REPORT ON CORPORATE GOVERNANCE
Responsible infrastructure development with sustainable business practices forms the core of HCC's business strategy. The efforts are always focused on long term value creation. Inherent to such an objective is to continuously engage and deliver value to all its stakeholders including shareholders, customers, partners, employees and the society at large. This is supported by a business ethos that focuses on being a responsible corporate citizen driven by a strong sense of ethics, fairness and integrity in all dealings.
The Company's corporate governance structure plays a pivotal role in realizing this long term goal. It provides the fundamental systems, processes and principles that promote objective decision making, performance based management and a corporate culture that is characterized by integrity and fairness in all dealings. Critical to this, is the high degree of transparency in disclosures across all levels of stakeholder engagement, which are periodically done while maintaining the importance of reserving competitive information from being disseminated.
In addition, the Company has a strong commitment to participation in community development. Its established systems encourage and recognize employee participation in environmental and social initiatives that contribute to organizational sustainability, conservation of energy, and promotion of safety and health.
The entire governance structure is actively supervised by Board of Directors, which oversees management activities and ensures their effectiveness in delivering member value. To implement this, HCC has always strived to promote an informed Board that functions independently.
This Chapter reports the Company's compliance with the Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as SEBI Listing Regulations) as given below:
I) Board of Directors
a) Composition of the Board
The Board of Directors has an ideal combination of executive and non executive Directors and is in conformity with the provisions of Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations which inter alia stipulates that the Board should have an optimum combination of Executive and Non-executive Directors with at least one Woman Director and not less than fifty percent of the Board should consist of Independent Directors, if the Chairman of the Board is an Executive Director
The Chairman of the Board of Directors is an Executive Director. The composition of the Board of Directors is in conformity with the Regulation 17 of the SEBI Listing Regulations.
The Board of Directors of the Company at its meeting held on May 2, 2016 has appointed Mr. Rajgopal Nogja as the Group Chief Executive Officer (Group CEO) of the Company w.e.f. May 3, 2016.
Pursuant to his appointment, Mr. Nogja has stepped down from the Board as Group COO & Whole-time Director w.e.f. May 2, 2016.
The Board of Directors at its Board Meeting held on May 2, 2016, appointed Mr. N. R. Acharyulu (DIN: 02010249) as an Additional Director on the Board of the Company in the category of Non-Executive Director with immediate effect, who is liable to retire by rotation in accordance with Section 161 of the Companies Act, 2013 read with Article 88 of the Articles of Association of the Company.
All the Directors possess the requisite qualifications and experience in general corporate management, finance, banking, insurance and other allied fields enabling them to contribute effectively in their capacity as Directors of the Company.
Save and except Ms. Shalaka Gulabchand Dhawan, who is the daughter of Mr. Ajit Gulabchand, Chairman and Managing Director of the Company, the other Directors of the Company are not related to each other.
b) Number of Board Meetings
The Board of Directors met four times during the financial year 2015-16. The meetings were held on April 30, 2015, July 30, 2015, October 29, 2015 and January 28, 2016. The maximum time gap between any two consecutive meetings did not exceed one hundred and twenty days
c) Directors' attendance record and details of Directorships/Committee Positions held
As mandated by SEBI Listing Regulations none of the Directors on the Board is a member of more than ten Board-level committees and Chairman of more than five such committees, across all such companies in which he/ she is a Director.
Further, none of the Directors of the Company serves as an Independent Director in more than seven listed companies.
Table 1 below gives the names and categories of Directors, their attendance at the Board Meetings held during the year and at the last Annual General Meeting
as also the number of Directorships and board-level committee positions held by them.
d) Information to the Board
A detailed agenda folder is sent to each Director seven days in advance of the Board Meetings. As a policy, all major decisions involving investments and capital expenditure, in addition to matters which statutorily require the approval of the Board are put up for consideration of the Board. 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.
The Board periodically reviews compliance reports of all laws applicable to the Company, prepared by the Management as well as steps taken by the Company to rectify instances of non compliances, if any. Further, the Board also reviews the Annual financial statements of the Unlisted Subsidiary Companies. In addition to the above, pursuant to Regulation 24 of the SEBI Listing Regulations, the Minutes of the Board Meetings of the Company's Unlisted Subsidiary Companies and a statement of all significant transactions and arrangements entered into by the Unlisted Subsidiary Companies are placed before the Board.
e) Directors with pecuniary relationship or business transaction with the Company
The Chairman & Managing Director and the Whole time Director (s) receive Salary, Perquisites and Allowances, while all the Non-Executive Directors receive Sitting Fees. Table 2: Remuneration paid / payable to Directors during the
f) Remuneration to Directors
Remuneration was paid to Mr. Rajgopal Nogja, Group Chief Operating Officer & Whole-time Director and Ms. Shalaka Gulabchand Dhawan as Whole-time Director pursuant to the approval of the Nomination and Remuneration Committee, the Board of Directors and the Members of the Company.
