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Finolex Industries Ltd.
Change Company :  Go
Chairman : Prakash P Chhabria Industry : Plastic Products
Last Price Today's Change Open Prev Close Day's Range 52 Week Range
257.45 0.15 257.40 257.30 (259.00)   (257.00) (348.00)   (245.10)
BSE Code 500940
ISIN Demat INE183A01016
Book Value (Rs.) 69.11
Dividend Yield (%) 0.78
Market Cap (Rs Mn) 31948.36
P/E 47.10
EPS (Rs.) 5.47
Face Value (Rs.) 10
Volume 7856.00
March 2015 Select Base Year :

Corporate governance

Compliance report for the year 2014-2015

1. A brief statement on Company's philosophy on code of governance:

The Company always strives to achieve optimum performance at all levels by adhering to corporate governance practices, such as:

• Fair and transparent business practices;

• Effective management control by Board of Directors;

• Adequate representation of promoter, executive, woman and independent directors on the Board of Directors;

• Accountability for performance;

• Monitoring of executive performance by the Board of Directors;

• Compliance of laws;

• Transparent and timely disclosure of financial management information.

2. Board of directors (the "Board") and Board procedure:

Composition and category of directors

The Board consists of total 10 directors. The Company has an optimum combination of three executive, one woman non-executive and six non-executive independent directors.

The Board is represented by three executive directors. Mr. Prakash P. Chhabria is Executive Chairman from promoters' group of the Company. Mr. Saurabh. S. Dhanorkar is Managing Director and Mr. Sanjay S. Math is Director (Operations) in the category of the executive directors.

Mrs. Ritu P. Chhabria is woman (non-executive) director and from promoters' group.

The Board is represented by six non-executive independent directors namely Mr. Sanjay K. Asher, Mr. Kanaiyalal N. Atmaramani, Mr. Dara N. Damania, Mr. Shrikrishna N. Inamdar, Mr. Prabhakar D. Karandikar and Dr. Sunil U. Pathak.

Attendance of the directors at the Board, Audit Committee, Nomination and Remuneration Committee, Stakeholders' Relationship Committee, Corporate Social Responsibility Committee, Risk Management Committee and Independent Directors Meetings and Annual General Meeting.

The details of attendance of each of the directors at the Board (BM), Audit Committee (ACM), Nomination and Remuneration Committee (NRCM) Stakeholders' Relationship Committee (SRCM) Corporate Social Responsibility Committee (CSRM), Risk Management Committee (RMM) and Independent Directors (IDM) Meetings and last Annual General Meeting (AGM) held during the financial year 2014-2015,

No. of Board meetings held during the year

During 2014-2015, the Board of Directors met 5 (five) times, viz. on 12th May, 2014, 26th July, 2014, 20th September, 2014, 13th November, 2014 and 6th February, 2015. The time-gap between two meetings was less than four months.

Appointment / re-appointment of directors

Appointment of Woman Director

Mrs. Ritu P. Chhabria (DIN 00062144) was co-opted as an additional director in the category of non-executive woman Director on the Board with effect from 21st March, 2015. She is part of the promoters' group. She is related to Mr. Prakash P. Chhabria, Executive Chairman of the Company. 

Mrs. Ritu P. Chhabria is aged 47 years. She is a double major in Economics and Marketing from Richmond College - London and holds a Masters degree in Public Relations and is a prominent personality in the field of social welfare programmes. She is the Managing Trustee of Mukul Madhav Foundation ("MMF"), a well know charitable trust in Pune and looks after the day-to-day activities of MMF. MMF touched many lives in the areas of Healthcare, Education and Social Welfare in many parts of the country.

Mrs. Ritu P. Chhabria holds 4,450 shares in the Company.

Mrs. Ritu P. Chhabria will hold the office of director till the conclusion of the ensuing annual general meeting. The Company has received a notice from the member of the Company proposing Mrs. Ritu P. Chhabria as a candidate for the office of director.

Re-appointment of director retiring by rotation

Mr. Saurabh S. Dhanorkar, Managing Director (DIN 00011322), retires at the thirty-fourth annual general meeting of the Company and being eligible, offers himself for re-appointment.

