ACC Ltd
Directors Reports
TO THE MEMBERS
Your Directors are pleased to present 87th Annual Report on business and
operations, together with the audited financial statements (consolidated as well as
standalone) of your company for the year ended March 31, 2023 (FY-2022-23).
1. STATE OF THE AFFAIRS OF THE COMPANY:
The performance of the Cement and Ready Mix Concrete business are detailed out in the
Management Discussion and Analysis Report, which forms part of the Annual Report.
2. FINANCIAL PERFORMANCE 2022-2023:
|
|
|
|
(Rs. in crore) |
|
Consolidated |
Standalone |
Particulars |
2022-23 |
2021 |
2022-23 |
2021 |
Revenue from Operations |
22,210.18 |
16,151.67 |
22,209.97 |
16,151.35 |
Other Income |
341.89 |
206.71 |
337.18 |
204.76 |
Total Income |
22,552.07 |
16,358.38 |
22,547.15 |
16,356.11 |
Profit before Tax* |
1,202.60 |
2,506.38 |
1,182.13 |
2,460.39 |
Tax Expenses |
317.39 |
643.28 |
312.22 |
640.12 |
Profit for the year |
885.21 |
1,863.10 |
869.91 |
1,820.27 |
Attributable to |
|
|
|
|
Owners of the Company |
885.07 |
1,862.99 |
869.91 |
1,820.27 |
Non-controlling Interest |
0.14 |
0.11 |
- |
- |
Other Comprehensive Income (OCI) |
30.96 |
5.43 |
31.05 |
5.44 |
Total Comprehensive Income |
916.17 |
1,868.53 |
900.96 |
1,825.71 |
Attributable to |
|
|
|
|
Owners of the Company |
916.03 |
1,868.42 |
900.96 |
1,825.71 |
Non-controlling Interest |
0.14 |
0.11 |
- |
- |
Opening Balance in retained earnings |
10,471,56 |
8,866.04 |
10,396.83 |
8,834.02 |
Amount available for appropriations |
11,387.59 |
10,734.46 |
11,297.79 |
10,659.73 |
Appropriations |
|
|
|
|
Final Dividend Paid for 2021 |
1,089.17 |
262.90 |
1,089.17 |
262.90 |
Closing balance in retained earnings |
10,298.42 |
10,471.56 |
10,208.62 |
10,396.83 |
*Profit before Tax for 2022 - 23 includes charge of RS.66.42 Crore towards
restructuring cost and RS.95.35 crore towards one time transition cost and for 2021
includes charge of RS.54.76 Crore towards restructuring cost and RS.38.10 Crore towards
impairment of assets.
The performance of the current year is not comparable to that of the previous year due
to change in accounting period, as the current year comprises of a period of 15 months as
against 12 months of the previous year.
CHANGE OF MANAGEMENT - ENTRY OF ADANIGROUP
During FY 2022-23, the Company became a part of the Adani group, as Holcim divested
their entire shareholding and control in the company by way of transfer of 100%
shareholding of Holderind Investment Limited (Holderind) to Endeavour Trade and Investment
Ltd. (Endeavour), a company belonging to Adani Group. In view of the above, Endeavour also
became one of the Promoter of the company.
With the change in the promoters, there was a change in the Management of the company.
The company also revised its financial year from January- December to April-March to
comply with the provisions of the Companies Act, 2013 Accordingly, the financial
performance presented is for the period of 15 months i.e. from January 1, 2022 to March
31, 2023.
3. OVERVIEW OF COMPANY'S
OPERATIONAL AND PERFORMANCE HIGHLIGHTS:
• Consolidated income, comprising Revenue from Operations and other income, for
the FY 2022-23 was RS.22,552.07 Crore as compared to RS.16,358.38 Crore in 2021.
• Consolidated Profit before Tax for the year was RS.1,202.60 Crore vis-a-vis
RS.2,506.38 Crore in 2021.
• Consolidated Profit after Tax for the FY 2022-23 was RS.885.21 Crore compared to
RS.1,863.10 Crore in 2021.
• Cement production increased from 26.92 Million Tonnes in 2021 to 33.08 Million
tonnes in 2022-23.
• Cement Sales Volume increased from 28.89 Million Tonnes in 2021 to 37.93 Million
tonnes in 2022-23.
• The net revenue from operations in cement increased from 15,105 Crore in 2021 to
20,659 Crore in 2022-23
• RMX Production Volume has increased from 2,809 Million M3 in 2021 to
3,591 M3 in 2022-23.
