Dear Members,
Your directors are pleased to present the Company's 51st annual report and
the Company's audited financial statements (standalone and consolidated) for the financial
year ended March 31, 2023.
FINANCIAL SUMMARY
The financial performance of the Company (standalone and consolidated) for the
financial year ended March 31,
2023 is summarized below:
(Rs. in Lakhs)
|
|
For the year ended |
|
Particulars |
Standalone |
Consolidated |
|
31.03.2023 |
31.03.2022 |
31.03.2023 |
31.03.2022 |
Total income for the year |
1,65,875 |
1,75,636 |
3,92,800 |
3,64,542 |
Profit before finance charges, depreciation, tax and exceptional items |
43,771 |
64,015 |
1,96,759 |
1,61,662 |
Less: Finance charges |
1,265 |
1,229 |
39,718 |
33,808 |
Profit before depreciation and taxation |
42,506 |
62,786 |
1,57,041 |
1,27,854 |
Less: Depreciation |
3,186 |
3,275 |
30,621 |
29,532 |
Profit before exceptional items but after depreciation |
39,320 |
59,511 |
1,26,420 |
98,322 |
Exceptional items, net |
- |
(3,120) |
- |
(9,427) |
Profit before tax |
39,320 |
56,391 |
1,26,420 |
88,895 |
Less: Current tax |
9,159 |
19,172 |
13,047 |
27,615 |
- Deferred tax expense |
(1,920) |
(227) |
(8,644) |
4,696 |
Profit after tax from continued operations |
32,082 |
37,446 |
1,22,017 |
56,584 |
Profit after tax from discontinued operations |
152 |
745 |
152 |
745 |
Profit after tax for the year |
32,234 |
38,191 |
1,22,169 |
57,328 |
Non-Controlling interest |
- |
- |
29,402 |
5,558 |
Net profit attributable to shareholders of the |
32,234 |
38,191 |
92,767 |
51,770 |
Company |
|
|
|
|
Appropriations |
|
|
|
|
Dividend on equity share capital |
8,706 |
3,627 |
8,706 |
3,627 |
Members will be pleased to note that the consolidated total income grew by 7.8% to
3,92,800 Lakhs compared to previous year with the exceptional performance of Maamba
Collieries Limited's (MCL) 300 MW power plant and increase in other income with forex and
Mark to Market (MTM) gains. Consolidated EBITDA margin increased to 50.1% for FY 2022-23
Vs 41.8% for FY 2021-22 with the higher availability and increased operational parameters
of 300 MW power plant of MCL. Consolidated profit after tax increased by 113.1% aided by
good contribution from MCL despite reduced operational parameters of 150 MW power plant of
Nava Bharat Energy India Limited, occasioned by major overhaul works.
Increased operating levels of 150 MW power station at Odisha works coupled with the
sustained Operation & Maintenance revenue have off-set the pressure on revenues and
margins in the Ferro Alloys division to some extent. The Company's standalone total income
experienced a decline of 5.6% to 1,65,875 Lakhs compared to the previous year, on account
of lower volume of sales of Manganese Alloys by 13,700 MT and lower realisations trailing
the sector trends. The Company's standalone EBIDTA margin for FY 2023 stood at 26.4%,
compared to 34.7% in the previous year. The decrease is attributable to the subdued ferro
alloy business being adversely impacted by dependent steel markets which in turn reeled
under the adverse export duty during the later part of the year under review.
REVIEW OF OPERATIONS
Metals:
Sales volume of Manganese Alloys from Paloncha works was lower by 13,700 MT compared to
FY 2021-22. Strategic sourcing of raw material coupled with cost management, however,
helped the Company maintain margins in a volatile market marked by the surge in cost of
reductants and their stiff availability.
Chromium Alloys production was ceased in October 2022 with the mutual pre-closure of
conversion agreement with Tata Steel Mining Limited (TSML). The Company produced 34,893 MT
of Ferro Chrome Alloys compared to 65,981 MT during the FY 2021-22. Both the smelters at
Odisha works underwent major overhaul before starting production of Manganese Alloys in
Q3. The production parameters have since been stabilized with the Company endeavouring to
stay competitive in a volatile market environment which also accounts for the inventory
overhang at the year end.
Energy:
150 MW energy plants at Odisha works has bettered its performance during the year aided
by merchant power offtake and higher realisations. Coal availability under the Shakthi
Scheme and linkages helped the power station stay in lower cost quadrant and improve
merchant sales aiding big spurt in revenues and PLF relative to previous year. Captive
consumption of energy has been the fulcrum of the energy business, supplemented by
merchant power sales. 114 MW energy plant in Paloncha however remains susceptible to the
vagaries of coal pricing by Singareni Collieries from which coal is drawn against
linkages. 150 MW IPP plant under Nava Bharat Energy India Limited (NBEIL) underwent major
overhaul during the year and hence the plant availability and generation were lower during
the year. This plant is sourcing coal from Mahanadi Coalfields Limited, Odisha incurring
high transportation costs as coal supplies from Singareni Collieries had stopped for all
power plants without linkages. Maamba Collieries Limited's (MCL) 300 MW power plant
operated at a record Availability and PLF exceeding 90%, which boosted the Consolidated
financial performance of the Company. With the resolution of receivables issue by way of
Consent Award under International Arbitration coupled with full realisations against
energy sales since May 2022, helped MCL in improving its cashflow position and long-term
debt repayments.
