Dear Members,
The Board of Directors are pleased to present the 72nd Annual Report of the
Company for the financial year ended 31st March, 2018.
FINANCIAL RESULTS
The Company's financial performance for the year ended 31st March, 2018 is
summarized below:
(Rs. in Crores)
|
|
Standalone |
|
|
Consolidated |
|
|
Year ended |
Year ended |
Growth |
Year ended |
Year ended |
Growth |
|
31.03.2018 |
31.03.2017 |
(%) |
31.03.2018 |
31.03.2017 |
(%) |
| Revenue from Operations* |
14,153.71 |
12,722.76 |
11.2% |
16,843.76 |
15,168.18 |
11.0% |
| Earning Before Interest, Taxes, Depreciation and Amortisation |
3,198.00 |
2,971.01 |
7.6% |
3,418.23 |
3,248.85 |
5.2% |
| Less : Finance Cost |
21.06 |
18.86 |
- |
35.07 |
29.99 |
- |
| Less : Depreciation and Amortisation Expense |
311.11 |
295.43 |
- |
360.47 |
334.79 |
- |
| Profit for the period before share of profit in associate |
2,865.83 |
2,656.72 |
7.9% |
3,022.69 |
2,884.07 |
4.8% |
| Share of profit ofAssociate |
- |
- |
- |
45.79 |
49.61 |
- |
| Profit Before Tax |
2,865.83 |
2,656.72 |
7.9% |
3,068.48 |
2,933.68 |
4.6% |
| Less : Tax Expense |
971.03 |
855.00 |
|
1,040.96 |
943.29 |
|
| Profit for the period from continuing operations |
1,894.80 |
1,801.72 |
5.2% |
2,027.52 |
1,990.39 |
1.9% |
| Profit before tax from discontinued operations |
- |
- |
- |
70.59 |
30.55 |
- |
| Tax expense of discontinued operations |
- |
- |
- |
0.59 |
4.69 |
- |
| Profit for the period from discontinued operations |
- |
- |
- |
70.00 |
25.86 |
- |
| Profit for the period |
1,894.80 |
1,801.72 |
5.2% |
2,097.52 |
2,016.25 |
4.0% |
| Attributable to: |
|
|
|
|
|
|
| Shareholders of the Company |
1,894.80 |
1,801.72 |
5.2% |
2,038.93 |
1,939.43 |
5.1% |
| Non Controlling Interest |
- |
- |
- |
58.59 |
76.82 |
- |
| Other Comprehensive Income (net of tax) |
(3.97) |
139.04 |
- |
(34.80) |
9.26 |
- |
| Total Comprehensive Income |
1,890.83 |
1,940.76 |
-2.6% |
2,062.72 |
2,025.51 |
1.8% |
| Attributable to: |
|
|
|
|
|
|
| Shareholders of the company |
1,890.83 |
1,940.76 |
-2.6% |
2,009.48 |
1,999.99 |
0.5% |
| Non-Controlling Interest |
- |
- |
- |
53.24 |
25.52 |
- |
| Opening balance in Retained Earnings |
2,672.53 |
2,282.32 |
- |
2,688.71 |
2,141.50 |
- |
| AMOUNT AVAILABLE FOR APPROPRIATION |
4,575.33 |
4,089.42 |
- |
4,736.24 |
4,106.21 |
- |
| Dividend - Interim - FY 2017-18 |
254.19 |
- |
- |
254.19 |
- |
- |
| Interim - FY 2016-17 |
- |
254.19 |
- |
- |
254.19 |
- |
| Final- FY 2016-17 |
733.79 |
- |
- |
733.79 |
- |
- |
| Final- FY 2015-16 |
- |
508.37 |
- |
- |
508.37 |
- |
| Tax on Dividend |
199.44 |
154.33 |
- |
199.44 |
154.33 |
- |
| Transfer to General Reserve |
- |
500.00 |
- |
- |
500.00 |
- |
| Transfer to Other Reserve |
- |
- |
- |
1.04 |
0.61 |
- |
| Closing balance in Retained Earnings |
3,387.91 |
2,672.53 |
- |
3,547.78 |
2,688.71 |
- |
* Figures for Revenue from Operations are comparable numbers .i.e Excise Duty has been
removed as same does not form part of Revenue post GST implementation.
COMPANY'S PERFORMANCE REVIEW
During the financialyear 2017-18, revenue from operations on standalone basis increased
to ' 14,153.71 crores as against ' 12,722.76 crores in the previous year - a growth of
11.2%.