4. DIVIDEND
The company has a robust track record of rewarding its shareholders with a generous
dividend pay-out. In view of the strong operational and financial performance during the
year under review, the Board of Directors is pleased to recommend a dividend of RS.9.25
per share (95 %) for the period ended March 31, 2023. This represents a pay-out ratio of
20%.
The Dividend payment is in accordance with the Company's Dividend Distribution Policy.
In terms of the provisions of Regulation 43A of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended ('the
Listing Regulations'), It is also available on the Company's website and can be accessed
at www.acclimited. com/assets/new/new pdf/Dividend Distribution Policv.pdf
5. TRANSFER TO RESERVES
The Company has not transferred any amount to the Reserves for the period ended March
31, 2023.
6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the period under review, as stipulated
under the Securities and Exchange Board of India (SEBI Listing Obligations and Disclosure
Requirements), Regulations, 2015, ('SEBI Listing Regulations') is presented in a separate
section, forming part of this Annual Report.
7. CAPITAL STRUCTURE OF THE COMPANY
The Company's paid-up equity share capital continues to stand at RS.187.79 Crore as on
March 31, 2023.
During the year, the Company has not issued any shares or convertible securities. The
Company does not have any scheme for the issue of shares, including sweat equity to the
Employees or Directors of the Company.
8. FINANCIAL LIQUIDITY
Cash and cash equivalent as on March 31, 2023 was RS.256.63 Crore vis-a-vis RS.7,366.59
Crore in the previous year.
The Company's working capital management is robust and involves a well-organised
process, which facilitates continuous monitoring and control over receivables, inventories
and other parameters.
9. CAPACITY EXPANSION AND NEW PROJECTS
The Company's current installed cement manufacturing capacity is 36.05 MTPA. Detailed
information on capacity expansion and new projects is covered in the report on Management
Discussion and Analysis, forming part of this Annual Report.
10. CREDIT RATING
As in the previous years, CRISIL, the reputed rating agency, has given the highest
credit rating of AAA for the long-term and A1+for the short-term financial instruments of
the Company. This reaffirms the reputation and trust your Company has earned for its sound
financial management and its ability to meet its financial obligations.
11. DEPOSITS
There were no outstanding deposits within the meaning of Section 73 and 74 of the Act
read with rules made thereunder at the end of the FY 2022- 23 or the previous financial
years. Your Company did not accept any deposit during the period under review.
12. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The details of loans, guarantees and investments covered under the provisions of
Section 186 of the
Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 are given in
the Notes to the Financial Statements (Refer note no. 47)
13. INTERNAL CONTROL SYSTEMS
Internal audit and its adequacy
The scope and authority of the internal audit function is defined in the Internal Audit
Charter.
To maintain independence and objectivity in its functions, the internal audit function
reports directly to the Audit Committee.
At the beginning of each financial year, a risk-based annual audit plan is rolled out
after it is approved by the Audit Committee. The audit plan aims to evaluate the efficacy
and adequacy of the internal control system(s) and compliance(s) thereof, robustness of
internal processes, policies and accounting procedures, compliance with laws and
regulations.
The Internal Audit function, consisting of professionally qualified accountants,
engineers, Fraud Risk and Information Technology audit specialists, is adequately skilled
and resourced to deliver audit assurances at highest levels.
Based on the reports of internal audit function, process owners undertake corrective
action in their respective areas. Significant audit observations and corrective actions
thereon are presented to the Audit Committee.
Internal Controls over Financial Reporting
The Company's internal financial controls are commensurate with the scale and
complexity of its operations. The controls were tested during the year and no reportable
material weaknesses either in their design or operations were observed.
The Company has put in place robust policies and procedures, which inter alia, ensure
integrity in conducting its business, safeguarding of its assets, timely preparation of
reliable financial information, accuracy & completeness in maintaining accounting
records and prevention & detection of frauds & errors.
14. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy and has established the necessary vigil
mechanism for its employees and Directors to report concerns about any unethical and
improper activity, without fear of retaliation. No person has been denied access to the
Chairman of the Audit Committee. The Audit Committee monitors and reviews the
investigations of the whistle blower complaints. During the FY 2022-23, 41 complaints were
received under Whistle Blower Policy and were resolved after investigation.
The Whistle Blower policy is uploaded on the website of the Company at Vigil
Mechanism Whistle Blower Policv.pdf (acclimited.com).
15. SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES
As of March 31, 2023, the Company has four subsidiaries, five joint ventures and two
associate companies.
The Board of Directors of the Company has approved a Policy for determining material
subsidiaries in line with the Listing Regulations. The Policy has been uploaded on the
Company's website.