Mr. Saurabh S. Dhanorkar is aged 59 years, B.Com. (Hons.), Fellow Chartered Accountant. After a brief stint with an international accounting firm and an agro based public limited company, he joined the Company in the year 1983. He has wide experience in finance, marketing and other commercial activities. He is a director of the Company since December, 1996. Mr. Dhanorkar was appointed as Managing Director with effect from the close of business hours of 11th August, 2012. Mr. Dhanorkar is also a director of Pawas Port Limited. Mr. Saurabh S. Dhanorkar holds 5,381 shares of the Company.

Other details relating to directors

i. The information as required under Annexure X to clause 49 was made available to the Board in all its meetings.

ii. None of the independent directors serve as independent directors in more than seven listed companies and none of the wholetime directors of the Company serve as independent directors in the listed company.

iii. The Related Party Transactions Policy of the Company approved by the Board is displayed on the website of the Company www.finolexwater.com at link at http://www.finolexwat.er. com/policies-code-of-conduct/.

3. Code of conduct:

The Board has laid down the code of conduct for the Board and senior management team and for independent directors of the Company. The code is posted on www.finolexwater. com at link at http://www.finolexwater.com/policies-code-of-conduct/.

The Board members and senior management team personnel have affirmed compliance with the code. The declaration dated 9th May, 2015 received from Mr. Saurabh S. Dhanorkar, Managing Director in this regard is given below: 

Certificate on compliance with code of conduct.

"I hereby declare that all Board members of the Company and senior management personnel have affirmed compliance with the code of conduct for the applicable period of the financial year 2014-15."

4. Audit committee:

Composition, members' names and chairperson: 

• As on 31st March, 2015, the Audit Committee (the ''Committee") consisted of 5 (five) independent directors viz. Mr. Kanaiyalal N. Atmaramani, Mr. Dara N. Damania, Mr. Shrikrishna N. Inamdar (Chairman of the Committee), Mr. Prabhakar D. Karandikar and Dr. Sunil U. Pathak.

• All members of the Audit Committee are financially literate and have accounting or related financial management expertise.

• Required information for review was placed before the Audit Committee meetings held during the year.

Meetings and attendance during the year:

During 2014-2015, the Audit Committee met 5 (five) times, viz. on 12th May, 2014, 26th July, 2014, 20th September, 2014, 13th November, 2014 and 6th February, 2015.

The details of the attendance of the directors at Audit Committee meetings during the year are given in Table 1.

Mr. Umesh M. Gosavi, Company Secretary of the Company acts as secretary to the committee.

Brief description of terms of reference

Terms of reference and other requirements of the Audit Committee pursuant to the provisions of section 177 of the Companies Act, 2013 and listing agreement are as under:

• Recommendation for appointment, remuneration and terms of appointment of auditors of the Company.

• Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

• Review and monitor the auditor's independence and performance and effectiveness of audit process;

• Examination and review of the quarterly and annual financial statement and auditors' report thereon before submission to the Board;

• Approval or any subsequent modification of transactions of the Company with related parties;

• Scrutiny of inter-corporate loans and investments;

• Valuation of undertakings or assets of the Company, wherever it is necessary;

• Evaluation of internal financial controls and risk management systems;

• Monitoring the end use of funds raised through public offers and related matters;

• Investigate into any matter as referred to it by the Board and for this purpose shall have power to obtain professional advice from external sources and have full access to information contained in the records of the Company;

• Oversight of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;

Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the Board for approval, with particular reference to:

a. Matters required to be included in the Director's Responsibility Statement to be included in the Board's report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013

b. Changes, if any, in accounting policies and practices and reasons for the same

c. Major accounting entries involving estimates based on the exercise of judgment by management

d. Significant adjustments made in the financial statements arising out of audit findings

e. Compliance with listing and other legal requirements relating to financial statements

f. Disclosure of any related party transactions

g. Qualifications in the draft audit report

• Reviewing with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for the purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter;

• Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

• Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;

• Discussion with internal auditors of any significant findings and follow up there on;

• Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;

• Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;

• To look into the reasons for substantial defaults in the payment to the depositors, debentureholders, members (in case of non-payment of declared dividends) and creditors;

• To review the functioning of the Whistle Blower mechanism;

• Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;

• Carrying out any other function as mentioned in the terms of reference of the Audit Committee. 

