24 Apr 2017 | Livemint.com

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Ambuja Cements Ltd.

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Ambuja Cements Ltd. Accounting Policy

REPORT ON CORPORATE GOVERNANCE

The Directors' Report on the compliance of the Corporate Governance Code is given below.

1. Corporate Governance

1.1 Company's Philosophy on Corporate Governance:

At Ambuja Cements, Corporate Governance has been an integral part of the way we have been doing our business since inception. We believe that good Corporate Governance emerges from the application of the best and sound management practices and compliance with the laws coupled with adherence to the highest standards of transparency and business ethics. These main drivers, together with the Company's ongoing contributions to the local communities through meaningful "Corporate Social Responsibility" initiatives will play a pivotal role in fulfilling our renewed vision to be the most sustainable and competitive company in our industry and our mission to create value for all our stakeholders.

The Company places great emphasis on values such as empowerment and integrity of its employees, safety of the employees & communities surrounding our plants, transparency in decision making process, fair & ethical dealings with all, pollution free clean environment and last but not the least, accountability to all the stakeholders. These practices being followed since the inception have contributed to the Company's sustained growth. The Company also believes that its operations should ensure that the precious natural resources are utilized in a manner that contributes to the "Triple Bottom Line".

1.2 The Governance Structure:

Ambuja's governance structure is based on the principles of freedom to the executive management within a given framework to ensure that the powers vested in the executive management are exercised with due care and responsibility so as to meet the expectation of all the stakeholders. In line with these principles, the Company has formed three tiers of Corporate Governance structure, viz.:

(i) The Board of Directors - The primary role of the Board is to protect the interest and enhance value for all the stakeholders. It conducts overall strategic supervision and control by setting the goals & targets, policies, governance standards, reporting mechanism & accountability and decision making process to be followed.

(ii) Committees of Directors - such as Audit Committee, Compliance Committee, Nomination & Remuneration Committee, CSR Committee and Risk Management Committee etc. are focused on financial reporting, audit & internal controls, compliance issues, appointment and remuneration of Directors and Senior Management Employees, implementation and monitoring of CSR activities and the risk management framework.

(iii) Executive Management - The entire business including the support services are managed with clearly demarcated responsibilities and authorities at different levels.

(a) Executive Committee - The Executive Committee is headed by the Managing Director & CEO. The CFO and the Heads of Manufacturing, Marketing and HR are its other members. Heads of Technical and Procurement are the permanent invitees. This committee is a brain storming committee where all important business issues are discussed and decisions are taken. This Committee reviews and monitors monthly performances, addresses challenges faced by the business, draws strategies and policies and keep the Board informed about important developments having bearing on the operational and financial performance of the Company. The Committee members report to the Managing Director & CEO.

(b) Managing Director & CEO - The Managing Director & CEO is responsible for achieving the Company's vision and mission, business strategies, project execution, mergers and acquisition, significant policy decisions and all the critical issues having significant business & financial implications. He is also responsible for the overall performance and growth of the Company and ensures implementation of the decisions of the Board of Directors and its various Committees. He reports to the Board of Directors.

2. Board of Directors 2.1 Composition:

The Company has a very balanced and diverse Board of Directors, which primarily takes care of the business needs and stakeholders' interest. The Non-executive Directors including Independent Directors on the Board are experienced, competent and highly renowned persons from the fields of manufacturing, finance & taxation, economics, law, governance etc. They take active part at the Board and Committee Meetings by providing valuable guidance to the Management on various aspects of business, policy direction, governance, compliance etc. and play critical role on strategic issues, which enhances the transparency and add value in the decision making process of the Board of Directors.

2.2 Selection and Appointment of Director:

The Nomination & Remuneration Committee have approved a Policy for the Selection, Appointment and Remuneration of Directors. In line with the said Policy, the Committee facilitate the Board in identification and selection of the Directors who shall be of high integrity with relevant expertise and experience so as to have well diverse Board. The abstract of the said Policy forms part of the Directors' Report.

Directors are appointed or re-appointed with the approval of the shareholders and shall remain in office in accordance with the provisions of the law and the retirement policy laid down by the Board from time-to-time. The Managing Director and all the Non-executive Directors (except Independent Directors) are liable to retire by rotation unless otherwise specifically provided under the Articles of Association or under any statute.

As required under Regulation 46(2)(b) of the Listing Regulations, the Company has issued formal letters of appointment to the Independent Directors. The terms & conditions of appointment of their appointment are posted on the Company's website and can be accessed at www.ambujacement.com/investors

2.3 Directors' Profile

The brief profile of each Director as at the year end is given below:

(i) Mr. N. S. Sekhsaria (Non-Executive Chairman, Non-Independent)

Mr. Sekhsaria is a doyen of the Indian Cement Industry and one of the most respected business personalities in India. He introduced new standards in manufacturing, management, marketing efficiency and corporate social responsibility to an industry he helped transform.

A first generation industrialist, Mr. Sekhsaria obtained his Bachelor's in Chemical Engineering with honours and distinction from the University of Bombay. As the Principal Founder-Promoter of Ambuja Cement, he was the Chief Executive & Managing Director of the Company from its inception in April 1983, until January 2006. Mr. Sekhsaria relinquished the post of Managing Director and was appointed as the Non-executive Vice Chairman when management control of the Company was transferred to Holcim. In September 2009, he was appointed as the Non-executive Chairman after Mr. Suresh Neotia relinquished the post of Chairman.

Mr. Sekhsaria built Ambuja Cement into the most efficient and profitable cement company in India. He created and developed a result-oriented management team, and an extraordinary business model for the Company that centred on continually fine-tuning efficiencies and upgrading facilities to meet increased competition and growing challenges in the Cement Industry.

Mr. Sekhsaria redefined industry practices by turning cement from a commodity into a brand, bringing cement plants closer to cement markets and linking plants to lucrative coastal markets by setting up ports and a fleet of bulk cement ships for the first time in India. During his tenure, the Company grew from a 0.7 million tonne capacity to 15 million tonnes, from a market capitalisation of Rs. 18 crores to Rs. 14,000 crores, and from a single location, to a pan-India Company which set new benchmarks for the cement industry. These achievements, from a first generation industrialist, speak volumes about Mr. Sekhsaria's vision, business acumen and leadership qualities.