The Company has made an application seeking approval from Ministry of Corporate Affairs for payment of managerial remuneration of Rs. 10,65,60,000 to Mr. Ajit Gulabchand, Chairman and Managing Director for the financial year 2014-15 which is in excess of the limits specified under the Companies Act, 2013 and the same is awaited.
The below mentioned Table 2 gives the details of remuneration paid / payable to Directors for the year ended March 31, 2016 along with the details of outstanding Stock Options granted to them. The Company did not advance loans to any of its Directors during the financial year 2015-16. financial year ended March 31, 2016
g) Details of Equity Shares held by the Non-Executive Directors
The details of outstanding stock options held by Non-Executive Directors have been disclosed in Table 2 and the details of the Equity Shares held by the Non-Executive Directors as on March 31, 2016 is given in Table 3 below.
h) Code of Conduct
The Board of Directors has laid down two separate Codes of Conduct ('Code(s)'), one for the Non-Executive Directors including Independent Directors to such extent as may be applicable to them depending on their roles and responsibilities and the other for Executive Directors and designated persons in the Senior Management. These Codes have been posted on the Company's website -www.hccindia.com The Codes lay down the standard of conduct which is expected to be followed by the Directors and by the designated persons in their business dealings and in particular on matters relating to integrity at the work place, in business practices and in dealing with stakeholders. All the Board Members and Senior Management personnel of the Company have affirmed compliance with the Code of Conduct as applicable to them, for the year ended March 31, 2016. A declaration to this effect signed by Mr. Ajit Gulabchand, Chairman & Managing Director is annexed to this Report.
i) Familiarisation Programmes for Board Members
The Familiarisation program aims to provide insight to the Independent Directors to understand the business of the Company. Upon induction, the Independent Directors are familiarized with their roles, rights and responsibilities.
In the Business Strategy Meeting held by the Company during April 2015 which lasted for a duration of 2.5 hours, the Independent Directors were familiarized with the strategy, operations, performance and the budget process of the Company for the financial year 2015-16.
In addition to the above, the familiarization program for Independent Directors forms part of the Board process. At the quarterly Board meetings of the Company held during the financial year 2015-16, the Independent Directors have been updated on the developments in the Company and the Company's performance.
The details of the familiarisation program for Independent Directors are available on the Company's website at <http://> www.hccindia.com/pdf/familiarisation_program_for_ independent_directors.pdf
(j) Nomination and Remuneration Policy
The Non-Executive Directors (NEDs) are paid sitting fees for attending the Meetings of the Board of Directors and the Board Committees, which are within the limits prescribed by the Central Government. The Company pays a sitting fee of Rs. 1,00,000 to each NED for their attendance at every Board meeting or Board constituted Committee Meeting. In respect of Ms. Harsha Bangari, Nominee Director of Exim Bank the sitting fees are paid to Exim Bank.
The detailed Remuneration Policy of the Company has been provided in the Board's Report which forms part of the Annual Report.
k) Performance Evaluation and Independent Directors Meeting
Pursuant to the provisions of Section 134 (3) (p), 149(8) and Schedule IV of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations, annual performance evaluation of the Directors as well as of the Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee has been carried out.
The performance evaluation of the Independent Directors was carried out by the entire Board and the Performance Evaluation of the Chairman and Non-Independent Directors was carried out by the Independent Directors.
II) Board Committees
The Board of Directors has constituted six Committees viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, ESOP Compensation Committee, Corporate Social Responsibility (CSR) Committee and Risk Management Committee. All decisions pertaining to the constitution of Committees, appointment of members and fixing of terms of reference / role of the Committees are taken by the Board of Directors. Details of the role and composition of these Committees, including the number of meetings held during the financial year and attendance at meetings, are provided below.
a) Audit Committee
As on March 31, 2016, the Audit Committee comprises three Independent Directors. viz Mr. Sharad M. Kulkarni -(Chairman), Mr. Rajas R. Doshi and Mr. Anil C. Singhvi. All Members of the Audit Committee possess accounting and financial management knowledge.
The Senior Management team i.e. Chairman and Managing Director, Group Chief Operating Officer & Whole-time Directors, President & CEO - E&C, Group Chief Financial Officer, CFO (E&C) and VP (Group Taxation) the Chief Internal Auditor and the representative of the Statutory Auditors are invited for the meetings of the Audit Committee. Mr. Sangameshwar Iyer, Company Secretary is the Secretary to this Committee.
