- - - - -----------------------------------------------------------------~
Cb}tfi~~Iq4Ig f6t~e:s('111«1 ~ 'fiT ~ 1 fl:lR rR cf;q;:ft, '1Rr ~ ~)
COCHIN SHIPYARDUMITED(A Government of India Category-1 Miniratna Company, Ministry of Shipping)
SEC/48/2017 -63 September 01, 2018
To,The ManagerCompliance DepartmentSSE LimitedPhiroze Jeejeebhoy Tower,Dalal Street,Mumbai- 400001
-rr-o-,--I The Manager'\Compliance DepartmentThe National Stock Exchange of India
I Ltd1 Exchange Plaza,S ndra-Kurla Complex, Sandra (East)
bai- 400051--------------------------
Dear Sir / Madam,
Subject: Annual Report 2017-18
1. Pursuant to. Regulatien 34 of the Securities and Exchange Beard of India (Listing
Obligations and Disclosure Requirements) Regulatiens, 2015, please find enclosed herewitha copy of the Annual Report of the Company (which includes Business Responsibility
Repert)ier the financial year 2017-·18.
2. This is fer your information and records.
Thanking you
EncJ: as above
~~: !Hlmf-iifl ~, 1:ft".,*. ~~. 1653, ~ 1:ft".,*., ~ - 682015RegisteredOffice: Administrative Building,P.OBagNo.1653, Perumanoor P.o.,Kochi - 682 015
1:fiR / Phone:+91 (484) 2361181/2501200 tRCffi/ Fax +91(484) 2370897/2383902~ / Website:www.cochinshipyard.com CIN: U63032KL 1972GOI002414
New Opportunities
COCHIN SHIPYARD LTD
th46 ANNUAL REPORT
2017- 2018
New Horizons
Page No.
Highlights of the Year 1
About us 2
Chairman’s Address 4
Our Credentials 12
Key Performance Indicators 14
Financial Highlights 16
Our People 18
Board of Directors 20
Corporate Social Responsibility 23
Corporate Information 24
Directors’ Report 25
Comments of C & AG 65
Management Discussion and Analysis 83
Business Responsibility Report 90
Report on Corporate Governance 98
Independent Auditors Report (Standalone) 118
Standalone Financial Statements 126
Independent Auditors Report (Consolidated) 183
Consolidated Financial Statements 188
Disclaimer
Statements in this report that describe the Company’s objectives, projections, estimates, expectations or predictions of the future may be ‘forward-looking statements’ within the meaning of the applicable securities laws and regulations. The Company cautions that such statements involve risks and uncertainty and that actual results could differ materially from those expressed or implied. Important factors that could cause differences include raw materials’ cost or availability, cyclical demand and pricing in the Company’s principal markets, changes in government regulations, economic developments within the countries in which the Company conducts business, and other factors relating to the Company’s operations, such as litigation, labour negotiations and fiscal regimes.
TABLE OF CONTENTS
HIGHLIGHTS OFTHE YEAR
TURNOVER
Crore2355`
PROFIT AFTER TAX
Crore396.75`
SHIPBUILDING TURNOVER
Crore1731.86`
SHIP REPAIR TURNOVER
Crore623.27`
• Cochin Shipyard Limited was LISTED on BSE and NSE on August 11, 2017.
• Achieved an all time RECORD TURNOVER of Rs.2355 crores.
• Achieved an all time RECORD SHIP REPAIR TURNOVER of Rs.623.27 crores.
• Achieved an all time RECORD PROFIT after tax of Rs.396.75 crores.
• SIGNED MOU with Central Institute of Fisheries Technology on August 30, 2017 for building fishing vessels.
• INCORPORATED Joint Venture Company viz., Hooghly Cochin Shipyard Ltd in partnership with Hooghly Dock and Port Engineers Limited on October 23, 2017.
• FOUNDATION STONE for International Ship Repair Facility (ISRF) project was laid on November 17, 2017 by Shri Nitin Gadkari ji, Hon’ble Union Minister for Shipping, Road Transport & Highways, Water Resources, River Development and Ganga Rejuvenation.
• SIGNED MOU with the Mumbai Port Trust on January 11, 2018 for operations and management of ship repair facility at Indira Dock. CSL shall utilize the facilities for the purpose of ship repair and allied services and for further expansion in the field of ship repair.
• SIGNED MOI with Defence Research and Development Organisation (DRDO) on January 18, 2018 for export of Defence vessels incorporating Defence systems developed by DRDO and produced by Indian OEMs.
• SIGNED CONTRACT on January 29, 2018 for construction of 16 nos Tuna Long Lining & Gillnetting Fishing Vessels under the diversification of trawl fishing boats from palk bay into deep sea fishing boats under Central sector on Blue Revolution Scheme with financial assistance from Government of India and the Government of Tamil Nadu.
• SIGNED MOU with Joint Stock Company United Shipbuilding Corporation (USC), Russia, on February 02, 2018 to collaborate and engage in design, development and execution of high-end ‘state of the art’ vessels for inland and coastal waterways.
• SIGNED MOU with Kolkata Port Trust on March 17, 2018 for operations and management of ship repair facility at Netaji Subhas Dock. CSL shall utilize the facilities for the purpose of ship repair and allied services and for the growth of ship repair in the region.
• EMERGED L1 BIDDER for 16 x ASW SWC project for Indian Navy.
146th Annual Report
2 Cochin Shipyard Ltd
ABOUT USCochin Shipyard Ltd (CSL) was incorporated in the year 1972 as a fully owned Government of India company. After the IPO in 2017 the Government of India holds 75% of equity share capital in the Company. In the last four decades, the company has emerged as a forerunner in the Indian shipbuilding & ship repair industry and also a well-known player on the global shipbuilding front. CSL has exported 45 ships to various commercial clients outside India such as National Petroleum Construction Company (Abu Dhabi), the Clipper Group (Bahamas), Vroon Offshore (Netherlands) and SIGBA AS (Norway).
The company has built and repaired some of the largest ships in India and is presently building the prestigious Indigenous Aircraft Carrier for the Indian Navy. Over the years, CSL has successfully responded to fluctuations in the shipbuilding requirements of the markets and have evolved from building bulk carriers to smaller and more technically sophisticated vessels such as Platform Supply Vessel (PSV) and Anchor Handling Tug Supply Vessel (AHTS). CSL has worked with several leading technology firms in the industry including Rolls Royce Marine (Norway), GTT (France), Vard Group (Norway) etc. This has added to our credibility in the international markets. Our key shipbuilding clients on the domestic front include the Indian Navy, the Indian Coast Guard and the Shipping Corporation of India Limited. CSL has also undertaken repairs of various types of vessels including upgradation of ships of the oil exploration industry as well as periodical maintenance, repairs and life extension of ships. CSL is presently one of the best performing shipyards in India.
2 Cochin Shipyard Ltd
346th Annual Report 346th Annual Report
HOW WECREATE VALUE
Emerge as an internationally preferred shipyard to construct world class Merchant and Naval ships, offshore vessels and structures.
Be the market leader in India for ship repairs, including conversions and up-gradation.
To be admired for our achievements, respected for our ethics and trusted for our service excellence by our valued customers.
To build and repair ships and off-shore structures to international standards and provide value added quality engineering services.
Sustain corporate growth in competitive environment.
To adopt and undertake practices towards becoming a responsible corporate citizen.
VISION
MISSION
OBJECTIVESTo sustain and enhance shipbuilding and shiprepair activities through technology up-gradation and capacity augmentation.
To continuously endeavor to expand/diversify activities of the shipyard including setting up new facilities.
To carry out Research & Development in existing and emerging technologies in shipbuilding processes.
To move towards international benchmarking, benchmark with the best shipbuilding standards followed in India.
To motivate employees through improved specific training programs. To adopt best practices for clean and safe environment. Ride the down time with aggressive bidding and secure orders to maximize capacity.
To ensure positive customer oriented initiatives.
To build a responsible corporate citizen image through CSR & Sustainability projects and compliance to Corporate Governance principles.
4 Cochin Shipyard Ltd
CHAIRMAN’S ADDRESS
It gives me immense pleasure to welcome you all, on behalf of the Board of Directors, to the 46th Annual General Meeting of your company Cochin Shipyard Limited (CSL). I have had the privilege of leading this prestigious organization as the Chairman & Managing Director over the last two and a half years and it has been an exhilarating journey.I take this opportunity to apprise you on the achievements of your company in the year 17-18, the operating scenario and the initiatives for the future.
OPERATING SCENARIO The Government of India has unveiled a host of initiatives aimed to develop and sustain growth of the shipbuilding and ship repair sector. The Government of India’s focus on development of Inland and coastal waterways infrastructure is an opportunity to be explored. The positive signs of progress in the sector will open up opportunities which could be converted into Company’s business. In the defence sector also, the industry outlook remained positive. However,
2017 was another difficult year for the global shipbuilding industry, with contracting remaining well below trend. However certain segments have seen ordering in the recent months. At this stage the Company will be focussing on domestic orders in shipbuilding continuously keeping a watch on appropriate projects in the international market.
The Ship repair market in India is promising and CSL with its long experience, competitive advantages and strong ecosystem of sub-vendors, service providers etc remains the dominant shiprepairer in India by a large margin. The Government of India is also keen to significantly increase ship repair activities in the country and has advised major ports to try and team up with CSL to develop ship repair capabilities in ports. We are leveraging this opportunity and are in advanced stages of discussions which could lead to CSL setting up ship repair operations in Mumbai, Kolkata and Port Blair shortly.There is a growing optimism and I would
The Ship repair market in India is promising and CSL with its long experience, competitive advantages and strong ecosystem of sub-vendors, service providers etc remains the dominant shiprepairer in India by a large margin.
Madhu S NairChairman and Managing Director
546th Annual Report
like to thank Government of India for all the support and initiatives provided for the shipbuilding and repair sector.
ACHIEVEMENTS DURING THE YEARYour company achieved an all time high turnover of Rs.2,355.12 crores and a Profit After Tax of Rs.396.75 crores during the FY 2018. The turnover from Shipbuilding was Rs.1,731.86 crores and that from Shiprepair was Rs.623.27 crores.
The shipbuilding front has been steady, the TDV for DRDO is in advanced stages of outfitting and the 2x 500 PAX vessels for A&N administration is presently in the erection and consolidation phase in the drydock. The 2x 1200 PAX vessels for A&N are closely following and are in the block fabrication stage. Outfitting activities are progressing well on the IAC and testing/ trials phase has been initiated on certain critical
equipment. It is a matter of great pride and satisfaction that we have emerged L1 in the tender for the prestigious ASW corvette project of the Indian Navy and expect contracts to be signed shortly. These contracts will contribute approximately Rs. 5,400 crores to CSL’s turnover in the coming years.
Ship Repair continued to do extremely well and we have posted an alltime high turnover of Rs.623 crores in FY 2017-18. To our list of MOU clients like DCI and LDCL we added A&N Administration and 4 of their vessels were handled in 2017. We have handled about 116 Nos of ships, including 18 Naval vessels. We have been aggressive in our marketing efforts and have bagged the major refit contracts of ONGC’s ‘Sagar Bhushan’ and DRDO’s ‘Sagardhwani’ amidst stiff competition from public and private shipyards. We expect significant order intake in the coming year also.
On November 17, 2017 the foundation stone was laid for the Rs. 970 crores ISRF project
being executed in 42 acres of land leased from Cochin Port Trust. This project marks the first ever expansion outside our 170 acre campus.
Subsequently in May 2018, we have awarded the turnkey contract for civil, electrical and mechanical
works for the new large drydock in CSL which project is being undertaken at an overall estimated
cost of ` 1,799 crores.
2017 will be etched in history of CSL as the year in which we changed character in more ways than one. After a hugely acclaimed IPO, we became a public listed company with a market-cap of above USD 1 billion. Our major expansion projects have secured all relevant clearances and have crossed critical milestones. On November 17, 2017 the foundation stone was laid for the Rs. 970 crores International Ship Repair Facility (ISRF) project being executed in 42 acres of land leased from Cochin Port Trust. This project marks the first ever expansion outside our 170 acre campus. Subsequently in May 2018, we have awarded the turnkey contract for civil, electrical and mechanical works for the new large drydock in CSL which project is being undertaken at an overall estimated cost of Rs. 1,799 crores.
Another significant milestone was the incorporation of Hooghly Cochin Shipyard Limited (HCSL) at Kolkata, as a
Estimated Cost of new Drydock
Commenced ISRF project
Crores1,799`
Crores970`
6 Cochin Shipyard Ltd
joint venture between CSL and Hooghly Dock & Port Engineers Limited (HDPEL) and marked the first geographical expansion of the Company. CSL holds 74% and HDPEL 24% stake in the equity of HCSL. HCSL has subsequently entered into Lease and Concession agreement with HDPEL for taking over the old units at Nazirgunge and Salkia on 60 year lease and to operationalize these facilities by putting up modern infrastructure. HCSL targets to develop various types of vessels like Ro-Ro Vessels, River-Sea Cargo Vessels for bulk, liquids, containers, Passenger Vessels, other watercrafts for the inland waterways.
Towards this, the Company has signed a Memorandum of Understanding (MoU) with United Shipbuilding Corporation (USC) which is the largest shipbuilding group in Russia to collaborate and engage in Design, Development and Execution of High-End, State-of-Art vessels for Inland and Coastal Waterways. Going with the Company’s plans of expanding its shiprepair business the Company signed MoUs with Mumbai Port Trust (MbPT) and Kolkata Port Trust (KoPT) for upgradation, operation and management of their Ship repair Facilities by leasing the facilities for 30 years and are in the process of signing binding agreements.
During the year the Company marked its entry into a new segment when we signed contracts for construction of 16 nos Tuna Long Lining & Gillnetting Fishing Vessels. These vessels are being built under Central Sector Blue Revolution Scheme with financial assistance from Government of India and the Government of Tamil Nadu to enable diversification of trawl fishing boats from Palk bay into deep sea fishing boats. CSL expects this novel initiative of partnering Central Institute of Fisheries technology (CIFT) and involving IIT Kharagpur, Indian Register of Shipping (IRS) and reputed OEM’s to create the impetus for further business opportunities for delivering technologically sound vessels in this hitherto unorganized but socially very relevant sector.
The Company also signed Memorandum of Intent (MOI) with Defence Research and Development Organisation (DRDO) for the export of defence vessels incorporating defence systems developed by Defence Research and Development Organisation and produced by Indian OEM’s, at the Defence Industry Development Meet chaired by Defence Minister Smt. Nirmala Sitaraman on January 18, 2018.
FIRE ACCIDENT IN CSLYour Company has laid topmost priority in integrating health, safety and environmental (HSE) aspects into business operations. However, CSL witnessed an unfortunate fire accident on February 13, 2018, onboard MODU Sagar Bhushan, the drillship of ONGC which was docked in the repair drydock. Despite concerted efforts by the Safety and Fire department of the yard,we lost 5 precious lives in the accident and 7 others were injured. This accident happened despite CSL having one of the most robust safety systems in the country, been the recipient of successive safety awards and has been giving high emphasis on employee safety training. This accident has triggered root cause analysis, and we are determined to do a deep introspection of all our systems and safety culture. CSL has subsequently implemented various additional measures, having closer vigil on systems and is now planning a major enterprise wide exercise involving reputed external agencies to significantly upgrade the culture of safety in the company.
We have reached out benevolently to the families of the deceased by providing Rs. 10 lakhs to each family over and above all the statutory dues, have offered employment to one immediate member in the family and have offered to
746th Annual Report
take care of all educational and allied expenditure of children till the graduation stage. For the injured, their salaries are being paid by the company and all medical expenditure is being taken care of.
It is a matter of great satisfaction that during these testing times the entire CSL family stood as one and received great support from the Central and State governments and from all walks of the society.
MAJOR EXPANSION PLANSIt gives me immense pleasure to inform that CSL is embarking on major expansion plans. The two major expansion plans of the company include the International Ship Repair Facility (ISRF) at the Cochin Port Trust premises and the new Drydock at the shipyard’s existing premises. These new facilities will expand the Company’s existing capabilities significantly. The new drydock will enable the yard to build and repair a broader variety of vessels including new generation aircraft carriers and oil rigs. The new International Shiprepair Facility will allow the Company to undertake repair of a broader range of smaller vessels and significantly increase shiprepair capacities. The progress on these expansion projects have been satisfactory.
INTERNATIONAL SHIP REPAIR FACILITY (ISRF)On November 17, 2017 Shri Nitin Gadkari, the Hon’ble Minister of Shipping, Road Transport & Highways and Water Resources, River Development and Ganga Rejuvenation laid the foundation stone for the ISRF after Cochin Port Trust (CoPT) allotted the second phase land area (8.134 ha) to the Company. The project is targeted to be commissioned by November 2019 at an estimated investment of Rs.970 Crores.
DRY DOCKThe new Dry Dock being set up by CSL at an estimate of Rs. 1,799 Crores,is expected to augment the Company’s shipbuilding/ ship repair capacity essentially required to tap the market potential of building and repairing specialized and technologically advanced large vessels such as LNG vessels, larger aircraft carriers, drill ships, and dry-dock repairs of semi-submersibles, jack-up rigs, etc. Subsequent to the receipt of all statutory clearances for the Dry Dock Project, the construction contract for the Plant & Machinery has been awarded in May 2018. Procurement process for the 600 T Gantry crane is at an advanced stage.The facility is targeted to be commissioned by June 2021.
The new drydock will enable the yard to build and repair
a broader variety of vessels including
new generation aircraft carriers and
oil rigs. The new ISRF facility will
allow the Company to undertake repair of a broader range of smaller vessels
and significantly increase shiprepair
capacities.
8 Cochin Shipyard Ltd
NEW INITIATIVESGeographical expansion is the key area in focus for CSL during the year 2018-19. By teaming up with the major ports on the eastern and western coasts of India, CSL will be able to leverage its competitive advantage in Ship building and Ship Repair to achieve new heights in the industry by exploiting the wider opportunities in Inland and Coastal Shipping. CSL has already inked MoUs with Mumbai Port Trust and Kolkata Port Trust and is confident to commence its Ship Repair Operations during this year. Subsidiary HCSL will cater to the upcoming demand for the Small and medium sized vessels for Coastal segments and Inland waterway segments specifically at NW-1, NW-2 and NW-5, which are now on the key focus of Government of India.
CSL has already received clearance for 10 Nos. Ro-Ro vessels for Inland Waterways Authority of India (IWAI) which will showcase capabilities in the emerging Inland vessel segment. CSL is keeping a close watch on new and green technologies like Electric Propulsion, Fuel Cells, LNG and Methanol fuelled engines etc in the shipping sector in India. As a first step towards its adaptation to the changing needs for alternate clean fuels, CSL is actively developing Methanol fuelled vessels for Inland Water Authority of India (IWAI) and the
first vessel is expected to be in waters by 2019.
Imbibing the digital technology trends in Shipping Industry, CSL is teaming up with M/s. ABB by integrating centralized electrical and automation systems in the 1200 pax vessels being built for A&N Administration, that allows predictability in operations and focusses primarily on safety and reliability of the onboard systems. These systems also enable remote trouble shooting. These ships complying with the International Maritime Organization’s Safe Return to Port (SRtP) requirements for passenger ships will be a key differentiator and will be the First-of-its kind in this part of the world.
CSL has kept its doors open for the Innovation, Technology Inception, Automation and Modernisation in the yard, its operations and its processes; and is looking forward to take steps towards achieving a significant transformation to adapt itself to ever changing technology trends in the market.