(ii) Mr. Bernard Terver (Non-Executive Promoter Director representing LafargeHolcim Ltd., Non-Independent) (up to 10th February, 2016)

Mr. Terver is a French national and the Vice Chairman of the Board. Born in 1952, he concluded his studies at the Ecole Polytechnique, Paris in 1976. After beginning his career in the steel industry, in 1977 he moved to cement producer CEDEST, which was taken over by Holcim France in 1994. In 1999, Mr. Terver became CEO of Holcim Colombia and in 2003, he was appointed as Area Manager for Andes nations, Central America and the Caribbean. Since October, 2008 he has been CEO of Holcim US and effective November 2010, CEO of Aggregate Industries US. Effective 1st September, 2012, he has been appointed as member of the Executive

Committee and effective January 01, 2014 he has been made in charge of the Indian subcontinent (India, Srilanka and Bangladesh), Africa and Middle East. Since July, 2015, Mr. Terver has been nominated as Head of India in the new Lafarge-Holcim group.

He joined the Board in December, 2013.

(iii) Mr. Eric Olsen (Non-Executive Promoter Director representing LafargeHolcim Ltd., Non- Independent)

Mr. Olsen is American and French national and is a Business Graduate from the University of Colorado, Certified Public Accountant from Chicago and a MBA from HEC International Business School in Paris. He is currently the CEO of LafargeHolcim Ltd., the ultimate holding company of Ambuja. Prior to the global merger of Lafarge and Holcim, he served as the Executive Vice President - Operations of Lafarge and a member of its Executive Committee. He joined Lafarge group in 1999 as Senior Vice President for Strategy & Development of Lafarge, North America. Since 2001, he served as President, north-east cement region and Senior Vice President, Purchasing. Since 2004, Mr. Olsen served as the CFO and Senior Vice President for Lafarge North America, a NYSE listed company. From 2007 to 2012, he served as Executive Vice President, Organisation and Human Resources of Lafarge group. Prior to joining Lafarge group, Mr. Olsen has worked with Deloitte & Touche, Banque Paribas and was a partner of Trinity Associates.

He joined the Board in July, 2015.

(iv) Mr. Christof Hassig (Non-Executive Promoter Director representing LafargeHolcim Ltd., Non-Independent)

Mr. Hassig is a Swiss national and a professional banker with Masters in Banking and the Advanced Management Program at Harvard Business School. He is currently the Head of the Corporate Strategy and Mergers & Acquisitions function at LafargeHolcim Ltd. Before joining the erstwhile Holcim Ltd., Mr. Hassig worked for over twenty years at UBS in different functions including global relationship manager and investment banker. In erstwhile Holcim, he has worked in corporate finance & treasury functions for over fifteen years. In 2013, he took over the additional responsibility as Head of Mergers & Acquisitions.

He joined the Board in December, 2015.

(v) Mr. Nasser Munjee (Non-Executive, Independent Director)

Mr. Munjee holds a Bachelor's and a Master's degree from the London School of Economics (LSE), U.K. His journey in creating financial institutions began with HDFC, which he joined at its inception in February 1978. In March 1993, he joined the Board of HDFC as Executive Director until 1997. He continues to be an Independent Director on the Board of HDFC along with other leading companies like ABB India Ltd., Cummins India Ltd., Tata Motors, Tata Chemicals, Britannia Industries, Jaguar Land Rover and GoAir. In 1997, Mr. Munjee played a pivotal role in setting up IDFC and then was its CEO in its formative years. Mr. Munjee has a deep interest for rural development, housing finance, urban issues, specially the development of modern cities and humanitarian causes.

He is also the Chairman of DCB Bank and of two other Aga Khan institutions in India. He was the President of the Bombay Chamber of Commerce and Industry - the city's oldest Chamber of Commerce and has served on numerous Government Task Forces on Housing and Urban Development. He has been awarded as the "Best Non-Executive Independent Director 2009 by Asian Centre for Corporate Governance (ACCG).

He joined the Board in August, 2001.

(vi) Mr. Rajendra Chitale (Non-Executive, Independent Director)

Mr. Chitale, an eminent Chartered Accountant, is the Managing Partner of M/s. Chitale & Associates, a leading boutique international structuring, tax and legal advisory firm and of M. P Chitale & Co., a reputed accounting firm. He has served as a member of the Insurance Advisory Committee of the Insurance and Regulatory Development Authority of India, the Company Law Advisory Committee, Government of India, the Takeover Panel of the Securities & Exchange Board of India, the Advisory Committee on Regulations of the Competition Commission of India, and the Maharashtra Board for Restructuring of State Enterprises, Government of Maharashtra. He has served on the Board of Life Insurance Corporation of India, Unit Trust of India, Small Industries Development Bank of India, National Stock Exchange of India Ltd., National Securities Clearing Corporation Limited and SBI Capital Markets Ltd. He is on the Board of several large corporates.

He joined the Board in July, 2002.

(vii) Mr. Shailesh Haribhakti (Non-Executive, Independent Director)

Mr. Haribhakti, an eminent Chartered Accountant, is a deeply engaged Independent Director. His strong belief is that good governance is a sustainable competitive advantage creator. Evolving from a background in Audit, Tax and Consulting, he now seeks to create enduring value for Companies and organizations he is involved with. He is a strong supporter of a clean and green environment and is pioneering the concept of 'innovating to zero' in the social context. He is currently Chairman of the National Pension Scheme Trust of India; serves on Boards of

Multinational and Indian Companies; 'Not for Profit' organizations and is a Member of several Advisory Boards. He is Managing Partner of Haribhakti & Co LLP, Chartered Accountants.

He joined the Board in May, 2006.

(viii) Dr. Omkar Goswami (Non-Executive, Independent Director)

Dr. Goswami, a professional economist, did his Master's in Economics from the Delhi School of Economics and his D. Phil (Ph.D.) from Oxford University. He taught and researched economics for 20 years at various reputed universities in India and abroad. During a career spanning over three decades, he has been associated as advisor to several Government committees and international organizations like the World Bank, the OECD, the IMF and the ADB. He has also served as the Editor of "Business India", one of India's prestigious business magazines and as the Chief Economist of the Confederation of Indian Industry. Dr. Goswami is the Founder and Executive Chairman of CERG Advisory Pvt. Ltd., which is engaged in corporate advisory and consulting services for companies in India and abroad. He also serves on the Board of several large Corporate.

He joined the Board in July, 2006.