The Audit Committee met four times during the year, i.e. on April 30, 2015, July 30, 2015, October 29, 2015 and January 28, 2016. The maximum time gap between any two consecutive meetings did not exceed one hundred and twenty days. The minutes of the meetings of the Audit Committee are noted by the Board. The details of the composition of the Committee, meetings held, attendance at the meetings along with sitting fees paid, are given in
The Chairman of the Audit Committee was present at the Annual General Meeting of the Company held on July 14, 2015 to answer the members' queries.
The terms of reference of the Audit Committee are in conformity with the requirements of SEBI Listing Regulations and Section 177(4) of the Companies Act, 2013. Further, the Audit Committee has powers which are in line with the SEBI Listing Regulations. The terms of reference of the Audit Committee include the following:
• Overseeing of the Company's financial reporting process and disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible;
• 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;
• Reviewing, with the Management, the annual financial statements and auditor's report thereon before submission to the Board for approval, with particular reference to:
- 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.
- Changes, if any, in accounting policies and practices and reasons for the same.
- Major accounting entries involving estimates based on the exercise of judgment by the management.
- Significant adjustments made in the financial statements arising out of audit findings.
- Compliance with listing and other legal requirements relating to financial statements.
- Disclosure of any related party transactions.
- Modified opinion(s) in the draft audit report.
• Reviewing with the Management, quarterly financial statements before submission to the Board for approval;
• 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 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;
• Review and monitor the auditor's independence and performance, and effectiveness of audit process;
• 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;
• Reviewing with the Management, performance of the statutory and internal auditors and 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 the internal auditors of any significant findings and follow-up thereon;
• 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;
• Discussions with the statutory auditors before the audit commences, about the nature and scope of the audit as well as post-audit discussions to ascertain any area of concern;
• To look into the reasons for substantial defaults in the payment to depositors, debenture holders, members (in case of non-payment of declared dividends) and creditors;
• To review the functioning of the Whistle Blower mechanism/Vigil 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 functions as specified in the terms of reference, as amended from time to time.
Review of Information by Audit Committee:
Besides the above, the role of the Audit Committee includes mandatory review of the following information:
• Management discussion and analysis of financial condition and results of operations;
• Statement of significant related party transactions (as defined by the audit committee), submitted by Management;
• Management letters/letters of internal control weaknesses issued by the statutory auditors, if any;
• Internal audit reports relating to internal control weaknesses; and
• The appointment, removal and terms of remuneration of the Chief Internal Auditor.
• Statement of deviations:
Quarterly statements of deviation(s) including report of monitoring agency, if applicable, submitted to the stock exchange(s) in terms of Regulation 32(i) of the SEBI Listing Regulations.
Annual statement of funds utilized for purposes of the than those stated in the offer document/prospectus/ notice in terms of Regulation 32(vii) of the SEBI Listing Regulations.
b) Nomination and Remuneration Committee
As of March 31, 2016, this Committee comprised three Independent Directors viz. Mr. Anil Singhvi - (Chairman), Mr. Rajas R. Doshi, Dr. Omkar Goswami (Appointed as a member w.e.f July 30, 2015) and Mr. Ajit Gulabchand, Chairman and Managing Director of the Company as a Member of this Committee.
The Group EVP- HR is invited for the meetings. The Company Secretary is the Secretary to the Committee.
This Committee met three times during the financial year i.e. on April 30, 2015, July 30, 2015 and October 29, 2015. The Minutes of the Nomination and Remuneration Committee Meetings are noted by the Board.
The details of the composition of the Committee, meetings held, attendance at the meetings along with sitting fees paid, are given in Table 5 below;
In accordance with Section 178 of the Companies Act, 2013 and SEBI Listing Regulations, the role of the Nomination and Remuneration Committee of the Company is as under:
• Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal.
• Formulation of criteria for evaluation of Independent Directors and the Board.
• Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees.
• Devising a policy on Board diversity.
• Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of Independent Directors
c) Stakeholders Relationship Committee
This Committee comprises four Directors viz. Mr. Ram P. Gandhi - (Chairman), Mr. Rajas R. Doshi Independent Director, Mr. Ajit Gulabchand, Chairman and Managing Director and Mr. Rajgopal Nogja, Group Chief Operating Officer and Whole-time Director. The Company Secretary, Mr. Sangameshwar Iyer is the Compliance Officer of the Company.
During the financial year 2015-16, the Committee met three times on April 30, 2015, October 29, 2015 and January 28, 2016. The Minutes of the Stakeholders Relationship Committee are noted by the Board.
The Committee deals with the following matters:
• Noting transfer/transmission of shares.
• Review of dematerialised/ rematerialised shares and all other related matters.
• Monitors expeditious redressal of investor grievance matters received from Stock Exchanges, SEBI, RoC, etc.