Pursuant to the provisions of Section 129, 134 and 136 of the Act read with rules made
thereunder and Regulation 33 of the SEBI Listing Regulations, your Company has prepared
Consolidated Financial Statements of your Company and a separate statement containing the
salient features of Financial Statement of subsidiary, joint venture and joint operation
entities in Form AOC-1, which forms part of this Annual Report.
The Annual Financial Statements and related detailed information of the subsidiary /
joint venture companies shall be made available to the shareholders of the holding and
subsidiary / joint venture companies seeking such information on all working days during
business hours. The financial statements of the subsidiary / joint venture companies shall
also be kept for inspection by any shareholders during working hours at your Company's
registered office and that of the respective subsidiary / joint venture companies
concerned. In accordance with Section 136 of the Act, the Audited Financial Statements,
including Consolidated Financial Statements and related information of your Company and
audited accounts of each of its subsidiary joint venture, are available on website of your
Company under Investor Section.
Pursuant to Section 134 of the Act read with rules made thereunder, the details of
developments of subsidiaries and joint ventures of your Company are covered in the
Management Discussion and Analysis Report, which forms part of this Annual Report.
16. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL
16.1 Directorate
A. Appointments/Re-appointments
With effect from September 16, 2022, the Board was re-constituted as under:
Mr. Karan Adani, Non-Executive Chairman, Mr. Vinay Prakash, Non-Executive Director, Mr.
Arun Kumar Anand, Non-Executive Director, Mr. Sandeep Singhi, Independent Director, Mr.
Rajeev Agarwal, Independent Director, Mr. Nitin Shukla, Independent Director, and Ms.
Ameera Shah, Independent Director, were appointed.
Mr. Ajay Kapur was appointed as Wholetime Director and CEO, being liable to retire by
rotation, on the Board of Directors of the Company by the Members by way of postal ballot
on January 14, 2023 with effect from December 3, 2022 till November 30, 2025.
Retirement by Rotation
In accordance with the provisions of Section 152 of the Act, read with rules made
thereunder and Articles of Association of the Company, Mr. Vinay Prakash (DIN: 03634648)
is liable to retire by rotation at the ensuing Annual General Meeting (AGM) and being
eligible, offers himself for re-appointment.
B. Cessation
During the year under review NonExecutive Directors- Mr. Jan Jenisch, Mr. Martin
Kriegner, Mr. Vinayak Chatterjee, Mr. Shailesh Hairbhakti, Mr. S.K. Roongta, Ms. Falguni
Nayar, Mr. Damodarannair Sundaram, Mr. Sunil Mehta, Mr. M R Kumar, Mr. Neeraj Akhoury and
Mr. N.S. Sekhsaria resigned w.e.f September 16, 2022 due to change in management.
The Board placed on record its appreciation for the valuable services rendered by all
outgoing Directors.
16.2 Key Managerial Personnel Cessation
During the year under review Mr. Rajiv Choubey, Company Secretary resigned w.e.f April
27, 2022, Mr. Yatin Malhotra, Chief Financial Officer resigned w.e.f August 31, 2022, Ms.
Rashmi Khandelwal, Company Secretary resigned w.e.f November 15, 2022 and Mr. Sridhar
Balakrishnan WTD and CEO resigned w.e.f December 3, 2022 from the Company.
The Board placed on record its appreciation for the valuable services rendered by Mr.
Sridhar Balakrishnan, Mr. Rajiv Choubey, Mr. Yatin Malhotra and Ms. Rashmi Khandelwal.
The Company appointed Mr. Vinod Bahety as Chief Financial Officer w.e.f September 16,
2022 and Mr. Ajay Kapur as WTD & CEO w.e.f December 3, 2022.
16.3 Independent Directors
The Company's Independent Directors have submitted requisite declarations confirming
that they continue to meet the criteria of independence as prescribed under Section 149(6)
of the Act and Regulation 16(1) (b) of the Listing Regulations. The Independent Directors
have also confirmed that they have complied with Schedule IV of the Act and the Company's
Code of Conduct.
The Board is of the opinion that the Independent Directors of the Company possess
requisite qualifications, experience and expertise in the fields of finance, people
management, strategy, auditing, tax and risk advisory services, infrastructure, banking,
insurance, financial services, investments, mining and mineral industries and e-marketing;
and they hold highest standards of integrity.
16.4 Board effectiveness
a. Familiarisation programme for Independent Directors
Over the years, the Company has developed a robust familiarisation process for the
newly appointed Directors with respect to their roles and responsibilities, way ahead of
the prescription of the regulatory provisions. The process has been aligned with the
requirements under the Act and other related regulations. This process inter-alia includes
providing an overview of the cement industry, the Company's business model, the risks and
opportunities, the new products, innovation, sustainability measures, digitisation
measures etc.