(ix) Mr. Haigreve Khaitan (Non-Executive, Independent Director)

Mr. Khaitan is a law graduate and is a Partner of reputed law firm, Khaitan & Co. He started his career in litigation and over the years has been involved in many Mergers & Acquisitions and private equity transactions, as well as project finance transactions. He has rich experience in all aspects of Mergers & Acquisitions, Corporate Restructuring, Demergers, Spin-offs, Sale of Assets, Foreign Investments, Joint Ventures and Foreign Collaborations. He advises a range of large Indian conglomerates and multinational clients in various business sectors including infrastructure, power, telecom, automobiles, steel, software and information technology, retail, etc.

He has been recommended by Chambers & Partners, Legal 500 & PLC. IFLR 1000 has recommended him as one of the leading lawyers in India. He has been ranked as the "Band 1 Lawyer" for Corporate/M & A transactions. Asialaw Leading Lawyers 2013 India M & A Atlas Awards 2013 regards him as one of the "Leading Lawyers for M & A Transactions". He is on the Board of some of the large public listed companies.

He joined the Board in July, 2012.

(x) Ms. Usha Sangwan (Non-Executive, Non-Independent Director, Institutional Nominee)

Ms. Sangwan, is currently the Managing Director of Life Insurance Corporation of India. She holds a Master's Degree in Economics and a Post Graduate Diploma in Human Resource Management. She has worked in almost all core areas of life insurance including Marketing, Personnel, Operations, Housing Finance, Group Business, Direct Marketing, International Operations and Corporate Communications and has over 30 years of experience. Her expertise lies in analytics, strategy, execution, people skill, use of technology particularly in marketing and servicing and setting up of systems.

Ms. Sangwan is on the Board of Axis Bank Ltd., LIC HFL Care Homes, LIC (Singapore) Pte. Ltd. and LIC (Lanka) Ltd., Member of Governing Council of National Insurance Academy, Pune. She has been awarded the "Women Leadership Award" in BFSI sector by Institute of Public Enterprise and "Brand Slam Leadership Award" by CMO Asia. She has also been awarded "Women Leadership Role Model" by Top Rankers Management Consultants and has won the "Corporate Leadership Award for 2014" by Colour TV.

She joined the Board in April, 2014.

(xi) Mr. B.L. Taparia (Non-Executive, Non-Independent Director)

Mr. Taparia is a Commerce and Law graduate and a fellow member of the Institute of Company Secretaries of India. He possesses more than 40 years of working experience in the fields of Legal, Secretarial, Finance, Taxation, Procurement, Internal Audit, HR, Health & Safety, and Sustainability. He joined the Company in the year 1983 as Deputy Company Secretary. After working at different positions in the Company, he was promoted as Whole-time Director in the year 1999 and he served as that till 2009. Throughout his career in Ambuja Cement, he was member of the Core Management Committee responsible for the growth of the Company. Mr. Taparia superannuated from the Company in July, 2012.

He re-joined the Board in September, 2012.

(xii) Mr. Ajay Kapur (Executive, Non-Independent, Managing Director & CEO)

Mr. Kapur holds an Economics degree from St. Xavier's College, Mumbai and a Masters in Management with marketing specialisation. He is an alumnus of the Wharton Advanced Management Program, Wharton Business  School, USA.

Following a stint with Citibank's consumer banking business, Mr. Kapur joined Ambuja Cement in 1993 as the Executive Assistant to the then Managing Director and Founder, Mr. N.S. Sekhsaria. From there, he moved on as the Marketing Head for West & South region (2001-07). As National Head - Marketing and Commercial Services (2007-09), he was simultaneously inducted into the Executive Committee of the company. In 2009, he was appointed Business Head (West & South region) and in May, 2012, was made CEO of the company. Soon after, he was made Deputy Managing Director & CEO on 1st August, 2013; and then Managing Director & CEO on  25th April, 2014.

Mr. Kapur shares a close, symbiotic relationship with the cement industry for over two decades. This has lent him a keen and multi-faceted adaptability to the industry's ever-changing dynamics, customer behavior and needs. He is known for his hands-on and performance-oriented work culture. Towards that, he has initiated several operational excellence programs during his tenure as CEO and later on as MD.

Mr. Kapur also evolved a sharp focus on sustainability. He is a co-chair of the CSI forum of the WBCSD, and a member of the Board of Governors of National Council for Cement and Building Materials. He is the Chairman of CII-Cement Industry Division.

Mr. Kapur also drives a strong focus on safety within the company, through the 'We Care' initiative. Mr. Kapur has successfully improved the safety standards of the company and of everyone associated with it.  He joined the Board in July, 2013.

2.4 Meetings, agenda and proceedings etc. of the Board Meeting:

Meetings:

The Board generally meets 5 times during the year. The yearly calendar of the meetings is finalized before the beginning of the year. Additional meetings are held when necessary. The Directors are also given an option of attending the board meeting through video conferencing. During the year ended on 31st December, 2015, the Board of Directors had 7 meetings. These were held on 12th January, 2015, 18th February, 2015, 24th March, 2015, 29th April, 2015, 27th July, 2015, 28th October, 2015 and 9th December, 2015. The last Annual General Meeting (AGM) was held on 8th April, 2015. The attendance record of the Directors at the Board Meetings during the year ended on 31st December, 2015, and at the last AGM is as under:-

As stipulated by the Code of Independent Directors under the Companies Act, 2013 and the Listing Regulations, a separate meeting of the Independent Directors of the Company was held on 8th December, 2015 to review the performance of Non-independent Directors (including the Chairman) and the entire Board. The Independent Directors also reviewed the quality, content and timeliness of the flow of information between the Management and the Board and its' Committees which is necessary to effectively and reasonably perform and discharge their duties.

Agenda:

All the meetings are conducted as per well designed and structured agenda. All the agenda items are backed by necessary supporting information and documents (except for the critical price sensitive information, which is circulated separately or placed at the meeting) to enable the Board to take informed decisions. Agenda also includes minutes of the meetings of all the Board Committees and Subsidiaries for the information of the Board. Additional agenda items in the form of "Other Business" are included with the permission of the Chairman. Agenda papers are circulated seven days prior to the Board Meeting. In addition, for any business exigencies, the resolutions are passed by circulation and later placed at the subsequent Board/Committee Meeting for ratification / approval.