Sugar:
Majority of the plant and equipment of the discontinued sugar works were sold above the
carrying value helping marginal profit. The final sale proceeds of the equipment will
therefore ensue in smooth closure for this discontinued operation.
Mining:
The coal mining operations of MCL were principally directed to meet the power plant
requirements with external sales helping MCL supplement the cash flows not only to cover
all direct mining operations but also a part of indirect overheads. This division
continues to contribute to top line and profitability of MCL with no cashflow issues.
Others:
The company's subsidiary businesses healthcare enabled services, commercial
agriculture, and manganese ore mining are currently in the development stage and
are gaining traction towards contributing to the consolidated operations in the future.
The healthcare division in Singapore and Malaysia has shown promising growth, with its
revenue doubling year-on-year. The division is working towards achieving positive cash
flow by 2025.
In the field of commercial agriculture, the company's avocado plantation in Zambia has
experienced significant traction during the last financial year. The plantation was
initially initiated on a trial basis covering 50 hectares of land and is set to expand to
1,100 hectares over the next four years.
DIVIDEND:
Your Board of Directors, remained vigilant of the prevailing volatility in standalone
businesses but the significant turnaround of financial position of the
Zambian subsidiary, have been pleased to recommend a dividend on the equity shares @
300% ( 6.00 per share of 2/- each) for the FY 2022-23, as in the last year after having
considered ongoing and imminent commitments, subject to shareholders' approval at the
ensuing Annual General Meeting (AGM). The aggregate dividend pay-out amounts to 8706.04
Lakhs.
RESERVES:
No amounts were proposed to be transferred to Reserves for the period under review.
FIXED DEPOSITS:
The Company has not accepted any deposits from Public and as such, no amount on account
of principal or interest on deposits from public was outstanding as on the date of balance
sheet.
LISTING OF EQUITY SHARES:
The securities of the Company are listed at National Stock Exchange of India Limited
(NSE) and BSE Limited (BSE). Further, the Company has no equity shares carrying
differential rights.
SUBSIDIARY COMPANIES:
The Company has direct and step-down subsidiaries in
India and overseas. Consolidated financial statements have been prepared by the Company
in accordance with the requirements of Ind AS 110 issued by Institute of Chartered
Accountants of India (ICAI) and as per the provisions of the Companies Act, 2013
("the Act"). Pursuant to the provisions of Section 136 of the Act, separate
audited financial statements of subsidiaries are placed by the Company on its website at
www.navalimited.com/financials/ and a report on the performance and financial position of
each of the subsidiaries included in the consolidated financial statements pursuant to
Rule 8(1) of Companies (Accounts) Rules, 2014, is enclosed as Annexure - 1 to this
report.
Statement containing the salient features of the financial statements of subsidiaries
for the year ended March 31, 2023 in Form AOC-1 (Pursuant to first proviso to sub-section
(3) of section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014) is
enclosed as Annexure - 2 to this report.
The Company has intermediate holding/operating companies domiciled in Singapore to
pursue its business interests in energy and energy related services, commercial
agriculture and processing thereof, health care enabled services and investments in
emerging opportunities abroad. This structure affords the Company with a focused approach
in these areas.
NAVA BHARAT (SINGAPORE) PTE. LIMITED (NBS)
NBS, a wholly owned subsidiary of the Company, is the investment arm and holding
company for investments in coal mining and energy generation, principal investment being
in Maamba Collieries Limited, Zambia.
MAAMBA COLLIERIES LIMITED (MCL)
MCL is a step- down subsidiary in Zambia with NBS holding about 65% of the equity stake
while the balance 35% is held by ZCCM Investments Holdings PLC., (ZCCM-IH) a Government of
Zambia undertaking. MCL pursues twin businesses of coal and energy in Zambia and
constitutes material base of the consolidated financials of the Company. The group
exposure to MCL is about
210,743 Lakhs (US$ 256.3 Million) as at March 31,
2023 and is represented by the Equity Share capital, Shareholder loans including
interest accrued thereon and other receivables.
MCL achieved a significant turnaround in its financial position in FY 2022-23, first by
realising full payments for energy sales from May 2022 and secondly by ZESCO paying the
long over due outstanding receivables in the backdrop of the Consented Arbitral Award
pronounced in December 2022. Better cash flows since May 2022 mitigated the reduction in
revenues following a tariff correction from that date, but resulting in an improved
financial position. MCL was thus able to reduce its long term debt from US$ 412.8 Million
as at 1st April 2022 to
US$ 314.4 Million as at 31st March 2023 paving way for better financial
leverage hereafter.
Energy
MCL's predominant business is sale of energy to the local power utility, ZESCO, under a
long term PPA on "Take or Pay" based on the availability of the 300 MW
integrated coal fired power plant. The Plant registered a significant availability of
92.0% during the year compared to 66.5% for FY 2021-22.
Coal mining
The coal mining operations of MCL continue to contribute to the overall profitability
meeting the fuel requirements of the power plant in full and supplementing it with
external sales to industries in the region. Revenues from external coal sales spruce up
the cash flows in a sustained manner.
MCL fared well in closing litigations with external parties including that with the
ZCCM-IH which has since conceded to treat the advance of US$ 10 Million as
Share Holder Loan.