Details of the familiarisation programme are explained in the Report on Corporate
Governance and are also available on the Company's website and can be accessed at www.acclimited.com/assets/new/
ndf/CG/Familiarization-Proaramme-for- Indenendent.-Direct.ors.ndf
b. Formal annual evaluation
The Board carries out its annual performance evaluation of its own performance, the
Directors individually, as well as the evaluation of the working of its Audit, Nomination
& Remuneration, Risk Management, Stakeholders Relationship and Corporate Social
Responsibility Committees as mandated under the Act and SEBI Listing Regulations, as
amended from time to time. The criteria applied in the evaluation process are explained in
the Report on Corporate Governance, which forms part of this Annual Report.
16.5 Remuneration policy and criteria for selection of candidates for appointment as
Directors, Key Managerial Personnel and Senior Leadership positions
The Company has in place, a policy for remuneration of Directors, Key Managerial
Personnel as well as a well-defined criterion for the selection of candidates for
appointment to the said positions, which has been approved by the Board. The Policy
broadly lays down the guiding principles, philosophy and the basis for payment of
remuneration to the Executive and Non-Executive Directors (by way of sitting fees and
commission), Key Managerial Personnel.
The criteria for the selection of candidates for the above positions cover various
factors and attributes, which are considered by the Nomination & Remuneration
Committee and the Board while selecting candidates. The policy on remuneration of
Directors, Key Managerial Personnel is also available at the website of the Company and
can be accessed at www.acclimited.com/assets/new/ pdf/CG/Policy remuneration selection
for appointment-mrif
The Board has also formulated and adopted the policy on the 'Diversity of the Board'
and 'Succession Policy for Directors'. The details of the same are available at the
website of the Company and can be accessed at www.acclimited.com/assets/ new/new
ndf/Policvondiversitvoftheboard. pdf www.acclimited.com/assets/new/ndf/CG/ succession
policy for directors.pdf
17. NUMBER OF MEETINGS OF THE BOARD & ITS COMMITTEES
Regular meetings of the Board and its Committees are held to discuss and decide on
various business policies, strategies, financial matters and other businesses. The
schedule of the Board/Committee Meetings to be held in the forthcoming financial year is
circulated to the Directors in advance to enable them to plan their schedule for effective
participation in the meetings. Due to business exigencies, the Board has also been
approving several proposals by circulation from time to time.
During the FY 2022-23, twelve (12) Board Meetings were convened and held, the details
of which are given in the Report on Corporate Governance, which forms part of this Annual
Report.
During the FY 2022-23, with an objective of further strengthening the governance
standards so as to match with internationally accepted better practices, the Board had
reconstituted certain existing Committees to bring more independence; constituted certain
new Committees and Subcommittees; and amended / adopted the terms of reference of the said
Committees. All Committees are chaired by an Independent Director. Details of the various
Committees constituted by the Board, including the Committees mandated pursuant to the
applicable provisions of the Act and SEBI Listing Regulations, are given in the Corporate
Governance Report, which forms part of this Annual Report.
18. INDEPENDENT DIRECTORS* MEETING
The Independent Directors met on March 23, 2023, without the attendance of
Non-Independent Directors and members of the management. The Independent Directors
reviewed the performance of Non-Independent Directors, the Committees and the Board as a
whole along with the performance of the Chairman of your Company, taking into account the
views of Non-Executive Directors and assessed the quality, quantity and timeliness of flow
of information between the management and the Board that is necessary for the Board to
effectively and reasonably perform their duties.
19. CORPORATE SOCIAL RESPONSIBILITY
Your Company has constituted a Corporate Social Responsibility (CSR) Committee and
framed a CSR Policy. The brief details of CSR Committee are provided in the Corporate
Governance Report, which forms part of this Annual Report.
In compliance with Section 135 of the Act read with the Companies (Corporate Social
Responsibility Policy) Rules, 2014 as amended, the statutory disclosures with respect to
the CSR Committee and an Annual Report on CSR Activities forms part of this Report
as Annexure-2.
The CSR Policy as recommended by the CSR Committee and as approved by the Board is
available on the website of the Company and can be accessed at
https://www.acclimited.com/assets/ new/pdf/ACC- CSR-policv.pdf
Further, the Chief Financial Officer of your Company has certified that CSR spends of
your Company for the FY 2022-23 have been utilised for the purpose and in the manner
approved by the Board of the Company.
20. RISK MANAGEMENT FRAMEWORK
The Company's governance structure has well- defined roles and responsibilities, which
enable and empower the Management to identify, assess and leverage business opportunities
and manage risks effectively. There is also a comprehensive framework for strategic
planning, implementation and performance monitoring of the business plan, which inter alia
includes a well-structured Business Risk Management process (BRM).