Invitees & Proceedings:

Apart from the Board members, the Company Secretary, the CFO, the Heads of Manufacturing and Marketing are invited to attend all the Board Meetings. Other senior management executives are called as and when necessary, to provide additional inputs for the items being discussed by the Board. The CFO makes presentation on the quarterly and annual operating & financial performance and on annual operating & capex budget. The Managing Director, and other senior executives make presentations on capex proposals & progress, operational health & safety and other business issues. The Chairman of various Board Committees brief the Board on all the important matters discussed & decided at their respective committee meetings, which are generally held prior to the Board meeting.

Post Meeting Action:

Post meetings, all important decisions taken at the meeting are communicated to the concerned officials and departments. Action Taken Report is prepared and reviewed periodically by the Managing Director and Company Secretary for the action taken / pending to be taken.

Support and Role of Company Secretary:

The Company Secretary is responsible for convening the Board and Committee meetings, preparation and distribution of Agenda and other documents and recording of the Minutes of the meetings. He acts as interface between the Board and the Management and provides required assistance and assurance to the Board and the Management on compliance and governance aspects.

2.5 Other Directorships etc.:

None of the Directors is a Director in more than 10 Public Limited Companies or acts as an Independent Director in more than 7 Listed Companies. The Managing Director & CEO does not serve as Independent Director on any listed company. Further, none of the Director acts as a member of more than 10 committees or acts as a chairman of more than 5 committees across all Public Limited Companies in which he is a Director.

2.6 Induction and Familiarization Program for Directors:

On appointment, the concerned Director is issued a Letter of Appointment setting out in detail, the terms of appointment, duties, responsibilities and expected time commitments. Each newly appointed Independent Director is taken through an induction and familiarization program including the presentation and interactive session with the Managing Director & CEO, Executive Committee Members and other Functional Heads on the Company's manufacturing, marketing, finance and other important aspects. The Company Secretary briefs the Director about their legal and regulatory responsibilities as a Director. The program also includes visit to the plant to familiarize them with all facets of cement manufacturing. On the matters of specialized nature, the Company engages outside experts/consultants for presentation and discussion with the Board members. The details of familiarization program can be accessed from the website: www.ambujacement.com

2.7 Board Evaluation:

During the year, the Board adopted a formal mechanism for evaluating its performance and effectiveness as well as that of its Committees and individual Directors, including the Chairman of the Board. For Board and its Committees, the exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, governance issues etc. In case of evaluation of the individual Directors, one to one meeting of each Director with the Chairman of the Board and the Chairman of the Nomination & Remuneration Committee was held.

The Directors were satisfied with the evaluation results, which reflected the overall engagement and effectiveness of the Board and its Committees.

2.8 Code of Conduct:

The Board of Directors has laid down a Code of Conduct for Business and Ethics (the Code) for all the Board members and all the employees in the management grade of the Company. The Code covers amongst other things the Company's commitment to honest & ethical personal conduct, fair competition, corporate social responsibility, sustainable environment, health & safety, transparency and compliance of laws & regulations etc. The Company believes in "Zero Tolerance" to bribery and corruption in any form and in line with our governance philosophy of doing business in most ethical and transparent manner, the Board has laid down an "Anti Bribery and Corruption Directives", which is embedded to the Code. The Code of Conduct is posted on the website of the Company.

All the Board members and senior management personnel have confirmed compliance with the code. A declaration to that effect signed by the Managing Director & CEO is attached and forms part of the Annual Report of the Company.

2.9 Prevention of Insider Trading Code:

As per SEBI (Prohibition of Insider Trading) Regulation, 2015, the Company has adopted a Code of Conduct for Prevention of Insider Trading. All the Directors, employees and third parties such as auditors, consultants etc. who could have access to the unpublished price sensitive information of the Company are governed by this code. The trading window is closed during the time of declaration of results and occurrence of any material events as per the code. The Company has appointed Mr. Rajiv Gandhi, Company Secretary as Compliance Officer, who is responsible for setting forth procedures and implementation of the code for trading in Company's securities. During the year under review there has been due compliance with the said code.

Audit Committee

The Board has constituted a well-qualified Audit Committee. All the members of the Committee are Non-Executive Directors with majority of them are Independent Directors including Chairman. They possess sound knowledge on accounts, audit, finance, taxation, internal controls etc. The Company Secretary acts as secretary to the committee.

3.2 Invitees / Participants:-

1. The M.D. & CEO and Mr. B. L. Taparia, Director are the permanent invitees to all Audit Committee meetings.

2. Head of Internal Audit department attends all the Audit Committee Meetings as far as possible and briefs the Committee on all the points covered in the Internal Audit Report as well as the other issues that come up during discussions.

3. The representatives of the Statutory Auditors have attended all the Audit Committee meetings held during the year.

4. The representatives of the Cost Auditors have attended 1(one) Audit Committee Meeting when the Cost Audit Report was discussed.

5. The CFO and the Heads of Manufacturing and Marketing also attends all the Committee meetings to provide inputs on issues relating to internal audit findings, internal controls, accounts, taxation, risk management etc. Other executives are invited to attend the meeting as and when required.

6. The Committee also invites the representatives of LafargeHolcim group's internal audit department to attend the Audit Committee meetings for review of the special audit projects undertaken by them and also to get their valuable support and guidance on the international best practices in internal audit and strengthening of internal controls.

3.3 Private Meetings:-

In order to get the inputs and opinions of the Statutory Auditors and the Internal Auditors, the Committee also held one separate one-to-one meeting during the year with the Statutory Auditor and Head of Internal Audit department but without the presence of the M.D. & CEO and the management representatives.

3.4 Terms of Reference:-

The terms of reference of the Audit Committee are as per the guidelines set out in the listing regulations read with section 177 of the Companies Act, 2013. These broadly includes (i) Develop an annual plan for Committee (ii) review of financial reporting processes, (iii) review of risk management, internal control and governance processes, (iv) discussions on quarterly, half yearly and annual financial statements and the auditor's report, (v) interaction with statutory, internal and cost auditors to ascertain their independence and effectiveness of audit process, (vi) recommendation for appointment, remuneration and terms of appointment of auditors and (vii) risk management framework concerning the critical operations of the Company.

In addition to the above, the Audit Committee also reviews the following:

(i) Matter included in the Director's Responsibility Statement.

(ii) Changes, if any, in the accounting policies.

(iii) Major accounting estimates and significant adjustments in financial statement.

(iv) Compliance with listing and other legal requirements concerning financial statements.