Cost of goods sold as a percentage to revenue from operations increased to 56.40 % as
against 54.58 % in the previous year.
Employee cost as a percentage to revenue from operations decreased to 5.6% (' 791.08
crores) against 5.8% (' 742.83 crores) in the previous year.
Other expense as a percentage to revenue from operations decreased to 17.4% (' 2,459.43
crores) as against 18.6% (' 2,365.04 crores) in the previous year.
The ProfitAfterTax tor the currentyear is ' 1,894.80 crores against ' 1,801.72 crores
in the previous year - a growth of 5.2%.
On a consolidated basis, the group achieved revenue of Rs. 16,843.76 crores as against'
15,168.18 crores - a growth of11.0%. Net profit after non-controlling interest for the
group for the currentyear is W 2,038.93 crores as against W 1,939.43 crores in the
previousyear-a growth of 5.1%.
There are no material changes and commitments affecting the financial position of the
Company which have occurred between the end of the financial year 2017-18and the date of
this report. There has been no change in the nature of business of the Company.
DIVIDEND
During the year under review, the Company declared and paid to the shareholders, an
interim dividend of ' 2.65 (Rupees two and paise sixty five only) per equity share of the
face value of ' 1 (Rupee one only) each in the month of October, 2017. In addition, the
Directors have recommended payment of ' 6.05 (Rupees six and paise five only) per equity
share of the face value of' 1 (Rupee one only) each as final dividend for the financial
year 2017-18, for the approval of the shareholders at the ensuing Annual General Meeting
of the Company. If approved, the total dividend (interim and final dividend) for the
financial year 2017 - 18 will be ' 8.70 (Rupees eight and paise seventy only) per equity
share of the face value of' 1 (Rupee one only) each as against the total dividend of '
10.30 (Rupees ten and paise thirty only) per equity share of the face value of '1 each
(Rupee one only) paid for the previous financial year 2016-17 which included one-time
special dividend of ' 2 (Rupees two only) per equity share of the face value of ' 1 each
(Rupee one only).
The Dividend Distribution Policy of the Company is set out as Annexure [A] and the same
is uploaded on the Company's website (https://www.asianpaints.com/more/investors/
policies-programs.html).
CONSOLIDATED FINANCIAL STATEMENTS
As per Regulation 33 of the Securities and Exchange Board of India (Listing Obligations
and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing
Regulations") and applicable provisions of the Companies Act, 2013 read with the
Rules issued thereunder, the Consolidated Financial Statements of the Company for the
financial year 2017-18 have been prepared in compliance with applicable Accounting
Standards and on the basis of audited financial statements of the Company, its
subsidiaries and associate companies, as approved by the respective Board of Directors.
The Consolidated Financial Statements together with the Auditors' Report form part of
this Annual Report.
SUBSIDIARIES & ASSOCIATE COMPANIES Financial Performance:
A separate statement containing the salient features of financial statements of all
subsidiaries of the Company in the prescribed Form AOC - 1 forms a part of consolidated
financial statements in compliance with Section 129 (3) and other applicable provisions,
if any, of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules,
2014. The said Form also highlights the financial performance of each of the subsidiaries
and joint venture companies included in the consolidated financial statements of the
Company pursuant to Rule 8(1) of the Companies (Accounts) Rules, 2014.
In accordance with Section 136 of the Companies Act, 2013, the financial statements of
the subsidiary and associate companies are available for inspection by the members at the
Registered Office of the Company during business hours on all days except Saturdays,
Sundays and public holidays upto the date of the Annual General Meeting ('AGM'). Any
member desirous of obtaining a copy of the said financial statements may write to the
Company Secretary at the Registered Office of the Company. The financial statements
including the consolidated financial statements, and all other documents required to be
attached to this report have been uploaded on the website of the Company (www.asianpaints.com ). The Company has formulated a
policy for determining material subsidiaries. The policy may be accessed on the website of
the Company (https://www .
asianpaints.com/more/investors/policies-programs.html).
During the year under review:
a. In order to consolidate, the Company's investments in overseas subsidiary companies,
Asian Paints (International) Limited, Mauritius, wholly owned subsidiary was amalgamated
with the Company pursuant to an Order dated 29th November, 2017 passed by the
Mumbai Bench of the Hon'ble National Company Law Tribunal pursuant to Sections 230 to 232
and 234, other applicable provisions of the Companies Act, 2013 and any other applicable
Regulations. The appointed date for the Scheme of amalgamation was 1st January,
2017.