To systematically identify risks and opportunities and monitor their movement, a heat
map has been designed comprising two (2) parameters:
a) likelihood of the event and
b) the impact it is expected to have on the Company's operations and performance.
The risks that fall under the purview of high likelihood and high impact are identified
as key risks. This structured process in identifying risks supports the ManCom in
strategic decision-making and in the development of detailed mitigation plans. The
identified risks are then integrated into the Company's planning cycle, which is a rolling
process to, inter alia periodically review the movement of the risks on the heat map and
the effectiveness of the mitigation plan.
The detailed section on key business risks and opportunities forms part of Management
Discussion and Analysis Report, which forms part of this Annual Report.
21. TRANSACTIONS WITH RELATED PARTIES
The Company has developed a Related Party Transactions ('RPTs') Manual and Standard
Operating Procedures to identify and monitor RPTs.
All transactions with related parties are placed before the Audit Committee as well as
the Board for approval. Prior omnibus approval of the Audit Committee and the Board is
obtained for the RPTs, which are foreseeable and repetitive. The RPTs are entered with
prior approvals of the Audit Committee and the same are subject to audit. A statement
giving details of all RPTs is placed before the Audit Committee and the Board of Directors
on a quarterly basis. The statement is supported by a certificate from the WTD & CEO
and the CFO.
All transactions with related parties during the year were on arm's length basis and
were in the ordinary course of business. The details of the material related-party
transactions entered into during the year as per the policy on RPTs approved by the Board
have been reported in Form AOC 2, which is given in Annexure-3 to this Report.
None of the Directors and the Key Managerial Personnel has any pecuniary relationships
or transactions vis-a-vis the Company.
Your Company did not enter into any related party transactions during the year which
could be prejudicial to the interest of minority shareholders. No loans / investments to /
in the related party have been written off or classified as doubtful during the year under
review.
The policy on RPTs as approved by the Board of Directors has been uploaded on the
Company's website and can be accessed at https://www.
acclimited.com/assets/new/pdf/Related%20
Part¦v%20Transact¦ion%20Policv.pdf
22. TRANSFER OF EQUITY SHARES UNPAID/ UNCLAIMED DIVIDEND TO THE IEPF
In line with the statutory requirements, your Company has transferred to the credit of
IEPF set up by the Government of India, equity shares in respect of which dividend had
remained unpaid/unclaimed for a period of seven (7) consecutive years within the time
lines laid down by the Ministry of Corporate Affairs. Unpaid/unclaimed dividend for seven
(7) years or more has also been transferred to the IEPF pursuant to the requirements under
the Act.
23. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
Builders Association of India complaint under the provisions of the Competition Act,
2002 against the cement manufacturers -Order of the Supreme Court of India in Appeal
As has been reported in detail in the earlier years a penalty of RS.1,147.59 Crore was
levied on the company by the Competition Commission of India ('CCI') based on a complaint
filed by the Builder's
Association of India for alleged violation of the provisions of the Competition Act,
2002.
By Order dated July 25, 2018, the National Company
Law Appellate Tribunal ('NCLAT') dismissed the appeal of the company upholding the levy
of penalty of RS.1,147.59 Crore as imposed by the CCI vide its order dated August 31,
2016. The NCLAT on November 7, 2016 initially stayed the operation of the CCI's order
subject to deposit of 10% of the penalty amount.
The company preferred an appeal before the Hon'ble Supreme Court against the above
order of NCLAT. The Hon'ble Supreme Court vide its order dated October 5, 2018 has
admitted the company's Civil Appeal and ordered for continuance of the interim orders
passed by NCLAT towards stay of the demand subject to deposit of 10% of the penalty
amount. The matter is currently sub-judice and as on March 31, 2023 the penalty amount of
RS.1,147.59 Crore and interest thereon has been disclosed as a contingent liability in the
Notes to Financial Statements [Refer Note - 40 A(a)].
CCI's order on complaint filed by Director, Supplies & Disposals, State of Haryana
in 2013
The Director, Supplies & Disposals, State of Haryana had filed a complaint before
CCI alleging collusion and bid rigging by cement manufacturers in violation of Section
3(1) and 3(3)(d) of the Competition Act, 2002. In January 2017, the CCI passed an order
against seven (7) cement manufacturers, including the Company imposing a penalty
calculated at the rate of 0.3% of the average turnover of the last three (3) years from
financial year 2012-13 to financial year 2014-15. In respect of the company, the amount of
penalty works out to RS.35.32 Crore.