CORPORATE GOVERNANCEThe Company continued to comply with good corporate governance practices as stipulated by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and guidelines of the Department of Public Enterprises (DPE). The total strength of the
Board of Directors as on July 18, 2018 is twelve out of which six are Independent Directors. The Company has constituted an Audit Committee consisting of three Independent Directors. A Nomination and Remuneration Committee, CSR Committee and Stakeholder Relationship Committee chaired by an Independent Director have been constituted. Shri Pravir Krishna IAS, demitted office of director on relinquishing his charge as the Joint Secretary, Shipping. Shri Satinder Pal Singh IPS, the present Joint Secretary, Shipping was appointed on the board on October 04 2017. Shri Bejoy Bhasker took over charge as Director (Technical) on April 05, 2018 in place of Shri Sunny Thomas who superannuated on November 30, 2017. Shri Jyothilal K R, IAS, Principal Secretary (Transport) Government of Kerala, was appointed on the Board on April 20, 2018.
HUMAN RESOURCE DEVELOPMENTThe success of your company is attributable to its employees and to keep its employees motivated and well trained various programmes have been devised. On the HR front, we have institutionalized syllabus based structured training programme for our officers and workmen. Our officers are being exposed to the best practices in other industries and are undergoing courses in prestigious management
946th Annual Report
institutes like IIMK, IIMA, IIMC etc. Under the comprehensive training programme titled “Young Officers Competency Development Programme” a total of 47 sessions were held over five modules and the first batch consisting of 24 executives have since completed the training. A second batch comprising of 25 Executives have also commenced training.
Various ‘People first’ initiatives like Shipyard Pariwar Prathibha Puraskar, Nethruthwa Samvriddhi Yojna, Shipyard Santwana Yojna, Mentor Mentee scheme have been well received by the CSL family and will continue on strong footing. ‘Prajyoti’ and ‘Atmajyoti’ talk series will continue to lead us in our quest for knowledge.
INDUSTRIAL RELATIONSThe industrial relation scenario has been peaceful in the Company. The recognized trade unions have resorted to various means of protests to highlight their concerns over the recently concluded Initial Public Offer (IPO). All such protests have been within the framework of legitimate and democratic trade union activities and have been peaceful.
RESEARCH AND DEVELOPMENT (R & D)R&D policy of CSL is to enhance the company’s pre-eminence in Shipbuilding, Ship repair and other chosen fields and products through Research and
Development. In-house R&D activities have been undertaken during the year 2017-18 mainly in the areas of welding procedure development and qualification of welders.
CSL is now exploring the schemes to encourage innovation-culture among the employees of the yard and is targeting to drive a change management in the organisation so as to ensure a hand-in-hand approach with technology changes.
SKILL DEVELOPMENTThe Company takes up various skill development initiatives within and outside the Company. CSL is a member of Strategic manufacturing sector skill council which has been set up to take forward the Skill India Mission. An exclusive skill development programme for Pipe Fitters under the Strategic Manufacturing Sector Skill Council (SMSSC) Scheme had been conducted and 18 participants mostly workmen drawn from the sub contract pool of workmen in CSL and trainees attended the programme.
INTEGRATED MANAGEMENT SYSTEMThe Shipyard continues to be compliant with the Integrated Management System (IMS) consisting of ISO 9001 Quality Management System, ISO 14001 Environment Standards and OHSAS 18001 Occupational Health and Safety Standards.
Geographical expansion is the
key area in focus for CSL during the year
2018-19. By teaming up with the major
ports on the eastern and western coasts
of India, CSL will be able to leverage
its competitive advantage in Ship building and Ship Repair to achieve
new heights in the industry by
exploiting the wider opportunities in
Inland and Coastal Shipping.
Madhu S NairChairman and Managing Director
Cochin Shipyard Ltd10
CSL will be upgrading its Quality Management system and Environmental management systems to the latest ISO 9001:2015 and ISO 14001:2015 standards respectively by September 2018.
CORPORATE SOCIAL RESPONSIBILITYYour Company continues to fulfil its obligation towards society through its CSR initiatives. The Company has identified and implemented socially impactful projects in a time bound manner. The total amount spent on CSR projects during the year 2017-18 was Rs 8.57 crore as against the mandated amount of Rs 8.54 crore as per the provisions of the Companies Act, 2013.
INITIAL PUBLIC OFFERThe Initial Public Offer (IPO) referred earlier comprise of 3,39,84,000 equity shares of Rs 10 each consisting of (a) 1,13,28,000 equity shares by way of offer for sale by GOI and (b) 2,26,56,000 equity shares by fresh issue, was opened on August 01, 2017 and remained opened till August 03, 2017. The Company filed the prospectus with the Registrar of Companies, Kerala on August 04, 2017. The issue price was fixed at Rs. 432 per share. However, the Retail Individual Investors and the Employees of CSL were given a discount of 5% (approx.) and the shares were offered to them at Rs. 411 per share. The
10 Cochin Shipyard Ltd
1146th Annual Report
Company listed its equity shares at BSE Ltd. and NSE of India Ltd. on August 11, 2017. The issue was subscribed 76.18 times and a whopping Rs. 1,442.93 crore was raised. With more than 20 lakh applications, CSL’s IPO was celebrated by the capital markets and was recorded as one of the most successful IPOs in recent history. I believe it is the strength and reputation of the company that generated investor interest in us.
ACCOLADESThe excellent performance of your company has won appreciation from various quarters. The Company is all set to maintain its “high level” rating against the MOU targets set by the Department of Public Enterprises, Government of India for the year 2017-18. However, the final rating from the Department of Public Enterprises is awaited.
Cochin Shipyard has received the Kerala State Energy Conservation Award 2017 in the category of ‘Large Scale Energy Consumers’ and Kerala State Renewable Energy Award 2017 from the Government of Kerala. The Company has won the MKK Nair Memorial Award for the Second Best Productivity Performance from Kerala State Productivity Council. The Company has also received the KMA excellence award for best CSR activities undertaken, India Seatrade Award 2017 for
the Shipbuilding & Repair Yard of the Year, Bureaucracy Today CSR excellence award for Rural Development, from Bureaucracy Today, Top exporter (PSU) at Kochi award from customs for the calendar year 2017, Corporate citizen award by Public Relations council of India for the year 2018 and Award for Best Stall in the IND EXPO 2017 from the Ministry of MSME.
CONCLUSIONCSL is presently in an extremely challenging and competitive business environment. It is very important that we develop, maintain and strengthen our core competencies. CSL has always been able to portray its competitive advantage & capabilities for bagging contracts amidst stiff competition. The vast opportunities posed by the Inland waterways segment and the huge expansion plans of CSL would help the Company to reach greater heights. Along with its qualities of hardwork, dedication and commitment, CSL has to maintain its competitive edge by continually developing and adapting itself with the fluctuating market needs and technology advancements. The changes that we have to bring into our system are to be advance, modern, economically viable and sustainable. I strongly believe that this yard will strive towards achieving the commanding heights in Ship building and Ship Repair Industy, and I believe that
each and every employee of CSL with their indomitable spirit would be the pillars of growth for the Company and will work towards this common goal of the organisation; and of the country.
I convey my thanks to all the Board Members for their valuable contribution in propelling this great organization.
I thank the Ministry of Shipping, other offices of Government of India, the Government of Kerala and West Bengal for their support.
Finally I would like to take this opportunity to thank all shareholders for the trust and support and solicit continued support to fulfill your expectations.
Thanking You
Jai Hind
Madhu S NairChairman and Managing DirectorDIN: 07376798
12 Cochin Shipyard Ltd
OURCREDENTIALS
12 Cochin Shipyard Ltd
SHIP REPAIR
OFFSHORE
QUALITY
SHIP BUILDINGHas built various types of vessels including Oil Tankers, Bulk Carriers, Tugs, Dredger, Platform Supply Vessels, Passenger Vessels, Anchor Handling Tug Supply vessels etc. Reputed international clientele. Currently building Aircraft Carrier, Technology Demonstration Vessel and Passenger Vessels.
Only yard in India which has undertaken drydock repairs of Aircraft Carriers INS Viraat and INS Vikramaditya. Can undertake complex and sophisticated repairs to all types of vessels including Oil Rigs, Naval and Coast Guard Vessels, Offshore Vessels, Dredgers, Fishing Vessels, Passenger Ships, Port Crafts, and all other Merchant Vessels.
CSL conforms to the Integrated Management System comprising of ISO 9001:2008 – Quality Management System, ISO 14001:2004 - Environmental Management System and OHSAS 18001:2007 – Occupational Health and Safety Management System. Has a NABL accredited laboratory for destructive and non destructive testing.
CSL will be upgrading its Quality Management system and Environmental management systems to the latest ISO 9001:2015 and ISO 14001:2015 respectively by September 2018.
Has undertaken a variety of complex and sophisticated offshore Upgradation contracts.
1346th Annual Report
Bahamas
IndiaJeddah
Cyprus
Germany
USA
Netherlands
Norway
AbuDhabi
COCHINSHIPYARD LTD
Vessels built and delivered by Cochin Shipyard Limited (Total as on March 31, 2018)
Large Vessels
Offshore Support Vessels
Small & Medium Vessels
DefenceVessels
1535
5220
AROUND THE WORLD
PROJECT TIMELINE
14 Cochin Shipyard Ltd
CSL Business Strategy Key recent developments Achieved / Expected Key Performance Indicators Goals for FY19 and beyond Expand 0perational capabilities
CSL is in the process of expanding the existing capacity in shipbuilding and shiprepair by adding a new Dry Dock at CSL premises and an International Ship Repair Facility (ISRF) at Cochin Port Trust land taken on 30 years lease. The total capex for putting up the above two facilities is Rs 2768 crore. Out of this Rs 941 crores will be financed from the IPO proceeds. The remaining cost is to be financed through internal accrual of the company and debt.
Signed MOU with Mumbai Port Trust for setting up of shiprepair facilities in their Indira Dock.
Signed MOU with Kolkata Port Trust for setting up of shiprepair facilities at their Netaji Subhas Dock.
Our proposed Dry Dock and ISRF will increase our ability to build, repair and service a broader range of vessels including vessels of larger capacities. The new Dry Dock measuring 310 x 75/60 x 13 m with 2 x 600T Gantry crane will be capable of handling vessels upto Suezmax, Aircraft Carriers of 75000T displacement, Jack-up rigs, LNG vessels etc.
The ISRF- 6000T shiplift for ships upto 130 x 25 m with six transfer work stations and allied facilities. Total outfitting berth of 1500 meters approx.
ISRF :-Piling and construction work commenced and to be in full swing.
DRYDOCK: Construction contract awarded and works to commence in full swing to meet targeted completion.
The Drydock project is expected to be completed by FY 2021 and the ISRF project by FY 2020.
Explore emerging opportunities in national & International joint ventures / technology tie-ups.
Formed a JV company with Hooghly Dock and Port Engineers Ltd. for operationalizing their facilities at Salkia and Nazirgunge for construction and repair of vessels for inland and coastal waterways.
Signed a MOU with United Shipbuilding Corporation (USC), Russia to collaborate and engage in design, development and execution of high-end, state-of-art vessels for inland and coastal waterways.
Signed Memorandum of Intent (MoI) with DRDO for partnership for the export of defence vessels with defence systems developed by the DRDO and its industrial partners.
Tap the opportunities in inland waterways segment.
MOU with DRDO will help in tapping export opportunities in defence shipbuilding
In FY 19 the DPR for the Joint Venture facility will be finalised and the contract for construction will be awarded.
As per the feasibility study conducted by M/s KITCO the project completion will take 18 months from the award of contract and receipt of all approvals.
To carry out Research & Development, innovation, technological upgradations.
Welding of lower thickness plates using one side welding process is a specialised method. Capability building in above area is of paramount importance to yard. Weld procedure development (WPS) has been undertaken in house for welding of lower thickness plate of high strength steel (AH 36) of 10 mm thickness using one side welding process employing twin wire with copper backing.
The procedure has been validated by ABS Classification society and welder has been qualified for performing the welding process.
Development of new products or products with new features.
Development of Submerged Arc Welding (SAW) process with ceramic backing for one side welding for productivity improvement in panel welding.
To be the supplier of choice through quality, on time product delivery and competitive bidding / cost efficient processes.
Emerged as the lowest bidder for a project of Indian Navy worth Rs.5400 Cr comprising of eight vessels.
Completed repairs of Naval refits of INS Shakti, INS Airavat, INS Cheriyam and INS Cora Divh. Also completed repairs of various transhipment vessels.
On repair front won the Sagar Bhushan from ONGC and Sagardhwani of DRDO.
Orders value in hand in shipbuilding and ship repair as on March 31, 2018 is estimated at Rs.13,000 crore (approx.) factoring balance on IAC (Cost plus) and Phase III.
Projects at contract stage amounting to Rs.5800 crores approx.
To build a responsible corporate citizen image through CSR & Sustainability projects and compliance to Corporate Governance principle.
Focus areas of CSL CSR continued to be health, education, capacity building, environmental protection, sanitation and drinking water for the economically poor and weaker sections of the society including the differently abled ones, senior citizens etc. The total outlay achieved for CSR and Sustainable causes was Rs. 857.08 lakhs.
(a) Received Corporate Citizen of the year 2018 Award for outstanding contribution to the profession, industry and society, given by Public Relations Council of India.
(b) KMA excellence award for best CSR activities undertaken.
(c) Bureaucracy Today CSR excellence award for ‘Rural Development’, given by Bureaucracy Today.
(d) Madhu S Nair, CMD, Cochin Shipyard Limited, was honoured with the ‘CSR-Oriented Chairman/CMD/MD of The Year (PSU)’ Award, given by Bureaucracy Today.
To follow the path of shared inclusive growth, distributing the fruits of its prosperity towards improved quality of life of the society and contributing to environment and nature for sustainable development.
KEY PERFORMANCEINDICATORS
14 Cochin Shipyard Ltd
1546th Annual Report
CSL Business Strategy Key recent developments Achieved / Expected Key Performance Indicators Goals for FY19 and beyond Expand 0perational capabilities
CSL is in the process of expanding the existing capacity in shipbuilding and shiprepair by adding a new Dry Dock at CSL premises and an International Ship Repair Facility (ISRF) at Cochin Port Trust land taken on 30 years lease. The total capex for putting up the above two facilities is Rs 2768 crore. Out of this Rs 941 crores will be financed from the IPO proceeds. The remaining cost is to be financed through internal accrual of the company and debt.
Signed MOU with Mumbai Port Trust for setting up of shiprepair facilities in their Indira Dock.
Signed MOU with Kolkata Port Trust for setting up of shiprepair facilities at their Netaji Subhas Dock.
Our proposed Dry Dock and ISRF will increase our ability to build, repair and service a broader range of vessels including vessels of larger capacities. The new Dry Dock measuring 310 x 75/60 x 13 m with 2 x 600T Gantry crane will be capable of handling vessels upto Suezmax, Aircraft Carriers of 75000T displacement, Jack-up rigs, LNG vessels etc.
The ISRF- 6000T shiplift for ships upto 130 x 25 m with six transfer work stations and allied facilities. Total outfitting berth of 1500 meters approx.
ISRF :-Piling and construction work commenced and to be in full swing.
DRYDOCK: Construction contract awarded and works to commence in full swing to meet targeted completion.
The Drydock project is expected to be completed by FY 2021 and the ISRF project by FY 2020.
Explore emerging opportunities in national & International joint ventures / technology tie-ups.
Formed a JV company with Hooghly Dock and Port Engineers Ltd. for operationalizing their facilities at Salkia and Nazirgunge for construction and repair of vessels for inland and coastal waterways.
Signed a MOU with United Shipbuilding Corporation (USC), Russia to collaborate and engage in design, development and execution of high-end, state-of-art vessels for inland and coastal waterways.
Signed Memorandum of Intent (MoI) with DRDO for partnership for the export of defence vessels with defence systems developed by the DRDO and its industrial partners.
Tap the opportunities in inland waterways segment.
MOU with DRDO will help in tapping export opportunities in defence shipbuilding
In FY 19 the DPR for the Joint Venture facility will be finalised and the contract for construction will be awarded.
As per the feasibility study conducted by M/s KITCO the project completion will take 18 months from the award of contract and receipt of all approvals.
To carry out Research & Development, innovation, technological upgradations.
Welding of lower thickness plates using one side welding process is a specialised method. Capability building in above area is of paramount importance to yard. Weld procedure development (WPS) has been undertaken in house for welding of lower thickness plate of high strength steel (AH 36) of 10 mm thickness using one side welding process employing twin wire with copper backing.
The procedure has been validated by ABS Classification society and welder has been qualified for performing the welding process.
Development of new products or products with new features.
Development of Submerged Arc Welding (SAW) process with ceramic backing for one side welding for productivity improvement in panel welding.
To be the supplier of choice through quality, on time product delivery and competitive bidding / cost efficient processes.
Emerged as the lowest bidder for a project of Indian Navy worth Rs.5400 Cr comprising of eight vessels.
Completed repairs of Naval refits of INS Shakti, INS Airavat, INS Cheriyam and INS Cora Divh. Also completed repairs of various transhipment vessels.
On repair front won the Sagar Bhushan from ONGC and Sagardhwani of DRDO.
Orders value in hand in shipbuilding and ship repair as on March 31, 2018 is estimated at Rs.13,000 crore (approx.) factoring balance on IAC (Cost plus) and Phase III.
Projects at contract stage amounting to Rs.5800 crores approx.
To build a responsible corporate citizen image through CSR & Sustainability projects and compliance to Corporate Governance principle.
Focus areas of CSL CSR continued to be health, education, capacity building, environmental protection, sanitation and drinking water for the economically poor and weaker sections of the society including the differently abled ones, senior citizens etc. The total outlay achieved for CSR and Sustainable causes was Rs. 857.08 lakhs.
(a) Received Corporate Citizen of the year 2018 Award for outstanding contribution to the profession, industry and society, given by Public Relations Council of India.
(b) KMA excellence award for best CSR activities undertaken.
(c) Bureaucracy Today CSR excellence award for ‘Rural Development’, given by Bureaucracy Today.
(d) Madhu S Nair, CMD, Cochin Shipyard Limited, was honoured with the ‘CSR-Oriented Chairman/CMD/MD of The Year (PSU)’ Award, given by Bureaucracy Today.
To follow the path of shared inclusive growth, distributing the fruits of its prosperity towards improved quality of life of the society and contributing to environment and nature for sustainable development.