NAVA ENERGY PTE. LIMITED, SINGAPORE (NEPL)
NEPL, the Wholly Owned Subsidiary (WOS) of the Company, continues to render quality
O&M services to MCL for its 300 MW power plant in Zambia. The O&M operations
leveraged upon the technical support extended by the Company and its Indian subsidiaries
and the on site services through its wholly owned subsidiary in Zambia, Nava Energy Zambia
Limited, to ensure not only smooth conduct of annual and major overhauls of the power
plant but also trouble free operations. NEPL established a branch office at Dubai to
pursue synergetic business opportunities hereafter.
NAVA AGRO PTE. LIMITED, SINGAPORE (NAPL)
NAPL is a Wholly Owned Subsidiary of the Company and is intended to be the intermediate
holding company in Singapore to pursue investments in commercial agriculture and
associated processing businesses, initially in Zambia through Kawambwa Sugar Limited.
KAWAMBWA SUGAR LIMITED, ZAMBIA (KSL)
Kawambwa Sugar Limited (KSL) is a Zambian step-down subsidiary which was allocated
10,000 ha of land by the Government of Zambia to pursue commercial agri-ventures including
processing thereof. NAPL holds 100% shareholding of KSL.
KSL has drawn up a blue print for pursuing commercial agriculture and processing in the
allocated virgin land, endowed with plentiful rainfall and abundant water resources.
Though there has been a delay on the
Government fulfilling its infrastructure commitments for road connectivity and power
supply, KSL took effective steps in site preparation works. Though the initial overture of
Sugar and Allied works could not start owing to infrastructure bottlenecks, KSL has since
zeroed on the project for Plantation and Processing of Avacado, considered the best fruit
ever for mankind, on about 1500 Ha to obtain economies of scale. It is gratifying that
leading world players in Avacado have evinced interest to associate with the proposed
project reflecting its merits.
The Avocado Project in the KSL Estate will be pursued under a different company to
derive brand image and strategic interests.
NAVA HOLDING PTE. LIMITED (NHPL)
NHPL was incorporated in Singapore, to hold investments in emerging areas of growth
including the healthcare enabled services being undertaken by the Company.
HEALTHCARE ENABLED SERVICES
TIASH PTE. LIMITED (TPL), SINGAPORE
Nava Holding Pte. Ltd. holds 65% equity stake in TIASH Pte. Ltd. and balance 35% is
held by other shareholder. The healthcare enabled services under TIASH, and its operating
subsidiaries in Singapore and Malaysia entail low capital out lay, principally for
marketing, distribution and administration of the intra venous iron medicine in APAC
region, known for premium lifestyle healthcare. TIASH has made good marketing strides in
Malaysia and Singapore where exclusive distribution rights exist for the world's leading
medicine in this space. Revenue has been doubling YoY and the division is working to
achieve break-even by 2025.
NAVA RESOURCES CI, COTE D'IVOIRE (NRCI)
NRCI is 100% subsidiary of the Company since October 2021. NRCI received exploration
permit for a Manganese ore mine. Required geological survey, exploration studies are
nearing completion following which NRCI will pursue exploitation of Manganese ore by end
of FY 2024.
INDIAN SUBSIDIARIES
NAVA BHARAT ENERGY INDIA LIMITED (NBEIL)
NBEIL is a step down, but wholly owned, subsidiary of the Company with 26% of equity
directly held by the Company and 74% being held through Nava Bharat Projects Limited
(NBPL).
NBEIL operates a 150 MW coal fired independent power plant in Telangana and remains
vulnerable to both fuel as well as merchant power rates. The performance of the power unit
was impacted by mandatory major overhaul in FY 2023 and the volatile coal prices limiting
its generation and revenues. NBEIL extends back end technical supervisory service to NEZL,
Zambia under a contractual arrangement.
NBEIL also runs an Ash Products Plant for part utilization of bed Ash and fly Ash to
produce premium quality bricks and pavers. In addition, NBEIL has added production of
manganese bricks to the array of products under a conversion arrangement with the Company,
being the holding company of NBEIL.
NAVA BHARAT PROJECTS LIMITED (NBPL)
NBPL is a Wholly Owned Subsidiary of the Company and is engaged in extending technical
and commercial services to the group companies. It plans to expand its foray of services
aside from back end critical technical and commercial support under the O&M contract
that NEPL has with MCL. NBPL holds 74% of Equity Share capital of NBEIL making it a
step-down subsidiary to the Company. This shareholding is subject to an attachment by the
Enforcement Directorate of the Government of India following a case instituted by the
Central Bureau of Investigation (CBI) against Brahmani Thermal Power Private Limited
(formerly Navabharat Power Private Limited (NPPL)), a subsidiary of Essar Power Limited
(EPL) and an erstwhile joint venture company as detailed below.
The CBI and the ED of the Government of India, instituted cases making allegations of
misrepresentation pertaining to the allotment of coal block to NPPL and alleging the
shareholding of NBPL in NBEIL and its sale to EPL being the subject matters of the case.
The cases were instituted in 2013 against the erstwhile Directors of NPPL, one of them
being the Managing Director of the Company and against NBPL. The Case has been going on
before the Special Court at New Delhi. Based on the non-involvement of the Company's MD in
the alleged offences, it is felt that a favourable outcome should ensue in due course.
While the CBI case is proceeding, ED had attached the NBPL's shareholding in NBEIL and
further sought transfer thereof which was contested by NBPL and a stay was obtained from
the designated Tribunal.