• Monitors redressal of queries/complaints received from members relating to transfers, non-receipt of Annual Report, dividend etc.
• All other matters related to shares/debentures.
In accordance with Section 178(5) of the Companies Act, 2013 the Stakeholders Relationship Committee shall in addition to the above role, also consider and resolve the grievances of debenture holders.
(d) ESOP Compensation Committee
The ESOP Compensation Committee comprises three Directors, viz. Mr. Sharad M. Kulkarni (Chairman), Mr. Ram P Gandhi and *Mr. Rajgopal Nogja, Group COO & Whole-time Director.
• Pursuant to appointment as Group CEO, Mr. Rajgopal Nogja has stepped down as Group COO and Whole-time Director and consequently ceased to be a member of the aforesaid Committee w.e.f. May 2, 2016.
No meetings of the ESOP Compensation Committee were held during the financial year 2015-16.
(e) Corporate Social Responsibility (CSR) Committee:
In accordance with Section 135 of the Companies Act, 2013, the Board of Directors of the Company at its meeting held on May 2, 2014, has constituted the CSR Committee which comprises three Directors viz. Mr. Ajit Gulabchand (Chairman), Mr. Rajas R. Doshi and Mr. Ram P. Gandhi and defined the role of the Committee, which is as under:
• 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.
• Recommend the amount of expenditure to be incurred on the activities referred in the CSR policy.
• Monitor the CSR Policy of the Company and its implementation from time to time.
• Such other functions as the Board may deem fit from time to time.
No meetings of the CSR Committee were held during the financial year 2015-16.
The Minutes of the CSR Committee are noted by the Board.
(f) Risk Management Committee:
Risk Management Committee has been constituted which is in conformity with the provisions of Companies Act, 2013 and Regulation 21 of the SEBI Listing Regulations and it comprises 5 Members i.e. Mr. Ajit Gulabchand, Chairman and Managing Director, Mr. Rajgopal Nogja, Group CEO, Mr. Rajas R. Doshi, Director, Mr. Arun V. Karambelkar, President and CEO - E&C and Mr. Praveen Sood, Group CFO & EVP - HCC Group Office.
This Committee has been delegated with the authority by the Board to review and monitor the implementation of the risk management policy of the Company.
No meetings of this Committee was held during the financial year 2015-16.
Management Discussion and Analysis Report
Management Discussion and Analysis is given in a separate section forming part of the Directors' Report in this Annual Report.
(a) Related Party Transactions
Details of materially significant related party transactions i.e. transactions of the Company of material nature with its promoters, the Directors or the management, their subsidiaries or relatives, etc. are presented in the Notes to the Financial Statements. All details on the financial and commercial transactions, where Directors may have a potential interest, are provided to the Board. The interested Directors neither participate in the discussion, nor vote on such matters. During the financial year 2015-16, there were no material related party transactions entered by the Company that may have a potential conflict with the interests of the Company.
The Company has formulated a policy on Related Party Transactions and the said Policy is available on the website of the Company at (<http://www.hccindia.com/> pdf/HCC_Policy_for_Related_Party_Transactions.pdf )
(b) Accounting treatment in preparation of financial statements
The Company has followed the Accounting standards notified by The Companies (Accounting Standards) Rules, 2006, as amended from time to time, read with Companies (Accounts) Rules, 2014 in preparation of its financial statements.
(c) Risk Management
The Company has established a well-documented and robust risk management framework. As mentioned earlier, the Company has also constituted a Risk Management Committee, which has been delegated with the authority by the Board to review and monitor the implementation of the Risk Management Policy of the Company. Under this framework, risks are identified across all business processes of the Company on a continuous basis. Once identified, these risks are systematically categorized as strategic risks, business risks or reporting risks.
To address these risks in a comprehensive manner, each risk is mapped to the concerned department for further action. Based on this framework, the Company has set in place various procedures for Risk Management.
(d) Subsidiary Companies
In accordance with Regulation 24 of the SEBI Listing Regulations, HCC Real Estate Limited (HREL), Lavasa Corporation Limited (Lavasa), HCC Concessions Limited, Baharampore-Farakka Highways Limited, Farakka-Raiganj Highways Limited and Warasgaon Assets Maintenance Ltd are six material non- listed Indian subsidiaries of the Company whose individual income or net worth (i.e. paid-up capital and free reserves) exceed 20% of the consolidated turnover or net worth respectively, of the Company and its subsidiaries in the immediately preceding financial year.
