with an aim to provide scholarships on
merit-cum-means basis to students pursuing 2-year regular courses in Government ITIs and
3-year regular courses in Government Polytechnics, to incentivize them to perform well.
The scheme aims to cover 36 Government institutes (18 ITIs and 18 Polytechnics) near 9
IndianOil Refinery locations. 50 students per batch are selected from each institute every
year. Each student is provided scholarship of 1000/- per month for the entire duration of
the regular courses. During 2018-19, 1138 students from 30 ITIs and Polytechnics were
selected for this scheme.
5. Skill Development Institute, Bhubaneswar, Odisha
Skill Development Institute, Bhubaneswar (SDl-B) was established on 9th May
2016 with an aim to provide opportunities for skilling to the unemployed and
underprivileged youth of Odisha and to provide skilled manpower to the industry.
Initially, SDI-B started operation in 2 trades viz. Industrial Electrician & Welder.
However, with increasing demand of skilled manpower, 6 new courses were added viz.
Computer Data Application (only for girls), Fitter Fabrication, Instrumentation
Technician, Pipe Fitter (City gas Distribution), Solar PV Installation and LPG Mechanic.
About 240 students per batch are being skilled in 8 trade courses, which are of 3 to 6
months duration each. Since inception, 810 underprivileged youth were skilled and
certified with over 85% placements. Hon'ble President of India laid the foundation of the
permanent campus of SDI-B on 18.03.2018 at Taraboi, Jatni, Odisha, which will be a
mega-world-class model skill academy to be set up with technical support from National
Skill Development Corporation (NSDC). Once functional, about 3,000 to 4,000 youth will be
trained every year in 16 regular trades pertaining to the hydrocarbon sector and local
industries.
6. Assam Oil School of Nursing, Digboi, Assam
Assam Oil School of Nursing (AOSN), established in 1986, offers 3-year Diploma in
General Nursing and Midwifery (GNM) course to young girls with intake capacity of 30
students per year. 4-year B.Sc. (Nursing) course started from the same campus in 2014 with
intake of 30 students per year. Before AOSN came into being, there was a dearth of
qualified nurses in the North East. AOSN is able to provide opportunities to young
under-privileged girls to bridge this gap and simultaneously provide them stable careers
and livelihood. Since inception, 410 students have successfully completed GNM course with
100% placement record.
7. Empowering women through Pradhan Mantri Ujjwala Yojana
As per a study by World Health Organization, about 1 million people die every year in
India, which can be attributable to diseases related to indoor air pollution. Pradhan
Mantri Ujjwala Yojana (PMUY) aims to safeguard the health of women & children by
providing them with cleaner cooking fuel, i.e. LPG. Under this scheme, IndianOil
contributes 20% of 2% of previous year’s profit towards release of one-time grant to
BPL families in rural areas for release of new LPG connections. During 2018-19, under CSR,
LPG connections were released to about 5.33 lakh families.
8. Assam Oil Division Hospital, Digboi, Assam
Assam Oil Division Hospital, Digboi, established in 1906, is a 200-bed hospital with
modern facilities. It caters to the population residing near Digboi and other nearby areas
of the North East. Every year, about 1 lakh patients are treated at this hospital, out of
which about 15% are non-employee patients. This hospital registers about 4,000 patients
for indoor admissions and conducts operative procedures on about 2,000 patients every
year. Health camps of general and specialized nature are also organized regularly by the
hospital to reach out to the poor villagers in the vicinity, who have no access to medical
consultations or treatment. During 2018-19, 8683 non-employee patients were treated at the
hospital.
9. Swarna Jayanti Samudayik Hospital, Mathura, Uttar Pradesh
Swarna Jayanti Samudayik Hospital at Mathura (with 50 beds), established in 1999,
provides medical treatment to residents near Mathura Refinery, Uttar Pradesh. The hospital
provides free treatment to the destitute and offers subsidized treatment to others. During
2018-19, 56,437 patients were treated at this Hospital, out of which operative procedures
were conducted on 727 patients.
10. Sarve Santu Niramaya, Digboi, Assam
IndianOil's unique CSR initiative titled "Sarve Santu Niramaya" (Good health
to all) was launched in December 2012 to provide free health consultation and free
medicines to human beings as well as livestock of the villages near Digboi Refinery. It
was felt that good health of livestock is as important as that of the human beings, as
livestock was a key livelihood generator for the villagers. During 2018-19, 21 Sarve Santu
Niramaya camps were organized, in which 2,507 human beings and 6,510 Livestock were
treated/ vaccinated.
11. IndianOil Sports Scholarship Scheme
IndianOil has been promoting sports for over three decades. In line with the sports
policy adopted in 1985, the Corporation has, over the years, recruited many promising
sports persons, who went on to reach their peak in their chosen disciplines. The purpose
of recruiting sportspersons is to nurture their talent early on, enhance their performance
at the National & International level & bring laurels for the Company and the
Country.
IndianOil introduced a Sports Scholarship Scheme in the year 2006-07 for promising
young sports persons representing the States in team games and National ranking in others.
This scheme started with 55 scholarships in 7 games/sports. At present, 250 scholarships
in 20 games/sports (Olympic sports categories & other popular games viz. Cricket,
Carom, Chess, etc) are awarded to upcoming junior players from 13 to 16 years of age in
two categories viz. Elite Scholar and Scholar. The scholarship amount varies from Rs
15000/- to Rs 19000/- per month for Elite Scholars and Rs 12000/- to Rs16000/- per month
for Scholars for a period of 3 years and cost of kit items is also paid by IndianOil. In
addition, IndianOil also provides assistance towards travel, lodging etc. for scholars in
individual games. During 2018-19, 103 sportspersons benefited from the scheme and since
inception, more than 900 sports persons have benefited from IndianOil scholarship scheme.
12. Robotic Scavenging Machine (Bandicoot) to Kumbakonam Municipal Corporation, Tamil
Nadu
As per the data provided by National Commission for Safai Karamacharis (NCSK), at least
one Indian worker has died while cleaning sewers or septic tanks every five days since the
beginning of 2017 and is considered one of country's deadliest jobs and most insidious
form of caste discrimination. To alleviate this problem, IndianOil has provided Robotic
Scavenging Machine (named Bandicoot) to Kumbakonam Municipal Corporation, Tamil Nadu.
Bandicoot has a control unit/user interface and a robotic spiderlike device at the bottom
with four limbs, which is lowered into the manholes for undertaking cleaning operations.
It is equipped with seven cameras and many sensors. The limbs scoop/collect the silt from
different angles inside the manhole and heap the dirt at one place, which is then lifted
up using ropes & buckets. Bandicoot works with precision, takes less time, requires
only one/ two persons to operate and saves many man-hours.