BRAHMANI INFRATECH PRIVATE LIMITED (BIPL)
During the year there were no operations in BIPL. The case involving Mantri Group,
concerning the erstwhile SEZ development project, went through protracted litigation
through Arbitration at first and then was before the Hon'ble High Court of Telangana which
directed that the matter be discharged by the Commercial Court at
Hyderabad in accordance with past judgement of the Hon'ble Supreme Court. The matter is
now awaiting disposal by the Commercial Court.
KINNERA POWER COMPANY PRIVATE LIMITED (KPCPL) (Associate Company)
The Company is holding 26% of equity shares in
KPCPL, which is continued as specified by the National
Highway Authority of India (NHAI). As per the professed intention and there being no
economic interest, the Company plans to fully off-load its stake in KPCPL in favor of
Meenakshi Infra Group as per the regulations. Accordingly, no economic interest from KPCPL
is being factored in the consolidated financials nor the accounts of KPCPL is appended to
the Annual report of the Company.
OUTLOOK AND FUTURE PLANS
"Management Discussion and Analysis" contains a section on the Company's
outlook and future plans and members may please refer the same on this.
CHANGE IN THE NATURE OF BUSINESS
There is no change in the nature of businesses of the Company during the year under
review.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
In accordance with the provisions of Section 134 (3) (m) of the Act, the required
information relating to conservation of energy, technology absorption and foreign exchange
earnings and outgo have been enclosed as Annexure - 3 to this report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The annual report on CSR activities, in terms of Section 135 of the Act, and the
details about the policy developed and implemented by the Company on CSR initiatives taken
during the year are enclosed as Annexure 4 to this report. A detailed policy
on CSR is placed on the Company's website under the web link:
https://www.navalimited.com/policies-code-of-conduct/
ANNUAL RETURN
In accordance with Section 92(3) of the Act and Rule 12(1) of the Companies (Management
and Administration) Rules, 2014 (as amended), a copy of the Annual Return of the Company
is placed on the website of the Company at https://www.navalimited.com/financials/.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The particulars of contracts or arrangements with related parties referred to in
sub-section (1) of Sec.188 in Form AOC-2 pursuant to clause (h) of sub-section (3) of
Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 are enclosed
as Annexure - 5 to this report.
The policy on materiality of related party transactions and also on dealing with the
related party transactions as approved by the Audit committee and the Board of directors
is placed on the website of the Company at
https://www.navalimited.com/policies-code-of-conduct/.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The details of loans given, guarantees provided and investments made, if any, during
the Financial Year ended on March 31, 2023 are enclosed as Annexure-6 to this
Report in compliance with the provisions of Section 186 of the Companies Act, 2013 read
with the Companies (Meetings of the Board and its Powers) Rules, 2014. The particulars of
aggregate loans, guarantees and investments under Section 186 of the Act are disclosed in
Financial Statements, which may be read as part of this Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review as stipulated
under Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) 2015 ("the Listing Regulations") is enclosed as Annexure
7.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
The Company has furnished the Business Responsibility and Sustainability Report (BRSR)
as mandated and in the format specified by SEBI for FY 2022-23.
A separate report on BRSR as required under the SEBI Regulations is provided as a
separate section to this Annual Report and is also available on the Company's website at
https://www.navalimited.com/financials/, which indicates the Company's performance against
the principles of the National Guidelines on Responsible Business Conduct'. This
would enable the members to have an insight into environmental, social and governance
initiatives of the Company.
CORPORATE GOVERNANCE
A separate report on Corporate Governance as required under the Listing Regulations is
provided as separate section to this Annual Report.
DISCLOSURES UNDER REGULATION 34(3) READ WITH SCHEDULE V OF THE LISTING REGULATIONS
(Rs. in Lakhs)
Sl. No. |
In the accounts of |
Particulars |
Amounts at the year ended 2022-23 |
Maximum amount of loans / advances / investments outstanding during the year
2022-23 |
1 |
Nava Limited (NL) (Holding Company) |
Loans given to: Nava Bharat Energy India Ltd (Subsidiary of NL) |
8,951.22 |
10,869.35 |
2 |
Nava Holding Pte Ltd (NHPL) (Wholly owned subsidiary of NL) |
Loans given to: TIASH Pte Ltd. (Subsidiary of NHPL) |
4,288.43 (US$ 5,216,000) |
4,288.43 (US$ 5,216,000) |
3 |
Nava Bharat (Singapore) Pte Ltd (NBS) (Wholly owned subsidiary of NL) |
Loans given to: Maamba Collieries Ltd (Subsidiary of NBS) |
73,804.21 (US$ 89,767,687) |
73,804.21 (US$ 89,767,687) |
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):
The Board of directors of the Company has an optimum combination of Executive,
Non-Executive and Independent Directors including one woman Independent Director.
Independent and Non-Executive Directors:
As prescribed under Listing Regulations and pursuant to Section 149(6) of the Act, the
particulars of Non-Executive and Independent Directors (as on the date of signing this
report) are as under: Mr. K. Durga Prasad, Mr. GP Kundargi, Mr. A Indra Kumar, Mrs. B.
