REPORT ON CORPORATE GOVERNANCE FOR THE YEAR 2014-15
The Directors present the Company's Report on Corporate Governance for the year ended March 31, 2015.
Company's Philosophy on Code of Governance
The Company is committed to enhancement of shareholder value and strongly believes that good corporate governance is one of the key tools for achieving this goal.
Board of Directors
The Board presently comprises 8 Directors including 2 Executive and 6 Non-Executive Directors, of which 4 are Independent Directors. The Directors are professionals, have expertise in their respective functional areas and bring a wide range of skills and experience to the Board. The Board is headed by Executive Chairman.
Mr. Abhishek Dalmia, Ms.Deepali Dalmia and Mr.Chaitanya Dalmia, Directors are related to each other. None of the other directors are related.
As per the disclosures received from the Directors, none of the Directors serve as member of more than 10 committees nor are they the Chairman / Chairperson of more than 5 committees, as per the requirements of the listing agreement.
As required, a brief profile of the Director (s) seeking appointment / re-appointment is furnished in the Notice of the 38th Annual General Meeting and forms part of the Corporate Governance Report.
The Company has appointed Independent Directors fulfilling the provisions of clause 49 of the Listing agreement and the relevant provisions of the Companies Act 2013.
In accordance with the Companies Act 2013, the maximum tenure of the Independent Directors has been fixed at five consecutive years from the date of their appointment and shall be eligible for appointment for another term up to five consecutive years on passing of a special resolution by the company. Provided that a person who has already served as an independent director for five years or more as on 1st October 2014 shall be eligible for appointment on completion of his present term for one more term upto five years only.
Familiarization Program for Independent Directors:
The new Independent Directors appointed by the Board are given induction and orientation with respect to the Company's strategy, business model, operations, service and product offerings, markets, organization structure, finance, human resources, technology, quality, facilities and such other areas as may arise from time to time.
The new Board members are also provided with copy of latest Annual Report, the Revathi Code of Conduct for directors, employees, Code of Conduct for Prevention of Insider Trading etc. and also requested to visit the Company's website link http:/ /www.revathi.in to enable them to familiarize with the Company's procedures and practices.
The appointment letters of Independent Directors have been posted on the Company's website at <http://www.revathi.in/wp-content/> themes/rel/pdf/Indipendent-directors-terms-conditions.pdf.
Separate Meeting of the Independent Directors:
The Independent Directors held a Meeting on 13th February 2015, without the attendance of Non-Independent Directors and members of Management. All the Independent Directors were present at the meeting. The following matters discussed in detail:
I) Review of the performance of non-independent directors and the Board as a whole;
II) Review of the performance of the Chairman of the Company, taking into account the views of Non-Executive Directors;
III) Assessment of the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
Committees of the Board
The Board at present have 3 Committees:
1) Audit Committee 2) Nomination and Remuneration Committee (Erstwhile Remuneration Committee) and 3) Stakeholders Relationship Committee (Erstwhile Shareholders Committee)
The Board constitutes the committees and defines their terms of reference. The members of the committees are co-opted by the Board.
All the members of the Audit Committee are independent and having knowledge of finance, accounts and engineering industry. The quorum for audit committee meeting shall be either two members or one third of the members of the audit committee whichever is greater.
The terms of reference of the Audit Committee is in line with the regulatory requirements of section 177 of Companies Act, 2013 and amended Clause 49 of the Listing Agreement. The terms of reference for the year under review, inter alia are as follows-
a) Oversee of the company's financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.
b) Examine the financial statements and the auditors' report thereon.
c) Recommendation for the appointment, remuneration and terms of appointment of auditors of the company.
d) Review and monitor the auditor's independence, performance and effectiveness of audit process.
e) Approval of Related Party Transactions and any subsequent modifications thereof.
f) Scrutinize the inter-corporate loans and investments.
g) Perform valuation of the undertakings or assets of the company, wherever it is necessary.
h) Evaluating the internal financial controls and risk management systems.
i) Monitoring the end use of funds raised through public offers and related matters.
j) Call up for the comments of the auditors about internal control systems, the scope of audit, including the observations of the auditors and review of financial statement before their submission to the Board.
k) Reviewing, with the management the quarterly financial statements before submission to the Board for approval.
l) Perform such other functions as may be specified under Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement as amended from time to time.
The Audit Committee carried out review of the information as specified in Clause 49(III)(E) of the Listing Agreement as amended.During the year under review, the Committee met five times on 30th May 2014, 08th August 2014, 12th September 2014, 11th November 2014 and 14th February 2015.
The Company Secretary acts as the Secretary of the Committee. The minutes of the Audit Committee meetings were circulated to the Board, where it was discussed and taken note of. The Audit Committee considered and reviewed the accounts for the year 2014-15, before being approved by the Board.
Nomination and Remuneration committee
During the year under review, the committee met two times on 8th August 2014 and 25th November 2014.