1546th Annual Report
16 Cochin Shipyard Ltd
(` in crores)
(` in crores)
(` in crores)
(`)
1652.66
194.24
290.96
17.15
1859.51
235.07
367.56
20.75
1993.45
273.79
419.65
24.07
2058.87
321.55
493.40
28.39
2355.12
396.75
604.86
31.03
TURNOVER
PROFIT AFTER TAX
PROFIT BEFORE TAX
EPS
Key Indicators 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
l EPS (Rs. per share) 31.03 28.39 24.07 20.75 17.15 16.35 15.21 20.09 19.69 14.13
l Face Value Per Share (Rs.) 10 10 10 10 10 10 10 10 10 10
l EBDIT/ Gross Turnover (%) 27.76 26.35 23.52 22.81 20.37 20.45 20.21 26.70 29.20 22.00
l Net Profit Margin % 16.85 15.62 13.73 12.64 11.75 11.92 12.27 15.57 17.86 12.74
l Return on Net Worth % 12.19 15.85 15.09 15.06 14.15 15.76 16.40 23.51 32.78 28.26
l Return on Capital Employed % 12.35 15.39 16.15 14.50 13.97 19.08 18.76 27.44 38.57 29.09
FINANCIALHIGHLIGHTS
FY 13-14
FY 13-14
FY 13-14
FY 13-14
FY 14-15
FY 14-15
FY 14-15
FY 14-15
FY 15-16
FY 15-16
FY 15-16
FY 15-16
FY 16-17
FY 16-17
FY 16-17
FY 16-17
FY 17-18
FY 17-18
FY 17-18
FY 17-18
1746th Annual Report
Particulars 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
l Turnover 2355.12 2058.87 1993.45 1859.51 1652.66 1554.16 1404.85 1461.72 1248.50 1256.21
l Total income 2544.28 2217.50 2107.37 1952.97 1728.64 1642.33 1481.54 1589.17 1326.49 1383.26
l Profit Before Tax (PBT) 604.86 493.40 419.65 367.56 290.96 275.55 252.97 344.23 331.25 247.63
l Depreciation & write offs 37.51 38.51 37.19 38.33 26.43 19.22 18.07 17.06 15.24 9.80
l Profit After Tax (PAT) 396.75 321.55 273.79 235.07 194.24 185.27 172.33 227.53 223.04 160.07
l Equity Share Capital 135.94 113.28 113.28 113.28 113.28 113.28 113.28 113.28 113.28 113.28
l Reserves & Surplus 3119.93 1915.30 1701.05 1447.79 1239.25 1062.42 898.41 775.38 490.54 336.70
l Net Worth 3255.87 2028.58 1814.33 1561.07 1352.53 1175.70 1050.83 967.80 680.32 566.49
l Gross Fixed Assets 369.79 357.72 569.53 636.84 602.38 444.35 376.73 362.10 349.68 270.39
l Net Fixed Assets 284.47 302.85 296.44 377.44 383.41 247.30 192.61 190.67 189.75 121.64
l Number of Employees 1781 1829 1671 1786 1751 1656 1900 1818 1907 1962
(` in crores)
(` )
1353
1390
1561
1621
1814
1695
2029
2089
3256
3212
NET WORTH
CAPITAL EMPLOYED
FY 13-14
FY 13-14
FY 14-15
FY 14-15
FY 15-16
FY 15-16
FY 16-17
FY 16-17
FY 17-18
FY 17-18
Lakhs
Lakhs
35749
857
Contribution to national exchequer
CSR Spend FY 18
`
Lakhs
27140Employee benefit Expenses
`
`
18 Cochin Shipyard Ltd
OUR PEOPLECSL Approach: Cochin Shipyard recognizes that among all resources it is the Shipyard’s abundant professional, skilled and trained Human Resources who have been propelling the Shipyard towards achievement of targets and helping CSL gain a competitive advantage. The Human Resources (HR) of CSL forms a very critical part of the company’s business strategy. Human Resource (HR) Management System procedures and approach in CSL are designed to maximize employee welfare and performance. The company focuses on effective management and development of human resources, recruitment, training and development, performance appraisal and rewards. HR is also concerned with the organizational change and maintaining a healthy employer employee relationship climate in the organization.
KEY HR PRIORITIES
Effectively plays the role of a strategic team member.
Planning for pragmatic manpower induction, re-skilling, redeployment and retention of human resources.
Develop and position the right mix of personnel.
Create, maintain and nurture a healthy employer-employee relation.
Evolve and implement best industry practices with transparency in approach, competitive reward and incentive systems for excellence in performance.
Focus on continual improvement for skill and knowledge development so as to enhance effectiveness in job.
Provide effective and meaningful social support to the community/ society around.
management development programmes at IIMA, IIMK, IIMC. Executives were also nominated to NIAS-IISC.
• Industrial orientating training programme- is an initiative wherein a group of executives and executive trainees are deputed to visit other Shipyards/Public Sector Undertakings of different industrial nature. The objective of the programme is to help the executives to gain a comprehensive knowledge of various kinds of work environment outside CSL.
• Mentoring Scheme - to encourage the mentor to be a friend, philosopher and a guide to the new entrants’ especially executives/executive trainees of CSL. The scheme will help the mentee to get focused attention from a senior executive for support and guidance in the organization, building competencies among the new entrants and ensuring their smooth induction. It also helps to increase sense of commitment and belongingness in the newcomers and increase employee retention.
KNOWLEDGE MANAGEMENT
• CSL has developed Knowledge Management platform on Mobile called “StarBoard”. This platform has provisions for sharing of both explicit knowledge and tacit knowledge.
• Department of Public Enterprises is developing a common Knowledge Management Portal for all Central Public Establishments (CPSEs). CSL is one of the 50 CPSEs shortlisted for Phase-I implementation.
KEY INITIATIVES DURING FY18
Training: During the year, 645 employees across all categories had been nominated for a total of 78 programmes conducted by reputed organisations. Young officers’ competency development training programme continued during the year. A total of 47 sessions were held covering five modules. 24 executives have since completed training under the scheme.
Ongoing Leadership Initiatives :
• An educational scholarship scheme “Shipyard Pariwar Prathibha Puraskar” launched to reward and promote the star performers among the regular employees of CSL.
• Leadership Acceleration Programme (LEAP) A scheme for scholarship for higher studies in IITs called “Nethruthwa Samvriddhi Yojana - Leadership Acceleration Programme (LEAP)” for upgrading Technical and Managerial Competencies of Officers in the core areas like Naval Architecture, Ship Design, Marine Engineering and Business Management.
• “Prajyoti” Leadership Talk Series - to help initiate, trigger and cascade the process of leadership development in the shipyard. The Executives learn from leaders from different walks of life and industries,
• “Atmajyoti”– An inner awakening talk series for all employees of CSL. The objective of the Atma Jyoti series by eminent people is to instill in the mind the splendid light of wisdom ignited by visionary experiences.
• Executives across all levels totalling 127 numbers were nominated to attend specific
1946th Annual Report
HR Vision
Emanating from the goals and objectives enshrined in the corporate mission statement, the strategic Human Resources Vision of the Shipyard is to strive and create a unique institution that integrates creativity, innovation, technology, business and good corporate governance practices for all round improvement in the quality of work life of the yard’s workforce.
HR Mission
To provide a vibrant platform for all those working in the yard to give their best and ensure all round growth both for the individual and organization.
HR Policy
Human Resources Policies are oriented towards providing the right mix of human resources, their empowerment and enrichment so as to meet organizational targets and results.
Target
To plan for, introduce/implement HR Policies based on performance that would ensure growth, recognition, rewards, motivation, competence building, commitment and healthy employer-employee relations.
20 Cochin Shipyard Ltd
BOARD OF DIRECTORS
Shri Madhu S Nair assumed charge as the Chairman and Managing Director of the Company on January 1, 2016. He had joined the Company as an executive trainee in June 1988. He holds a Degree of Bachelor of Technology in Naval Architecture and Ship Building from Cochin University of Science and Technology, India and a Degree of Master in Engineering with specialisation in Naval Architecture and Ocean Engineering from Osaka University, Japan. He has completed a training course in Shipbuilding-Production Control at Ishikawajima Harima Heavy Industries Overseas Vocational Training Association organised by the Japan International Cooperation Agency under the International Cooperation Programme of the Government of Japan. Furthermore, he has also attended an intensive Japanese language course at Osaka International Centre. He is a member of the Royal Institution of Naval Architects, London. He has approximately 30 years of work experience with the Company. He is also a CSL Nominee Director in the Board of Hooghly Cochin Shipyard Limited, a Joint Venture Company between Cochin Shipyard Limited and Hooghly Dock & Port Engineers Limited.
Shri Satinder Pal Singh is a Part Time Official (Nominee) Director of the Company representing Ministry of Shipping, Government of India. He was inducted into the Board from October 04, 2017. He holds a Bachelor degree in civil engineering from Regional Engineering College, Srinagar, Post Graduate degree in law from Brunel University, London and Master’s degree in Police Management from Osmania University, Hyderabad. He is an IPS Officer of 1995 batch (Himachal Pradesh cadre) and has served in senior positions in the State Government of Himachal Pradesh, including Superintendent of Police, Special Secretary in the Department of Home and Inspector General of Police. He is currently posted as Joint Secretary, Ministry of Shipping, Government of India and prior to this he has served as Director (Housing) in the Ministry of Housing and Urban Affairs.
Shri D Paul Ranjan is the Director (Finance) and Chief Financial Officer of the Company from May 1, 2014. He is a Chartered Accountant and has completed post qualification course in Information Systems Audit (ISA) from the Institute of Chartered Accountants of India. He had joined the Company as an executive trainee in December 1984. He has approximately 33 years of work experience with the Company wherein his responsibilities included financial management, strategic planning, risk management, forex management, budgeting and cost control. He is also in charge of the Information Systems Department. He is also a CSL Nominee Director in the Board of Hooghly Cochin Shipyard Limited, a Joint Venture Company between Cochin Shipyard Limited and Hooghly Dock & Port Engineers Limited.
Shri Jyothilal K R is a Part Time Official (Nominee) Director of the Company representing Government of Kerala. He was inducted into the Board from April 20, 2018. He holds a degree of bachelor of technology in Chemical Engineering from IIT Chennai.He is an IAS Officer of 1993 batch (Kerala cadre) and served in various departments of the Government of Kerala viz. Land Revenue Management and District Administration, Fisheries / Agriculture & Cooperation, Information Technology, Food, Civil Supplies & Consumer Affairs etc. He is currently posted as Principal Secretary (Transport), Government of Kerala.
Chairman and Managing Director
Part Time Official (Nominee) Director
Director (Finance) and Chief Financial Officer
Part Time Official (Nominee) Director
SHRI MADHU S NAIR
SHRI SATINDER PAL SINGH
SHRI D PAUL RANJAN
SHRI JYOTHILAL K R
20 Cochin Shipyard Ltd
2146th Annual Report
Shri Suresh Babu N V is the Director (Operations) of the Company from April 26, 2016. He holds a degree of Bachelor of Engineering (Mechanical) from the University of Kerala. He holds a Diploma in Management from Indira Gandhi National Open University. He has completed one year Group Training Course in Shipbuilding, Repairing and Maintenance conducted by Overseas Shipbuilding Cooperation Centre under International Cooperation Programme of the Government of Japan under Colombo Plan. He has also undergone a practical training course with shipyard in Sekaide, Japan of Kawasaki Heavy Industries Limited. Furthermore, he has completed supplementary course in Japanese language held at Overseas Shipbuilding Cooperation Centre. He joined the Company as an executive trainee in February 1985. He has approximately 33 years of work experience with the Company wherein he has had experience across various areas of the shipyard such as Ship Building, Materials and Ship Repair divisions. He is also a CSL Nominee Director in the Board of Hooghly Cochin Shipyard Limited, a Joint Venture Company between Cochin Shipyard Limited and Hooghly Dock & Port Engineers Limited.
Shri Bejoy Bhasker assumed charge as the Director (Technical) of the Company on April 05, 2018. He holds a Degree of Bachelor of Technology (Mechanical) from the University of Kerala with First Rank and Gold Medal. He also holds a Degree of Master of Technology (Mechanical) from the Indian Institute of Technology, Madras. He completed Advanced Diploma in Management from Indira Gandhi National Open University. He joined the Company on June 29, 1988 as an executive trainee. He was awarded the “Manager of the Year” award in 2014 by Kerala Management Association. He has approximately 30 years of work experience with the Company wherein he was involved in Ship Design, Ship Building, Outfit and Ship Repair divisions of the Company. He is also a CSL Nominee Director in the Board of Hooghly Cochin Shipyard Limited, a Joint Venture Company between Cochin Shipyard Limited and Hooghly Dock & Port Engineers Limited.
Director (Operations) Director (Technical)
SHRI SURESHBABU N V SHRI BEJOY BHASKER
Shri Krishna Das E is a Non-Official Part Time (Independent) Director of the Company from March 21, 2016. He holds a Degree of Bachelor in Commerce from University of Calicut and a Bachelor of Law from Mangalore University. He is an Advocate on the roll of the Bar Council of Kerala since 1996 and practising in the District Courts at Palakkad, Kerala.
Non-Official Part Time (Independent) Director
SHRI KRISHNA DAS E
Smt. Roopa Shekhar Rai is a Non-Official Part Time (Independent) Director of the Company from March 21, 2016. She holds a Degree of Bachelor in Science from Nagpur University and Master of Arts from Rashtrasant Tukadoji Maharaj Nagpur University. She also holds a Diploma in Homoeopathic Medical Science from Homoeopathic and Biochemic Doctor’s Training Institute. She was the Chairperson of the Ladies Wing of Vidarbha Industries Association in the year 1994-95.
Non-Official Part Time (Independent) Director
SMT. ROOPA SHEKHAR RAI
2146th Annual Report
22 Cochin Shipyard Ltd
Shri Pradipta Banerji is a Non-Official Part Time (Independent) Director of the Company from July 15, 2017. He holds a Degree of Bachelor of Technology from Indian Institute of Technology, Delhi. He also holds a Degree of Master of Science and a Doctorate of Philosophy (Ph.D) from University of California, Berkeley, USA. He has done an executive development programme with Kellogs School of Management, Northwestern University, USA. He is currently associated with Indian Institute of Technology, Bombay. He is the former director of Indian Institute of Technology, Roorkee. He has received “Excellence in Teaching” award from Indian Institute of Technology, Bombay.
Shri Nanda Kumaran Puthezhath is a Non-Official Part Time (Independent) Director of the Company from July 15, 2017. He holds Bachelor of Arts and Master of Arts degrees from Calicut University. He is also a Certified Associate of the Indian Institute of Bankers. He has been associated with State Bank of India from 1975 to 2011, post which he was appointed as the Managing Director of State Bank of Travancore from 2011 to 2013. He has, after his retirement from State Bank of India Group in 2013, also held various positions including the President of MobMe Wireless Solutions Limited, the Chief Executive Officer of Alpha Palliative Care and the Managing Director of Atlas Jewellery India Limited.
Non-Official Part Time (Independent) Director Non-Official Part Time
(Independent) Director
SHRI PRADIPTA BANERJI SHRI NANDA KUMARAN PUTHEZHATH
Shri Jiji Thomson is a Non-Official Part Time (Independent) Director of the Company from July 15, 2017. He holds Bachelor of Arts and Master of Arts degrees in Economics from University of Kerala and Degree of Master of Social Science in Public Economic Management from University of Birmingham, UK. He belongs to the 1980 batch of the Indian administrative service (Kerala cadre). In the past, he has been the Chief Secretary of the Government of Kerala from January 2015 to February 2016 and Director General in Sports Authority of India, Ministry of Youth Affairs and Sports from March 2013 to January 2015.
Non-Official Part Time (Independent) Director
SHRI JIJI THOMSON
Shri Radhakrishna Menon is a Non Official Part Time (Independent) Director of the Company from March 21, 2016. He holds a Degree of Bachelor in Legal, Social Science from Bharati Vidyapeeth’s New Law College, Pune. He is the President of Travancore Travel and Tourism Co-operative Society Limited. In addition to being an entrepreneur and proprietor of Devi Agency and Devi Traders, he is also the Vice-President of the World Malayalee Organisation. He is a Non-Official Member of General Council for National Livestock Mission, Ministry of Agriculture and Farmer Welfare, Government of India.
Non Official Part Time (Independent) Director
SHRI RADHAKRISHNA MENON
BOARD OF DIRECTORS
22 Cochin Shipyard Ltd
2346th Annual Report
SOCIALRESPONSIBILITY
CSR VISION
Cochin Shipyard Ltd. in consonance with its Corporate Vision looks forward to continuing in the best tradition of being a responsible Corporate Citizen recognised for the quality of its products and services and respected for its ethical way of conducting business. In this, it endeavours to follow the path of shared inclusive growth, thereby distributing the fruits of its prosperity towards improved quality of life of the society and contributing to environment and Nature for sustainable development.
Major take aways for CSL from CSR initiatives are (i) Building Corporate image (ii) Boosting CSL’s standing in the society which in turn improved the morale of the employees.
Major Projects
Minor Projects
Swachh Bharath
Education
Healthcare
OthersLakhs
31
39
33%
31%
12%
24%857
(Project cost more than Rs10 Lakh )
(Project cost less than Rs10 Lakh )
`
During FY18 the major focus areas of CSL CSR were Swachh Bharat, health, education, skill development, rural development, rehabilitation, environmental conservation, protection/ promotion of national monuments, art culture and heritage.
CSR OVERVIEW AND BUDGET ALLOCATION FY 18
24 Cochin Shipyard Ltd
CORPORATE INFORMATION
Board of Directors
Shri Madhu S NairChairman & Managing Director
Shri Paul Ranjan DDirector (Finance) andChief Financial Officer
Shri Sureshbabu N VDirector (Operations)
Shri Bejoy BhaskerDirector (Technical)
Shri Satinder Pal Singh IPSJoint Secretary (Shipping),Ministry of Shipping, Govt. of IndiaPart Time Official (Nominee) Director
Shri Jyothilal K R IASPrincipal Secretary (Transport)Government of KeralaPart Time Official (Nominee) Director
Smt. Roopa Shekhar RaiNon-Official Part Time (Independent) Director
Shri Krishna Das ENon-Official Part Time (Independent) Director
Shri Radhakrishna MenonNon-Official Part Time (Independent) Director
Shri Jiji Thomson IAS (Retd.)Non-Official Part Time (Independent) Director
Shri Pradipta BanerjiNon-Official Part Time (Independent) Director
Shri Nanda Kumaran PuthezhathNon-Official Part Time (Independent) Director
Management Team
Shri Ramesh K JChief General Manager(Human Resource & Training)
Shri Murugaiah MChief General Manager (Tech)
Shri Varghese M DChief General Manager(Industrial Relations & Administration)and Head CSR
Shri Neelakandhan A NGeneral Manager (Materials)
Shri Sreejith K NGeneral Manager (Ship Repair)
Shri Suresh Kumar A VGeneral Manager (Ship Building)
Shri Varadarajan SGeneral Manager & SO (M-SR)
Smt. V KalaGeneral Manager and Company Secretary
Shri Rajesh GopalakrishnanGeneral Manager(Business Development & New Projects)
Shri Harikrishnan SGeneral Manager (LNG, PM & PPC)
Shri Eldho JohnGeneral Manager (Infra Projects)
Shri Subramaniya Pillai RGeneral Manager (Design & Engg)
Shri Jose V JGeneral Manager (Finance)
Shri Sivakumar A General Manager (IAC)
Shri Sunil Kumar K RGeneral Manager (Mat-II)
Registered Office
Cochin Shipyard LimitedAdministrative Building,Cochin Shipyard Premises,Perumanoor, Kochi, Kerala,India – 682 015.
Bankers
State Bank of IndiaSyndicate BankUnion Bank of India
Statutory Auditors
M/s. Krishnamoorthy & KrishnamoorthyChartered Accountants,XXXIX/3217, Paliam Road,Cochin – 682 016.
Secretarial Auditors
SVJS & Associates, Company Secretaries39/3519B, Padmam Apartments,Manikkath RoadRavipuram, Cochin 682 016.
Cost Auditors
Shri K A FelixD31/670, Parvathy Nilayam,Opp. Welcare Hospital, Vytila P.O,Ernakulam – 682 019.
Debenture Trustees
SBICAP Trustee Company Ltd.6th Floor, Apeejay House,3, Dinshaw Wachha Road,Churchgate, Mumbai - 400 020.
Registrar & Transfer Agents
Link Intime India Pvt. Ltd.Surya, 35, Mayflower Avenue,Behind Senthil Nagar,Sowripalayam Road,Coimbatore – 641 028.
2546th Annual Report
Dear Shareholders,
1. Your Directors have pleasure in presenting the 46thAnnualReportofyourCompanyalongwiththeauditedfinancialstatementsfortheyearendedMarch31,2018.
Financial Performance2. The performance of Cochin Shipyard Limited (CSL)
continuedtobegoodduringtheyear2017-18.Inspiteof the continued global down-turn in shipbuildingindustry, the turnover for the year was ` 2355.12crores as compared to ` 2058.87 crores in the year2016-17.TheProfitBeforeTaxwas`604.86croresasagainst`493.40croresinthepreviousyear.Thenetprofitwas`396.75croresascompared to`321.55crores for the previous year. This performance is creditable considering the continuing recessionaryconditionsintheshippingandshipbuildingsector.
3. The authorised share capital of the Company is` 2,50,00,00,000 divided into 25,00,00,000 equityshares of face value of `10each.Thepaidupsharecapital of the Company is ` 1,35,93,60,000 dividedinto13,59,36,000equitysharesoffacevalueof`10each.CSLwent in foran IPO inAugust2017,whichconsistedofpublicissueof3,39,84,000equitysharesof face value of ` 10 each. In consequence of theIPO, the post issue paid up equity share capital ofCSL increased from ` 1,13,28,00,000 (pre-issue) to`1,35,93,60,000(postissue).TheCompanywaslistedinBSE&NSEonAugust11,2017.