Shanti Sree and *Mr. Balasubramaniam Srikanth. Mr. K. Durga Prasad and Mr. GP Kundargi
were appointed as Independent directors of the Company for a period of five years with
effect from August 06, 2018 and their term of office as Independent Director will expire
on August 05, 2023. Upon the performance evaluation, the Nomination and Remuneration
committee considered and recommended to the Board reappointment of Mr. K. Durga Prasad and
Mr. GP Kundargi as an Independent Directors for second term of five years. Further, they
fulfil the conditions for appointment as Independent Director as specified under Companies
Act, 2013 and SEBI (LODR) and the
Board is of the opinion that they are the person with high integrity, expertise and
experience (including the proficiency). The resolution for re-appointment of Mr. K. Durga
Prasad and Mr. GP Kundargi as Independent Directors is proposed for consideration and
approval of the members by way of a special resolution at this 51st AGM.
*Mr. Balasubramaniam Srikanth was appointed as Independent Director for a term of two
years commencing from June 17, 2021 and holds office as such till June 16, 2023.
Changes in Directors and KMP:
During the year under review, Mr. C V Durga Prasad,
Director (Business Development), retired from the office of directorship w.e.f. June
30, 2022. The Board placed on record its deep appreciation of the valuable service
rendered by Mr. C V Durga Prasad as Director (Business Development).
Whole-Time Directors:
The following are the whole-time directors of the Company. Mr. D. Ashok, Chairman, Mr.
P. Trivikrama Prasad, Managing Director, Mr. Ashwin Devineni, Chief
Executive Officer and Mr. G R K Prasad, Executive Director.
Further, Mr. G R K Prasad, Executive Director was re-appointed as such by the members
at the AGM held on August 06, 2018 for a further period of five years with effect from
June 28, 2018. The Nomination & Remuneration committee and the Board at their meeting
held on May 23 & 24, 2023 respectively considered his re-appointment for another
period of three years with effect from June 28, 2023. A resolution for re-appointment of
Mr. G R K Prasad as Executive Director is proposed for consideration and approval of the
members by way of ordinary resolution at this 51st AGM.
Declarations of Independent Directors:
All the independent directors of the Company have given declaration that they meet the
criteria of independence as provided in sub-section (6) of section 149 of the Act. The
Company also received a declaration of compliance of sub-rule (1) and sub-rule (2) of the
Rule 6 of the Companies (Appointment and
Qualifications of Directors) Rules, 2014.
Directors retiring by rotation:
Pursuant to the provisions of the Companies Act, Mr. GRK Prasad retires by rotation at
the ensuing annual general meeting and being eligible, offers himself for re-appointment
NUMBER OF MEETINGS OF THE BOARD
During the financial year under review, four meetings of the directors were held on May
16, 2022; August 10, 2022; November 4, 2022 and February 3, 2023 in compliance with the
provisions of the Companies Act, 2013 (the Act'), the Listing Regulations and
Secretarial Standards.
PERFORMANCE EVALUATION OF THE BOARD
Pursuant to the provisions of the Act and the Listing Regulations, the Board has
carried out annual performance evaluation of its own, the individual directors as well as
the mandatory committees of the Board. A structured set of criteria was adopted after
taking into consideration the inputs received from the directors, covering various aspects
of the Board's functioning such as adequacy of the composition of the Board and its
Committees, Board culture, execution and performance of specific duties, obligations and
governance. Evaluation of the Board members is conducted on an annual basis by the Board,
Nomination and Remuneration committee and Independent Directors with specific focus on the
performance and effective functioning of the Board and individual directors.
The Nomination and Remuneration committee had specified criteria for performance
evaluation of
Directors, Committees and the Board as a whole and recommended the same to the Board
for evaluation. Performance indicators for evaluation of independent directors:
Independent directors have three key roles governance, control and guidance. Some
of the performance indicators based on which the independent directors are evaluated are:
Ability to contribute towards all round growth of the Company
Ability to create brand image of the Company and helps the Company wherever
possible to resolve issues, if any
Contribution to strategy and other areas impacting Company's performance.And in
general commitment to the fulfilment of a Director's obligations and fiduciary
responsibilities.
The performance evaluation of each Independent or non-executive director is done by the
Board annually based on criteria specified above and also the role played other than at
meetings.
The evaluation process also considers the time spent by each of the Board members, core
competencies, personal characteristics, accomplishment of specific responsibilities and
expertise.
POLICY ON DIRECTORS' APPOINTMENT, REMUNERATION & OTHER DETAILS
Pursuant to the provisions of the Act and the Listing Regulations, the Nomination and
Remuneration committee identifies persons who are qualified to become directors in
accordance with the criteria laid down and recommend to the Board for their appointment
and removal. The Company adopted a policy relating to the remuneration for Directors, key
managerial personnel and other senior management personal. This Policy covers the
remuneration and other terms of employment for the Company's executive team. The
remuneration policy for members of the Board and for management, aims at improving the
performance and enhancing the value of the Company by motivating and retaining them and to
attract the right persons to the right jobs in the Company. The object of this
Remuneration Policy is to make your Company a desirable workplace for competent employees
and thereby secure competitiveness, future development and acceptable profitability. In
order to achieve this, it is imperative that the Company is in a position to offer
competitive remuneration in all its operational locations.
A detailed policy on remuneration of the Directors and Senior Management is placed on
the Company's website under the web link: https://www.navalimited.com/
policies-code-of-conduct/
POLICY FOR SELECTION OF DIRECTORS AND DETERMINING DIRECTORS' INDEPENDENCE
The Nomination and Remuneration committee (NRC) shall assess the independence of
directors at the time of appointment, re-appointment and the Board shall assess the same
annually based on the criteria provided by NRC. The Board shall re-assess determination of
independence when any new interests or relationships are disclosed by a Director.