5. Nomination and Remuneration committee:

Composition, name of members and Chairperson

The Board at its meeting held on 27th October, 2012 has constituted a Remuneration Committee. The Board at its meeting held on 12th May, 2014 renamed the Remuneration Committee as Nomination and Remuneration Committee.

The six independent directors namely Mr. Sanjay K. Asher, Mr. Kanaiyalal N. Atmaramani, Mr. Dara N. Damania, Mr. Shrikrishna N. Inamdar (Chairman of the Committee), Mr. Prabhakar D. Karandikar and Dr. Sunil U. Pathak are the members of the Nomination and Remuneration Committee.

Brief description of terms of reference

The objective of the Nomination and Remuneration Committee is to assist the Board of the Company and its controlled entities in fulfilling its responsibilities to members by:

• considering the requirement of skill sets by the Board, eminent people having an independent standing in their respective field/profession, and who can effectively contribute to the Company's business and policy decisions are considered by the Human Resources, Nomination and Remuneration Committee, for appointment, as Independent Directors on the Board. The Committee, inter alia, considers qualification, positive attributes, area of expertise and number of Directorships and Memberships held in various committees of other companies by such persons. The Board considers the Committee's recommendation, and takes appropriate decision.

• ensuring that the Board of Directors is comprised of individuals who are best able to discharge the responsibilities of directors in consonance with the Companies Act, 2013 and the norms of corporate governance; and

• ensuring that the nomination processes and remuneration policies are equitable and transparent.

• The responsibilities of the Committee include :

- formulating a criteria for determining qualifications, positive attributes and independence of a director;

- recommending to the Board a policy or recommendation, relating to the appointment and remuneration for the directors, key managerial personnel and other employees which includes one level below key managerial personnel;

- formulating a criteria/ recommendation for evaluation of performance of Independent Directors and the Board and on the basis of the report of performance evaluation, it shall be determined whether to extend or continue the term of appointment of the independent director;

- devising a policy/ recommendation on Board diversity; and

- identifying persons who are qualified to become directors and who may be appointed as part of the 'senior management' or core management team of the Company in accordance with the criteria laid down, and recommending to the Board the appointment and removal of such personnel. 

Meetings and attendance during the year

During the year, four meetings of the Nomination and Remuneration Committee were held on 12th May, 2014, 26th July, 2014, 13th November, 2014 and 6th February, 2015. The attendance details are given in Table 1.

Nomination and Remuneration Policy

The nomination and remuneration policy of the Company on recommendation by the Nomination and Remuneration Committee was approved by the Board and the same is in place. The same is attached as Annexure 1 of the Directors' report and given on website of the Company at www.finolexwater.com at link at http://www.finolexwater.com/policies-code-of-conduct/.

6. Stakeholders' Relationship Committee:

Composition, members' names and chairperson:

As on 31st March, 2015, the Stakeholders' Relationship Committee consisted of six directors viz. Mr. Kanaiyalal N. Atmaramani (Chairman of the committee), Mr. Dara N. Damania, Mr. Shrikrishna N. Inamdar, Mr. Prabhakar D. Karandikar, Dr. Sunil U. Pathak and Mr. Prakash P. Chhabria of the Company.

Brief description of terms of reference

The terms of reference of the Stakeholders' Relationship Committee shall be as follows:

• To review and note certificate received from Practising Company Secretary in compliance of Clause 47(c) of the listing agreement.

• To review Regulatory compliance and periodic report of the in-house STA for the six months' in terms of SEBI circular No. CIR/MIRSD/7/2012 dated 5th July, 2012.

• To review and note the status of Investor Complaints.

• To review and note the status of unclaimed dividend.

• To take necessary actions on the matters delegated by the Board from time to time.

Compliance Officer

Mr. Umesh M. Gosavi, Company Secretary is the compliance officer of the Company. 