(v) Subject to review by the Board of Directors, review on quarterly basis, Related Party Transactions entered into by the Company pursuant to each omnibus or specific approval given.

(vi) Qualification in draft audit report.

(vii) Scrutiny of inter-corporate loans & investments.

(viii) Management's Discussions and Analysis of Company's operations.

(ix) Valuation of undertakings or assets of the company, wherever it is necessary.

(x) Periodical Internal Audit Reports and the report of Ethical View Reporting Committee (Fraud Risk Management Committee).

(xi) Findings of any special investigations carried out either by the Internal Auditors or by the external investigating agencies.

(xii) Letters of Statutory Auditors to management on internal control weakness, if any.

(xiii) Major non routine transactions recorded in the financial statements involving exercise of judgement by the management.

(xiv) Recommend to the Board, the appointment, re-appointment and, if required the replacement or removal of the statutory auditors and cost auditors considering their independence and effectiveness, and recommend the audit fees.

(xv) Recommend to the Board, the appointment and remuneration of the CFO and Chief Internal Auditors.

3.5 Other Matters:-

i. The Audit Committee has framed its Charter for the purpose of effective compliance of regulation 18 of the listing regulations. The Charter is reviewed by the Committee from time-to-time and necessary amendments as may be required are made in it.

ii. In view of large number of laws & regulations applicable to the Company's business, their complexities and the time required for monitoring the compliances, the task of monitoring and review of legal & regulatory compliances has been assigned to a separate committee of directors called the "Compliance Committee". The composition and the scope/function of Compliance Committee are given under point no. 4 below.

4. Compliance Committee

With the rapid growth of business and its complexities coupled with increasing regulatory compliances, the Board felt it necessary to have zero non compliance regimes for sustainable business operations. With this object, a structured mechanism for ensuring full compliance of various statutes, rules & regulations has been put in place and a separate Committee of Directors by the name "Compliance Committee" has been constituted by the Board.

The CFO and the Head of Legal department are the Permanent Invitees to all the Committee meetings. The Company Secretary acts as the Secretary to the Committee.

The terms of reference of the Committee are to:

a. periodically review the Legal Compliance Audit report of various Units / Department submitted by the Corporate Legal Department;

b. suggest taking necessary corrective actions for non compliance, if any;

c. specifically review and confirm that all the requirements of Competition Law and Anti Bribery and Corruption Directives are fully complied with;

d. review the significant amendments in the laws, rules & regulations;

e. review the significant legal cases filed by and against the Company;

f. review the judgements of various court cases not involving the Company as a litigant but having material impact on the Company's operations;

g. periodically review the Code of Business Conduct & Ethics and Code of Conduct for prevention of Insider Trading.

The Legal and Corporate Secretarial departments provides 'backbone' support to all the business segments for timely compliance of all the applicable laws, rules & regulations by putting in place a robust compliance mechanism with adequate checks & balances and thus facilitates the management in practicing the highest standards of Corporate Governance.

The Compliance Committee on its part gives valuable guidance to ensure full compliance of all significant laws, rules & regulations as may be applicable to the Company on top priority.

5.2 Terms of Reference of the Nomination & Remuneration Committee:

The Committee is empowered to -

(i) Formulate criteria for determining qualifications, positive attributes and independence of Directors and oversee the succession management process for the Board and senior management employees.

(ii) Identification and assessing potential individuals with respect to their expertise, skills, attributes, personal and professional standing for appointment and re-appointment as Directors / Independent Directors on the Board and as Key Managerial Personnel.

(iii) Formulate a policy relating to remuneration for the Directors, Committee and also the Senior Management Employees.

(iv) Support Board in evaluation of performance of all the Directors & in annual self-assessment of the Board's overall performance.

(v) Conduct Annual performance review of MD and CEO and Senior Management Employees;

(vi) Administration of Employee Stock Option Scheme (ESOS), if any;

5.3 Remuneration Policy

The Company follows a policy on remuneration of Directors and Senior Management Employees. Remuneration of Non-Executive Directors

The Non-Executive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses for participation in the Board / Committee meetings and commission as detailed hereunder:

i. A Non-Executive Director shall be entitled to receive sitting fees for each meeting of the Board or Committee of the Board attended by him of such sum as may be approved by the Board of Directors within the overall limits prescribed under the Companies Act, 2013 and The Companies Managerial Remuneration Rule, 2014;

ii. A Non-Executive director will also be entitled to receive commission on an annual basis of such sum as may be approved by the Board on the recommendation of the Nomination & Remuneration Committee;

iii. The Nomination & Remuneration Committee may recommend to the Board, the payment of commission on uniform basis to reinforce the principles of collective responsibility of the Board.

iv. The Nomination & Remuneration Committee may recommend a higher commission for the Chairman of the Board of Directors taking into consideration his overall responsibility;

v. In determining the quantum of commission payable to the Directors, the Nomination & Remuneration Committee shall make its recommendation after taking into consideration the overall performance of the Company and the onerous responsibilities required to be shouldered by the Director.

vi. The Nomination & Remuneration Committee may recommend to the Board, for the payment of additional commission to those Directors who are Members on the Audit Committee and the Compliance Committee of the Board subject to a ceiling on the total commission payable may be decided;

vii. In addition to the remuneration paid under Clause (ii) and (vi) above, the Chairman of the Audit Committee shall be paid an additional commission as may be recommended to the Board by the Nomination & Remuneration Committee;

viii. The total commission payable to the Directors shall not exceed 1% of the net profit of the Company;

ix. The Commission shall be payable on pro-rata basis to those Directors who occupy office for part of the year.

x. The Independent Directors of the Company shall not be entitled to participate in Stock Option Scheme of the Company, if any, introduced by the Company;

Remuneration of Managing Director & CEO

i. At the time of appointment or re-appointment, the Managing Director & CEO shall be paid such remuneration as may be mutually agreed between the Company (which includes the Nomination & Remuneration Committee and the Board of Directors) and the Managing Director & CEO within the overall limits prescribed under the Companies Act.

ii. The remuneration shall be subject to the approval of the Members of the Company in General Meeting.

iii. The remuneration of the Managing Director & CEO is broadly divided into fixed and variable component. The fixed compensation shall comprise salary, allowances, perquisites, amenities and retiral benefits. The variable component shall comprise of performance bonus.