An appeal is pending before NCLAT in the said matter against the orders of the CCI. The
"Note of Submission" as directed is filed. As on March 31, 2023, the penalty
amount of RS.35.32 Crore is disclosed as a contingent liability in the Notes to Financial
Statements [Refer Note. - 40 A(b)].
There are no further developments during the year under review in respect of the above
cases.
24. AUDITORS
24.1 Statutory Auditor & Auditors' Report
M/s. S R B C & Co. LLP, Chartered Accountants (ICAI Firm Registration Number
324982E/ E300003) were appointed as the Statutory Auditors of the Company for a period of
5 years to hold office from the conclusion of the 86th AGM till the conclusion
of the 91st AGM to be held in the year 2027. The Auditors have also furnished a
declaration confirming their independence as well as their arm's length relationship with
the Company as well as declaring that they have not taken up any prohibited non-audit
assignments for the Company. The Audit Committee reviews the independence of the Auditors
and the effectiveness of the Audit process. The Auditors attend the Annual General meeting
of the Company. The Auditor's Report for FY 202223 on the financial statement (standalone
and consolidated) of the Company forms part of this Annual Report.
The Notes to the financial statements referred in the Auditors' Report are
self-explanatory. The Auditors'Report is enclosed with the financial statements forming
part of this Annual Report.
Explanation to Auditors' Comment
The Auditors' Qualification has been appropriately dealt with in Note No.58 and 61 of
the Notes to the Audited Financial Statements on Standalone and Consolidated basis
respectively.
24.2 Cost Auditor
The cost accounts and records are required to be maintained under Section 148(1) of the
Act. They are duly made and maintained by the Company. In terms of the provisions of
Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the
Board has on the recommendation of the Audit Committee appointed M/s. D. C. Dave &
Co., Cost Accountants, Mumbai (Firm Registration No 000611), to conduct the cost audit of
the Company for the financial year ending March 31, 2023, at a remuneration as mentioned
in the Notice convening the 87th AGM.
As required under the Act read with the Companies (Cost Records and Audit) Rules, 2014,
the remuneration payable to Cost Auditors must be placed before the Members at a general
meeting for ratification. Hence, a resolution for the same forms part of the Notice of the
ensuing AGM.
M/s. D.C. Dave & Co. have confirmed the cost records for the financial year ended
December 31, 2021 are free from any disqualifications as specified under Section 141 (3)
and proviso to Section 148(3) read with Section 141(4) of the Act. They have further
confirmed their independent status.
The cost audit report for the FY 2021 was filed before the due date with Ministry of
Corporate Affairs.
24.3 Secretarial Auditor and Secretarial Audit Report
In terms of the provisions of Section 204 of the Act read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has
appointed M/s. Mehta & Mehta, Company Secretaries in Practice, Mumbai, as the
Secretarial Auditor for conducting Secretarial Audit of the Company for the financial year
ended March 31, 2023.
The report of the Secretarial Auditor is given in Annexure-4. The Secretarial
Audit Report does not contain any qualification, reservation or adverse remark.
25. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments, affecting the financial position of the
Company, which has occurred between the end of FY 2022-23 and the date of this report.
26. CORPORATE GOVERNANCE
The Board of Directors reaffirm their continued commitment to good corporate governance
practices. During the year under review, the Company complied with the provisions relating
to corporate governance as provided under the Listing Regulations. The compliance report
together with a certificate from the Company's auditors confirming the compliance is
provided in the Report on Corporate Governance, which forms part of this Annual Report.
BOARD POLICIES
The details of the policies approved and adopted by the Board, as required under the
Act and SEBI Listing Regulations, are provided in Annexure - 1 to this report.
27. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Report, describing the initiatives taken by your
Company from environment, social and governance perspective, for the FY 2022-23,
Business Responsibility and Sustainability forms part of this Annual Report as required
under Regulation 34(2) (f) of the Listing Regulations.
28. PARTICULARS OF EMPLOYEES
Your Company had 5,472 employees on standalone basis as on March 31, 2023. Disclosures
pertaining to remuneration and other details as required under Section 197(12) of the Act
read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
are given in Annexure-5 to this Report.
Further, a statement showing the names and other particulars of employees drawing
remuneration in excess of limits set out in the Rules 5(2) and 5(3) of the aforesaid Rules
forms part of this Report. However, in terms of the first proviso of Section 136(1) of the
Act, the Annual Report and Accounts are being sent to the Members and other entitled
thereto, excluding the aforesaid information. The said information is available for
inspection by the Members at the Registered Office of your company during business hours.
Any Member, who is interested in obtaining these, may write to the Company Secretary at
the Registered Office of the Company.