The merger was effective 15th January, 2018 after obtaining necessary
approvals including approval from the Registrar of Companies, Mauritius.
b. The Company acquired the balance 49% of the paid up share capital of Sleek
International Private Limited (Sleek) from the Ahuja family for a consideration of ' 50
crores (Rupee Fifty crores only). Sleek is now a wholly owned subsidiary of the Company.
c. The Company acquired 100% stake in Reno Chemicals Pharmaceuticals & Cosmetics
Private Limited (Reno) for an amount of ' 159.52 crores (Rupees one hundred fifty nine
crores and fifty two lakhs only) with an objective of using the land and building of Reno
to meet the Company's growing infrastructure requirements.
d. The Company fully exited from its operations in the Caribbean region carried on
through Lewis Berger (Overseas Holdings) Limited (LBOH), United Kingdom, indirect
subsidiary of the Company, for a consideration of ' 189.16 crores (Rupees one hundred
eighty nine crores and sixteen lakhs only) (approx). The divestment was with an objective
to focus on its international presence in growing geographies across the continents of
Asia and Africa.
EXPANSION OF MANUFACTURING CAPACITY AT ANKLESHWAR, GUJARAT
During the year under review, the Company resolved to expand the existing paint
manufacturing capacity at its unit situated at Ankleshwar, Gujarat, from 1,30,000 KL to
3,00,000 KL per annum and to augment the manufacturing capacity of synthetic resins and
emulsions from existing 32,000 MT to 85,000 MT (approx.) over a span of the next 3 - 4
years.
The said expansion and augmentation would involve phasing out the current Phthalic
Anhydride and its allied products manufactured at this facility.
The Company is awaiting necessary approvals from statutory authorities and will
thereafter work on this project in a phased manner.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Retirement by rotation and subsequent re-appointment:
In accordance with the provisions of Section 152 and other applicable provisions, if
any, of the Companies Act, 2013, read with the Companies (Appointment and Qualification of
Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof
for the time being in force) and the Articles of Association of the Company, Mr. Ashwin
Choksi (Non-Executive Chairman) and Mr. Ashwin Dani (Non-Executive Vice-Chairman), are
liable to retire by rotation at the ensuing AGM and being eligible have offered themselves
for re-appointment.
In accordance with the provisions of the Companies Act,
2013 read with the Rules issued thereunder, the Listing Regulations and the Articles of
Association of the Company, the Independent Directors and the Managing Director of the
Company are not liable to retire by rotation.
Declaration of independence from Independent Directors:
The Company has received declarations from all the Independent Directors confirming
that they meet the criteria of independence as prescribed under the provisions of the
Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as
Regulation 16 of Listing Regulations (including any statutory modification(s) or
re-enactment(s) thereof for the time being in force).
Number of meetings of the Board:
8 (eight) meetings of the Board of Directors were held during the financial year. The
details of the meetings of the Board of Directors of the Company convened during the
financialyear 2017-18 are given in the Corporate Governance Report which forms part of
this Annual Report.
Remuneration of directors, key managerial personnel and particulars of employees:
The remuneration paid to the Directors is in accordance with the Nomination and
Remuneration Policy formulated in accordance with Section 178 of the Companies Act, 2013
and Regulation 19 of the Listing Regulations (including any statutory modification(s) or
re-enactment(s) thereof for the time being in force).
The information required underSection 197 ofthe Companies Act, 2013 read with Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any
statutory modification(s) or re-enactment(s) thereof for the time being in force) in
respect of Directors/ employees of the Company is set out in the Annexure [B] to this
report and is also available on the website of the Company (www.asianpaints.com ).
Nomination and Remuneration Policy:
The Company has formulated and adopted the Nomination and Remuneration Policy in
accordance with the provisions of Companies Act, 2013 read with the Rules issued
thereunder and the Listing Regulations.
The said Policy of the Company, inter alia, provides that the Nomination and
Remuneration Committee shall formulate the criteria for appointment of Executive,
Non-Executive and Independent Directors on the Board of Directors of the Company and
persons in the Senior Management of the Company, their remuneration including
determination of qualifications, positive attributes, independence of Directors and other
matters as provided under sub-section (3) of Section 178 of the Companies Act, 2013
(including any statutory modification(s) or re-enactment(s) thereof for the time being in
force).