Financial Highlights(`inCrs)
Sl No Particulars 2017-18 2016-17(i) GrossIncome 2544.28 2217.50
(ii) Profit before finance cost,depreciation&tax 653.78 542.45
(iii) Finance costs 11.41 10.54(iv) Depreciation&writeoff 37.51 38.51(v) ProfitBeforeTax 604.86 493.40(vi) Provisionfortax(Net) 208.11 171.85(vii) Netprofit 396.75 321.55
Dividend
4. As per Office Memorandum F.No.5/2/2016-Policydated May 27, 2016 issued by Department ofInvestment and Public Asset Management (DIPAM),everyCPSEhave topayaminimumannualdividendof30%ofPATor5%of thenet-worth,whichever is
DIRECTORS’ REPORT
higher. Accordingly, your Directors are pleased torecommend a dividend of ` 12/- per share on the13,59,36,000 fully paid Equity shares of ` 10 each.The totaloutgo fordividendanddividend taxwouldbe approximately ` 196.65 crores. No unclaimeddividend (previousyears’) isdue tobe transferred totheInvestorEducationandProtectionFund(IEPF).
Dividend Distribution Policy
5. AsperRegulation43AoftheSecuritiesandExchangeBoard of India (Listing Obligations and DisclosureRequirements)Regulations,2015thetopfivehundredlisted entities shall formulate a dividend distributionpolicy. Accordingly, dividend distribution policyhas been adopted to set out the parameters andcircumstances thatwillbe taken intoaccountby theBoard in determining the distribution of dividend toits shareholders and/or retaining the profit into thebusiness.ThepolicyisenclosedasAnnexure1tothethis report and is available on the CSL’s website athttps://www.cochinshipyard.com/links/Dividend%20Distribution%20Policy.pdf
194
2013-14 2014-15 2015-16 2016-17 2017-18
235273
322
397
Profit Ater Tax (` Crs)
13531561
18142029
3256
2013-14 2014-15 2015-16 2016-17 2017-18
Increasing Networth (` Crs)
26 Cochin Shipyard Ltd
Transfer to Reserves
6. During the year an amount of ` 2.88 Crores wastransferred to Debenture Redemption Reservesin terms of Section 71(13) of the Companies Act,2013. As on March 31, 2018, the Company hasReservesandSurplusamountingto`3119.93croreswhichreflectstheinherentfinancialstrengthoftheCompany.
Contribution to Exchequer
7. The total contributionmade during theyear bywayofValueAddedTax, IncomeTax,CST,CustomsDuty,Service Tax, GST and Dividend Tax was ` 357.49Crores.
Shipbuilding
8. TheCompanyachievedatotalshipbuildingincomeof`1731.86croresduring2017-18asagainst`1515.82croresin2016-17.Duringtheyear2017-18,theyardcompleted the delivery of twoDouble ended Ro-Rovessels for Kochi Municipal Corporation. The yardcompleted various major milestones on the projectswhichareunderconstructionsuchaskeellayingandlaunchingofSH20-TechnologyDemonstrationVessel(SpecialPurposeVessel),steelcuttingandkeel layingofSH21andSH22 -500paxvessels, steelcuttingandkeellayingofSH23andSH24-1200paxvesselsandsteelcuttingfor16nos.fishingvessels.IndigenousAircraftCarrier(IAC)projectprogressedsatisfactorily.Machinery outfittingof engine room and installationof415voltpowergenerationanddistributionsystemwas completed. 3Dmodelling ofmajor ship systemsuptoflightdeckwasalsocompleted.TrialsofDGsets1 and 5 were completed successfully. Critical AFCequipmentwasreceivedattheYard.Phase3contractis expected to be concluded in the current financialyear.
Shiprepair
9. During theyear, theCompanyachieveda total shiprepair income of ` 623.27 crores as compared to` 543.05 crores during the financial year 2016-17.Major vessels repaired during the year include INSShakti, INS Nireekshak, INS Airavat, INS Sujata,INSSutlej,MVSagardweep- II,MVKalighat,MVBharatSeema,WSVSamudraNidhi,DCIDredgeXIXetc.Also, after a long interval,CSLhas started refitofOffshoreDrillingVesselsbyundertakingongoingrefitofMODUSagarBhushanfromONGCduringtheyear.
14101643 1626
1516
1732
2013-14 2014-15 2015-16 2016-17 2017-18
Shipbuilding Income (` Crs)
228
367
543
623
196
2013-14 2014-15 2015-16 2016-17 2017-18
Shiprepair income (` Crs)
Shipbuilding Order Book Position
10. TheorderbookpositionasonMarch31,2018 isasfollows:-
Vessel Type NosIndigenousAircraftCarrierfortheIndianNavy,P-71 01
TechnologyDemonstrationVessel(SpecialPurposeVessel)forDRDO 01
500passengercum150MTcargovesselforA&NAdministration 02
1200passengercum1000MTcargovesselforA&NAdministration 02
TunaLonglinerCumGilnetterFishingBoat 03
Expansion Projects
11. Detailsofmajorprojectsandinitiativestakenupduring2017-18areasfollows:
i) International ShiprepairFacility (ISRF) atCochinPortTrust
CSLcontinuedtooperatethedrydock&existingfacilitiesintheleasedarea(firstphase)atCoPT.
2746th Annual Report
Drydockrepairoftenvesselshavebeencompletedduring the financial year 2017-18. Meanwhile,CoPT had allotted the second phase land area(8.134 ha) to CSL in the month of November2017. Ministry of Environment, Forests &ClimateChangehadissuedEnvironmental&CRZclearancefortheISRFprojectonJune22,2017.CSL had awarded the construction contract forcivil, mechanical & electricalworks onOctober10,2017.HonourableUnionMinisterofShipping,ShriNitinGadkari laid foundation stone for theISRFprojectonNovember17,2017.Sincethen,the construction activities of the project hadcommenced.CSLexpectstopositionKochiasamajorshiprepairhubwithmajoroperationsinthepresentshiprepairdockcoupledwith increasedcapacitiesthatwouldbeavailablewhentheISRFiscommissioned.
ii) NewDryDockProject
ThenewDryDockwill enable theCompany tobuild and repair specialised and technologicallyadvanced large vessels such as LNG vessels,larger aircraft carriers, drill ships and dry-dockrepairsofsemi-submersibles,jack-uprigs,etc.
Subsequent to the receipt of all statutoryclearances for the Dry Dock project, letter ofacceptance was issued for the construction (Civil, Mechanical and Electrical) on April 27,2018. Tendering for the 600 T Gantry crane isalsounderprogress.
iii) Joint Venture with Hooghly Dock and PortEngineersLtd.(HDPEL)
The Ministry of Shipping vide letter No. SY-11018/1/2010- HDPE dated March 29,2017 approved the formation of joint venturepartnershipbetweenCochinShipyard(74%stakein equity) andHDPEL (26% stake in equity) forupgradation and modernization of shipbuildinginfrastructureatthetwoshipyardsitesofSalkiaandNazirgungeinKolkata.OnOctober23,2017ajointventurecompanynamedHooghlyCochinShipyard Ltd. (HCSL) has been incorporated asa subsidiary company of Cochin Shipyard. TheCompany executed shareholders agreement onNovember17,2017,andconcessionagreementand leaseagreementwereexecutedonJanuary19, 2018. The consultancy work for DPR isawarded to M/s. KITCO. HCSL being in theprojectimplementationstagehasreportedanon-operating incomeof` 18.57 lakh and a loss of`37.07lakhduringthefinancialyear2017-18.
A separate statement containing the salientfeaturesofthefinancialstatementofSubsidiaries/
Associates/Joint Venture Companies in FormAOC-1pursuanttoprovisionsofSection129(3)of theAct, is attached alongwith the financialstatements.
iv) NewInitiatives CSLhasenteredintoanMOUwiththeMumbai
PortTrustonJanuary11,2018foroperationsandmanagementofshiprepairfacilityatIndiraDock.CSLshallutilize the facilities for thepurposeofship repair and allied services and for furtherexpansioninthefieldofshiprepair.SimilarMOUhasbeensignedwithKolkataPortTrustonMarch17,2018foroperationsandmanagementofshiprepair facility at Netaji Subhas Dock. CSL shallutilizethefacilitiesforthepurposeofshiprepairand allied services and for the growth of shiprepairintheregion.
CSL signed an MOU with Central Institute ofFisheries Technology on August 30, 2017 forbuilding fishing vessels. The Company alsosigned an MOU with Joint Stock CompanyUnited Shipbuilding Corporation (USC), Russia,onFebruary02,2018tocollaborateandengagein design, development and execution of high-end ‘state of the art’ vessels for inland andcoastalwaterways.AnotherMOIwassignedonJanuary 18, 2018 with Defence Research andDevelopment Organisation (DRDO) for exportof Defence vessels incorporating Defencesystems developed by DRDO and produced byIndian OEMs. CSL signed contract on January29, 2018 for constructionof16nosTuna LongLining & Gillnetting Fishing Vessels under thediversification of trawl fishing boats from palkbay into deep sea fishing boats under CentralsectoronBlueRevolutionSchemewithfinancialassistance from Government of India and theGovernmentofTamilNadu.
Initial Public Offer
12. CSL’sInitialPublicOfferof3,39,84,000equitysharesof face value of `10eachwasopenedonAugust01,2017 and closed onAugust 03, 2017. CSL listed inBSEandNSEonAugust11,2017.Thecompanyhasraised`1,442croresfromtheIPOwhichhasbeenacombinationoffreshissueandofferforsaleintheratioof2:1.TheIPOwassubscribedbyover75timeswithmorethan1.11lakhcrorebeingraisedagainsttheofferof `1,442crores.TheIssuealsosawastronginterestfrom retail segmentwith about20 lakh applications,thehighest in the last decade.TheQIBportionwassubscribed over 63 times and the HNI portionwassubscribed by 287 times. Overall there were verypositivemarketsentimentstowardstheIPO.
28 Cochin Shipyard Ltd
13. TheproceedsofthefreshissuepartoftheIPO,totalingapprox. ` 961 crores will be used by CSL for partfundingtwoexpansionprojectscosting`2768croresviz. a larger dry dock atCSL premises and the ISRF.Balanceamountof`481croreshasbeentransferredtoGovernmentofIndiaforNationbuilding.
Utilisation of IPO Proceeds
14. DetailsofutilizationoffundsfromproceedsofIPOasonMarch31,2018isgivenbelow:
` Crs
ParticularsProceedsfromInitialPublicOffer(IPO) 961.95
Less:AmountestimatedtowardsIPOexpenses(Company’sshare)
20.26
NetIPOproceeds 941.69
Addinterestamountreinvested 13.90
Total proceeds plus interest 955.59Lessutilisationofproceedsfor: GeneralCorporatePurpose(GCP) 99.56
ConstructionofNewDryDock 3.31
ISRF 11.42 114.29Fund balance as on March 31, 2018 841.30
ParkingoffundsinFixedDeposits 841.27
ParkingofFundsinCurrentAccounts 0.03
Parking of funds as on March 31, 2018 841.30
Manpower Status
15. ThemanpowerstrengthofthecompanyasonMarch31,2018was1781consistingof331executives,167supervisorsand1283workmen.
Industrial Relations16. IndustrialRelationscenariooftheCompanyremained
generally cordial during the year. The Companycontinued the legacy of strike free period of last33 years except one day strike on April 28, 2017called by all the trade unions to protest against thedisinvestmentofCochinShipyardLimitedthroughtheInitialPublicOfferofitsequityshares.However,postIPOtheissuehasnotbeenraisedbythetradeunionsandtheIndustrialRelationsclimatehasbeengenerallypeaceful in this respect.
17. All employees continue to render whole heartedsupportandco-operationtothemanagementinitiativesandtargetssetbytheCompany.Thecriticalmilestonein the industrial relations journey of any organisationis chalking out most reasonable and acceptable LongTermSettlement (LTS) for itsemployees.Asfaras theworkmen under the Industrial DisputesAct 1947 areconcerned,theirnextLTSisdueforrevisionwitheffectfromApril01,2017.AllrecognisedtradeunionsoftheCompanyhavesubmittedtheircharterofdemandsforthe new LTS. Company has started negotiating withthe recognised trade unions on the said charters ofdemandsubject tothebroadframeworkofguidelinesissuedbythegovernmentthroughtheDepartmentofPublicEnterprises.AsregardstheBoardlevelandbelowBoard level officers and non-unionised supervisors,presidential orders have been issued for their payrevisioneffectivefromJanuary01,2017andvaliduptoDecember31,2027(thepayrevisionordersinrespectofthesecategoriesofemployeeshavebeenimplemented).
18. Various foraconstitutedtowardspromotingworkers’participation in management, continue to functionwell.Theyarejointcouncils,shopcouncil,centralsafetycommittee, shop level safety committees, contractworkers safety committee, canteen managementcommittee, employees’ contributory provident fundtrust etc.
19. EmployeesandtheirdependentswelfareandwellbeingarewelltakencarethroughvariousvoluntaryschemeslikeEmployeesMedicalAssistanceScheme,EmployeesPension Scheme, Shipyard Pariwar Prathibha PuraskarScheme,EmployeesEducationalAssistanceSchemeetc.
Human Resource Development
Learning and Development activities during 2017-18
20. Thesyllabusbasedcomprehensivetrainingprogrammetitled “Young Officers Competency DevelopmentProgramme” covering young managers upto the levelof Deputy Managers started during the last financialyear continued this year also. During the currentfinancialyearatotalof47sessionswereheldoverfivemodulesandthefirstbatchconsistingof24executives
2946th Annual Report
have since completed the training. A second batchcomprisingof25executiveshavecommencedtraining.The faculty for this programme is primarily drawnfromin-housetalentaswellasretiredexecutives.Theprogramme focuses in detail on all technical matterspertaining toShipBuildingandShipRepair and topicsof relevance in other non technical areas. As part of facilitating knowledge transfer, a structured trainingprogramme forworkmen in the tradesofwelder,pipefitter, structural & engineering fitters and electricalcovering229workmenwas held during theyear.Thedetailedsyllabusfortrainingoftheworkmeninvarioustradeswaspreparedbyapoolofretiredemployeesoftheyard.This structuredprogrammeaims to facilitateskilldevelopmentofthenewemployeesandmakethemcapableofhandling the challenges atwork site.Apartfromthisin-housedevelopmentprogramme,anexclusiveskilldevelopmentprogrammeforpipefittersundertheStrategic Manufacturing Sector Skill Council (SMSSC)Schemehadbeenconductedand18participantsmostlyworkmendrawnfromthesub-contractpoolofworkmeninCSLandtraineeshadattended.
21. Executives at all levels were nominated to attendspecific management development programmesat IIMA, IIMK, IIMC. Executives have also beennominated to NIAS-IISC. As part of a continuouslearning and development five customizedmanagementdevelopmentprogrammeswereheld inassociationwith the Indian InstituteofManagement(IIMK),Kozhikode.CSLhasalsoentered intospecificMOUswith CUSAT and faculty support is extendedbyCSLforNavalArchitecturecourseconducted.Twocomprehensive one week programmes on “GeneralManagement” were conducted at the IIMK maincampuscovering48executivesuptothelevelofAGMs.ThreedayprogrammeswereconductedatIIMKKochicampus covering 75 executives on communicationeffectiveness, contract management and finance fornon financemanagers etc. Further, sixteen in-houseprogrammeswereconductedinCSLonawiderangeof topics ranging from GST updation to vigilancesensitization. The prominent technical programmesconductedin-houseincludejointprogrammebyM/s.NIRDESH,KozhikodeandexpertsfromtheIndianNavy,NPOL and BHEL on “Warship inspection, tests andtrials”, programme on “QC Inspection” conducted byrenownedclassificationsociety,M/s.IndianRegisterofShipping(IRS)and“TechnicalMDPonShipStructures-Strength, Fabrication andDistortionControl byM/s.Asranet, UK and professors from IIT (Kharagpur). A total of eight executives were nominated forspecializedinternationalprogrammesinJapan/Europerangingfromthreetofourweeksforbothtechnicalandmanagement development programmes. The topicsinclude Energy Management, Quality Management,
ProjectManagement,LeadershipandProblemSolvingTechniques. A Technical Management Developmentprogramme on Passenger Ships by LRSwith specialemphasisonSRtP requirementswas conductedwiththeparticipationofrepresentativesfromDGS,DesignconsultantM/sSEDSandCSL.
Encouraging Leadership22. Inordertoencourageandmotivateyoungexecutivesfor
higherlearningaschemecalled“NethruthwaSamvriddhiYojana–LeadershipAccelerationProgramme(LEAP)hasbeenlaunched.Underthisschemethreeexecutiveshavebeengrantedstudyleavefortwoyearstopursuepostgraduation from leading national level institutes (IITs/NITsetc).Thecorebenefitundertheschemeisnotonlyagrantofstudyleavefortwoyears,butreimbursementoftuitionfeesupto`10lakhsininstalmentsaftertheycomebackandjoinforduty.
Educational Scholarships to Wards of Employees23. “ShipyardPariwarPrathibhaPuraskar”,aneducational
scholarship scheme introduced from the year 2016aimstorewardandpromotethestarperformersamongthewardsofregularemployeesofCSL.Ascholarshipof `25,000/-peryearforamaximumperiodof5yearsshallbebestowedintheorderofhighestmarksscoredbythewardsinClassXIIfinalexamination.Duringtheyear2017-18,20eligiblestudentshavebeengrantedscholarshipunderthesaidscheme.
Recognising Excellence24. CSLhasintroducedtheEmployeeExcellenceAwards
Scheme envisaging reward and recognition ofinnovativeideasandpracticesamongtheemployeesbelow the level ofAGMs. The highest award underthe scheme isChairman’s awardwith a citation andcash price of `15,000/-.Therearealso10Chairman’scommendations awardwith a citation and` 2000/-eachascashprice.Theawardsarepresentedtothewinners on the occasion of Independence Day andRepublicDaycelebrationseveryyeartothepermanentemployeeswhilefixed termcontractemployeesandadvancedtraineesarehonouredduringthevaledictoryceremony of “Productivity Month Celebrations”or on “Safety Day” etc. In 2017-18, 47 permanentemployees and16 contract personnel/trainees havebeenhonoredwithChairman’scommendationwhichcarries `2,000/-cashprize.
Encouraging Thought Provoking Ideas25. Thetalkseries ‘Prajyoti’,whereeminentpersonalities
whohaveexcelledintheirprofessionalfieldsharetheirthoughtswiththeexecutivesofCSLcontinued.Duringthe year, two such talk sessions were held. Apartfromtheabove,prominentpersonsalsoaddressedagathering of executives on procurement, procedures
30 Cochin Shipyard Ltd
andpolicies.ExpertsfromLloyd’sRegisterofShipping,UKalsoaddressedaselectgatheringofexecutives.
Professional Assessments
26. Duringtheyear,anagencyhasbeenawardedtheworkfor conductingexecutives’AssessmentDevelopmentCentre(ADC)andcreationofIndividualDevelopmentPlans(IDPs)forSuccessionPlanning.Thescopeofworkincludesidentificationandvalidationofleadershipandrolebasedcompetenciesfor17keyrolesofCSLandalso drawing up an IndividualDevelopment Plan fora groupof 70 executives in the grades ofManager/SeniorManager.
Training
27. During the year, the Company has also trained205 ITI tradeapprentices,71engineeringgraduates,71diplomaholdersand03vocationaltraineesunderthe Apprentices Act. Under the Company scheme,specialisedtrainingprimarily inthetechnicalstreamswasextended to600Trainees.TheCompanyduringtheyearhadalsoinducted5executivetraineesforoneyeartraining.TheMarineEngineeringTrainingInstituteapprovedby theDirectorGeneral of Shipping,Govt.of India provided training to130engineering cadetsduring the year to enable them qualify for marineengineeringjobsonboardvessels.