As on March 31, 2016, Mr. Anil C. Singhvi Independent Director of the Company is on the Board of Lavasa and HCC Concessions Ltd. Mr. Rajas R Doshi, Independent Director of the Company is also on the Board of HCC Concessions Limited and HCC Real Estate Ltd. The Company is in process of appointing Independent Directors on the Board of Baharampore-Farakka Highways Ltd, Farakka-Raiganj Highways Limited and Warasgaon Assets Maintenance Ltd.
The Subsidiaries of the Company function independently, with an adequately empowered Board of Directors and necessary management resources.
For effective governance, the Company overviews the performance of its subsidiaries, inter alia, in the following manner:
• The financial statements, in particular, the investments made by the unlisted subsidiary companies, are reviewed by the Audit Committee and the Board of Directors of the Company.
• The Minutes of the Board Meetings of the subsidiary companies are placed before the Board of Directors of the Company.
Details of all significant transactions and arrangements entered into by the unlisted subsidiary companies are periodically placed before the Board of Directors of the Company.
As required under erstwhile Clause 49 of the Listing Agreement, the Company has also formulated a Policy for determining "Material Subsidiaries" which is available on the website of the Company at (<http://> www.hccindia.com/pdf/HCC_Policy_for_determining_ Material_Subsidiaries.pdf)
(e) Code for Prevention of Insider Trading Practices
In January 2015, SEBI notified the SEBI (Prohibition of Insider Trading) Regulations, 2015 which came into effect from May 15, 2015. Pursuant thereto, the Company has formulated and adopted a revised Code for Prevention of Insider Trading. HCC's Code of Conduct for Prevention of Insider Trading is revised to bring it in line with these Regulations w.e.f July 30, 2015.
The revised code viz "Code of Conduct for Prevention of Insider Trading" and the "Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information" allows the formulation of trading plan subject to certain conditions as mentioned in the said Regulations and requires pre-clearance for dealing in the Company's shares. It also prohibits the purchase or sale of Company's securities by the Directors, designated person and connected persons, while in possession of unpublished price sensitive information in relation to the Company and during the period when the trading window is closed.
Mr. Sangameshwar Iyer, Company Secretary, has been designated as the Compliance Officer for this Code.
Vigil Mechanism / Whistle Blower Policy
The Company promotes ethical behaviour in all its business activities and has put in place a mechanism for reporting illegal or unethical behaviour. The Company has a Vigil Mechanism Policy under which the employees are free to report violations of applicable laws and regulations.
The same is posted on the website of the Company www.hccindia.com
(f) CEO/CFO Certification
As required under Regulation 17 (8) of the SEBI Listing Regulations, the Chairman & Managing Director and the Group Chief Financial Officer of the Company have submitted a Compliance Certificate for the financial year ended March 31, 2016, which is annexed to this Report.
(g) Pledge of Equity Shares
During the year 2012-13, Hincon Holdings Ltd., Promoter Company of HCC, had pledged its holding of 20,07,03,600 equity shares of Rs. 1 each of HCC in favour of 3i Infotech Trusteeship Services Ltd., the Security Trustees for the CDR Lenders in accordance with the requirement of CDR package approved for the Company by the Corporate Debt Restructuring (CDR) Cell under the regulatory framework of RBI.
No other pledge has been created over the equity shares held by the other Promoters and/or Promoter Group Shareholders as on March 31, 2016.
The aggregate shareholding of the Promoters and Members of the Promoter Group as on March 31, 2016, was 281,015,080 Equity Shares of Rs. 1 each representing 36.07% of the paid-up Equity Share Capital of the Company.
(h) Disclosure of Pending Cases/Instances of Non-Compliance
There were no non-compliances by the Company and no instances of penalties and strictures imposed on the Company by the Stock Exchanges or SEBI or any other statutory authority on any matter related to the capital market during the last three years.
(i) Disclosure of Commodity price risks and commodity hedging activities.
The Company is not dealing in commodities and hence disclosure relating to commodity price risks and commodity hedging activities is not required.
IV) Shareholder Information
(a) Disclosures regarding the Board of Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of Independence as prescribed under the Companies Act, 2013 and Regulation 16 (1) (b) of the SEBI Listing Regulations.
Detailed profile of the Director who is seeking appointment at the ensuing Annual General Meeting of the Company is given under the Explanatory Statement to the Notice which is forming part of the Annual Report of the Company.
(b) Means of Communication
In accordance with Regulation 46 of the SEBI Listing Regulations, the Company has maintained a functional website at www.hccindia.com containing information about the Company viz., details of its business, financial information, shareholding pattern, compliance with corporate governance, details of the policies approved by the Company, contact information of the designated officials of the Company who are responsible for assisting and handling investor grievances etc. The contents of the said website are updated from time to time.
The quarterly and annual results are published in Business Standard (English) and Sakal (Marathi), which are national and local dailies respectively and also displayed on the Company's website for the benefit of the public at large.