7. Risk Management Committee

Composition, members' names and chairperson:

The Board at its meeting held on 26th July, 2014 has constituted the Risk Management Committee. As on 31st March, 2015, the Risk Management Committee consisted of three directors viz. Mr. Prakash P. Chhabria (Chairman of the Committee), Mr. Saurabh S. Dhanorkar and Dr.Sunil U. Pathak.

Meetings and attendance during the year:

During 2014-15, the Risk Management Committee met 1 (one) time, viz. on 6th February, 2015.

Brief description of terms of reference

Terms of reference of the Risk Management Committee shall be as follows;

a. The Risk Management Committee (RMC) shall have at least three directors as members of the Committee;

b. RMC shall review the Risk Management plan and policy at its meeting and inform the Board about the risk assessment and minimization procedure;

c. The Board may delegate monitoring and reviewing of the risk management plan and such other functions as it deem fit to RMC and/or the Executive Chairman and/ or Managing Director as may be necessary for effective implementation of the Risk Management Plan/ Policy;

d. To take necessary actions on the matters delegated by the Board from time to time.

8. Corporate Social Responsibility (CSR) Committee

Composition, members' names and chairperson:

As on 31st March, 2015, the Corporate Social Responsibility Committee consisted of three directors viz. Mr.Prakash P. Chhabria (Chairman of the Committee), Mr.Saurabh S. Dhanorkar and Dr.Sunil U. Pathak.

Meetings and attendance during the year:

During 2014-2015, the Corporate Social Responsibility Committee met 4 (four) times, viz.on 12th May, 2014, 26th July, 2014, 13th November, 2014 and 6th February, 2015.

The details of attendance of CSR Committee meetings by the directors during the year is given in Table 1.

Brief description of terms of reference

Terms of reference of the Corporate Social Responsibility Committee shall be as follows;

a) Formulate and recommend to the Board a Corporate Social Responsibility Policy, which shall indicate the activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013 (the "Act") including any amendments or modification from time to time as applicable;

b) Recommend the amount of expenditure to be incurred on the activities referred to in above;

c) Monitor the Corporate Social Responsibility Policy of the Company from time to time;

d) Monitor and ensure that the surplus arising out of the CSR projects or programs or activities shall not form part of the business profits of a Company;

e) Ensure that all the income generated by way of CSR activities is credited back to the CSR corpus;

f) Review and comply with the requirements of the provisions of the Act, and rules made thereunder and periodical disclosure requirements.

9. Share Transfer Committee 

Composition, members' names and chairperson:

As on 31st March, 2015, the Share Transfer Committee consisted of four directors viz. Mr. Prakash P. Chhabria (Chairman of the Committee), Mr.Saurabh S. Dhanorkar, Mr. Prabhakar D. Karandikar and Dr. Sunil U. Pathak.

Brief description of terms of reference

• Consider and approve the transfer and transmission of securities i.e. shares, debentures and other security documents;

• Consider and approve issue of duplicate share certificate;

• Consider and approve split, consolidation of share/ debenture certificate and issue fresh share certificates and debenture certificates;

• Consider any other assignment as directed by the Board;

• Consider and approve dematerialization and rematerialization of securities;

• To take necessary actions on the matters delegated by the Board from time to time.

10. Finance Committee Composition, members' names and chairperson:

As on 31st March, 2015, the Finance Committee consisted of four directors viz. Mr. Prakash P. Chhabria (Chairman of the Committee), Mr. Saurabh S. Dhanorkar, Mr. Sanjay K. Asher and Dr. Sunil U. Pathak.

Brief description of terms of reference

• To consider and review various financial proposals for the financial, investments, borrowings and give recommendation to Audit Committee/ Board; and

• To take necessary actions on the matters delegated by the Board from time to time.

11. Disclosures:

i. No transaction of material nature has been entered into by the Company with its promoters, directors or management or relatives etc. that may have a potential conflict with the interest of the Company.

ii. There were no instances of non-compliance or penalty, strictures imposed on the Company by Stock Exchanges or SEBI or any statutory authority on any matter related to capital markets, during last three years.

iii. The Company has adopted the whistle blower policy. The said policy is available at website of the Company www.finolexwater.com at link at http://www.finolexwat.er. com/policies-code-of-conduct/. No personnel have been denied access to the audit committee.

iv. The Company has complied with all the mandatory requirements of clause 49 of the Listing Agreements.