29. REPORTING OF FRAUDS BY AUDITORS
During the FY 2022-23, neither the Statutory Auditors nor the Secretarial Auditor have
reported to the Audit Committee of the Board, under Section 143(12) of the Act, any
instances of fraud committed against the Company by its officers or employees, the details
of which would need to be mentioned in this Report.
30. ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Act read with
Rule 12 of the Companies (Management and Administration) Rules, 2014, the draft of the
Annual Return of the Company for the financial year March 31, 2023 is uploaded on the
website of the Company and can be accessed at www.acclimited.com
31. COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors affirms that the Company has complied with the applicable
Secretarial Standards (SS) issued by the Institute of Company Secretaries of India (SS1
and SS2), relating to Meetings of the Board and its Committees respectively, which have
mandatory application during the year under review.
32. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The disclosures required to be made under Section 134(3) (m) of the Act read with Rule
8 of The Companies (Accounts) Rules, 2014, on Conservation of Energy, Technology
Absorption and Foreign Exchange Earnings and Outgo are given as under:
A. Conservation of energy
A1. Power cost optimisation
During the period Jan'22 - Mar'23, efforts were made to reduce the impact of increasing
electrical energy cost by partly replacing grid and CPP power through consumption of
Renewable energy initiatives power from comparatively cheaper sources. The plants which
actively participated in procurement of power were Jamul, Lakheri, Tikaria, Thondebhavi,
Kudithini, and Thondebhavi & Madukkarai. Overall purchase of power from OA has
resulted in a saving of ~ '57.1 Crore. In addition, the Waste Heat Recovery System (WHRS)
at Gagal, Kymore & Jamul generated ~103 Million units for internal consumption in
place of grid power.
A2. Renewable power obligation
Your Company is putting all efforts to increase the share of Renewable Energy. The
captive wind power generation from Tamil Nadu and Rajasthan wind farms contributed
considerably in this front. This has resulted in a saving of ~ '0.44 Crore on account of
RPO cash outgo.
Following energy conservation and efficiency improvement measures were undertaken in
various areas of the cement manufacturing and Captive Power Plants ('CPPs'), through
Operational and Capex measures. A few highlights are as under: •
• Energy efficiency improvement through installation of efficient equipment such
as fans, blowers, compressors and motors across all ACC plants;
• Conduction of mandatory energy audits and identification of energy conservation
projects;
• Implementation of projects identified as part of Mandatory Energy audits;
• Focus on Productivity Rate Index ('PRI') improvement through Computational Fluid
Dynamics ('CFD') studies and through other inhouse modification at Wadi, Bargarh &
Lakheri.
• Installation of medium voltage variable frequency drives ('MVVFD') and low
voltage variable frequency drives ('LVVFD') for process fans across all ACC plants. Some
of the additional proposals being implemented for further conservation of energy
• Installation of variable frequency drives and high efficiency fans, across ACC
plants;
• Reduction of Preheater pressure drop through enlargement of kiln inlet neck and
improving heat exchange within cyclones by checking / installation of new flap damper in
kiln feed pipes;
• Installation of water spray system in preheater down comer duct&
modification of clinker cooler inlet;
• Installation of vacuum pumps &energy efficient screw compressor in CPP
Impact of the above measures for reduction of energy consumption and consequent impact
on cost of production
The measures stated in points (A) above would further improve the thermal and
electrical energy efficiency of the ACC Plants.
The capital investment on energy conservation equipment
Your Company invested ~'387.00 Crore on productivity/ efficiency improvement, besides
implementation low -cost measures to reduce energy consumption.
The steps taken by the Company for utilising alternate sources of energy
Besides the use of Renewable Energy (Solar and Non -Solar), your Company utilised 0.56
Million tonnes of Alternative Fuels during the cement manufacture, with an investment for
~'16.00 Cr.
B. Technology Absorption Research and Development (R&D)
1. Specific areas in which R&D is carried out by the Company
a) Conservation of resources through maximisation of the use of low -grade limestone
for cement manufacturing, improvement in the quality of blended cement through innovative
process utilising industrial by -products for improved quality and performance of ACC
plants;
b) Maximsation of industrial wastes utilisation and looking into possibilities of
environmentally friendly co -processing of wastes in cement manufacture leading to thermal
substitution and conservation of natural resources;
c) Optimisation of fuel mix for lowering the cost;
d) Effective replacement of the costlier natural Gypsum by other form of gypsum and
byproducts without affecting the quality of cement;
d) Effective replacement of dry fly ash with wet / conditioned fly ash, by installation
of dryers & additional feeding system in cement mills;
e) Productivity research for increased efficiency in use of resources development of
application oriented cements with decreased CO 2 emissions;
f) Development of Integral waterproofing Compound;
g) Development of cement based niche products like water repellent and self curing Dry
Mix Mortar, thin bed jointing mortar, plasters, tile adhesives range;
h) Development of Concrete Admixture for ACC RM.