iv. In determining the remuneration (including the fixed increment and performance bonus) the Nomination & Remuneration Committee shall consider the following:

a. the relationship of remuneration and performance benchmarks is clear;

b. balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals;

c. responsibility required to be shouldered by the Managing Director & CEO and the industry benchmarks and the current trends;

d. the Company's performance vis-d-vis the annual budget achievement and individual performance vis-d-vis the KRAs / KPIs

Remuneration of Senior Management Employees

i. In determining the remuneration of the Senior Management employees (i.e. KMPs and Executive Committee Members) the Nomination & Remuneration Committee shall consider the following:

a. the relationship of remuneration and performance benchmark is clear;

b. balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals;

c. the remuneration is divided into two components viz. fixed component of salaries, perquisites and retirement benefits and variable component of performance based incentive;

d. the remuneration including annual increment and performance incentive is decided based on the criticality of the roles and responsibilities, the Company's performance vis-d-vis the annual budget achievement, individuals performance vis-d-vis KRAs / KPIs, industry benchmark and current compensation trends in the market;

ii. the Managing Director & CEO will carry out the individual performance review based on the standard appraisal matrix and after taking into account the appraisal score card and other factors mentioned hereinabove, recommends the annual increment and performance incentive to the Nomination & Remuneration Committee for its review and approval.

5.4 Details of Remuneration Paid to the Directors

Remuneration to Directors:

(a) The Non-Executive Directors are paid sitting fees of Rs. 50,000/- per meeting for attending the Board and Audit Committee meetings and Rs. 30,000/- per meeting for attending other committee meetings. The CSR Committee members have unanimously decided not to accept any sitting fees for the CSR Committee meeting to be attended by them.

In addition to the sitting fees, the Company also pays commission to the Non-executive Directors for their overall engagement and contribution for the Company's business. The Commission is paid on a uniform basis to reinforce the principle of collective responsibility. Accordingly, the Company has provided for payment of commission of Rs. 16 lacs to each of the Non-Executive Directors who were in office for the whole of the financial year 2015 and on pro-rata basis to those who were in office for part of the year.

Considering the accountability and the complexities of issues handled by the Audit and Compliance Committees respectively, the Company has provided additional commission of Rs. 12 lacs for each of the Non-Executive Member Directors of the Audit Committee and Compliance Committee who were in office for the whole of the financial year 2015 and on pro-rata basis to those who were in office for part of the year. The maximum commission payable to each Non-Executive Director has however been capped at Rs. 28 lacs per Director. In view of the higher degree of engagement and increased responsibility, the Company has provided for additional commission of Rs. 21 Lacs and Rs. 6 Lacs respectively to the Chairman of the Board and the Chairman of the Audit Committee.

@ The Board has extended the advisory services agreement of Mr. B.L. Taparia for a year from 1st November, 2015 and also increased the service fee from Rs.11 Lacs to Rs. 12 Lacs p.m. The increase in remuneration is subject to the approval from the shareholders.

# Appointment of MD & CEO is governed by a service contract for a period of 5 years and the notice period of 3 months. His remuneration includes basic salary, performance bonus, allowances, contribution to provident, superannuation and gratuity funds and perquisites (including monetary value of taxable perquisites) etc.

6. Stakeholder's Relationship Committee and Share Transfer Committee

In order to provide quality and efficient services to the investors and to align & streamline the process of share transfer/ transmission, the Share Transfer Committee was merged with the Stakeholder's Relationship Committee during the year. Based on the revised scope, this Committee is now responsible for transfer/transmission of shares, satisfactory redressal of investors' complaints and recommends measures for overall improvement in the quality of investor services. The Committee also looks into allotment of shares kept in abeyance, allotment of shares on exercise of the stock options by the employees, if any and allotment of privately placed preference shares, debentures and bonds, if any.

. Other Committees of Directors

In addition to the above referred Committees which are mandatory under the Companies Act, the Listing Regulations and under the SEBI Guidelines, the Board of Directors has constituted the following Committees of Directors to look into various business matters :-

(A) Capex Committee

The large CAPEX needs critical evaluation of all the aspect of the projects. The detailed engineering, the profile of equipment suppliers, cost estimates & contingencies, schedule of implementation and safety & security of people are some of the critical areas where focused appraisal is required at the highest level. In view of the same, a separate CAPEX Committee of Directors was formed w.e.f 1st May, 2010. The Committee comprises of Mr. Bernard Terver, Chairman, Mr. Nasser Munjee and Mr. Rajendra P. Chitale as the Members. Mr. Ajay Kapur, Managing Director and Mr. M. L. Narula (former Managing Director of ACC Ltd.) are the permanent invitees for all the Committee meetings.

The Roles and Responsibilities of the Committee are as follows:

a) To approve and recommend to the Board, all CAPEX proposals for green field plants, new kilns or power plants;

b) To critically evaluate all the aspect of techno commercial feasibility and financial viability of these projects. The Committee did not hold any meeting during the year under review.

(B) Management Committee

The Management Committee is formed to authorize grant of Power of Attorney to executives, to approve various facilities as and when granted by the Banks and execution of documents for these facilities. Four committee meetings were held during the year 2015. The committee comprises of Mr. Rajendra Chitale, Chairman, Mr. Shailesh Haribhakti, Mr. B.L. Taparia and Mr. Ajay Kapur as the Members.

Vigil Mechanism and Ethical View Policy

With the rapid expansion of business in terms of volume, value and geography, various risks associated with the business have also increased considerably. One such risk identified is the risk of fraud & misconduct. The Companies Act, 2013 and the listing regulations requires all the listed companies to institutionalize the vigil mechanism and whistle blower policy. The Company since its inception believes in honest and ethical conduct from all the employees and others who are associated directly and indirectly with the Company. The Audit Committee is also committed to ensure fraud-free work environment and to this end the Committee has laid down a Ethical View Policy (akin to the Whistle Blower Policy), long before the same was made mandatory under the law. The policy provides a platform to all the employees, vendors and customers to report any suspected or confirmed incident of fraud/misconduct through any of the following reporting protocols:

• E-mail : acl@ethicalview.com

• National Toll Free Phone Line : 18002091005

• Fax Number : 022 - 66459796

• Written Communication to : P O. Box No. 25, HO, Pune - 411 001

• Filling online report through : <https://integrityline.lafargeholcim.com>

In order to instil more confidence amongst Whistle Blowers, the management of the above referred reporting protocols are managed by an independent agency. Adequate safeguards have been provided in the policy to prevent victimization of anyone who is using this platform and direct access to the Chairman of the Audit Committee is also available in exceptional cases.