The criteria of independence are as prescribed in the Act and the listing regulations
and the independent directors shall abide by the Code specified for them in Schedule IV to
the Act.
THE CRITERIA FOR THE APPOINTMENT OF DIRECTORS, KMPs AND SENIOR MANAGEMENT
The Nomination and Remuneration committee identifies persons who are qualified to
become directors, KMP and who may be appointed in the senior management in accordance with
the criteria laid down and recommend to the Board for their appointment and removal.
A person for appointment as director, KMP or in senior management should possess
adequate qualifications, expertise and experience for the position considered for
appointment. The committee decides whether qualification, expertise and experience
possessed by a person are sufficient for the concerned position. The committee ascertains
the credentials and integrity of the person for appointment as director, KMP or senior
management level and recommends to the Board his / her appointment.
The Committee, while identifying suitable persons for appointment to the Board, will
consider candidates on merit against objective criteria and with due regard for the
benefits of diversity on the Board.
COMMITTEES OF THE BOARD
Currently the Board has six committees: Audit, Nomination and Remuneration, Corporate
Social Responsibility, Stakeholders' Relationship, Risk Management and Investment. The
composition of the committees are in line with the applicable provisions of the Act, Rules
and the Listing Regulations as detailed below:
Name of the Committee |
Composition of the Committee |
Remarks |
Audit Committee |
Mr. K. Durga Prasad, Chairman |
The Audit committee of the Board of directors was constituted in conformity with the
requirements of Section 177 of the Act and regulation 18 of the Listing Regulations and
its role has been the same as stipulated in the Act and the Regulations mentioned above. |
|
Mr. A. Indra Kumar, Member |
|
|
Mrs. B. Shanti Sree, Member |
All recommendations made by the Audit committee during the year were accepted by the
Board. |
Nomination and Remuneration Committee |
Mr. K. Durga Prasad, Chairman |
The Nomination and Remuneration committee of the Board of directors was constituted in
conformity with the requirements of Section 178 of the Act and Regulation 19 of the
Listing Regulations |
|
Mr. A. Indra Kumar, Member |
and its role has been the same as stipulated in the Act and the Regulations mentioned
above. |
|
Mr. GP Kundargi, Member |
|
Corporate Social Responsibility |
Mr. D. Ashok, Chairman |
The Corporate Social Responsibility committee of the Board of directors was
constituted in conformity with the requirements of |
Committee |
Mr. K. Durga Prasad, Member |
Section 135 of the Act. |
|
Mrs. B. Shanti Sree Member |
The Committee monitors the implementation of the CSR Policy from time to time. |
Stakeholders' Relationship Committee |
Mr. K. Durga Prasad, Chairman |
The Stakeholders' Relationship committee of the Board of directors was constituted in
conformity with the requirements of Section 178 of the Act and Regulation 20 of the
Listing Regulations and its role has been the same as stipulated in the Act and the
Regulations mentioned above. |
|
Mr. P. Trivikrama Prasad, Member |
|
|
Mr. GP Kundargi, Member |
|
Risk Management Committee |
Mr. Ashwin Devineni, Chairman |
The Risk Management committee of the Board of directors was constituted in conformity
with the requirements of Regulation 21 of the Listing Regulations with its role as
stipulated in the Listing |
|
Mr. GRK Prasad, Member Mrs. B. Shanti Sree, Member |
Regulations. |
Investment Committee |
Mr. D. Ashok, Chairman |
The Investment Management committee of the Board of directors was constituted with
executive directors |
|
Mr. P. Trivikrama Prasad, Member |
|
|
Mr. Ashwin Devineni, Chairman |
|
|
Mr. GRK Prasad, Member |
|
A detailed note on the Board and its Committees is provided in the Corporate Governance
Report.
PARTICULARS OF EMPLOYEES
The names and other particulars in accordance with the provisions of Section 197(12) of
the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, are enclosed as Annexure - 8 to this Report.
Names of the top ten employees in terms of remuneration drawn and the name of every
employee employed throughout the financial year and in receipt of remuneration of 1.02
cores or more, or employed for part of the year and in receipt of 8.50 Lakhs or more per
month, under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules 2014, are enclosed as Annexure - 9 to this Report.
EMPLOYEES' STOCK OPTION SCHEME
The Company is intending to issue employee stock options under NAVA - Restricted Stock
Unit Plan 2023 ("RSU 2023" or the "Plan") to the employees of the
Company including subsidiaries whether existing or future by enabling them to participate
in the ownership of the Company. A resolution to introduce and implement "RSUs
2023" is proposed for consideration and approval of the members by way of special
resolution at this 51st AGM. The maximum number of shares under the scheme
shall not exceed 29 lakh equity shares. The detailed scheme is available at the
Company's website https://www.navalimited.com/ policies-code-of-conduct/
DIRECTORS' RESPONSIBILITY STATEMENT
Directors confirm that:
(a) in the preparation of the annual accounts for the financial year ended March 31,
2023, the applicable accounting standards have been followed and there are no material
departures; (b) they selected such accounting policies and applied them consistently and
made judgments and estimates that are reasonable and prudent so as to give a true and fair
view of the state of affairs of the Company at the end of the financial year and of the
profit of the Company for that period; (c) they took proper and sufficient care for the
maintenance of adequate accounting records in accordance with the provisions of the Act
for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities; (d) they prepared the annual accounts on a going concern basis;
(e) they laid down internal financial controls to be followed by the Company and that
such internal financial controls were adequate and operating effectively; and (f) they
devised proper systems to ensure compliance with the provisions of all applicable laws and
that such systems were adequate and operating effectively.