Status on affirmative action to implement Presidential directives on reservations
28. CochinShipyardhasbeenstrictlycomplyingwiththePresidential directives and guidelines on reservationfor Scheduled Caste (SC)/ Scheduled Tribes (ST)/Other Backward Classes (OBC) and Persons withDisabilities (PWD) issued by the Government ofIndia from time to time. Shipyard has appointed aLiaisonOfficerforSC/ST/PWD/Ex-Servicemenanda separate Liaison officer for OBCs to oversee theimplementation of reservation policies. Reservationpercentage is ensured through the maintenanceof Post Based Roster System as prescribed by theGovernment of India. During theyear, trainingwasimparted exclusively for employees belonging tothese categories.Three executives belonging to SC/STcategoryweredeputedfortrainingabroad.Regularmeetings with the associations of the employeesbelonging to these categories were conducted todiscuss and redress their grievances. Pursuant toGovernment orders, special recruitment drive wasresorted during the year for filling up of vacanciesreserved for PersonswithDisabilities and out of 15vacancies notified four candidates were selected.Inorder to supportemployeesbelonging to theSC/ST/OBC/PWD employees who fall under the zoneofconsiderationforpromotion,specialcrashcourses
werearrangedwiththeaidofexpertexternalfacultyonthetopicsofleadership,conversationalEnglishandother soft skills.AsdirectedbyGovt. of India undertheAccessibility India Campaign, accessibility auditfor PWD was carried out by an accredited agencyM/s.EkanshTrust,Pune.Furtherimprovementsinthisregardhavealsobeencarriedout.
Representation of SC/ST employees
29. TherepresentationofSCandSTemployeesinvariousgroupsofpostsasonMarch31,2018isgivenunder:
Category CSL’s Total Strength SC STGroup A 266 41 12GroupB 126 21 8Group C 775 104 15Group D 614 81 10Total 1781 247 45Note:Againstthetotalof383apprentices,97i.e,25%
belongtoSC/STcommunitywhichiswellabovethestatutoryrequirement.
Representation of OBC employees
30. The representation of OBC employees in variousgroupsofpostsasonMarch31,2018isgivenunder:
Category CSL’s Total Strength OBCGroup A 266 63GroupB 126 12Group C 775 255Group D 614 343Total 1781 673
Representation of minority employees
31. The representationofminority employees invariousgroupsofpostsasonMarch31,2018isgivenunder:
Category CSL’s Total Strength MinorityGroup A 266 82GroupB 126 33Group C 775 222Group D 614 163Total 1781 500
Representation of Persons with Disabilities employees
32. TherepresentationofPersonswithDisabilitiesinvariousgroupsofpostsasonMarch31,2018isgivenunder:
Category CSL’s Total Strength PWDGroup A 266 2GroupB 126 9Group C 775 24Group D 614 23Total 1781 58
3146th Annual Report
Provision for safeguard of women
33. The Sexual Harassment of Women at Work Place(Prevention,ProhibitionandRedressal)Act,2013andRulesframedthereunderarestrictlycompliedwith.AnInternalComplaintsCommitteehasbeenconstitutedin accordance with the Act chaired by a seniorwomanexecutive.TheCommitteedidnotreceiveanycomplaintduringtheyear2017.
Welfare assistance for the care of differently abled children
34. A monthly welfare assistance of ` 4,500 has beenextended to all employees for taking care of theirdifferentlyabledchildren. Inaddition, theyhavealsobeen allowed grant of special leave/time off for amaximumoffivedaysinayear.
Integrated Management System (IMS)
35. Cochin Shipyard continued to be an IMS compliantcompany encompassing ISO 9001:2008 (QualityManagementSystem),ISO14001:2004(EnvironmentalManagement System) and OHSAS 18001: 2007(OccupationalHealthandSafetyManagementSystem).CSLwillbeupgradingitsQualityManagementsystemandEnvironmentalmanagementsystemstothelatestISO9001:2015andISO14001:2015respectivelybySeptember2018.
Facility Upgrade and Capital Expenditure
36. The total capital expenditure incurred in 2017-18amountedto 157.10crores.ThisrelatedtoRenewalsand Replacements, Modernization and Expansion,
Dry Dock, ISRF, Research & Development projects,infrastructureforIACetc.
Implementation of Official Language Policy
37. Inpursuanceofsubrule (4)ofrule10oftheOfficialLanguage(UsefortheOfficialPurposesoftheUnion)Rules, 1976, Government of India have notified, intheGazetteof India, that 80%ofministerial staffofthe Company have acquired working knowledge/proficiencyinHindi.
38. LateShankarDayalSinghMemorialAwardSchemewasintroducedinCSLduring2013asperdirectionsfromMinistry of Heavy Industries and Public Enterprises.ThisyeartheawardwasgiventoSmt.PriyaAR,JuniorCommercial Assistant. Incentive scheme for doingoriginalworkinHindihasbeenmademoreattractivewithaviewtoencourageemployeestodomoreworkinHindi.
39. As per the instructions from Hindi Salahkar Samitiof Ministry of Shipping, essay writing and ‘Whatpicture says’ competitions in Hindi were organizedby the Company in connectionwith Hindi fortnightcelebrationsinwhichprimary,highschoolandhighersecondarystudentsofschoolsinKochiparticipated.
40. Various competitions in Hindi were organized inconnectionwithHindifortnightcelebrations2017foremployees,childrenofemployeesandtraineesofCSL.AspartofimplementationofOfficialLanguagePolicyof Govt. of India, CSL observes first Wednesday ofeverymonthasHindiDay.FourHindiworkshopswere
1160
100
200
Group A Group B
Total SC/ST/OBC
Group C Group D
300
400
500
600
700
800
900
41
434
Representation of Various Groups
374
32 Cochin Shipyard Ltd
organizedintheyear2017-18inwhichatotalof101employees participated. Spoken Hindi classes wereorganised in three batches in which 67 employeesparticipated.NinthissueofHindihousejournal,‘SagarRatna’wasreleasedduringthisyear.
41. CommitteeofParliamentonOfficialLanguagevisitedonNovember09,2017.
42. Joint Hindi fortnight celebrations were organizedfrom November 16 to November 30, 2017 undertheauspicesofKochiTOLIC.14employeesattendedvariouscompetitionsorganizedinthisconnection.Outoftheabove8employeeswonprizes.
Particulars of employees and related disclosures
43. In accordance with Ministry of Corporate Affairsnotification no. GSR 463(E) dated June 05, 2015,GovernmentCompaniesareexemptfromSection197oftheCompaniesAct,2013anditsrulesthereof.
Conservation of energy, technology absorption and foreign exchange earnings and outgo
44. Details are placed at Annexure-2. The Company’smajor initiative in the conservation of energy wasinstallationof solar panels on the rooftopofvariousbuildings inside CSL premises. The programme wascommencedfromthefinancialyear2013-14.Tilldatesolarpowerplanthavingcapacityof535KWhasbeencommissioned and the power generated from solarpanelsis15.05lakhsunitasonMarch31,2018.
Risk Management
45. CSLhasadoptedacomprehensiveRiskManagementPolicyatthe214thmeetingoftheBoardofDirectorsheld on September 16, 2014. The purpose ofthis policy is to put in place a comprehensive riskmanagementsystemconsistingofadefinedprocessofriskmanagement andmethodology of identification,assessment, response, monitoring and reporting ofrisks.ThepolicywouldprovidethemanagementandBoard of Directors an assurance that key risks arebeingproperlyidentifiedandeffectivelymanaged.
46. Asper thepolicy,CSLBoardat thehelmwill reviewthe risk management system in CSL. The Boardshall discharge its responsibility of risk oversight byensuringthereviewatperiodicalintervals.Boardmayalso delegate to any other person or committee thetask of independently assessing and evaluating theeffectivenessoftheriskmanagementsystem.TheCSLmanagementcomprisingofCSLBoardlevelandbelowBoard level executives has been entrustedwith theimplementation of the risk management process. InthisrespectRiskManagementCommittees(RMC)andRiskManagementSteeringCommittees(RMSCs)have
beenconstitutedtoimplementthepolicyinCSL.TheAudit Committee and the Board ofDirectors reviewthe risk management process and policy. TheYard’sproduct mix comprising of Defense and commercialshipbuilding and shiprepair gives the Company anaturalhedgeagainstmarketrisk.
Research and Development (R&D) Activities
47. R&DpolicyofCSL is toenhance the company’spre-eminenceinShipbuilding,ShiprepairandotherchosenfieldsandproductsthroughResearchandDevelopment.In-houseR&Dactivitieshavebeenundertakenduringthe year 2017-18 in the areas ofwelding proceduredevelopmentandqualificationofwelders.
48. Welding of lower thickness plates using one sidewelding process is a specialised method. Capabilitybuilding in above area is of paramount importanceto yard. In the above context, Weld ProcedureDevelopment(WPS)hasbeenundertakenin-houseforweldingoflowerthicknessplateofhighstrengthsteel(AH36) of 10mm thickness using one sideweldingprocessemployingtwinwirewithcopperbacking.Theprocedure has been validated by ABS Classificationsocietyandwelderhasbeenqualifiedforperformingtheweldingprocess.
Health, Safety & Environment (HSE)
49. CSLplacesHSEasoneofitscorevalueinoperationsconsidering the character of the industry. In orderto strengthen the HSE awareness levels among theworkforce new initiatives such as HSE briefings,issuingofHSEalertsandsameaspartofthetoolsboxtalkswas implemented. CSL understands safety is alinefunctionanditshouldbemanagedbyeveryoneintheirdomain.Intheyear2017-18providingrefreshersafety training to contractors’ workmen was ourfocus area. The Company constantly strives to create andmaintain HSE awareness to our employees andsubcontractors’ workmen through various in-houseandonsite trainingprogrammes includingemployeesinthecategoryofpersonwithdisability.
50. HSE performance for the last 3 calendar years istabulatedbelow:
Category 2015 2016 2017Fatal 0 0 0Reportableaccidents 6 7 2NonReportableAccidents 137 148 100NumberofPermanentTotalDisability 0 0 0
FrequencyRate(Reportableaccidentsinonemillionmanhours)
0.63 0.68 0.20
3346th Annual Report
Fire Incident in MODU Sagar Bhushan
51. “Sagar Bhushan”, Mobile Offshore Drilling Unit ofONGC (MODU Sagar Bhushan) arrived at CochinShipyardLimitedonDecember07,2017forrepairsandthevesselwasdry-dockedonJanuary12,2018.ThevesselwasscheduledtobeundockedonFebruary28,2018. This vessel was built in the year 1987 atHindustanShipyardLimitedandhadundergonerepairsatCSLmanytimesbeforeandthelastrepairworkbyCSLonthevesselwasinthefinancialyear2007.
52. OnFebruary13,2018, therewasfire incident in theforward area of thevessel Sagar Bhushan. Itwas anexplosion near the AC compartment in the forwardareaoftheship.TheFireTenderandtheambulanceofCSLimmediatelyrushedtothestarboardsideareaofthevessel.TheFireTendersfromtheIndianNavyandKerala Fire Force also reached the site immediately.TherescueoperationwascarriedoutbyCSLfiremen,safetypersonnelandtheotheremployees ledby theSeniorManagementteamincludingC&MD.12personsweretakenoutandsenttothehospital,ofwhich5ofthemsuccumbedto injuries includingonepermanentemployee of CSL. 4 persons were admitted to thehospitaland3personsweregivenfirstaidathospitalanddischargedon thesameday itself. Inaddition totheabove,twomorepersonswhoparticipatedintherescue operationswere admitted to the hospital forreportedgiddinessorsuffocationonthenextdayoftheincident,butdischargedonthesameday.Informationof the incident was reported to all authorities asmandatedunderthestatutoryprovisions.TheHon’bleFinanceMinisterofKeralavisitedtheyardandalsothefamiliesofthevictimsonthedayoftheincidentatthebehestoftheHon’bleChiefMinisterofKerala.
53. An internal enquiry was conducted on the incidentand it was concluded that it was caused due to amomentary explosion of high impact that occurredin the air conditioning compartment. The enquiryrevealedthatthecauseofthe incidentwasahumanerrorandwasnotduetoanysystemicfailure. IntheaftermathoftheincidentCSLhasdecidedtointroduceautomatic closing valves in each of fuel gas hoses.StorageanddistributionsystemofindustrialgasesintheYardhasbeenreviewed.Vesselmanentrysystemhasbeenstrengthenedonallshipsandthefrequencyof gasmonitoringhasbeen increased in all confinedspaces onboard vessels. Various other actions totighten existing systems and to have amuch higherlevel of safety culture amongst all stakeholders areunderway.A detailed audit has been undertaken byaneightmemberspecialistteamfromtheDepartmentof Factories and Boilers, Government of Kerala andtheir recommendations have been implementedsubstantially.Allsuchactionshavethefullinvolvement
and understanding of all employees, contractors,contractworkmen,traineesetc.
54. CMDandSeniorManagementteamvisitedthefamilyof the deceased and assured them of full support.Consideringthehardshipbeingexperiencedbythekithandkinof thedeceasedand tomeet the immediatepenury of the families of the deceased, CSL haddeclaredfollowingfinancialassistanceonFebruary13,2018:(i) ` 10 Lakhs to the family of the deceased in
addition to the statutory compensation andinsurancereliefasapplicabletothem.
(ii) ` 25,000 to be disbursed on the day itself toenablethefamiliestodefraytheexpensesrelatedtothefuneralandotherrituals.
(iii) All treatment expenses incurred for the besttreatmentfortheinjured.
55. On February 14, 2018 Shri P Radhakrishnan, Hon’bleMinisterofStateforShippingvisitedCochinShipyard,andtookstockofthesituation.HemettheCSLemployeesandofficersatthesiteofthe incidentandappreciatedthe earnest efforts taken by the entire shipyard teamin the rescue operations and subsequent actions. Heconveyedhisheartfeltcondolencestothebereavedones.Heappreciatedthesteadfastandexpeditiousdecisionstaken by the CSLmanagement in reaching out to thefamilies of the deceased and for promptly announcingreasonablefinancialrelieftothefamiliesofthedeceased.He visited the injured at the hospital, interactedwiththeirdearandnearonesandpromisedfullsupportfromtheMinistryofShippingthroughtheshipyard.
56. Afterthereviewandinteractions,theHon’bleMinisterdirectedCSLtoextendthefollowingadditionalreliefstotheaffected:(i) Amountequivalenttotwomonthsnormalwages
totheinjuredimmediately.(ii) Appropriate employment on compassionate
groundstoanyeligibledependentofthedeceasedvictims.
(iii) Appropriatefinancialaidtowardstheeducationofthechildrenofthedeceaseduptoandincludinggraduatelevel.
(iv) Inadditiontothestatutorycompensationrelief,Company to disburse wages to the injured tilltheyreturnforworkinCSL.
(v) One dependent of each of the deceased whohave been offered employment by CSL, joinedfor permanent employment in CSL on June 01,2018.
57. On February 17, 2018, Shri Paul Antony IAS, ChiefSecretaryofKeralavisitedCSL,paidfloralhomageto
34 Cochin Shipyard Ltd
thedeceasedandinteractedwiththerepresentativesoftheCSLemployeesandcontractors.
58. Allunionsandassociationsexpressedtheirsatisfactionand gratitude to the management for their promptrescueoperationsandempatheticsupport&relieftothekithandkin.
Industrial security59. TotalsecurityoftheCompanycontinuedtoberobust
without causing any serious security concern duringtheyear.Allsecuritysystemsandmeasuresintroducedand installed in the Company are of internationalstandards. Periodic joint survey was conducted bytheCompanyandCISF.Twentyfourhourswaterfrontpatrolling in a dedicated speed boat with armedpersonnel and wireless surveillance (CCTV) systemcovering all critical locations and installations arein place. As per the security plan and policy of theCompany, periodic security drillswere conducted toensure promptmitigating action in the event of anysecuritybreach,crisisorcalamities.
60. Effective access control systems including biometricembeddedturnstilegatesareinplaceintheCompany.Afull-fledgedvisitor’sfacilitationcenterisoperatedforscrutinyandverificationofthecredentialsofthevisitorsto the Company. Baggage scanning system has alsobeeninstalledatthemainentrygateoftheCompany.Apart from these, special systems andmeasures suchas exclusive photo entry pass and special surveillancesystem, additional waterside security net around IACetcarepositionedandoperatedtowardstotalsecurityoftheIndigenousAircraftCarrier(IAC).ArobustcybersecuritypolicyhasalsobeenadoptedbytheCompany.
61. Materials entry and exit have been integrated withERP module which ensures effective and vigilantmonitoring of materials movement into and out oftheCompany.Nocaseof theft,sabotage, leakageofinformationetc.wasreportedduringtheyear.
62. The physical security of the Company has beenentrusted to the Central Industrial Security Force(CISF) contingent of 133 personnel headed by anofficeroftherankofAssistantCommandant.
63. CSL has also engagedDGR approved ex-servicemensecurity services for supplementing existing forcesmainlycateringtoexternalpropertiesofCSLandalsointernalspecificlocations.
Awards and Recognitions64. During the financial year CSL received following
awards:(a) KMA excellence award for best CSR activities
undertaken.(b) Bureaucracy Today CSR excellence award for
‘RuralDevelopment’,givenbyBureaucracyToday.
(c) Madhu S Nair, CMD, Cochin Shipyard Limited,washonouredwiththe‘CSR-OrientedChairman/CMD/MD of the Year (PSU)’ Award, given byBureaucracyToday.
(d) MKKNairMemorialAwardfortheSecondBestProductivity Performance from Kerala StateProductivityCouncil
(e) KeralaStateEnergyConservationAward2017inthecategoryof‘LargeScaleEnergyConsumers.’
(f) ‘Top Exporter (PSU) at Cochin for the calendaryear2017’awardfromCustoms,CentralGSTandCentralExcise.
(g) Kerala State Renewable Energy Award 2017 inappreciation of commendable achievementstowardstheutilizationofRenewableEnergyinthecategoryof‘IndustrialUnitsintheStateofKeraladuringtheyear2016-17,givenbyDepartmentofPower,GovernmentofKeralathroughANERT.
(h) Corporate Citizen of the year 2018 Award foroutstanding contribution to the profession,industry and society, given by Public RelationsCouncilofIndia.
(i) ‘Award for Best Stall’ in the National LevelVendorDevelopmentProgrammecumIndustrialExhibition & B2B Meet, ‘IND EXPO 2017’organised by MSME Development Institute,Thrissur,MinistryofMSMEfromDecember07to09,2017.
(j) ‘IndiaSeatradeAward2017’fortheShipbuilding&RepairYardoftheYear.
Board of Directors & Key Managerial Personnel
65. The Board of CSL comprises of 12 directors; 4Whole Time Directors, 6 Non-Official Part Time(Independent) Directors and 2 Official Part Time(Nominee) Directors of Government of India andGovernment of Kerala.
66. Shri Jiji Thomson IAS (Retd.) (DIN: 01178227), ShriPradipta Banerji (DIN: 00630615) and Shri NandaKumaran Puthezhath (DIN: 02547619) took overcharge as Non-Official Part Time (Independent)DirectorswitheffectfromJuly15,2017videMinistryof Shipping letter No. SY-11012/1/2016-CSL datedJuly15,2017.TheMinistryofShipping,Governmentof India vide letter F. No. SY-11012/1/2017-CSLdatedOctober04,2017appointedShri SatinderPalSingh IPS (DIN:07490296),JointSecretary,MinistryofShipping,GovernmentofIndiaasOfficialPartTime(Nominee)Directoron theBoardofCochinShipyardLimited (CSL) in place of Shri Pravir Krishna (DIN:06519104)with effect fromOctober 04, 2017. ShriSunnyThomas (DIN:06882228),Director (Technical)retiredfromservicebysuperannuationonNovember
3546th Annual Report
30,2017.ShriBejoyBhasker(DIN:08103825)tookoverchargeasDirector(Technical)witheffectfromApril05,2018videMinistryofShippingletterNo.SY-11012/4/2017-CSLdatedApril04,2018.TheMinistryofShipping,Governmentof Indiavide letterSY-11012/1/2017-CSLdatedApril20,2018appointedShriK.RJyothilal IAS (DIN:01650017),PrincipalSecretary(Transport),Govt.ofKeralaasOfficialPartTime(Nominee)DirectorontheBoardofCSLinplaceofShriEliasGeorge(DIN:00204510)witheffectfromApril20,2018.