2. Benefits derived as result of above R&D
a) Effective use of marginal quality raw materials and fuels with improved clinker
quality;
b) Reduction in raw material cost- gypsum and fly ash;
c) Increased production of high -performance products like F2R, Concrete+, ACC Gold for
specific market segments/ market climatic conditions;
e) Increased absorption of blending materials like fly ash and slags in blended
cements;
f) Fuel efficiency;
g) Reduction in special power consumption for grinding;
h) ACC Concrete admixture project resulted in cost savings on admixture buying cost
with a consistent quality.
3. Plan of action
a) Development of application oriented cement focusing customer pain points with
reduced carbon footprint;
b) Development of cement-based niche products;
c) Exploratory research works on the above specified areas;
d) Maximisation of use of waste/ byproducts in cement manufacture as alternative
materials;
e) Improve product quality particularly with respect to long-term durability and
reduction in cost of manufacture;
f) Implementing & developing complete range of concrete admixture for ACC RMX to
maximise the potential for quality & cost;
g) Maximisation of utilisation of renewal power & energy from WHRS system.
4. Expenditure on R&D
|
Rs. in Crore |
a) Capital |
NIL |
b) Recurring (Gross) |
1.05 |
c) Total |
1.05 |
Total R&D expenditure as percentage of total turnover |
0.0004 |
C. Foreign Exchange Earnings and Outgo
|
Rs. in Crore |
Foreign Exchange earned |
1.50 |
Foreign exchange outgo |
1,310.00 |
33. OTHER DISCLOSURES
33.1 There were no material changes and commitments affecting the financial position of
the Company between the end of the financial year and the date of this report.
33.2 The Company has not issued any shares with differential voting rights/sweat equity
shares.
33.3 There was no revision in the Financial Statements.
33.4 There has been no change in the nature of business of the Company as on the date
of this report.
33.5 There are no proceedings, either filed by the company or filed against the
company, pending under the Insolvency and Bankruptcy Code, 2016 as amended, before
National Company Law Tribunal or other courts during the FY 2022-23.
33.6 The WTD & CEO of your Company is not drawing any remuneration or commission
from any of the subsidiary of the Company.
33.7 Your Company has taken appropriate insurance for all assets against foreseeable
perils.
33.8 Prevention of Sexual Harassment of Women at the Workplace
As per the requirements of The Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013 and rules made thereunder, your Company has
constituted Internal Complaints Committees (ICs) at all relevant locations across India to
consider and resolve the complaints related to sexual harassment. The ICs includes
external member with relevant experience.
The ICs, presided by senior women, conduct the investigations and make decisions at the
respective locations. The ICs also work extensively on creating awareness on relevance of
sexual harassment issues, including while working remotely. During FY 2022-23, there were
no complaints pertaining to sexual harassment. All new employees go through a detailed
personal orientation on anti-sexual harassment policy adopted by the Company.
34. DIRECTORS* RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and
explanations obtained by them, your Directors make the following statement in terms of
Section 134 of the Act:
a) that in the preparation of the annual Financial Statements for the year ended March
31, 2023, the applicable accounting standards have been followed along with proper
explanation relating to material departures, if any
b) that such accounting policies as mentioned in Note 1 of the Notes to the Financial
Statements have been selected and applied consistently and judgment and estimates have
been made that are reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as on March 31, 2023, and of the profit of the Company for the
year ended on that date;
c) that proper and sufficient care has been taken for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d) that the annual accounts have been prepared on a going concern basis;
e) that proper internal financial controls laid down by the Directors were followed by
the Company and such internal financial controls are adequate and were operating
effectively;
f) that proper systems to ensure compliance with the provisions of all applicable laws
have been devised and such systems were adequate and were operating effectively.
35. INTEGRATED REPORTING
For the 4th year, the Company has drawn up an Integrated Report, which
encompasses both financial and non-financial information to enable Members to have a more
holistic understanding of the Company's long term perspective.
36. ACKNOWLEDGEMENTS
The Directors express their deep sense of gratitude to the Central and State Government
Ministries and departments, shareholders, customers, business associates, bankers,
employees, trade unions and all other stakeholders for their support and look forward to
their continued assistance in future.
|
For and on behalf of the Board of Directors |
|
For ACC Limited |
|
Karan Adani |
Ahmedabad |
Chairman |
April 27, 2023 |
DIN:03088095 |