The salient features of the Policy is set out in the Corporate Governance Report which
forms part of this Annual Report. The Policy is also available on the website of the
Company https://www.asianpaints.com/more/investors/policies-
programs.html .
Performance Evaluation:
The Nomination and Remuneration Policy of the Company empowers the Nomination and
Remuneration Committee to formulate a process for evaluating the performance of Directors,
Committees of the Board and the Board as a whole.
The process for evaluation of the performance of the Director(s) / Board / Committees
of the Board for the financialyear 2017-18was initiated by the Nomination and Remuneration
Committee, by triggering online Survey(s) to all Directors.
The Directors carried out the annual performance evaluation of the Board, Committees of
Board and individual Directors along with assessing the quality, quantity and timeliness
of Row ofinformation between the Company management and the Board that is necessary for
the Board to effectively and reasonably perform their duties.
The details of the evaluation process are set out in the Corporate Governance Report
which forms a part of this Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act, 2013 (including any statutory
modification(s) or re-enactment(s) thereof for the time being in force), the Directors of
the Company confirm that:
a. in the preparation of the annual accounts for the financialyear ended 31st
March, 2018, the applicable Accounting Standards and Schedule III of the Companies Act,
2013, have been followed and there are no material departures from the same;
b. the Directors have selected such accounting policies and applied them consistently
and made judgements and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company as at 31st
March, 2018 and of the profit and loss of the Company for the financial year ended 31st
March, 2018;
c. proper and sufficient care has been taken for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 2013 for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts have been prepared on a 'going concern' basis;
e. proper internal financial controls laid down by the Directors were followed by the
Company and that such internal financial controls are adequate and operating effectively;
and
f. proper systems to ensure compliance with the provisions of all applicable laws were
in place and that such systems are adequate and operating effectively.
AUDIT COMMITTEE
The composition of the Audit Committee is in alignment with provisions of Section 177
of the Companies Act, 2013 read with the Rules issued thereunder and Regulation 18 of the
Listing Regulations. The members of the Audit Committee are financially literate and have
experience in financial management.
The Audit Committee comprises of Mr. M. K. Sharma,
Mr. Mahendra Shah, Mr. Abhay Vakil and Mr. R Seshasayee. Mr. Jayesh Merchant acts as
Secretary to the Audit Committee.
All the recommendations made by the Audit Committee were accepted by the Board of
Directors of the Company.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis as stipulated under the Listing Regulations is
presented in a separate section forming part of this Annual Report. It speaks about the
overall industry structure, global and domestic economic scenarios, developments in
business operations/ performance of the Company's various businesses viz., decorative
business, international operations, industrial and home improvement business, internal
controls and their adequacy, risk management systems and other material developments
during the financial year 2017-18.
CORPORATE GOVERNANCE REPORT
In compliance with Regulation 34 of the Listing Regulations, a separate report on
Corporate Governance along with a certificate from the Auditors on its compliance forms an
integral part of this Annual Report.
BUSINESS RESPONSIBILITY REPORT
A Business Responsibility Report as per Regulation 34 of the Listing Regulations,
detailing the various initiatives taken by the Company on the environmental, social and
governance front forms an integral part of this Annual Report.
AUDITORS AND AUDITORS' REPORT
Statutory Auditor:
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No.
117366W/W-100018), were appointed as Statutory Auditors of the Company at the 70th
AGM till the conclusion of the 75th AGM.
M/s. Deloitte Haskins & Sells LLP have confirmed their eligibility and
qualification required underSections 139,
141 and other applicable provisions of the Companies Act, 2013 and Rules issued
thereunder (including any statutory modification(s) or re-enactment(s) thereof for the
time being in force).
The Auditors' Report for the financial year ended 31st March, 2018 on the
financial statements of the Company is a part of this Annual Report. The Auditors' Report
for the financial year ended 31st March, 2018 does not contain any
qualification, reservation or adverse remark.
Cost Auditor:
The Board of Directors of the Company, on the recommendations made by the Audit
Committee, has appointed M/s. RA & Co., Cost Accountants, (Firm Registration No.
000242) as the Cost Auditor of the Company to conduct the audit of cost records for the
financial year 2018-19. The remuneration proposed to be paid to the CostAuditor, subject
to ratification by the shareholders of the Company at the ensuing 72nd AGM,
would not exceed ' 6.75 lakhs (Rupees six lakhs seventy five thousand only) excluding
taxes and out of pocket expenses, if any.