This policy is applicable to all the directors, employees, vendors and customers of the Company and contains features similar to the Whistle Blower Policy. The policy is also posted on the website of the Company.

The main objectives of the policy are:

(i) To protect the brand, reputation and assets of the Company from loss or damage, resulting from suspected or confirmed incidents of fraud / misconduct.

(ii) To provide guidance to the employees, vendors and customers on reporting any suspicious activity and handling critical information and evidence.

(iii) To provide healthy and fraud-free work culture.

(iv) Promotion of ACL's zero tolerance compliance approach

For the effective implementation of the policy, the Audit Committee has constituted an Ethical View Reporting Committee (EVC) of very senior executives/director comprising of:

i) Mr. B. L. Taparia, Non - Executive Director - Chairman

ii) Mr. Sanjay Khajanchi (Head - Corporate Controlling) - Member

iii) Mr. A. J. Pandya, Advisor - Member

iv) Mr. Prabhakar Mukhopadhay - Chief Internal Auditor - Member The Company Secretary acts as the Response Manager and Secretary to the Committee. The EVC is responsible for the following:

(i) implementation of the policy and spreading awareness amongst employees;

(ii) review all reported cases of suspected fraud / misconduct;

c(iii) order investigation of any case either through internal audit department or through external investigating agencies or experts;

(iv) recommend to the management for taking appropriate actions such as disciplinary action, termination of service, changes in policies & procedure and review of internal control systems;

(v) annual review of the policy.

The EVC functions independently and reports directly to the Audit Committee. 11.

12. Disclosures

1. Transactions with related parties, as per requirements of Accounting Standard 18, are disclosed in notes to accounts annexed to the financial statements.

2. There are no materially significant transactions with the related parties viz. Promoters, Directors or the Management, or their relatives or Subsidiaries that had potential conflict with the Company's interest. Suitable disclosure as required by the Accounting Standard (AS 18) has been made in the Annual Report. The Related Party Transactions Policy as approved by the Board is uploaded on the Company's website at <http://www.ambujacement.com/wp-content/> uploads/2015/12/policy_on_determining _materiali1y _ of_rpt_28_oct_2015_revised.pdf.

3. The Company has followed all relevant Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 while preparing Financial Statements.

4. There are no pecuniary relationships or transactions of Non-Executive Directors vis-d-vis the Company which has potential conflict with the interests of the Company at large.

5. No penalties or strictures have been imposed on the Company by Stock Exchange or SEBI or any statutory authority on any matter related to capital markets during the last three years.

6. The Company has in place a mechanism to inform the Board members about the Risk assessment and mitigation plans and periodical reviews to ensure that the critical risks are controlled by the executive management. The details of the Risk Management Committee is provided at point no. 8 of this report.

7. During the year ended 31st December, 2015, the Company does not have any material listed/unlisted subsidiary companies as defined in Regulation 16 of the Listing Regulations. The Company has framed the policy for determining material subsidiary as required by under Regulation 16 of the Listing Regulation and the same is disclosed on the Company's website. The web link is <http://www.ambujacement.com/investor-relations/policy-material-subsidiaries/>.

8. The Independent Directors have confirmed that they meet the criteria of 'Independence' as stipulated under the Companies Act, 2013 and the Listing Regulations.

13. CEO / CFO Certification

The MD & CEO and Chief Financial Officer (CFO) have issued certificate pursuant to the provisions of Regulation 17(8) of the Listing Regulations certifying that the financial statements do not contain any materially untrue statement and these statements represent a true and fair view of the Company's affairs. The said certificate is annexed and forms part of the Annual Report.

14. Discretionary Requirements under Regulation 27 of Listing Regulation

The status of compliance with discretionary recommendations of the Regulation 27 of the Listing Regulations with Stock Exchanges is provided below:

14.1 Non-Executive Chairman's Office: Chairman's office is separate from that of the Managing Director & CEO. However, the same is now maintained by the Chairman himself.

14.2 Shareholders' Rights: As the quarterly and half yearly financial performance along with significant events are published in the news papers and are also posted on the Company's website, the same are not being sent to the shareholders.

14.3 Modified Opinion in Auditors Report: The Company's financial statement for the year 2015 does not contain any modified audit opinion.

14.4 Separate posts of Chairman and CEO: The Chairman of the Board is a Non-executive Director and his position is separate from that of the Managing Director & CEO.

14.5 Reporting of Internal Auditor: The Internal Auditor reports to the Audit Committee.

15. Means of Communication

The quarterly, half-yearly and yearly financial results of the Company are sent to the Stock Exchanges immediately after these are approved by the Board. These are widely published in The Financial Express, Business Standard and other newspapers.

These results are simultaneously posted on the website of the Company at www.ambujacement.com and also uploaded on the website of National Stock Exchange of India Ltd. and the Bombay Stock Exchange of India Ltd.

The official press releases and presentation made to Institutional Investors / Analysts, if any, are also available on the Company's website.

16. General Shareholders' Information 16.1 Annual General Meeting:

Day & Date : Thursday, 14th April, 2016

Time : 10.30 a.m.

Venue

P.O. Ambujanagar, Taluka Kodinar, District Gir Somnath, Gujarat - 362 715. (Registered Office of the Company)

Financial Calendar:

The Company follows the period of 1st January to 31st December, as the Financial Year. First quarterly results : April, 2016

Second quarterly / Half yearly results : July, 2016

Third quarterly results : October, 2016

Annual results for the year ending on 31st December, 2016 : February, 2017

Annual General Meeting for the year ending on 31st December, 2016 : April, 2017

Book Closure:

The Register of Members and the Share Transfer Books of the Company shall remain closed from Wednesday, the 24th February, 2016 till Monday, the 29th February, 2016 till (both days inclusive) for payment of final dividend.

Dividend Payment Date:

Dividend shall be paid to all the eligible shareholders from 21st April, 2016 onwards. Dividend Policy:

The first issue of shares was made by the Company in the year 1985 at Rs. 10/- per share. Company is paying dividend from its very first full year of operation. From a modest dividend of 11% in 1987-88, the Company has been increasing dividend almost every year. This year, the Board has recommended total dividend of 140% (Rs. 2.80/- per share) including 60% (Rs. 1.20/- per share) paid as interim dividend. As a future policy for payment of dividend, Company shall endeavour to follow a pay-out ratio of more than 50% in the ordinary circumstances.