Application of non-mandatory requirements:

1) The Company has already moved to a regime of unqualified financial statements.

2) The Company has appointed separate persons to the post of Executive Chairman and Managing Director.

3) The internal auditor has access for the direct reporting to the Audit Committee. 

v. Cost Auditor: 

With reference to the general circular No.15/2011-52/5/CAB 2011 dated 11th April, 2011 issued by the Government of India, Ministry of Corporate Affairs, Cost Audit Branch, New Delhi, following are the details of cost auditor and filing of cost audit report with Central Government. 

Particulars of cost auditor

M/s. S. R. Bhargave & Co.

3, Kushaboo Apartments 5 No.78/2, Plot No.29, Bhusari Colony (L), Off Paud Road, Kothrud, Pune 411 038

E-mail: bhargaves@vsnl.net  

Details of filing of cost audit report for the period ended 31st March, 2014 

Cost Audit Report:

Due date: 27th September, 2014

Filing date: 24th September, 2014

Cost compliance report for 31st March 2014

Filing date: 24th September, 2014 

12. Means of communication:

The quarterly results were published during the year under review in leading national and regional newspapers appropriately.

The quarterly results are displayed on www.finolexwater.com and on websites of BSE and NSE.

The official news releases of the Company are displayed on the websites of BSE andNSE.

Presentations made to institutional investors or to the analysts are available on website of the Company.

The Management Discussion and Analysis Report is forming part of annual report. Detailed report is given on page no. 5.

13. General shareholder information: 

i. Annual general meeting:

• Day, date & time:Saturday, 29th August, 2015 at 11.00 a.m.

• Venue: Kirloskar Institute of Advanced Management Studies, Gat No. 356 & 357, Near Tata Foundry Maval, Village Dhamane, Taluka Maval, District Pune 410 506. 

ii. Financial Calendar (Tentative) :

April, 2015 to March, 2016 

Announcement of quarterly results of 2015-16 & annual general meeting

Quarterly results by 14th August, 2015, 14th November, 2015, 14th February, 2016 and 30th May, 2016 and annual general meeting by end of September, 2016. 

iii. Book Closure Period

22nd August, 2015 to 29th August, 2015 (both days inclusive)

iv. Dividend Payment date

Credit / dispatch between 3rd September, 2015 to10th September, 2015. 

v. Listing on stock exchanges 

Name of the stock exchange Scrip Code 

 BSE Limited (BSE) 500940/finolexind 

 National Stock Exchange of India Limited (NSE) FINPIPE 

 ISIN Code INE183A01016 

The annual listing fee for the year 2015-16 has been paid to BSE & NSE.

vi. Dividend payment date:

3rd September, 2015.

vii Registrar and transfer agent:

The Company is registered with SEBI as in-house share transfer agent category II. All shareholders related services are provided in-house. 

viii. Share transfer system:

The share transfer committee attends to share transfer formalities normally once in a fortnight. Demat requests are confirmed within 15 days from the date of receipt of request, if found in order. 

ix. Dematerialization of shares:

NSDL: 81.09% & CDSL: 10.64%

x. Company has not issued any GDRS / ADRS / Share Warrants or any convertible instruments.

xi Plant locations: 

PVC, PVC pipes and power plants

Ranpar - Pawas Road, District Ratnagiri 415 616, Maharashtra, India.

PVC pipes plant

Village Masar,Taluka Padra,District Vadodara 391 421,Gujarat, India.

PVC pipes & fittings plants

Gat No.399, Urse, Taluka Maval, District Pune 410 506, Maharashtra, India.

D1/10, M.I.D.C. Chinchwad, Pune 411 019, Maharashtra, India. 

xii Address for correspondence:

Investor Relations Centre D1/10, M.I.D.C., Chinchwad, Pune 411 019, Maharashtra, India.

Tel. No.020-2740 8200 / 2740 8571 Fax No.020-27479000

E-mail: investors@finolexind.com  www.finolexwater.com  

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