67. DetailsofchangesinKeyManagerialPersonsduringthefinancialyear2017-18andalsouptothedateofthisreportaregivenbelow:
Sl No Name DIN Designation Date of Appointment
Date of Cessation Changes if any
1 ShriMadhuSNair 07376798 Chairman&
ManagingDirector January01,2016 Continuing NoChange
2 ShriDPaulRanjan 06869452
Director(Finance)&ChiefFinancialOfficer
May01,2014 Continuing NoChange
3 Shri Sunny Thomas 06882228 Director(Technical) June01,2014 November30,
2017 Superannuation
4 Shri Suresh BabuNV 07482491 Director
(Operations) April26,2016 Continuing NoChange
5 ShriBejoyBhasker 08103825 Director(Technical) April05,2018 Continuing Appointment
6 Smt. Kala V - Company Secretary May02,1998 Continuing NoChange
Declaration and Meeting of Independent Directors
68. TheCompany has received declarations from all theIndependentDirectorsoftheCompanyconfirmingthattheymeetthecriteriaofindependenceasprescribedundertheCompaniesAct,2013.AseparatemeetingofIndependentDirectorswasheldonFebruary22,2018inwhichalltheIndependentDirectorswerepresent.
Details of Board Meetings held during 2017-18
69. TenBoardMeetingswereheldduringtheyear2017-18andthegapbetweentwomeetingsdidnotexceed120 days. The dates on which the Board Meetingswereheldareasfollows:
Sl. No Date Board Strength
No. of Directors present
1 April27,2017 9 82 May11,2017 9 83 June10,2017 9 74 July17,2017 12 75 July21,2017 12 126 August04,2017 12 107 September11,2017 12 108 November10,2017 12 99 February05,2018 11 1010 February22,2018 11 10
70. For more details with respect to the Directors,BoardandCommitteemeetingsheldduring theyearand attendance of these meetings, refer CorporateGovernance Report which forms part of Directors’Report.
Remuneration Policy / Evaluation of Board’s Performance
71. Cochin Shipyard is a 75% Government of Indiaowned Public Sector Enterprise under Ministry ofShipping. Presently the Directors of the Companyare presidential appointees and their remunerationis fixed in accordance with the DPE guidelines.Accordingly,Article21(a)oftheArticlesofAssociationof CSL states that President will appoint Directorsand determine their remuneration. Since the Boardlevel appointments are made by President of India,the evaluation of performance of such appointeesis also done by theGOI.The IndependentDirectorsevaluatedtheperformanceoftheBoardasawholeinaseparatemeetingof independentdirectorsheldonFebruary22,2018.
Report of the Nomination & Remuneration Committee on Company’s Policy on Directors’ Remuneration
72. Presently,theremunerationofBoardlevelappointeesare determined in accordance with DPE guidelines.CSL at its 228th Board meeting held on December14,2016adoptedtheNominationandRemunerationPolicyincompliancewiththeprovisionsofsection178of theCompaniesAct, 2013. and at its 241stBoard
36 Cochin Shipyard Ltd
meetingheldonMay24, 2018 amended thePolicy.ThePolicyisavailableinthewebsiteoftheCompanyathttp://www.cochinshipyard.com/investors.htm
Directors Responsibility Statement
73. YourDirectorsstatethat:
(a) in the preparation of the annual accounts fortheyear endedMarch 31, 2018, the applicableaccounting standards read with requirementssetoutunderScheduleIIItotheAct,havebeenfollowed and there are no material departuresfromthesame;
(b) the Directors have selected such accountingpoliciesandappliedthemconsistentlyandmadejudgmentsandestimatesthatarereasonableandprudentsoastogiveatrueandfairviewofthestateofaffairsof theCompanyasatMarch31,2018 andof the profit of theCompany for theyearendedonthatdate;
(c) the Directors have taken proper and sufficientcareforthemaintenanceofadequateaccountingrecordsinaccordancewiththeprovisionsoftheActforsafeguardingtheassetsoftheCompanyandforpreventinganddetectingfraudandotherirregularities;
(d) theDirectorshavepreparedtheannualaccountsona‘goingconcern’basis;
(e) the Directors have laid down internal financialcontrolstobefollowedbytheCompanyandthatsuchinternalfinancialcontrolsareadequateandareoperatingeffectively;and
(f) the Directors have devised proper systemsto ensure compliance with the provisions ofall applicable laws and that such systems areadequateandoperatingeffectively.
Contracts and arrangements with related parties
74. During the year, the Company had not entered intoany contract/ arrangement/ transactionwith relatedparties which could be considered material. YourDirectorsdrawattentionofthememberstoNote46tothefinancialstatementswhichsetsoutrelatedpartydisclosures as per Indian Accounting Standard (IndAS)24.FormAOC-2hasbeenattachedasAnnexure-3asrequiredundersection134(3)(h)oftheCompaniesAct,2013.
Corporate Social Responsibility & Sustainable Development Committee (CSR & SD Committee)
75. Presently,theCSR&SDCommitteeofCSLcomprisesofSmt.RoopaShekharRai(DIN:07565156),Non-Official
PartTimeDirectorasChairpersonoftheCommittee,Shri Radhakrishna Menon (DIN: 07518727), Non-OfficialPartTimeDirector,ShriDPaulRanjan (DIN:06869452),Director(Finance),andShriBejoyBhasker(DIN: 08103825), Director (Technical) as members.TheCorporateSocialResponsibilityandSustainabilityDevelopmentCommittee(CSR&SD)hasformulatedand recommended to the Board, a Corporate SocialResponsibility Policy (CSR Policy) indicating theactivitiestobeundertakenbytheCompany,whichhasbeenapprovedbytheBoard.TheCSRPolicycanbeaccessedontheCompany’swebsiteatthelink:http://www.cochinshipyard.com/links/CSL_CSR_14-15.pdf.
76. Cochin Shipyard started CSR activities in the year2010-11 based on the guidelines issued by theDepartment of Public Sector Enterprises (DPE)applicabletoGovernmentCompanies.CSLhasputinplaceaneffectiveCSRPolicyandplanimplementationmachinery. The CSR implementation machineryconsists of three tier system: Tier I CSL Board, TierII CSL Board Level CSR Committee consisting fourmembers of the Board headed by an IndependentDirector and Tier III CSL CSR Executive CommitteeconsistingofsixseniorlevelexecutivesacrossvariousdepartmentsoftheCompany.
77. TheCSLCSRprojects are spread throughout lengthand breadth of Kerala covering the most commonfieldsofCSRinterventionsappearinginScheduleVIIof Companies Act 2013. However, the major focusareasofCSLCSRcontinuedtobehealth,education,capacity building, environmental protection,sanitation and drinking water for the economicallypoorandweakersectionsofthesocietyincludingthedifferently abled ones, senior citizens etc. This year33%ofthetotalbudgetwasspecificallyallocatedtoSwachh Bharat projects, emphasizing the need forsupportingthenationalinitiativeofsanitation.Specialinitiatives were taken up focusing on programsincludingtoiletconstructioninschoolsandindividualhouseholdsnotonlyincoastalareasofKeralabutalsoinLakshadweep.
78. During the year, CSL has spent ` 857.08 lakhs forvariousongoingandcompletedCSLCSRprojectsandrelatedindirectexpenses.TheAnnualReportonCSRactivitiesisannexedherewithmarkedasAnnexure-4.
Audit Committee
79. The present Audit Committee of CSL is constitutedwith Shri Radhakrishna Menon (DIN: 07518727),Non-Official Part Time Director as Chairman, Adv.Krishna Das E (DIN: 02731340), Non-Official PartTime Director and Shri Nanda Kumaran Puthezhath(DIN:02547619),NonOfficialPartTimeDirectorasmembers. During the year, all recommendations of
3746th Annual Report
theAuditCommitteewereacceptedbytheBoardofDirectors.Particulars regarding theAuditCommitteeareprovidedundertheSection‘BoardCommittees’inthe Report on Corporate Governance.
Corporate Governance
80. TheCompanyiscommittedtomaintainingthehigheststandards of corporate governance and has put inplaceaneffectivecorporategovernancesystem.TheCompany complies with the applicable regulationsof Securities and Exchange Board of India (ListingObligationsandDisclosureRequirements)Regulations,2015,andalsotheguidelinesoncorporategovernanceissuedby theDepartmentofPublicEnterprises.TheCompany also submits its quarterly progress reportson corporate governance within 15 days from theclose of each quarter to theMinistry of Shipping asrecommendedby theDPE in this regard.The reportoncorporategovernanceformspartoftheDirectors’Report.
Management Discussion and Analysis
81. A separate section ‘Management Discussion andAnalysis Report’ has been included in the AnnualReport and the same forms part of the Directors’Report.
Internal Financial Controls
82. TheCompanyhas inplaceadequate internalfinancialcontrolswithreferencetofinancialstatements.Duringthe year, the Company had engaged M/s. Varma &Varma, (Firm Registration No. 004532S) CharteredAccountants for reviewing and installing adequateInternal Financial Controls and to ensure proper andadequatesystemsforcompliancewiththeprovisionsofall applicable laws. Such controlswere tested andnoreportablematerialweaknessinthedesignoroperationwas observed. In order to provide for functionalautonomy,theCompanyhasasystemwhereinfinancialpowers of the Board of Directors are delegated tothe CMD. These powers are further sub-delegatedto officers at various levels for smooth and efficientdaytodayfunctioning.An independent internalauditmechanism is in place for conducting extensive auditof various operational and financial matters. C&AGconducts proprietary audit. An independent AuditCommittee of the Board of Directors also examinesinternal/ statutory audit observations and providesguidance based on the same. The Audit Committeealso looks into the internal control system, Companyprocedures and internal audit performance andreports to the Board of Directors. The Company hasimplementedanintegratedERPSystem(SAP)sinceJuly2014whichisenablingbettermanagementcontrol.
Statutory Auditors
83. M/s. Krishnamoorthy & Krishnamoorthy (FirmRegistration No. 001488S), Chartered Accountants,ErnakulamwerereappointedastheStatutoryAuditorsoftheCompanybytheComptroller&AuditorGeneralof India for the year 2017-18. The shareholdershavedelegatedthepowertofixtheremunerationofStatutoryAuditors to theBoardandaccordingly, thesamehasbeenfixedbytheBoard.
Auditors Report
84. M/s. Krishnamoorthy & Krishnamoorthy, StatutoryAuditorshavesubmittedtheirreportonthestandaloneandconsolidatedfinancialstatementsoftheCompanyfor the year ended March 31, 2018 on May 24,2018.TheReportdoesnotcontainanyqualification,reservationoradverseremarkordisclaimer.
Comments of C&AG
85. ThecommentsoftheComptrollerandAuditorGeneralof India under Section 143 (6) (b) of theCompaniesAct,2013onthestandaloneandconsolidatedfinancialstatementsoftheCompanyfortheyearendedMarch31,2018areplacedatAnnexure-5.
Cost Auditors
86. The Board has appointed M/s. Felix & Co (FirmRegistration No. 100416), Cost Accountants, as thecostauditorsforconductingtheauditofcostrecordsof theCompany for the financial year 2017-18.Theremuneration of Cost Auditor for the financial year2018-19 will be ratified by the shareholders at theensuingAGM.
Secretarial Auditor
87. The Board has appointed M/s. SVJS & Associates,PractisingCompanySecretaries,toconductSecretarialAudit for thefinancialyear2017-18.TheSecretarialAudit Report for the financialyear endedMarch31,2018 is annexedherewithmarked asAnnexure-6 tothis Report. There is no qualification, reservation oradverse remarkordisclaimer in theSecretarialAuditReport.
Internal Auditor
88. The Board has appointed M/s. Varma & Varma,Chartered Accountants, Kochi, to conduct InternalAuditforthefinancialyear2017-18.
Extract of Annual Return
89. The extract of annual return in Form MGT 9 asper Rule 12(1) of the Companies (Management &Administration)Rules,2014isplacedatAnnexure-7.
38 Cochin Shipyard Ltd
Investor Services
90. ThesharesoftheCompanyare listed inBSELimited(“BSE”)andNationalStockExchangeofIndiaLimited(“NSE”).CSLhaspaid listingfeestoBSEandNSEontime.M/s. Link Intime India Private Limited are theRegistrar&TransferAgentsinrespectoftheseequityshares. The tax free Bonds issued by the Companyin 2013-14 are fully dematerialized with both thedepositories,NSDLandCDSL.ThesebondsarelistedonWholesaleDebtMarket(“WDM”)segmentofBSE.CSLhaspaidthelistingfeestoBSEontimeinrespectoftheseBonds.M/s.LinkIntimeIndiaPrivateLimitedaretheRegistrar&TransferAgentsandM/s.SBICAPTrusteeCompanyLimitedaretheDebentureTrusteesinrespectoftheseBonds.
Vigilance
91. Vigilance Department functions advocatingtransparency, equity and competitiveness in allprocurement.ImportantCVCguidelinesarediscussedwithHeadsofDepartments for its strictcompliance.Emphasis was given to vigilance sensitization among the officers and supervisors for preventivevigilance.
92. Submission of annual property returns of executiveswas made online with a link to view the same tovigilance and the vigilance Dept. is scrutinizing thesame.
93. Effortsweretakentodevelopane-moduletofurnishthevigilancedataofofficersthroughonlineasapartofissueofonlinevigilanceclearance.
94. Further theDepartment has conducted 68 surprise/periodic inspection for the year in various areas ofoperations and suggested corrective actions onvigilance angle. All reports to the CentralVigilanceCommissionaresubmittedintimeandnoreferenceispendingwithCVC.
95. Onevigilance casewas disposedoffduring theyear2017-18 and one case relating to a contractor ispending.
Right to Information Act
96. Inorder topromote transparencyandaccountability,your Company has implemented the provisions oftheRTIAct, 2005 in its true letter and spirit and anappropriatemechanismhasbeensetupintheCompanywith a dedicated centralized RTI Cell to provideinformationtothecitizensundertheprovisionsofthisAct.AlltheRTIapplicationsandtheappealsreceivedbothonlineandofflineduringtheyear2017-18havebeen processed and information was provided in atimeboundmannerasstipulatedintheAct.
97. Therehavebeenno instancesofnon-compliancebytheCompany.NopenaltiesorstrictureswereimposedontheCompanybyanystatutoryauthorityduringthelastthreeyearswithrespecttoRTI.
Vigil Mechanism
98. The Whistle Blower Policy of CSL adopted by theBoard of Directors at the 198th Meeting held onFebruary22,2012 is functioningasVigilMechanismofCSL.TheWhistleBlowerPolicyofCSLisavailableat the link http://www.cochinshipyard.com/links/Whislte_Blower%20policy_CSL.pdf
Details of frauds reported by Auditors under Section 143
99. Nil.
Particulars of loans, guarantees or investments
100.DuringtheyearunderReport,theCompanyhasnot
(a) given any loan to any person or other bodycorporate;
(b) given any guarantee or provided security inconnection with a loan to any other bodycorporateorperson;and
(c) acquired by way of subscription, purchase orotherwise, the securities of any other bodycorporate, as prescribed under Section 186 oftheCompaniesAct,2013,exceptaninvestmentof ` 16.28 crores in the subsidiary companyviz., Hooghly Cochin Shipyard Ltd. The saidinvestment iswithin the limitofSection186oftheCompaniesAct,2013.
Material changes and commitments
101.Nomaterialchangesandcommitments,affectingthefinancial position of the Company, have occurredbetweentheendofthefinancialyearoftheCompanyandthedateofthisReport.
Details of change in nature of business
102.TherehasbeennochangeinthenatureofbusinessoftheCompanyduringtheyearunderreport.
Deposits
103.Your Company has not accepted any deposits fromthe public under Chapter V of the Companies Act,2013.
Secretarial Standards
104.The Company has complied with the applicableSecretarial Standards issued by the Institute ofCompanySecretariesofIndia.
3946th Annual Report
Significant and Material orders
105.Nosignificantandmaterialorderswerepassedbytheregulators or any courts or tribunals impacting thegoingconcernstatusoftheCompanyandaffectingitsoperations.
Business Responsibility Report
106.The Securities and Exchange Board of India (SEBI)has mandated inclusion of Business ResponsibilityReport(“BRreport”)aspartoftheAnnualReportfor500 listed entities based on market capitalization.This SEBI mandate is also inserted as Regulation34(2)(f) of SEBI (LODR) regulations 2015. The SEBI(LODR) Regulations, 2015 provide a format for BRreports. It also contains a list of nine Key Principlesand various core elements under each principle toassess compliance with Environmental, Social andGovernancenorms.TheCompany’sBRreportfortheyear forms part of the Annual Report.
Acknowledgment
107.TheBoardofDirectorsareextremelythankfulforthecontinued patronage and support extended by theHon’blePrimeMinister,Hon’bleMinisterofShippingandallofficersoftheMinistryofShipping.TheBoard
wouldalso like toexpress theirgratefulappreciationforthesupportandco-operationfromvariousofficesof the Government of India, Government of Kerala,Government of West Bengal, various local bodies,theComptroller&AuditorGeneralofIndia,StatutoryAuditors,SecretarialAuditors,CostAuditors, InternalAuditors, Suppliers, Sub-contractors, Company’sBankers and our valued customers. The Board alsoplacesonrecorditsappreciationforthecontributionand support extended by all employees of CochinShipyardLtd.YourDirectorsexpresstheirappreciationandgratitudetoalltheshareholders/investorsforthetrustandconfidencereposedintheCompanyandlookforwardtotheircontinuedsupportandparticipationinsustainingthegrowthoftheCompanyinthecomingyears.
ForandonbehalfoftheBoardofDirectors
Madhu S NairChairman&ManagingDirector
DIN:07376798
Place:KochiDate:June30,2018
40 Cochin Shipyard Ltd
Annexure-1
Dividend Distribution Policy1. Preamble
1.1 The shares of CSL are listed on BSE Ltd andNational Stock Exchange of India Ltd. As perregulation43AofSecuritiesandExchangeBoardof India (Listing Obligations and DisclosureRequirements) Regulations, 2015 the topfive hundred listed entities based on marketcapitalization (calculated as on March 31stof every year) need to formulate a dividenddistributionpolicywhichshallbedisclosedintheAnnualReportandontheirWebsites.
1.2 This policy lays down the general frameworkfor considering and deciding the distribution ofdividend to theCompany’s shareholders and/orretainingofearningsforsustainedgrowth.
2. Policy framework
2.1 Thepurposeof thepolicy is tospecify inbroadterms,theexternalandinternalfactorsincludingfinancialparametersthatwillbeconsideredwhiledeciding on the distribution of dividend, thecircumstances underwhich shareholders of theCompany,mayormaynot expect dividend andthepolicyrelatingtoretentionandutilisationofearnings.Thispolicy isnotanalternativetothedecisionoftheBoardforrecommendingdividendeveryyearbasedonall relevant factorsnamely,factorsenumeratedinthispolicyandalsootheradditional factors that the Board may considerrelevant in the overall interest of the Company. However,suchadditionalfactorsifanyresultingin amendmentof thepolicywill bedisclosed intheAnnualReportaswellasthewebsiteoftheCompany.
2.2 ThepolicywillbeimplementedbytheCompanykeeping in view the provisions of SEBI (LODR)Regulations, the CompaniesAct 2013 and alsotaking into consideration guidelines issued bySEBI,DPE,DIPAM,MinistryofShippingasalsoother guidelines to theextent applicable to theCompany.