STATUTORY AUDITORS & AUDITOR'S REPORT
M/s. Walker Chandiok & Co. LLP, Chartered Accountants (Firm Regn. no. 001076N /
N500013) were appointed as statutory auditors of the Company for a period of 5 years
(second term) by the members of the Company at their meeting held on August 10, 2022.
i.e., till the conclusion of 55th AGM to be held in the calendar year 2027 at
such remuneration as may be mutually agreed between the Board of directors of the Company
and the statutory auditors from time to time.
The Auditors' Report on the financial statements of the Company for the financial year
ended March 31, 2023 does not contain any reservation, qualification or adverse remarks
and their report together with the notes to Financial Statements are self-explanatory and
hence do not call for any further comments under Section 134 of the Act, except in respect
of the loans and advances in the nature of loans granted by the Company to Nava Bharat
Energy India Limited (NBEIL) step down / wholly owned, the receipts of principal and
interest were delayed as referred in the Annexure I (point iii (c) & (d)) to the
Independent Auditor's Report. Further, the Board explained that the NBEIL had borrowed
15500 lakhs term loan in September2018 from the Company which is to be repaid in 32
structured quarterly instalments. Two loan instalments of 639.40 lakh each due on 31 Dec
2022, 31 Mar 2023 and interest payments for the months of Jan to Mar 2023 were not paid
for preserving funds to procure coal for the operations of the power plant. The delay in
interest and loan instalment payments would not affect the operations, credit profile of
NBEIL as the loan is from the ultimate holding Company which is supportive and not from a
Bank/Financial Institution.
FRAUD REPORTING
During the Financial Year under review, the Statutory Auditors have not reported any
incident of fraud to the Board of Directors of the Company, pursuant to the provisions of
Section 143(12) of the Companies Act, 2013.
COST AUDIT
The Board appointed M/s. Narasimha Murthy & Co., Cost
Accountants, as Cost Auditors for conducting the audit of cost records of the Company
for Steel (ferro alloys) and Electricity for the Financial Year 2022-23 on the
recommendations of the Audit committee. The same was ratified by the Members at the 50 th
AGM held on August 10, 2022.
The Cost Audit reports for FY 2021-22 were filed with Ministry of Corporate Affairs on
September 6, 2022. Further, the Board of directors based on the recommendations of the
audit committee, appointed M/s. Narasimha Murthy & Co., Cost Accountants, as
CostAuditors for conducting the audit of cost records of the Company for Steel (ferro
alloys) and Electricity for the FY 2023-24, subject to ratification by the members at the
ensuing AGM.
INTERNAL AUDITORS FOR COSTING SYSTEMS AND COST ACCOUNTING RECORDS
M/s. Sagar & Associates, Internal Auditors (Costing) conducted internal audit of
cost records for the Financial Year 2022-23. Further, the Board appointed
M/s Sagar & Associates, as Internal Auditors to conduct the internal audit of cost
records for the Financial Year 2023-24.
MAINTENANCE OF COST RECORDS
During the year under review, Section 148(1) of the Act is applicable to your Company
and accordingly such accounts and records are made and maintained by the
Company as specified.
SECRETARIAL AUDIT
During the year under review, the Company has complied with the provisions of Section
204 of the Act and Regulation 24A of the Listing Regulations. The Secretarial Audit Report
for the financial year ended March 31, 2023 issued by M/s. P.S. Rao &
Associates,Practicing Company Secretaries, Hyderabad is enclosed as Annexure - 10
to this Report and it does not contain any reservation, qualification or adverse remarks.
The Board has appointed M/s. P.S. Rao & Associates,
Practicing Company Secretaries to conduct the secretarial audit pursuant to the
recommendations of the Audit committee for the FY 2023-24. Further, the Secretarial Audit
report of Nava Bharat Energy India Limited (NBEIL), a material subsidiary of the Company,
is also available on the Company's website at https://www.navalimited.com/financials/
MATERIAL CHANGES AND COMMITMENTS
There have been no material changes and commitments in the business operations of the
Company from the financial year ended March 31, 2023 to the date of the signing of the
Directors' Report. However, the name of the Company was changed from Nava Bharat Ventures
Limited to Nava Limited with effect from July 15, 2022.
MATERIAL ORDERS PASSED BY THE REGULATORS
No significant and material orders were passed by the Regulators or courts or tribunals
impacting the going concern status and the Company's operations in future, except as
stated otherwise.
INSURANCE
All the properties of the Company including buildings, plant and machinery and stocks
have been adequately insured.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has an Internal Control System, commensurate with the size, scale and
complexity of its operations. The Company maintains all its records in
SAP system and the workflow and approvals are routed through SAP.