The Company has received consent from M/s. RA & Co.,
Cost Accountants, to act as the Cost Auditor for conducting audit of the cost records
for the financial year 2018-19 along with a certificate confirming their independence and
arm's length relationship.
Secretarial Auditor:
The Board of Directors of the Company has appointed Dr. K R Chandratre, Practicing
Company Secretary (Certificate of Practice No. 5144), as the Secretarial Auditor to
conduct an audit of the secretarial records for the financial year 2018-19.
The Company has received consent from Dr. K. R. Chandratre to act as the auditor for
conducting audit of the secretarial records for the financialyear ending 31st
March, 2018.
The Secretarial Audit Report for the financial year ended 31st March, 2018
is set out in the Annexure [C] to this report. The Secretarial Audit Report does not
contain any qualification, reservation or adverse remark.
EXTRACT OF ANNUAL RETURN
The extract of the Annual Return of the Company as on 31st March, 2018 in
Form MGT - 9 in accordance with Section 92 (3) of the Companies Act, 2013 read with
Companies (Management and Administration) Rules, 2014, are set out in the Annexure [D] to
this report.
RELATED PARTY TRANSACTIONS
All contracts/arrangements/transactions entered by the Company with Related Parties
were in ordinary course of business and at arm's length basis.
During the year under review, the Company has not entered into any
contracts/arrangements/transactions with related parties which qualify as material in
accordance with the Policy of the Company on materiality of related party transactions.
All transactions with related parties were reviewed and approved by the Audit Committee
and are in accordance with the Policy on Related Party Transactions formulated by the
Company.
There are no materially significant related party transactions that may have potential
conflict with interest of the Company at large.
The details of the related party transactions as per Indian Accounting Standards (IND
AS) - 24 are set out in Note 43 to the Standalone Financial Statements of the Company.
Form AOC - 2 pursuant to Section 134 (3) (h) of the Companies Act, 2013 read with Rule
8(2) of the Companies (Accounts) Rules, 2014 is set out in the Annexure [E] to this
report.
LOANS AND INVESTMENTS
Details of loans, guarantees and investments under the provisions of Section 186 of the
Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules,
2014, as on 31st March, 2018, are set out in Note 38 to the Standalone
Financial Statements of the Company.
RISK MANAGEMENT
The Company has a well-defined process in place to ensure appropriate identification
and treatment of risks. Risk identification exercise is inter-woven with the annual
planning cycle which ensures both regularity and comprehensiveness. The identification of
risks is done at strategic, business, operational and process levels. While the mitigation
plan and actions for risks belonging to strategic, business and key critical operational
risks are driven by senior leadership, for rest of the risks, operating managers drive the
conception and subsequent actioning of mitigation plans.
The key strategic, business and operational risks which are significant in terms of
their impact to the overall objectives of the Company along with status of the mitigation
plans are periodically presented and discussed in the Risk Management Committee (RMC)
meetings. Inputs from the RMC are duly incorporated in the action plans. AH significant
risks are well integrated with functional and business plans and are reviewed on a regular
basis by the senior leadership.
The Company, through its risk management process, aims to contain the risks within its
risk appetite. There are no risks which in the opinion of the Board threaten the existence
of the Company. However, some of the risks which may pose challenges are set out in the
Management Discussion and Analysis which forms part of this Annual Report.
VIGIL MECHANISM
The Whistleblower Policy has been approved and adopted by Board of Directors of the
Company in compliance with the provisions of Section 177 (10) of the Companies Act, 2013
and Regulation 22 of the Listing Regulations.
The Company has engaged a third party for managing an 'Ethics Hotline' which can be
used by employees and business associates of the Company to, inter alia, report any
instances of financial irregularities, breach of code of conduct, abuse of authority,
disclosure of financial / price sensitive information, unethical / unfair actions
concerning company vendors / suppliers, malafide manipulation of company records,
discrimination to the Code of Conduct in an anonymous manner.
The Policy also provides protection to the employees and business associates who report
unethical practices and irregularities.
Any incidents that are reported are investigated and suitable action is taken in line
with the Whistle Blower Policy.
POLICY ON PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
The Company's Policy on Prevention of Sexual Harassment at Workplace is in line with
the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 (Prevention of Sexual Harassment of Women at Workplace Act) and
Rules framed thereunder. Internal Complaints Committees have also been set up to redress
complaints received regarding sexual harassment.
The Company conducts sessions for employees across the organization to build awareness
amongst employees about the Policy and the provisions of Prevention of Sexual Harassment
of Women at Workplace Act.