The Board of Directors of the Company at their meeting held on 24th June 2014 have renamed its Remuneration Committee as "Nomination and Remuneration Committee". The terms of reference of Nomination and Remuneration Committee, as revised, in brief consists of the following:
1. Identification of the persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down.
2. Recommend to the Board the appointment and removal of Directors or Senior management personnel.
3. Carry out evaluation of the performance of every Director.
4. Formulate the criteria for determining qualifications, positive attributes and independence of a Director.
5. Recommend to the Board a Policy relating to the remuneration for the Directors, Key Managerial Personnel (KMP) and Senior Management Personnel i.e. all members of management one level below the Executive Directors which shall include functional heads.
6. Such other terms, as per the provisions of Section 178 of the Companies Act, 2013 and amended Clause 49 of the Listing Agreement.
The Nomination and Remuneration Policy in compliance with section 178 of the Companies Act, 2013 and amended Clause 49 of the Listing Agreement as recommended by the Nomination & Remuneration Committee has been approved by the Board of Directors. The said Policy is attached as Annexure to the Board's Report and is also available on the Company's website http:/ /www.revathi.in/wp-content/themes/rel/pdf/Nomination-Remuneration-Policy.pdf
This Committee would basically look into and determine the Company's policy on remuneration.
Stakeholders Relationship Committee
During the year under review, the committee met four times on 30th May 2014, 8th August 2014, 11th November 2014 and
12th February 2015.
The Committee deals in these matters-
a) Consider and resolve the grievances of the Shareholders of the Company.
b) Review and rectify the applications received for transfer/transmission of any class of shares issued by the company.
c) Review and approve the applications received for sub-division, consolidation and issue of duplicate share certificates in accordance with the Companies (Share Capital and Debentures) Rules, 2014.
d) Consider and approve the applications received for conversion of dematerialised shares into physical share certificates.
e) Review the dematerialisation of share certificates.
The Share Transfers/transmissions approved by the committee are placed at the Board Meetings from time to time.
The total number of complaints received and replied to the satisfaction of shareholders during the year ended 31st March 2015 was Nil and there was no outstanding complaints as on that date.
The Board of Directors of the Company at their meeting held on 24th June 2014, have renamed and reconstituted its Shareholders Committee as "Stakeholders Relationship Committee". The Company Secretary acts as the Compliance Officer of the committee.
Management Discussion and Analysis Report
Management Discussion and Analysis appeared in directors report, forms part of this Annual Report.
(i) Disclosures on materially significant related party transactions that may have potential conflict with the interest of the company at large.
Refer the Note No. 28 forming part of accounts for the details of related party transactions. There are no materially significant Related Party Transactions, which have potential conflict with the interest of the Company at large.
(ii) Details of non-compliance by the company, penalties, and strictures imposed on the company by Stock Exchanges or SEBI or any Statutory Authorities, on any matter relating to capital markets, during the last three years.
The Company has complied with all the requirements of the Listing Agreement of the Stock Exchanges as well as regulations and guidelines of SEBI.
No Penalties have been levied or strictures have been passed by SEBI, Stock Exchanges or any other Statutory Authority on matters relating to capital markets, in the last three years.
(iii) Whistle Blower policy and affirmation that no personnel has been denied access to the audit committee
The Company established a Vigil mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of Company's code of conduct or ethics policy. This mechanism shall also provide for adequate safeguards against victimization of director(s)/employee(s) who avail of the mechanism and also provide for direct access to the chairperson of the Audit Committee. Moreover the details of such mechanism has been disclosed by the company on its website and in the Board's Report.
(iv) Details of compliance with mandatory requirements and adoption of the non-mandatory requirements of clause 49
The Company has complied with all mandatory requirements of amended Clause 49 of the Listing agreement.
1. The Board
There is no Non-Executive Chairman in the Company. Hence the question of maintaining non-executive chairman's office does not arise.
2. Shareholder Rights
As the quarterly and half yearly financial performance are published in the newspapers and are also posted on the Company's website, the same are not being sent to the shareholders.
3. Audit Qualifications
Company is in process to move towards a regime of unqualified financial statements.
4. Seperate posts of Chairman and CEO
The Company has appointed Executive Chairman and Whole-time Director separately.
5. Reporting of Internal Auditor
The Internal Audit reports are considered by Audit Committee.
Disclosure of Accounting Treatment.
The financial statements have been prepared under the historical cost convention except certain fixed assets which have been revalued, in accordance with the generally accepted accounting principles in India and the provisions of Companies Act, 2013 and Accounting Standards specified under Section 133 of Companies Act 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
Code of Conduct
The Board of Directors has laid down a code of conduct for all Board Members and Senior Management of the Company. The same has been posted on the website of the Company. All Board Members and Senior Management personnel have affirmed their compliance with the code of conduct for the year under review. It incorporates the duties of Independent Directors as laid down in the Companies Act, 2013.
The Company's Whole time Director's declaration to this effect forms a part of this report.
Prevention of Insider Trading
The Company has framed a Code of Conduct for prevention of Insider Trading based on SEBI (Prohibition of Insider Trading) Regulations, 1992 and the Company Secretary is the Compliance Officer. This code is applicable to all directors / officers / designated employees. The Code ensures the prevention of dealing in shares by persons having access to unpublished price sensitive information.