Presentations made to institutional investors or to analysts, are also immediately uploaded on the website of the Company.
Further, the Company disseminates to the Stock Exchanges (i.e. BSE and NSE), wherein its equity shares are listed, all mandatory information and price sensitive/ such other information, which in its opinion, are material and/or have a bearing on its performance/ operations and issues press releases, wherever necessary, for the information of the public at large.
For the benefit of the members, a separate email id has been created for member correspondence viz., firstname.lastname@example.org
(d) General Shareholder Information
• Forthcoming Annual General Meeting
Date : July 14, 2016
Day : Thursday
Time : 11.00 a.m.
Venue : Walchand Hirachand Hall, Indian Merchants' Chamber, Indian Merchants' Chamber Marg, Churchgate, Mumbai - 400 020.
• Last date for Receipt of Proxies
Tuesday, July 12, 2016.
• Financial Year
The financial year of the Company covers the financial period from April 1 to March 31.
During the financial year under review, the Board Meetings for approval of quarterly and annual financial results were held on the following dates:
1st Quarter Results : July 30, 2015
2nd Quarter Results : October 29, 2015
3rd Quarter Results : January 28, 2016
4th Quarter & Annual Results : April 28, 2016
The tentative dates of the Board Meetings for consideration of financial results for the year ending March 31, 2017 are as follows:
1st Quarter Results : July 28, 2016
2nd Quarter Results : October 27, 2016
3rd Quarter Results : February 2, 2017
4th Quarter & Annual Results : April 27, 2017
• Dates of Book Closure : July 08, 2016 to July 14, 2016 (both days inclusive)
Presently, the Equity Shares of the Company are listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).
The Company has paid the annual listing fees for the financial year 2016-17 to BSE Limited and National Stock Exchange of India Limited. The Company has paid annual custodial fees for the financial year 20162017 to National Securities Depository Limited(NSDL) and Central Depository Services (India) Limited (CDSL), on the basis of number of beneficial accounts maintained by them as on March 31, 2016.
• Stock Codes:
ISIN (Equity Shares) in NSDL & CDSL : INE549A01026
BSE Code : 500185
NSE Code : HCC
Corporate Identification Number:
Corporate Identity Number (CIN) of the Company is L45200MH1926PLC001228.
• Dematerialization of Shares and Liquidity
As on March 31, 2016, 77,12,23,608 equity shares representing 98.98% of the total equity share capital of the Company, were held in dematerialised form with National Securities Depository Limited and Central Depository Services (India) Limited.
The Promoters hold their entire equity shareholding in the Company in dematerialized form.
The Company's equity shares are regularly traded on the BSE and NSE.
Employees Stock Options (ESOPs)
a) As on March 31, 2016, 16,54,630 stock options are outstanding, in aggregate, for exercise as per the exercise schedule and are exercisable at a price of Rs. 52.03 per stock option.
b) Each option, when exercised, as per the exercise schedule, would entitle the holder to subscribe for one equity share of the Company of face value Rs. 1 each.
c) During the year under review, no options were vested in the employees of the Company.
d) No options were exercised by the optionees during the year.
• Details regarding Listing and redemption of Debt Securities
Pursuant to the directions of Securities and Exchange Board of India (SEBI), all the debt securities issued by the Company on private placement basis have been listed in the F Group - Debt Instruments of the BSE Limited (BSE).
During the year under review, the Company has not issued any fresh debentures and debentures worth Rs. 22.80 crore have been redeemed.
The existing Non Convertible Debentures (NCDs) of Rs. 120 crore held by Axis Bank and Rs. 100 crore held by LIC stand restructured under approved CDR package as per CDR Letter of Approval dated June 29, 2012. Accordingly, there was 2 year moratorium and 8 year for repayment of the aforementioned principal amount to the Lenders. As of March 31, 2016, an amount of Rs. 100.80 crore was outstanding as regards NCDs issued and allotted to Axis Bank and an amount of Rs. 86.50 crore was outstanding for NCDs held by LIC (the outstanding amount includes current and non-current portion).
• Share Transfer system
The Registrars and Share Transfer Agent have put in place an appropriate Share Transfer system to ensure timely share transfers. Share transfers are registered and returned in the normal course within an average period of 30 days from the date of receipt, if the documents are clear in all respects. Requests for dematerialisation of shares are processed and confirmation is given to the respective depositories ie. NSDL and CDSL within 21 days.
• Address for members' correspondence:
Members are requested to correspond with the Registrars and Share Transfer Agents at the below given address on all matters relating to transfer/ dematerialisation of shares, payment of dividend and any other query relating to Equity Shares or Debentures of the Company.