During the financialyear2017-18, 4 (four) complaints of sexual harassment were received
by the Company and the same were investigated in accordance with the procedures prescribed
and adequate steps were taken to resolve them.
The Company is committed to providing a safe and conducive work environment to all of
its employees and associates.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
During the financialyearended 31st March, 2018, the Company incurred CSR
Expenditure of ' 46.51 crores (Rupees forty six crores and fifty one lakhs only). The CSR
initiatives of the Company were under the thrust areas of health & hygiene, education,
water management and enhancement of vocational training.
The Company's CSR Policy statement and annual report on the CSR activities undertaken
during the financialyear ended 31st March, 2018, in accordance with Section 135
of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules,
2014 (including any statutory modification(s) or re-enactment(s) thereof for the time
being in force) is set out in the Annexure [F] to this report.
DETAILS ON INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS
Internal financial control systems of the Company have been designed to provide
reasonable assurance with regard to recording and providing reliable financial and
operational information, complying with applicable Accounting Standards.
The Company has a well-defined and documented delegation of authority manual with
specified limits for approval of expenditure, both capital and revenue. The Company has a
Shared Services Center (SSC) which centrally handles payments made by the Company. While
compliance with the policies are well integrated with the underlying processes, SSC acts
as a second line of defence to ensure adherence to certain laid down policies.
The Company uses an established Enterprise Risk Management (ERP) system to record day
to day transactions for accounting and financial reporting. The ERP system is configured
to ensure that all transactions are integrated seamlessly with the underlying books of
accounts.
The Company periodically conducts physical verification of inventory, fixed assets and
cash on hand and matches them with the books of account. Explanations are sought for any
variances noticed from the respective functional heads.
The Company has a robust financial closure self-certification mechanism wherein the
line managers certify adherence to various accounting policies, accounting hygiene and
accuracy of provisions and other estimates. There are adequate polices, authorization
matrices governing financial transactions and approvals.
The Company has adopted accounting policies which are in line with the Indian
Accounting Standards notified under Section 133 of the Companies Act, 2013 read together
with the Companies (Indian Accounting Standards) Rules, 2015. These are in accordance with
Generally Accepted Accounting Principles in India. Changes in policies, if any, are
approved by the Audit Committee in consultation with the Statutory Auditors.
The Company in preparing its financial statements makes judgments and estimates based
on sound policies and uses external agencies to verify/ validate them as and when
appropriate. The basis of such judgments and estimates are also audited by the Statutory
Auditors and reviewed by the Audit Committee.
For each major element in the financial statements, the inherent reporting risks have
been identified by the Company. Controls have been put to mitigate these risks. These
risks and the mitigation controls are revisited periodically. Corporate accounts function
of the Company is actively involved in designing large process changes as well as
validating changes to IT systems that have a bearing on the books of account.
The Company gets its Standalone financial statements audited every quarter by its
Statutory Auditors. The policies to ensure uniform accounting treatment are prescribed to
the subsidiary companies as well of the Company. The accounts of the subsidiary and joint
venture companies are audited and certified by their respective Statutory Auditors for
consolidation.
OTHER DISCLOSURES
a. During the year under review, the Company has not accepted any deposit within the
meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies
(Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or
reenactments) thereof for the time being in force);
b. The Company has complied with Secretarial Standards issued by the Institute of
Company Secretaries of India on Meetings of the Board of Directors and General Meetings;
c. There are no significant material orders passed by the Regulators or Courts or
Tribunals impacting the going concern status of the Company and its operations in future;
d. The information on conservation of energy, technology absorption and foreign
exchange earnings and outgo as stipulated under Section 134 of the Companies Act, 2013
read with the Companies (Accounts) Rules, 2014, is set out in the Annexure [G] to this
report;
e. The Managing Director & CEO of the Company has not received any remuneration or
commission from any of Companies subsidiary;
f. None of the Auditors of the Company have reported any fraud as specified under the
second proviso of Section 143 (12) of the Companies Act, 2013 (including any statutory
modification(s) or re-enactment(s) thereof for the time being in force);
g. The Company does not have any scheme or provision of money for the purchase of its
own shares by employees/ Directors or by trustees for the benefit of employees/ Directors;
and
h. The Company has not issued equity shares with differential rights as to dividend,
voting or otherwise.
APPRECIATION
The Board of Directors place on record sincere gratitude and appreciation for all the
employees at all levels for their hard work, solidarity, cooperation and dedication during
the year.