WTD/CFO has certified to the Board that:
(a) he has reviewed the financial statements and the cash flow statement for the year 2014-15 and that to the best of his knowledge and belief :
(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;
(ii) these statements together present a true and fair view of the Company's affairs and are in compliance with the existing accounting standards, applicable laws and regulations.
(b) there are, to the best of his knowledge and belief, no transactions entered into by the Company during the year 2014-15 which are fraudulent, illegal or violative of the Company's code of conduct.
(c) he accepts responsibility for establishing and maintaining internal controls for financial reporting and that he has evaluated the effectiveness of the internal control systems of the Company pertaining to financial reporting and found them satisfactory.
(d) there are no significant changes in internal control over financial reporting during the year 2014-15
(e) there are no significant changes in accounting policies during the year 2014-15 and
(f) there are no instances of significant fraud of the management or an employee having a significant role in the company's internal control system over financial reporting.
The WTD/CFO has given a Declaration to the effect that all Board Members and Senior Management personnel have confirmed compliance with the Code of Conduct during the Financial Year ended on 31st March, 2015.
Means of Communication
The quarterly results and annual results are displayed on the website of the Company www.revathi.in and are widely published in newspapers viz. Business Standard and Malai Malar (Vernacular paper).The results are also promptly forwarded to the Stock Exchanges in which the shares are listed.
Official news releases are made whenever it is considered necessary.
General shareholder information
38th Annual General Meeting
Date and Time : 21st December 2015 at 2.30 p.m.
Venue : At the registered office of the company, Pollachi Road, Malumachampatti, Coimbatore 641 050
Financial Year: 1st April 2015 to 31st March 2016
Period of reporting Proposed Board meeting dates
Qtr ending 30th June 2015 Second week of July 2015
Qtr ending 30th September 2015 First week of October 2015
Qtr ending 31st December 2015 First week of January 2015
Year ending 31st March 2016 Last week of April 2016
Date of Book closure
From 15th December 2015 to 21st December 2015 (Both days inclusive)
Dividend payment date
Considering results of the year the Directors have not recommended any Dividend for the year ended 31st March, 2015.
Listing of shares on Stock Exchanges
Phiroze Jeejeebhoy Towers Dalal Street, Fort Mumbai - 400 001
National Stock Exchange of India Ltd
Exchange Plaza, 5th Floor, Plot No. C/1 'G' Block, Bandra-Kurla Complex Bandra (East), Mumbai - 400 051
Annual listing fees for the year 2015-16 were paid to BSE Limited & National Stock Exchange of India Limited
Type of Security : Equity
Stock Code :
BSE Limited - 505368
National Stock Exchange of India Limited - REVATHI
ISIN number allotted for equity shares(Fully Paid Re. 10/- each) : INE617A01013
Registrar and Share Transfer Agents
(for both physical and demat segments)
Office Address :
S.K.D.C Consultants Ltd.,
Kanapathy Towers, 3rd Floor, 1391/A-1, Sathy Road, Ganapathy, Coimbatore - 641 006
Tel : 0422-6549995, 2539836 Fax : 0422-2539837
E-mail : firstname.lastname@example.org
Compliance Officer's Details
Revathi Equipment Ltd
Pollachi Road, Malumachampatti P O Coimbatore - 641050
e-mail : email@example.com
Phone: 0422-6655100, 6655111 Fax : 0422-2610427
Share Transfer System
The company's shares, being in compulsory dematerialised (demat) list, are transferable through the depository system. Shares in physical form are processed by the Registrar and Share Transfer Agents, S.K.D.C. Consultants Limited and approved by the Stakeholders Relationship Committee of the Company. The Share transfers are processed within a period of 21 days from the date of receipt of the transfer documents by S.K.D.C. Consultants Limited, if the documents are complete in all respects. All requests for dematerialization of shares are processed and confirmed to the depositories, NSDL and CDSL, within 15 days. The Stakeholders Relationship Committee generally meets as and when required to effect the shares received for transfer in physical form.
The total number of shares transferred (physically) during the year 2014-15 was 1488 (previous year 1838)
Dematerialisation of Shares and liquidity
The Company has arrangement with National Securities Depository Ltd. (NSDL) as well as Central Depository Services (India) Limited (CDSL) for demat facility.
During the financial year 2014-15, 1790 (0.58%) shares were dematted. As on 31st March, 2015, total shares in demat form is 29,90,398 shares and 76,545 shares in physical form. This represents 97.5% shares of the company are in demat form and 2.5% shares are in physical form. The shares are compulsorily tradable in demat form with effect from 26.6.2000 for all investors.
Outstanding GDRs/ADRs/Warrants or any Convertible Instruments and their likely impact on equity.
There are no outstanding warrants or any convertible instruments. The Company has not issued GDR/ADR.
Drilling Equipment Division
Pollachi Road Malumachampatti Post Coimbatore - 641 050.
Construction Equipment Division
D-12, SIPCOT Industrial Complex Gummidipoondi - 601 201.
Address for Correspondence
Revathi Equipment Ltd
Pollachi Road, Malumachampatti P Coimbatore - 641 050
e-mail : firstname.lastname@example.org
Phone: 0422-6655100, 6655111 Fax: 0422-2610427