3. Effective date
3.1 Thepolicywillbeeffectivefromthefinancialyear2017-18.
4. Exclusions
4.1 Thepolicyshallnotapplyto:
a) Distributionofdividendinkindi.e.byissueoffullyorpartlypaidbonussharesorothersecurities,subjecttoapplicablelaw;
b) Distribution of cash as an alternative topayment of dividend through Buyback ofequityshares.
5. Factors considered while declaring dividend
5.1 a) InpursuanceofSection123oftheAct,no
dividend shall be declared or paid by theCompany for any financial year except outoftheprofitsoftheCompanyforthatyearoroutoftheprofitsoftheCompanyforanyprevious financial year or years arrived atafter providing for depreciation. Howevernormally, the Company will decide todeclare dividendonly out of currentyear’sprofits after providing for depreciation inaccordancewiththelawandaftertransfertothereservesoftheCompanysuchportionoftheprofitsasmaybeconsideredappropriateforfuturegrowth.
b) Interim dividend will be based on profitsof the current year as per unauditedresults after providing for depreciation inaccordance with law and Managementestimatesofprofitsforfullfinancialyear.
c) Dividend distribution tax payable by theCompanyondividendpaidtoshareholderswillalsobeconsidered.
5.2. The quantum of dividend declared by theCompany would depend upon the followingexternalandinternalfactors:a) The external factors that shall impact the
decision to pay dividend will inter-aliainclude economic environment, marketconditions, expectation of shareholders,statutory requirements and applicableGovernmentdirectivesasmaybeapplicablefromtimetotime.
b) Theinternalfactorsthatshallbeconsideredfor dividend will be profitability of the
4146th Annual Report
Company,itsnetworth,itsrequirementforfunds for its Capital Expenditure towardsrenewals & replacement/ upgradation /R&Dandexpansion(CAPEX),investmentinSubsidiaries/JVs, stability of earnings, pastdividendtrends,obligationtocreditorsandanyotherfactorsasmayimpactthedecisiontodeclaredividend.
c) The Company may endeavour to payminimumannual dividendof30%ofProfitafterTax(PAT)or5%ofnetworth,whicheverishigher subject to themaximumdividendpermittedundertheextantlegalprovisions.
6. Utilisation of retained earnings
6.1 The Company is a major player in the shipbuilding and ship repair sector and is acutelyconsciousof theneedtoploughbackadequateprofits for operations and capital investment inordertomaintain,andmoreimportantlyimproveitsmarketposition in the faceofemergingnewtechnologies requiring investments to stayabreast of current technologies, competitionarising from the private players, both domesticand foreign. The Company has an ambitiousexpansion programme, Capex requirementswhich includes multi locational shiprepairing/building facility, two major capital projects viz. a drydock at the existing premises and a newshiprepaircomplexatCochinPortTrustpremisesand also has necessarily to invest in upgrading& renewals and replacement of its existingfacility and R&D projects. Further, with theanticipatedhigher growth in salesyearonyear,the incremental working capital requirementsalsowill have to bemet increasingly from cashandreservesoftheCompany.
7. Circumstances under which the shareholders may or may not expect dividend
7.1 The Company has been consistently payingdividends to its shareholders and that it willcontinue to do so in future is a reasonableexpectation unless circumstances warrant thecontrary.
7.2 The shareholders of the Company may ormay not expect dividend depending upon thecircumstances including, but not limited, to thefollowing:-
a) In the event of inadequacy of profits orwhenevertheCompanyhasincurredlosses;
b) Whenever the Company undertakes orproposes to undertake significant capitalexpenditureor investment in newareasofbusiness whether in CSL itself or in Jointventures/Subsidiaries;
c) Significantly higher working capitalrequirementadverselyimpactingcashflows;or
d) WhenevertheCompanyproposestoutilisethesurpluscashforbuybackofsecurities;
e) Anyothercircumstance/instancewhichtheBoardofDirectorsmayconsiderrelevanttothedividenddeclarationdecisions.
7.3 The Company will take a decision on thedividend distribution keeping all external andinternal factors in view and duly adopting ajudiciousbalancebetweendirectlyrewardingtheshareholdersthroughdividenddeclarationontheonehandand increasingshareholderswealth infuturethroughappropriateretentionofprojectsanditsrealisationforsustainablegrowth,ontheother.
8. Parameters to be adopted with regard to various classes of shares
8.1 TheCompanyhasissuedonlyoneclassofsharesi.e.equityshareswithequalvotingrights,allthemembersoftheCompanyareentitledtoreceivethesameamountofdividendpershare.
9. Interpretation & amendments
9.1. AnywordusedinthisPolicyshallhavethesamemeaning as defined under the Companies Act,2013, SEBI Listing Regulations, 2015 and anyotherapplicablestatutoryregulations.
9.2 The Board of Directors may review, amendand modify the policy at any point of timeas it may deem necessary and /or as may berequired from time to time in accordancewithsubsequent amendments in Companies Act,2013&CompaniesRules,Circulars,Notifications,Guidelines thereto, SEBI Listing Regulations,2015, the relevant guidelines of Ministry ofFinance,Ministryof Shipping,DPE,DIPAMetc.andotherapplicablestatutes.
10. Disclosure
10.1ThispolicyshallbedisclosedintheAnnualReportand hosted on theCompany’swebsite tomeetstatutoryrequirementsifany.
42 Cochin Shipyard Ltd
Annexure-2
A. ConservationofEnergya. Stepstakenorimpactonconservation
ofenergyduringtheyear2017-18STEPS TAKEN• Electrification of new buildings is carried out with LED lights
insteadofconventionaldischargelamps.
• ReplacedconventionaldischargelampstreetlightswithLEDlights.
• Leakages in the compressed air distribution system and otherindustrialgaslinesareregularlymonitoredandrectified.
• ReducingtheusageofMainAirCompressorduringlunchbreak.
• Switching off Main power supply to shops, Quays, & Docksmomentarilyat12:15hrs.Thistripsmancoolers,roofextractors(controlledthroughstarters),etc.whicharenotrequiredduringthelunchbreak.
• ProvidedVariable Frequency Drive (VFD) with panel for ballastpumpsinshiprepairdock
• ReducingtheusageofmainaircompressorsduringdaytimeandutilizingportableaircompressorclusterswithVFD.
• Displayed energy saving stickers & posters, conducted seminarandquizcompetitionforinculcatingawarenessamongemployeesforenergyconservationaimedatoptimumuseofelectricpower.
• Powerfactoriscontinuouslymonitoredandmaintainednearunity.
• VFDInstalledfor40TOBELLTTcraneforLuffMovement.
• Installationof 300 kWgrid connected solar powerplant on therooftopofHullShopinprogress.
IMPACTEnergy saving is approx. 10.93 Lakhs units per annum with theimplementationofmeasuresspecifiedabove.
b. Steps taken for utilizing alternatesourcesofenergy.
• Installationof 300 kWgrid connected solar powerplant on therooftopofHullShopinprogress.
c. Capital investment on energyconservationequipments
• Anamountofapproximately`44.81Lakhshasbeeninvestedforconservationofenergy
4346th Annual Report
B. TechnologyAbsorption,AdaptationandInnovation(i) Effortsmade
towardstechnologyabsorption.
i. Developed contract & basic design for 16 Nos. Gillnet Long Liner Fishing Vessels intechnicalcollaborationwiththeCentralInstituteofFisheriesTechnology,ICAR.
ii. DevelopedconceptdesignformarineambulanceboatforKeralaGovt.
iii. Development of specification for implementation of accommodation system & HVACPackagefor500PAX.
iv. Developmentofspecificationforimplementationofaccommodationsystemfor1200PAX.
v. Development of specification for implementation of HVAC & refrigeration system for1200PAX.
vi. Developmentofspecificationfortheprocurementofequipment/systemsincompliancetoSRtP(SafeReturntoPort)requirementsfor1200PAX.
vii. Development of specification for the procurement of power and automation system,navigation and communication system, lighting, electrical cables for 1200 PAX incompliancewithSRtPrequirements.
viii. In-house development of 3D modeling for accommodation & other outfit Systemsin accommodation spaces for the Technology Demonstration Vessel (Ship - 020) forDRDO/500 PAX forA&NAdministration/1200 PAX forA&NAdministration inTribonunderprogress.
ix. In-house development of 3Dmodeling for electrical outfitting for 1200 PAX forA&NAdministrationisinprogressincompliancewithSRtPrequirements.
x. In-house conceptual design of integrated fire and flood detection system by suitablycombiningexistingstandalonesystems forfiredetectionandflooddetectionforSRtPcompliancefor1200PAX.
xi. Software upgrades for “Cable Manager” – In-house developed cable scheduling andnestingsoftwareforusageonboardprojects.
xii. Software upgrades for “Electrical Apps” – In-house developed production designcustomizationtoolforTribonM3forusageinongoingprojects.
xiii. FunctionaldesigndrawingsdevelopedforelectricalcableroutesandantennaarrangementbasedontheEMI/EMCrequirementsforTechnologyDemonstrationVesselShip-020forDRDO;specialpurposevesselforGovt.ofIndia;
xiv. DevelopmentofspecificationfortheprocurementofspecializedHatchCoversrequiredforthearticlelaunchingfortheTechnologyDemonstrationVessel(Ship-020)forDRDO;specialpurposevesselforGovt.ofIndia;
xv. Installationofhighvoltagepowergeneration&distributionsystem,highpowerpropulsionsystem, UPS systems with neutral arrangement for client system power distribution,navigation&communicationsystemsmeetingDNVNaut-AWandIRSIBSnotations,SPScoderequirements,onboardTechnologyDemonstrationVesselShip-020;specialpurposevesselforGovt.ofIndia;
xvi. Structural interface of client systems (DRDO) with Ship systems for TechnologyDemonstrationVesselShip–020;specialpurposevesselforGovt.ofIndia;
xvii. Installationof1500NBvalvewithelectricactuationonboardTechnologyDemonstrationVesselShip–020;specialpurposevesselforGovt.ofIndia;
xviii.Preparation of technical specification and 3Dmodelling of completely explosion prooftype electrical overhead cranes for client article handling operations for TechnologyDemonstrationVesselShip–020;specialpurposevesselforGovt.ofIndia.
44 Cochin Shipyard Ltd
DisclosureofParticularsinrespectofAbsorption(ii) Benefits derived like product
improvement, cost reduction, productdevelopmentorimportsubstitutions.
i. Improved self reliance, better control and focus on productivityimprovement.
ii. Accesstohighendclienteleandenhancedcredibilityonaccountofhighqualitydesignsolutions.
iii. Reduction of cost due tominimized rework, as interface of thesystemscanbeviewedandcorrectedin3Dmodellingoncomputer.
iv. ConsiderableimprovementintimeandcostsavingforproductionofvesselsbeingbuiltatShipyard.
v. Yard has developed expertise and skill to produce production-engineering drawings by extracting relevant data from Tribonmodel.
vi. Carriedoutmodellingoftheentirehull,facilitatingveryshortcycletimefordrawingissue.
vii. Capabilityachievedinundertakingmultipleprojectsconcurrently.viii. Considerable improvement in time for estimation of cables and
optimalroutedesignforcables.(iii) Incaseofimportedtechnology(imported
during the last three years reckonedfromthebeginningofthefinancialyear)followinginformationmaybefurnisheda. Thedetailsoftechnologyimported Nilb. Theyearofimport NotApplicablec. Whetherthetechnologybeenfully
absorbedNotApplicable
d. If not fully absorbed, areas whereabsorptionhasnot takenplace,andthereasons thereof
NotApplicable
(iv) Expenditure incurred on Research andDevelopment
Nil
C. ForeignExchangeEarningsandOutgo(`inlakhs)
2017-18 2016-17Income from Foreign ExchangeFromShipbuilding 0.00 10442.05From Shiprepair 496.90 0.00Total 496.90 10442.05Expenditure in Foreign ExchangeMaterials(CIFValue) 94984.50 40846.20Design&Documentation 2.65 28456.92ServiceCharge&Others 3539.79 15709.26Total 98526.94 85102.38
ForandonbehalfoftheBoardofDirectors
Madhu S NairChairman&ManagingDirector
DIN:07376798KochiJune30,2018
4546th Annual Report
Annexure-3
FormNo.AOC-2(Pursuanttoclause(h)ofsub-section(3)ofsection134oftheCompaniesAct,2013and
Rule8(2)oftheCompanies(Accounts)Rules,2014)
Formfordisclosureofparticularsofcontracts/agreementsenteredintobytheCompanywithrelatedpartiesreferredtoinsubsection(1)ofsection188oftheCompaniesAct,2013includingcertainarmslengthtransactionsunderthirdprovisothereto:
1. Details of contracts or arrangements or transactions not at arm’s length basisName(s)oftherelatedpartyandnatureofrelationship NotApplicableNatureofcontracts/arrangements/transactions NotApplicableDurationofthecontracts/arrangements/transactions NotApplicableSalienttermsofthecontractsorarrangementsortransactionsincludingthevalue,ifany NotApplicableJustificationforenteringintosuchcontractsorarrangementsortransactions NotApplicableDate(s)ofapprovalbytheBoard NotApplicableAmountpaidasadvances,ifany NotApplicableDateonwhichthespecialresolutionwaspassedingeneralmeetingasrequiredunderfirstprovisotosection188 NotApplicable
2. Details of material contracts or arrangements or transactions at arm’s length basisName(s)oftherelatedpartyandnatureofrelationship NotApplicableNatureofcontracts/arrangements/transactions NotApplicableDurationofthecontracts/arrangements/transactions NotApplicableSalienttermsofthecontractsorarrangementsortransactionsincludingthevalue,ifany NotApplicableDate(s)ofapprovalbytheBoard NotApplicableAmountpaidasadvances,ifany None
ForandonbehalfoftheBoardofDirectors
Madhu S NairChairman&ManagingDirector
DIN:07376798KochiJune30,2018
46 Cochin Shipyard Ltd
Annexure-4
REPORTONCORPORATESOCIALRESPONSIBILITY1. AbriefoutlineoftheCompany’sCSRPolicy,includingoverviewofprojectsorprogramsproposedtobeundertakenand
referencetotheweb-linktotheCSRPolicyandprojectsorprograms.a) CochinShipyardLimitedCorporateSocialResponsibilityPolicy(CSLCSRPolicy):
(i) CSLCSRPolicyapprovedandadoptedby theBoardofCSL in its213thMeetingheldonSeptember16,2014isfoundedonthebasicprinciplesofsharedandinclusivegrowthofthecommunityandenvironmentandisamanifestationofCompany’scommitmenttothepeopleandplanetwithoutsacrificingitseconomicsustainability.Morethanamandatorypractice,CSRforCSLisitswayofconductingthebusiness.ThePolicyencompassesthebasictenetsofCSRanddomainofCSRactivitiesasenshrinedintheCompaniesAct,2013andtheCSRRulesframedthereunderwithparticularreferencetotheScheduleVIIoftheAct.
(ii) Accordingly,CSLCSRPolicycontains:• CSRVisionandMission• ThrustareasofCSRinterventions• CSRactivities• CSRManagementstructureinCSL• CSRimplementationprocessormodusoperandi• CSRbudgeting• Documentationandreporting
(iii) Web-linktotheCSRPolicyandprojectsorprograms:http://www.cochinshipyard.com/links/CSL_CSR_14-15.pdf
(b) DetailsofCSRspentonprojectsorprogramsundertaken(Asshownunder5below)2. TheCompositionoftheCSRCommittee(BoardLevel)asondate:
i) Smt.RoopaShekharRai DIN:07565156 IndependentDirectorandChairpersonoftheCommitteeii) ShriRadhakrishnaMenon DIN:07518727 IndependentDirectoriii) ShriDPaulRanjan DIN:06869452 Director(Finance)iv) ShriBejoyBhasker DIN:08103825 Director(Technical)
3. Averagenetprofitofthecompanyforthelastthreefinancialyears:`426.87crore.4. PrescribedCSRExpenditure(twopercentoftheamountasinitem3above):`8.54crore.5. DetailsofCSRspentduringthefinancialyear
a) Totalamounttobespentforthefinancialyear : ` 8.54croreb) Totalamountspent : ` 8.57crorec) Amountunspent,ifany : Nil
RESPONSIBILITY STATEMENT‘TheimplementationandmonitoringofCorporateSocialResponsibility(CSR)Policy,isincompliancewithCSRobjectiveandpolicyoftheCompany.’
Madhu S Nair Roopa Shekhar Rai(DIN:07376798) (DIN:07565156)Chairman&ManagingDirector ChairpersonofCSR&SDCommittee
Place:KochiDate:June30,2018
4746th Annual Report
Mannerinwhichtheam
ountspentduringthefinancialyear2017–18
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect
or
prog
ram
w
ise
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:(1
) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
ASw
achhBharatP
rojects(Major)
1.HarithaKeralam–
100Pondsin50Days
(ASwachhBharat
Project)
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
ErnakulamDistrict,
Kera
la S
tate
30.00
30.00
30.00
Dist
rict
Collector,
Ernakulam
Entire
Ernakulam
Dist
rict
2.Su
ppor
t for
co
nstr
uctio
n of
householdtoilets
inLakshadweepto
achieveODFstatusto
Lakshadw
eep
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
UTIofLakshadweep
100.00
100.00
100.00
Govt.ofIndia,
Lakshadw
eep
Administration
(Departmentof
Environm
ent
andForests)
UTIof
Lakshadw
eep
3.Co
nstr
uctio
n of
toile
ts
for t
he c
oast
al p
eopl
e of
Alle
ppey
.
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
Coas
tal a
rea
of
Alleppeydistrictof
Kera
la S
tate
32.50
16.25
16.25
Coas
tal
Educational
Society,
Alle
ppey
50Fam
ilies
4.Supportforrestoring
the
scul
ptur
es in
SubhashCh
andra
BoseParklocated
intheParkAvenue
areaofErnakulam
backwaters
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
ErnakulamDistrictof
Kera
la S
tate
20.00
20.00
20.00
Municipal
Corp
orat
ion
ofKochialong
withCentre
forH
eritage,
Environm
ent
and
Dev
elop
men
t
Peoplewho
arevisiting
thePark
5.Su
ppor
t for
Cle
an
GangaMission
Activities(Fund)to
NMCG
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
ThebanksofRiver
Ganga
60.00
60.00
60.00
National
Missionfor
CleanGanga
(NMCG
)
People
whouse
theGanga
waterand
the
faci
litie
s around.
Sub
Tota
l (A
)24
2.5
226.