The Board conveys its appreciation for its customers, shareholders, suppliers as well
as vendors, bankers, business associates, regulatory and government authorities for their
continued support.
For and on behalf of the Board
Ashwin Choksi
Chairman
Place: Mumbai
Date: 10th May, 2018
Annexure (A) to Board's Report
DIVIDEND DISTRIBUTION POLICY
(Approved by the Board of Directors at their meeting held on 25th October,
2016)
INTRODUCTION
This Policy is called "Asian Paints Limited - Dividend Distribution Policy"
(hereinafter referred to as "this Policy") and shall be effective From 25th
October, 2016 ("Effective Date").
In terms of the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015, including any statutory modification(s) or
re-enactment(s) thereof for the time being in force, Asian Paints Limited (hereinafter
referred to as "the Company") is required to Frame this Policy.
POLICY
This policy aims at ensuring compliance with the provisions of Regulation 43A of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, including any statutory modification(s) or re-enactment(s) thereof for
the time being in force.
The Company would, inter alia, consider the following financial parameters and/or
internal & external factors before declaring dividend(s) or recommending dividend(s)
to the shareholders:
• Current year profits arrived at after providing for depreciation in accordance
with the provisions of Section 123 and other applicable provisions, if any, of the
Companies Act, 2013 read with the Rules issued thereunder; and/or
• Profits from any of the previous financial year(s) arrived at after providing
for depreciation in accordance with the provisions of Section 123 and other applicable
provisions, if any, of the Companies Act, 2013 read with the Rules issued thereunder;
• Fund requirements to finance the working capital needs of the business;
• Opportunities for investments of the funds of the Company to capture future
growth in the industry, e.g. capital expenditure, network expansion, etc;
• Funding requirements for any organic and inorganic growth opportunities to be
pursued by the Company;
• Optimal free cash to fund any exigencies, if any;
• Prevailing legal requirements, regulatory conditions or restrictions laid down
under the applicable laws including tax laws.
In case the Board proposes not to distribute the profit; the grounds thereof and
information on utilisation of the retained earnings, if any, shall be disclosed to the
shareholders in the Board's Report forming part of Annual Report of the Company.
The CFO jointly with the MD & CEO of the Company shall suggest any amount to be
declared / recommended as Dividend to the Board of Directors of the Company, taking into
account the aforementioned parameters.
Parameters adopted w.r.t. various classes of shares:
• The Company has only one class of shares referred to as equity shares of the
face value of Re. 1 each, forming part of its Issued, Subscribed and Paid - up share
capital.
• Dividend (including interim and/or final) would be declared and paid to equity
shareholders at the rate fixed by the Board of Directors of the Company. Final dividend
proposed by the Board of Directors, if any, would be subject to the approval of the
shareholders at the ensuing Annual General Meeting.
AMENDMENTS TO THE POLICY
The Company is committed to continuously reviewing and updating our policies and
procedures. Therefore, this policy is subject to modification. Any amendment(s) of any
provision of this policy shall be carried out by persons authorized by the Board in this
regard.
Information required under Section 197 of the Companies Act, 2013 read with Companies
(Appointment and Remuneration) Rules, 2014
A. Ratio of remuneration of each Director to the median remuneration of all the
employees of the Company for the financialyear 2017-18 is as follows:
| Name of Director(s) |
Total Remuneration (Rs. ) |
Ratio of Remuneration of director to the Median remuneration* |
| Ashwin Choksi |
47,35,000 |
6.25 |
| Ashwin Dani |
43,95,000 |
5.80 |
| Abhay Vakil |
41,70,000 |
5.51 |
| K.B.S. Anand |
10,57,41,842 |
139.62 |
| Mahendra Choksi |
33,80,000 |
4.46 |
| Malav Dani |
35,20,000 |
4.65 |
| Amrita Vakil |
32,60,000 |
4.30 |
| Mahendra Shah |
36,40,000 |
4.81 |
| Deepak Satwalekar |
36,40,000 |
4.81 |
| S. Sivaram |
32,60,000 |
4.30 |
| S. Ramadorai |
33,50,000 |
4.42 |
| M. K. Sharma |
41,70,000 |
5.51 |
| Vibha Paul Rishi |
33,20,000 |
4.38 |
| R. Seshasayee |
34,50,000 |
4.56 |
Notes:
1. ‘Median remuneration for the financialyear 2017-18 is ' 7,57,344 (Rupees seven
lakhs fiftyseven thousand three hundred forty fouronly).