• Registrars and Share Transfer Agents:
Contact Officer: Ms. Mary George
TSR Darashaw Limited Unit: Hindustan Construction Co. Ltd. 6-10, Haji Moosa Patrawala Ind. House, 20, Dr. E. Moses Road, Near Famous Studio, Mahalaxmi, Mumbai - 400 011 Telephone: +91-22-66568484 Fax: +91-22-66568494 Email: email@example.com <mailto:csg-
The Company has maintained an exclusive email id: firstname.lastname@example.org which is designated for investor correspondence for the purpose of registering any investor related complaints and the same has been displayed on the Company's website: www. hccindia.com
Members are required to note that, in respect of shares held in dematerialized form, they will have to correspond with their respective Depository Participants (DPs) for related matters.
Members may contact the Compliance Officer and/or the Investor Relations Officer at the following address:
» Compliance Officer:
Mr. Sangameshwar Iyer Company Secretary Hindustan Construction Co. Ltd. Hincon House, 11th Floor, 247Park, Lal Bahadur Shastri Marg, Vikhroli (West), Mumbai-400 083, India. Tel: +91-22-2575 1000 Fax: +91-22-2577 5950 Website: www.hccindia.com http://www.hccindia.com> Email: email@example.com
» Investor Relations Officer:
Mr. Santosh Kadam Hindustan Construction Co. Ltd. Hincon House,11th Floor, 247Park, Lal Bahadur Shastri Marg, Vikhroli (West), Mumbai-400 083, India Tel: +91-22-2575 1000 Fax: +91-22-2577 5950 Website: www.hccindia.com Email: firstname.lastname@example.org
a) (i) Details of non-compliance, if any
There is no Non-Compliance of any requirement of Corporate Governance Report of sub para (2) to (10) of the Part C of Schedule V of the SEBI Listing Regulations.
(ii) Compliance with mandatory requirements
The Company has complied with all the mandatory items of the erstwhile Clause 49 of the Listing Agreement as applicable till November 30, 2015 and the SEBI Listing Regulations from December 01, 2015 onwards.
(iii) Compliance with the Discretionary Requirements under SEBI Listing Regulations
Adoption of discretionary requirements of SEBI Listing Regulations is being reviewed by the Company from time to time.
(iv) Auditors' Certificate on Corporate Governance
The Company has obtained a Certificate from its Statutory Auditors regarding compliance of the conditions of Corporate governance, as stipulated in Regulation 34(3) and PART E of Schedule II of SEBI Listing Regulations, which together with this Report on Corporate Governance is annexed to the Directors' Report and shall be sent to all the members of the Company and the Stock Exchanges along with the Annual Report of the Company.
(b) Compliance with Regulation 39(4) read with Schedule V and VI of SEBI Listing Regulations - Uniform procedure for dealing with unclaimed shares:
In accordance with the requirement of erstwhile Clause 5A (II) of the Listing Agreement, in respect of the Bonus Equity Share certificate(s) dispatched by the Company in August 2010, which were "returned undelivered" TSR Darashaw Limited, Registrar and Share Transfer Agent of the Company have sent two reminders to all such member(s) at their addresses as per Register of Members.
As and when response from members have been/ will be received, the respective Share Certificate(s) in respect of the unclaimed shares are/will be re-dispatched to those members.
Upon completing the process of dispatching the mandatory third reminder letter, the Company shall comply with the other formalities prescribed under erstwhile Clause 5A for dealing with the unclaimed shares, if any.
(c) Disclosure under Regulation 30 and 46 of SEBI Listing Regulations regarding certain agreements with the media companies:
Pursuant to the requirement of Regulation 30 of the SEBI Listing Regulations, the Company would like to inform that no agreement(s) have been entered with media companies and/or their associates which has resulted/ will result in any kind of shareholding
in the Company and consequently any other related disclosures viz., details of nominee(s) of the media companies on the Board of the Company, any management control or potential conflict of interest arising out of such agreements, etc. are not applicable. The Company has not entered into any other back to back treaties/ contracts/agreements/ MoUs or similar instruments with media companies and/or their associates.
VI) Investor safeguards and other information:
• Dematerialisation of Shares
Members are requested to convert their physical holdings to demat/electronic form through any of the registered Depository Participants (DPs) to avoid the hassles involved in dealing in physical shares such as possibility of loss, mutilation, etc. and also to ensure safe and speedy transaction in respect of the shares held.
• RevalidationofDividend Warrants
In respect of members who have either not opted for NECS/ECS mandate or do not have such a facility with their bankers and who have not encashed earlier dividends paid by the Company, are requested to write to the Company's Share Transfer Agents for revalidation of expired dividend warrants and failing their encashment for a period of seven years, they stand to lose the right to claim such dividend owing to transfer of unclaimed dividends beyond seven years to Investor Education and Protection Fund.