16.7 Listing of Shares & Other Securities:

A. Equity Shares

The equity shares are at present listed at the following Stock Exchanges:

Name of the Stock Exchanges Stock Code / Symbol

(i) Bombay Stock Exchange Ltd. 500425 Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001.

(ii) National Stock Exchange of India Ltd. AMBUJACEM

Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra-Kurla Complex, Bandra (East), Mumbai - 400 051.

B. Debentures

There are no outstanding debentures.

C. GDRs

The GDRs are listed under the EURO MTF Platform (Code:US02336R2004) of Luxembourg Stock Exchange, Societe de la Bourse de Luxembourg, Avenue de la Porte Neuve L-2011 Luxembourg, B.P.165.

D. ISIN Code for the Company's equity share : INE079A01024

E. Corporate Identity Number (CIN) : L26942GJ1981PLC004717

16.8 Listing Fees:

The Company has paid listing fees up to 31st March, 2016 to the Bombay Stock Exchange (BSE) and National Stock Exchange of India Ltd. (NSE) where Company's shares are listed.

16.11 Share Transfer Agents:

Sharepro Services (India) Pvt. Ltd., 13AB Samhita Warehousing Complex, 2nd Floor, Near Saki Naka Telephone Exchange, Andheri Kurla Road, Saki Naka, Andheri (East), Mumbai - 400 072 Tel. No.: (022) 67720300/67720400, Fax No.: (022) 28591568 / 28508927 E-mail - sharepro@shareproservices.com

16.12 Share Transfer System:

Shares sent for transfer in physical form are registered and returned by our Registrars and Share Transfer Agents in 15 days of receipt of the documents, provided the documents are found to be in order. Shares under objection are returned within two weeks. The Share Transfer Committee considers the transfer proposals generally on a weekly basis

16.15 Dematerialisation of Shares:

About 98.71 % of total equity share capital is held in dematerialised form with NSDL and CDSL as on 31st December, 2015.

16.16 Reconciliation of Share Capital Audit:

As stipulated by Securities and Exchange Board of India (SEBI), a qualified practicing Company Secretary carries out the Share Capital Audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. This audit is carried out every quarter and the report thereon is submitted to stock exchanges, NSDL and CDSL and is also placed before the Board of Directors. No discrepancies were noticed during these audits.

16.17 Outstanding GDRs or Warrants or any Convertible Instrument, conversion Dates and likely impact on Equity:

(i) The Company had issued Foreign Currency Convertible Bonds (FCCB) in the year 1993 and 2001. Out of the total conversion of these bonds into GDRs, 26458484 GDRs are outstanding as on 31st December, 2015 which is listed on the Luxembourg Stock Exchange. The underlying shares representing the outstanding GDRs have already been included in equity share capital. Therefore, there will be no further impact on the equity share capital of the Company.

The Company has granted stock options from time-to-time in the past. At the same time, the Company had also issued warrants which can be converted into equity shares. However, during the year the last ESOP Scheme has come to closure and as on 31st December, 2015 none of the ESOP Schemes are in force. The year-end outstanding position of the rights shares / warrants that are convertible into shares and their likely impact on the equity share capital is as under:-

16.18 Plant Locations:

Integrated Cement Plants

(i) Ambujanagar, Taluka Kodinar, District Gir Somnath, Gujarat.

(ii) Darlaghat, District Solan, Himachal Pradesh.

(iii) Maratha Cement Works, Dist. Chandrapur, Maharashtra.

(iv) Rabriyawas, Dist. Pali, Rajasthan.

(v) Bhatapara, Dist. Raipur, Chhattisgarh.

Grinding Stations

(i) Roopnagar, Punjab.

(ii) Bathinda, Punjab.

(iii) Sankrail, Dist. Howrah, West Bengal.

(iv) Farakka, Dist. Murshidabad, West Bengal.

(v) Roorkee, Dist. Haridwar, Uttaranchal.

(vi) Dadri, Dist Gautam Budh Nagar, Uttar Pradesh.

(vii) Nalagarh, Dist. Solan Himachal Pradesh.

(viii) Magdalla, Dist. Surat, Gujarat.

Bulk Cement Terminals

(i) Muldwarka, District Gir Somnath, Gujarat.

(ii) Panvel, District Raigad, Maharashtra.

(iii) Cochin, Kerala.

(iv) Mangalore, Karnataka

16.19 Address for Correspondence:

(a) Corporate Office: Elegant Business Park, MIDC Cross Road 'B', Off Andheri-Kurla Road, Andheri (East), Mumbai-400 059. Phone No: 022 - 40667000/ 6616700.

(b) Exclusive e-mail id for Investor Grievances: The following e-mail ID has been designated for communicating investors' grievances:- shares@ambujacement.com

16.20 Registered Office:

P. O. Ambujanagar, Taluka Kodinar, District Gir Somnath, Gujarat - 362 715

16.21 Mandatory requirement of PAN:

SEBI vide its circular dated 7th January, 2010 has made it mandatory to furnish PAN copy in the following cases:

(i) Deletion of name of deceased shareholder(s), where the shares are held in the name of two or more shareholders;

(ii) Transmission of shares to the legal heir(s), where deceased shareholder was the sole holder.

(iii) Transposition of shares - in case of change in the order of names in which physical shares are held jointly in the names of two or more shareholders.

16.22 Disclosures with respect to the Demat Suspense Account / Unclaimed Suspense Account :

During the year, the Company in compliance with Clause 5A of the Listing Agreement has transferred 24,96,378 shares belonging to 16,427 shareholders who were holding shares in physical form and whose certificates were returned undelivered and currently lying with the company to the demat 'Unclaimed Suspense Account' after complying with the procedure as laid down under the Listing Agreement.

Before transfer of these shares to the demat 'Unclaimed Suspense Account', the Company had sent reminder letters to 16935 shareholders holding 26,55,351 shares and had released 1,58,973 shares belonging to 508 shareholders pursuant to their requests. As at the year end the company is holding 24,96,378 shares belonging to 16,427 shareholders in the demat 'Unclaimed Suspense Account'. The voting rights on these shares will remain frozen till the rightful owner claims the shares.

17. Subsidiary Companies

There is no material Indian subsidiary Company requiring appointment of Independent Director of the Company on the Board of Directors of the subsidiary Company. The requirements of the Regulation 24 of the Listing Regulations with regard to subsidiary companies have been complied with.