The Internal Audit Department monitors and evaluates the efficacy and adequacy of
internal control system in the Company, its compliance with operating systems, accounting
procedures and policies at all locations of the Company and its subsidiaries. Based on the
report of internal audit function, the Units undertake corrective action in their
respective areas and strengthen the controls. Significant audit observations and
corrective actions thereon are presented to the Audit committee of the Board periodically.
The Board of directors of the Company have adopted various policies like related party
transactions policy, whistle blower policy, policy to determine material subsidiaries and
such other procedures for ensuring orderly and efficient conduct of its business for
safeguarding its assets, prevention and detection of frauds and errors, accuracy and
completeness of the accounting records, and timely preparation of reliable financial
information.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
During the year under review, pursuant to the provisions of Section 124 (5) of the Act
(section 205A of the Companies Act 1956), an amount of 34,20,280/- relating to FY 2014-15,
which remained unclaimed for a period of 7 years was transferred to the Investor Education
and Protection Fund by the Company in September 2022.
TRANSFER OF UNCLAIMED SHARES TO
INVESTOR EDUCATION AND PROTECTION FUND AUTHORITY
During the year under review, all shares in respect of which dividend has not been paid
or claimed for seven consecutive years or more (relevant shares) upto and including the
financial year 2014-15 were transferred by the Company in the name of IEPF from time to
time and the statement containing such details as prescribed is placed on the Company's
website at www.navalimited.com.
VIGIL MECHANISM
The Company established a Whistle Blower policy & Vigil mechanism for directors and
employees to report genuine concerns pursuant to Section 177 of the Act. The vigil
mechanism provides for adequate safeguards against victimisation of employees who use such
mechanism and for direct access to the chairperson of the Audit committee in appropriate
or exceptional cases. The policy lays down the mechanism for making enquiry into whistle
blower complaint received by the Company. Employees who may become aware of any alleged
wrongful conduct are encouraged to make a disclosure to the Audit committee.
The details of such mechanism are communicated to all the directors and employees and
it is also disclosed on the website of the Company
https://www.navalimited.com/policies-code-of-conduct/
RISK MANAGEMENT POLICY
The Board formulated and implemented Risk Management Policy for the Company which
identifies various elements of risks which in its opinion may threaten the existence of
the Company and measures to contain and mitigate risks. The Company has adequate internal
control systems and procedures to combat the risk. The Risk Management procedures are
reviewed by the Audit committee and the Board on periodical basis.
DIVIDEND DISTRIBUTION POLICY
The Dividend Distribution policy as stipulated under Regulation 43A of the Listing
Regulations is applicable to your Company for FY 2022-23 and is placed on the website of
the Company under the web link: https://www.navalimited.com/policies-code-of-conduct.
INDUSTRIAL SAFETY AND ENVIRONMENT
Utmost importance continues to be given to the safety of personnel and equipment in all
the plants of the Company. The Company reviews thoroughly the various safety measures
adopted and takes effective steps to avoid accidents. Safety drills are also conducted at
regular intervals to train the employees for taking timely and appropriate action in case
of accidents.
AWARDS
Your Company received the following awards during FY 2022-23:
1. Export Award as Star Performer Large Enterprise (Ferro Alloys)
outstanding export performance for the year 2018-19 from EEPC India's Southern Region
2. Telangana State Industry Award -2022 for Best CSR Practices Platinum Award for
excellence in Women Empowerment.
3. State Level Electrical Safety Award-2022 under the category of "Large
Industry" from Minister of State Energy, Odisha
4. National Award for Excellence in Energy Management, 2022 from Confederation of
Indian Industry (CII).
5. State level Energy Conservation Award, Odisha.
GREEN INITIATIVE
The Ministry of Corporate Affairs (MCA) has taken a green initiative in Corporate
Governance by allowing paperless compliance by the Companies and permitted the service of
Annual Reports and other documents to the shareholders through electronic mode subject to
certain conditions and the Company continues to send Annual Reports and other
communications in electronic mode to those members who have registered their email ids
with their respective depositories.
Members may note that Annual Reports and other communications are also made available
on the
Company's website https://www.navalimited.com and websites of the Stock Exchanges i.e.
BSE Limited and National Stock Exchange of India Limited.
INDUSTRIAL RELATIONS
Industrial relations have remained cordial during the year under review, and your
directors appreciate the sincere and efficient services rendered by the employees of the
Company at all levels, contributing to the successful operations of the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
Your Company has zero tolerance towards sexual harassment at the workplace and the
details of sexual harassment complaints as per the provisions of the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules
thereunder are as follows: No of Complaints Received : Nil No of Complaints Disposed off :
NA
During the year under review, the Company has complied with the provisions related to
the constitution of Internal Complaints Committee under the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.
COMPLIANCE WITH SECRETARIAL STANDARDS
During the year under review, the Company has complied with the secretarial standards
issued by the Institute of Company Secretaries of India on Board Meetings and General
Meetings.
ACKNOWLEDGEMENT
We thank our customers, vendors, investors, bankers, Government of India and State
Governments, wherever we have our operations, for their assistance, patronage and
co-operation. We place on record our appreciation for the contribution made by our
employees at all levels. Our consistent growth was made possible by their hard work,
solidarity, cooperation, and support.
For and on behalf of the Board
Nava Limited (formerly Nava Bharat ventures limited)
P. Trivikrama Prasad
Managing Director DIN: 00006887
|
D. Ashok |
Place: Hyderabad |
Chairman |
Date: May 24, 2023 |
DIN:00006903 |
|