• Transfer of Unclaimed Dividend to Investor Education & Protection Fund (IEPF)
Under the Companies Act, 2013, dividends which remain unclaimed for a period of seven years are required to be transferred to the Investor Education & Protection Fund (IEPF) administered by the Central Government.
Dates of declaration of dividends since financial year 2008-09 and the corresponding dates when unclaimed dividends are due to be transferred to the IEPF are given in the table below.
Separate letter has already been sent on December 28, 2015 to the Members who are yet to encash dividend for the financial year 2008-09 indicating that the unclaimed amount will be transferred to IEPF, if not claimed by the members before the due date of transfer to the said Fund. Members are once again requested to utilize this opportunity and get in touch with the Company's Registrar and Share Transfer Agents TSR Darashaw Limited at their communication address for encashing the unclaimed dividends standing to the credit of their account.
Members are further requested to note that after completion of seven years, no claims shall lie against the said Fund or Company for the amounts of dividend so transferred, nor shall any payment be made in respect of such claims.
• Update Address/ E-Mail Address/Bank Details
To receive all communications/corporate actions promptly, members holding shares in dematerialised form are requested to please update their address/email address/bank details with the respective DPs and in case of physical shares, the updated details have to be intimated to the Registrar & Share Transfer Agents.
• Electronic Service of Documents to Members at the Registered Email Address
As a responsible corporate citizen, your Company has been continuously supporting the "Green Initiatives" taken by the Ministry of Corporate Affairs, Government of India (MCA) and Securities and Exchange Board of India (SEBI).
Accordingly, in respect of Members / Members who have registered their email addresses, the Company has been dispatching all documents vide electronic form since May 2011.
In accordance with Rule 18 of the Companies (Management and Administration) Rules, 2014 notified under the Companies Act, 2013, the Companies may give Notice of the General Meetings through electronic mode. Further, the said Rule provides that advance opportunity should be given at least once in a financial year to the Members / Members for registering their email address and changes therein, as may be applicable. Further Rule 11 of the Companies (Accounts) Rules, 2014 notified under the Companies Act, 2013 provides that in case of listed companies, financial statements may be sent by electronic mode to such members / members whose shareholding is in dematerialized form and whose email Ids are registered with the Depository for communication purposes. As regards Members / Members whose shareholding is held in physical form, the financial statements may be sent in electronic mode to those members who have positively consented in writing for receiving by electronic mode.
In view of the above, the Company shall send all documents to Members like General Meeting Notices (including AGM), Annual Reports comprising Audited Financial Statements, Directors' Report, Auditors' Report and any other future communication (hereinafter referred as "documents") in electronic form, in lieu of physical form, to all those members, whose email address is registered with Depository Participant (DP)/Registrars & Share Transfer Agents (RTA) (hereinafter "registered email address') and made available to us, which has been deemed to be the member's registered email address for serving the aforesaid documents. To enable the servicing of documents electronically to the registered email address, we request the members to keep their email addresses validated/ updated from time to time. We wish to reiterate that Members holding shares in electronic form are requested to please inform any changes in their registered e-mail address to their DP from time to time and Members holding shares in physical form have to write to our RTA, TSR Darashaw Limited at their specified address, so as to update their registered email address from time to time.
It may be noted that the Annual Report of the Company will also be available on the Company's website www.hccindia.com for ready reference. Members are also requested to take note that they will be entitled to be furnished, free of cost, the aforesaid documents, upon receipt of requisition from the members, any time, as a member of the Company.
In compliance with the provisions of Section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014, the Company is pleased to provide members the facility to exercise their right to vote at the 90th Annual General Meeting (AGM) by electronic means and the business may be transacted through e-Voting Services provided by National Securities Depository Limited (NSDL).
• Consolidate multiple folios (in respect of physical shareholding)
Members are requested to consolidate their shareholdings under multiple folios to eliminate the receipt of multiple communications and this would ensure that future correspondence/corporate benefits could then be sent to the consolidated folio.
• Register Nomination(s)
Members holding shares in physical form, are requested to register the name of their nominee(s), who shall succeed the member as the beneficiary of their shares and in order to avail this nomination facility, they may obtain/submit the prescribed form from the Registrars & Share Transfer Agents. Members holding shares in dematerialised form are requested to register their nominations directly with their respective DPs.
• Dealings of Securities with Registered Intermediaries
In respect of dealings in securities, members must ensure that they deal only with SEBI registered intermediaries and must obtain a valid contract note/ confirmation memo from the broker/sub-broker within 24 hours of execution of the trade(s) and it should be ensured that the contract note/confirmation memo contains details about order no., trade no., trade time, quantity, price and brokerage.