2. The aforesaid details are calculated on the basis of remuneration for the
financialyear 2017-18.
3. The remuneration of Directors includes sitting fees paid to them for the
financialyear 2017-18.
B. Details of percentage increase in the remuneration of each director and CFO &
Company Secretary in the financial year 2017-18are as follows:
| Name of Director(s) |
Remuneration (in Rs.) |
Increase/(Decrease) |
| 2017-18 |
2016-17 |
(%) |
| Ashwin Choksi |
47,35,000 |
45,12,919 |
5 |
| Ashwin Dani |
43,95,000 |
42,05,000 |
5 |
| Abhay Vakil |
41,70,000 |
39,35,000 |
6 |
| K.B.S. Anand |
10,57,41,842 |
9,72,05,442 |
9 |
| Mahendra Choksi |
33,80,000 |
31,90,000 |
6 |
| Malav Dani |
35,20,000 |
32,20,000 |
9 |
| Amrita Vakil |
32,60,000 |
30,20,000 |
8 |
| Dipankar Basu (Resigned w.e.f. 1st January, 2017) |
- |
23,86,000 |
* |
| Mahendra Shah |
36,40,000 |
35,80,000 |
2 |
| Deepak Satwalekar |
36,40,000 |
34,00,000 |
7 |
| S. Sivaram |
32,60,000 |
30,40,000 |
7 |
| S. Ramadorai |
33,50,000 |
30,10,000 |
11 |
| M.K. Sharma |
41,70,000 |
40,10,000 |
4 |
| Vibha Paul Rishi |
33,20,000 |
31,00,000 |
7 |
| R. Seshasayee (Appointed w.e.f. 23rd January, 2017) |
34,50,000 |
4,72,000 |
# |
| CFO & Company Secretary |
Remuneration (in Rs.) |
Increase (%) |
|
2017-18 |
2016-17 |
|
| Jayesh Merchant |
3,85,28,456 |
3,22,35,266 |
20 |
Notes:
1. * Percentage increase in remuneration is not reported as Mr. Dipankar Basu resigned
wef 1st January 2017 and his remuneration for current year is zero.
2. # Percentage increase in remuneration is not reported as they were holding
Directorship for the part of the financial year 2016-17.
3. The remuneration to Directors is within the overall limits approved by the
shareholders of the Company.
4. The remuneration to Directors includes sitting fees paid to them.
C. Percentage increase in the median remuneration oF all employees in the Financialyear
2017-18:
(Amount in Rs.)
|
2017-18 |
2016-17 |
Increase (%) |
| Median remuneration of employees per annum |
7,57,344 |
7,08,106 |
7 |
D. Number oF permanent employees on the rolls oF the Companyas on 31st
March, 2018:
| Executive/Manager cadre |
1,093 |
| StaFF |
3,453 |
| Operators/Workmen |
1,692 |
| Total |
6,238 |
E. Comparison oF average percentage increase in salary oF employees other than Key
Managerial Personnel and the percentage increase in the remuneration paid to Key
Managerial Personnel:
(Amount in Rs.)
|
2017-18 |
2016-17 |
Increase (%) |
| Average salary of all employees (other than Key Managerial Personnel) |
11,38,613 |
10,69,512 |
6 |
| Key Managerial Personnel |
|
|
|
| - Salary of MD & CEO |
10,57,41,842 |
9,72,05,442 |
9 |
| - Salary of CFO & CS |
3,85,28,456 |
3,22,35,266 |
20 |
The increase in remuneration of employees other than the Key Managerial Personnel is
considerably in line with the increase in remuneration of Key Managerial Personnel.
F. AFFirmation that the remuneration is as per the Nomination and Remuneration Policy
oF the Company:
It is affirmed that the remuneration paid to the Directors, Key Managerial Personnel
and senior management is as per the Nomination and Remuneration Policy of the Company.
G. The statement containing names of top ten employees in terms of remuneration drawn
and the particulars of employees as required underSection 197(12) oF the Act read with
Rule 5(2) oF the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, is provided in a separate annexure forming part of this report. Further, the report
and the accounts are being sent to the members excluding the aforesaid annexure. In terms
of Section 136 oF the Act, the said annexure is open For inspection at the Registered
Office oF the Company and has been uploaded on the website of the Company www.asianpaints.com . Any shareholder interested in
obtaining a copy of the same may write to the Company Secretary.
|