2522
6.25
48 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect
or
prog
ram
w
ise
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:(1
) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
BSw
achhBharatP
rojects(Minor)
1.Fi
nanc
ial s
uppo
rt fo
r thepublicationofthe
Book“N
janumEnte
Bhum
iyum
Njanum
EnteSam
oohavum’
Cl.(i)prom
oting
health(Swachh
Bharat)
ErnakulamDistrictof
Kera
la S
tate
05.00
05.00
05.00
Welfare
Serv
ice
Society,
Ernakaulam
5,000Bo
ok
love
rs
2.Su
ppor
t for
Harithardra
Santhw
anam
-A27
DaysSw
achatha
awarenesscampaign
Cl.(i)prom
oting
health(Swachh
Bharat)
All
Dist
ricts
of K
eral
a St
ate
01.00
00.63
00.63
Bodhananda
Srut
i Sev
a Trust,Vyttila
2000people
including
students
3.Prom
otionof
environm
entfriendly
itemsthatreduce
pollutionandenhance
the
inco
me
of
marginalizedwom
en
Cl.(i)prom
oting
health(Swachh
Bharat)
ErnakulamDistrictof
Kera
la S
tate
03.00
01.50
01.50
St.Theresa’s
College,
Ernakulam
40Poor
wom
enand
students
4.Su
ppor
t for
constructionofnew
septictankforgirls
hostelatV
ivekananda
TribalResidential
schoolMattilayam
,VellaMunda,
WayanadDistrict
Cl.(i)prom
oting
health(Swachh
Bharat)
Mattilayam
,Vella
Munda,Wayanad
Dist
rict o
f Ker
ala
Stat
e
04.50
04.50
04.50
Vivekananda
Tribal
Resid
ential
scho
ol
Mattilayam
,VellaMunda
,Wayanad
Dist
rict
100Tribal
Students
Sub
Tota
l (B)
13.5
011
.63
11.6
3
4946th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2
) Ove
rhea
ds
(` L
akhs
)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
CMajorProjects(General)
1.Fi
nanc
ial s
uppo
rt fo
r co
nstr
uctio
n of
an
early
inte
rven
tion
cum
sensoryintegration
ther
apy
unit
for
autisticchildrenat
Aranattukara,Thrissur
Dist
rict
Cl.(ii)promoting
education,
includingspecial
education
Aranattukara,Thrissur
Dist
rict
40.00
40.00
40.00
Ass
ocia
tion
forM
entally
Handicapped
Adults(AMHA
Kuryattukara,
Thris
sur
40Autistic
Children
2.Fi
nanc
ial s
uppo
rt fo
r defendingthehuman
rightsofthedestitute,
theagedandthe
mentallydisabledin
relie
f set
tlem
ent a
t Palluruthy
Cl.(iii)settingup
ofhom
esand
hostelsforw
omen
andorphans
Palluruthy,Ernakulam
District,KeralaState
11.76
11.76
11.76
PeoplesCo
uncil
for S
ocia
l Justice(PCS
J),
Ernakulam
120old
andthe
sickinthe
Palluruthy
relie
f se
ttle
men
t
3Fi
nanc
ial s
uppo
rt
for c
ompl
etio
n of
incompleteIndiraAvas
YojanahousesatBlock
PanchayatVeliyanad,
Alle
ppey
Dist
rict
Cl.(x)Rural
developm
ent
projects
VeliyanadBlock
PanchayatofA
lleppey
District,KeralaState
36.00
36.00
36.00
BDO,Veliyanad
BlockPanchayat
of A
llepp
ey
District,Kerala
Stat
e
31poor
fam
ilies
of
the
Panchayat
4.Fi
nanc
ial S
uppo
rt fo
r skilldevelopmentin
weldingtechnology
for60unem
ployed
youthwhobelongto
BPLFamilies
Cl.(ii)and(iii)
Livelihood
enha
ncem
ent
projectsand
mea
sure
s forreducing
inequalitiesfaced
bySocially&
econ
omic
ally
backwardgroups
Diff
eren
t Dist
ricts
of
Kera
la32.85
16.42
16.42
DonBosco
Tech,Vaduthala,
Ernakulam
60Students
50 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2
) Ove
rhea
ds
(` L
akhs
)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
5.Fi
nanc
ial s
uppo
rt
for c
onst
ruct
ion
ofacounseling
cumrehabilitation
trainingcentreat
Aranattukara,Thrissur
DistrictbySO
LACE
Cl.(i)prom
oting
heal
th c
are
including
prev
entiv
e he
alth
Aranattukara,Thrissur
Dist
rict
10.00
5.00
5.00
SOLACE
,Aranattukara,
Thris
sur D
istric
t
50Children
whoare
affectedwith
Canc
er
6.Fi
nanc
ial a
ssist
ance
fo
r the
pur
chas
e of
a50seaterm
arine
boattoVivekananda
RockMem
orial&
VivekanandaKendra,
Kanyakum
ari
Cl.(v)protectionof
nationalheritage,
artandculture
Kanyakum
ariD
istrict
ofTam
ilNaduState
60.00
18.00
18.00
Vivekananda
RockMem
orial
&Vivekanan-
daKendra,
Vivekanandapur-
am,Kanyakumari,
TamilNadu
40staff
mem
bersof
theInstitute
7.Fi
nanc
ial s
uppo
rt
forsettingupa
rehabilitationcum
yogacentreforthe
agedbyPunnyam
TrustatVazhoor,
Kott
ayam
Dist
rict
Cl.(iii)settingup
ofhom
esand
hostelsforw
omen
andorphans
Vazhoor,Kottayam
D
istric
t40.00
38.50
38.50
PunnyamTrust
atVazhoor,
Kott
ayam
Dist
rict
40aged
peop
le
8.Fi
nanc
ial a
ssist
ance
foradialysisclinic
supportprogram
atLittleFlower
HospitalandResearch
CentreAngam
aly,
to tr
eat e
ffec
tivel
y thepatientsw
ho
havebeenbittenby
poiso
noussnake
Cl.(i)prom
oting
heal
th c
are
including
prev
entiv
e he
alth
Angam
aly,Ernakulam
district
28.90
28.90
28.90
LittleFlower
Hospitaland
Rese
arch
Cen
tre
Angam
aly,
Ernakulam
Dist
rict
Snakebitten
patie
nts
5146th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2
) Ove
rhea
ds
(` L
akhs
)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
9.Fi
nanc
ial s
uppo
rt fo
r conservationofwhale
sharksalongKerala
andLakshadw
eep
watersbyW
ildLife
TrustofIndia,N
ew
Del
hi
Cl.(iv)
Cons
erva
tion
of
natu
ral r
esou
rces
Keralaand
Lakshadw
eepCo
astal
area
40.00
15.00
15.00
WildLifeTrustof
India,New
Delhi
500
Fish
erm
en
Com
mun
ities
10.
Fina
ncia
l sup
port
for
minimum
25joint
replacem
entsurgeries
bySudheendra
MedicalMission,
Ernakulam.
Cl.(i)prom
oting
heal
th c
are
including
prev
entiv
e
Allthedistrictsof
Kera
la S
tate
25.00
7.50
7.50
Sudheendra
MedicalMission,
Ernakulam
25 p
atie
nts
whosuffer
Knee
problems
11.
Fina
ncia
l ass
istan
ce
forestablishingIT
labatSRV
Govt.
(Model)H
ighSchool,
Ernakulam
Cl.(ii)promoting
education,
includingspecial
education
Ernakulamdistrictof
Kera
la S
tate
11.54
11.54
11.54
SRVGovt.Model
HighSchool,M
G
Road,Ernakulam
1200School
Children
12.
RequestforFinancial
supp
ort f
or th
e ‘Velicham’educational
project
Cl.(ii)promoting
education,
includingspecial
education
Vypin,Ernakulam
D
istric
t of K
eral
a St
ate
10.00
10.00
10.00
Dep
uty
Dire
ctor
Education,
Ernakulam
Dist
rict
3000School
Children
13.
SupportforNandanam
Balasadanambuilding
forthedestitute
children,Koovapadam,
Koch
i.
Cl.(ii)promoting
education,
includingspecial
education
Koovappadam,
Ernakulamdistrictof
Kera
la S
tate
16.00
16.00
16.00
Nandanam
Balasadanam,
Koovapadam
,Ko
chi
40destitute
children
14.
Supp
ort f
or a
sch
ool
bustoRakshaSociety
for t
he c
are
of
childrenwithspecial
needs.
Cl.(ii)promoting
education,
includingspecial
education
Mattanchery,
ErnakulamDistrict
16.53
16.53
16.53
Secr
etar
y ofRaksha
Society,Darrag
SalamRoad,
Kochangadi,
Coch
in
75Special
Children
52 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2
) Ove
rhea
ds
(` L
akhs
)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
15.
Supportforatraining
anddevelopm
ent
cent
re fo
r marginalizedwom
en-
Thekkumbhagam
-Vizhinjam
,Th
iruva
nant
hapu
ram
.
Cl.(ii)
Employment
enhancing
vocationalskills,
especiallyamong
children,wom
en,
elderly,andthe
differently-abled.
Thekkumbhagam
-V
izhinjam
,Th
iruva
nant
hapu
ram
D
istric
t of K
eral
a St
ate
30.00
15.00
15.00
Vizhinjam
Thekkumbhag-
am,M
uslim
Jama’ath.
50
Marginalized
Wom
enof
the
area
.
16.
Supp
ort f
or a
computerlaband
a sm
art c
lass
room
atPanditK
aruppan
Mem
orialLibrary
&ReadingRoomat
Thevara,Cochin
Cl.(ii)promoting
education,
includingspecial
education
Thevara,Ernakulam
D
istric
t of K
eral
a St
ate
15.00
7.50
7.50
PanditKaruppan
Mem
orialLibrary
&Reading
Room
,Thevara,
Coch
in
200
Childrenof
the
area
17.
Supp
ort f
or c
ente
nary
mem
orialskill
developm
entblock
atSMVHigher
SecondarySchool,
Poonjar,Kottayam
D
istric
t
Cl.(ii)Promoting
education
Poonjar,Kottayam
D
istric
t of K
eral
a St
ate
30.00
25.00
25.00
SMVHigher
Secondary
School,Poonjar
1000School
Children
18.
Supportforanew
schoolbusto
SnehabhavanSpecial
Scho
ol fo
r the
MentallyChallenged,
Ettumanoor,Kottayam
D
istric
t.
Cl.(ii)promoting
education,
includingspecial
education
Ettumanoor,Kottayam
D
istric
t of K
eral
a St
ate
16.62
16.62
16.62
Director,
Snehabhavan
Spec
ial S
choo
l fortheMentally
Challenged,
Ettumanoor,
Kott
ayam
Dist
rict
50Special
Children
5346th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect i
s co
vere
d (C
laus
e no
. of S
ched
ule
VII
to C
ompa
nies
Ac
t, 20
13, a
s am
ende
d)
Proj
ects
or P
rogr
ams
(1) L
ocal
are
a or
oth
er
(2) S
peci
fy th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pro
gram
s w
as u
nder
take
n
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2
) Ove
rhea
ds
(` L
akhs
)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
19.
Supp
ort f
or v
ehic
le
andotherequipments
forM
ridulasparsham
a sp
ecia
l sch
ool
fordifferently
abledpersonsat
Thrip
unith
ura
Cl.(ii)promoting
education,
includingspecial
education
Thripunithura,
ErnakulamDistrictof
Kera
la S
tate
12.00
12.00
12.00
Chairman,
Mridulasparsham
SpecialSchool,
Thrip
unith
ura
40special
children
20.
Supp
ort f
or a
n am
bulancetoAshraya
CharitableSociety,
Kalayapuram,Kollam
Cl.(iii)Settingup
old-agehomes,
daycarecenters
andsuchother
faci
litie
s fo
r sen
ior
citizens.
Kalayapuram,Kollam
Dist
rict o
f Ker
ala
Stat
e12.00
12.00
12.00
Ash
raya
Ch
aritable
Society,
Kalayapuram,
Kolla
m
300Inmates/
patie
nts
21.
Ass
istan
ce fo
rVidyaposhanam
-Poshakasam
rdham
Project(Mid-Day
MealsforStudents)
Cl.(ii)promoting
education
ErnakulamDistrictof
Kera
la S
tate
10.00
10.00
10.00
SelectedSchools
from
Ernakulam
Parliam
ent
Cons
titue
ncy
3000School
Children
22.
Supp
ort f
or A
ll Ke
rala
Ch
ildren’sFest2017
Cl.(v)protection
of n
atio
nal
heritage,artand
cultu
re
The
entir
e st
ate
of
Kera
la12.00
12.00
12.00
CochinShipyard
RecreationClub,
Koch
i
6000
Chidlren
Sub
Tota
l (C)
516.
2038
1.27
381.
27
54 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
DMinorProjects(General)
1.SupportforIT
equipm
entsto
Govt.H.School
Kanjiramattom,
Thodupuzha,Idukki
Cl.(ii)promoting
education
Kanjiramattom,
Thodupuzha,
IdukkiDistrictof
Kera
la S
tate
04.00
04.00
04.00
Headmaster
Govt.High
Scho
ol
Kanjiramattom,
Thodupuzha,
IdukkiDistrict
400School
Children
2.D
evel
opm
ent
supp
ort t
o G
ovt.
HigherSecondary
SchoolKum
arakom
,Ko
ttay
am D
ist.
Cl.(ii)promoting
education
Kumarakom
,Ko
ttay
am
Dist
rict o
f Ker
ala
Stat
e
04.00
04.00
04.00
Govt.Higher
SecondarySchool
Kumarakom
,Ko
ttay
am D
istric
t
500School
Children
3.D
onat
ion
of fu
rnitu
re
andcomputersto
RamaVarmaUnion
L.P.SchoolCherai,
ErnakulamDistrict.
Cl.(ii)promoting
education
Cherai,
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
02.00
02.00
02.00
Ram
a Va
rma
UnionL.P.
SchoolCherai,
Ernakulam
Dist
rict
150School
Children
4.Fi
nanc
ial s
uppo
rt fo
r prom
otingGeriatric
CarebyRedCross
Kakkanadu
Cl.(iii)Setting
upold-age
homes,day
care
cen
ters
andsuchother
faci
litie
s fo
r seniorcitizens.
Kakkanadu
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
05.00
02.50
02.50
RedCross
Soci
ety
Kakkanadu,
Ernakulam
Dist
rict
40Aged
People
5.Fi
nanc
ial s
uppo
rt fo
r prom
otingGeriatric
CarebyRotaryClub
of K
alam
asse
ry.
Cl.(iii)Setting
upold-age
homes,day
care
cen
ters
andsuchother
faci
litie
s fo
r seniorcitizens
Kala
mas
sery
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
05.00
05.00
05.00
RotaryClubof
Kalamassery,
Ernakulam
Dist
rict
45Aged
peop
le
5546th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
6.Su
ppor
t for
sm
art
clas
s ro
oms
at G
ovt.
UPSchoolNorth,
Ezhiprum
,Aluva
Cl.(ii)promoting
education
AluvaErnakulam
D
istric
t of K
eral
a St
ate
02.00
02.00
02.00
Governm
entU
PSchoolNorth
Ezhiprum
,Vazhakulam
G
ram
a Panchayat,
Ernakulam
200School
Children
7.Supportforkids
parkandcom
puter
labtoSree
NarayanaCentenary
Mem
orialLP
SchoolNeyyassery,
Thodupuzha,Idukki
Dist
rict.
Cl.(ii)promoting
education
Neyyassery,
Thodupuzha,
IdukkiDistrictof
Kera
la S
tate
04.20
02.10
02.10
SreeNarayana
Cent
enar
y Mem
orial
LPSchool,
Neyyassery,
Thodupuzha,
IdukkiDistrict
180School
Children
8.Fi
nanc
ial s
uppo
rt fo
r computerlabatSt.
Philomina’sHigher
SecondarySchool,
Koonam
mavu,
ErnakulamDistrict.
Cl.(ii)promoting
education
Koonam
mav,
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
02.74
02.74
02.74
St.Philomina’s
HigherSecondary
School,Koonam-
mavu,Ernakulam
Dist
rict
600School
Children
9.Su
ppor
t for
computers,projector
andaprinterto
SNVLPSchool,
Thum
poly,Alappuzha.
Cl.(ii)promoting
education
Thum
poly,
Alappuzha
Dist
rict o
f Ker
ala
Stat
e
04.00
04.00
04.00
SNVLPSchool,
Thum
poly,
Alappuzha
Dist
rict
160School
Children
10.
Supportforlearning
cent
re a
t Gov
ernm
ent
LowerPrim
ary
School,BristoRoad,
WillingtonIslands.
Koch
i.
Cl.(ii)promoting
education
Willington
Islands.Kochi,
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
02.00
02.00
02.00
LowerPrim
ary
School,
BristoRoad,
Willington
Islands.Kochi.
100School
Children
56 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
11.InstallationofSolar
System
atSri.Sarada
Math,Ravipuram
,Ko
chi
Cl.(iv)Ensuring
envi
ronm
enta
l sustainability
Ravipuram,
KochiErnakulam
D
istric
t of K
eral
a St
ate
09.44
09.44
09.44
Sri.SaradaMath,
Ravipuram,Kochi
50inmates
12.
Fina
ncia
l ass
istan
ce
to a
nnua
l sta
te m
eet
ofIndianAssociation
ofPalliativeCare
Kera
la
Cl.(i)prom
oting
heal
thErnakulam
Dist
rict o
f Ker
ala
Stat
e
01.00
01.00
01.00
Cons
ortiu
m
ofPainand
Palliative
CareUnitsin
Ernakulam
Dist
rict
2000
delegates
13.
Fina
ncia
l ass
istan
ce
to th
e pr
omot
ion
ofTheyyam
-A
traditional&cultural
art f
orm
s of
Ker
ala
Cl.(v)
Prom
otionand
developm
entof
traditionalarts
andhandicrafts
Thrippunithura,
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
00.50
00.50
00.50
Thap
asya
SahithyaVedhi,
Thrip
unith
ura
2000art
loving
popu
latio
n
14.
Fina
ncia
l sup
port
for‘Puthuyugam
’–
A co
mpr
ehen
sive
educational
projectbydistrict
administration,
Ernakulam
Cl.(ii)promoting
education
includingspecial
Education
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
09.36
09.36
09.36
DistrictC
ollector,
Ernakulam
200Student
aspi
rant
s
15.
Supp
ort f
or
establish
inga
smartclassroom
,co
nstr
uctio
n of
a
newkitchenand
re-roofingofthe
oldbuildingof
Govt.L.P.School,
Kaipam
angalam,
Thris
sur D
istric
t
Cl.(ii)promoting
education
Kaipam
angalam,
Thris
sur D
istric
t of
Ker
ala
Stat
e
06.50
06.50
06.50
Govt.L.P.School,
Kaipam
angalam,
Thris
sur D
istric
t
186School
Children
5746th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
16.
Fina
ncia
l Sup
port
for‘Madhyam
am
Velic
ham
Programme’-an
Initiativetoboost
readinghabits
amongchildrenin
governmentschools
inErnakulam
and
Alappuzhadistricts
Cl.(ii)promoting
education
Ernakulamand
Alappuzha
Dist
ricts
of
Kera
la S
tate
02.00
01.00
01.00
Madhyam
am,
KochiU
nit
3000
Scho
ol
Children
17.
Fina
ncia
l sup
port
for
providingeducational
aidstothepoor
SC/STstudentsin
WayanadDistrict
Cl.(ii)promoting
education
WayanadDistrict
of K
eral
a St
ate
03.50
03.06
03.06
Federationof
CentralG
ovt.SC
/STEmployees
(Kerala)Cochin
ShipyardUnit
500ST
Scho
ol
Children
18.
Supp
ort f
or
convertingasm
all
buildingtoan
‘AyurvedicClinic’at
RamakrishnaMath,
Vyttila,Kochi
Cl.(i)prom
oting
heal
thVyttilaKochi,
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
07.77
03.88
03.88
Ramakrishna
Math,Vyttila
Koch
i
30patients
daily
19.
Dev
elop
men
t sup
port
toGovt.HighSchool
Mannamkandam
,Korangatty,Idukki
Dist
rict
Cl.(ii)promoting
education
Mannamkandam
,Korangatty,
IdukkiDistrictof
Kera
la S
tate
04.00
04.00
04.00
Govt.High
Scho
ol
Mannamkandam
,Korangatty,
IdukkiDistrict
400Tribal
students
58 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
20.
Fina
ncia
l Sup
port
for
‘MalayalaManoram
aVayanakalari’-an
Initiativetoboost
readinghabits
amongchildrenin
governmentand
aidedschoolsin
Idukki,Kottayam
andPathanam
thitta
Dist
ricts
Cl.(ii)promoting
education
Idukki,
Kottayam
and
Pathanam
thitta
Dist
ricts
of
Kera
la S
tate
03.00
01.50
01.50
Malayala
Manoram
a,
Kottayam
Unit
3000School
Children
21.SupportforShikaha
ofBackw
aters-2017
an a
nnua
l managem
entfestival
ofIIMKozhikode.
Cl.(ii)promoting
education
Kozhikode
Dist
rict o
f Ker
ala
Stat
e
01.50
01.50
01.50
IIMKozhikode.
1000
Students
22.SupportforSradha-A
SchoolforC
hildren
withspecialneeds,by
ErnakulamW
omen’s
Ass
ocia
tion
Cl.(ii)promoting
education
includingspecial
Education
Ernakulam
Dist
rict o
f Ker
ala
Stat
e
02.00
02.00
02.00
Ernakulam
Wom
en’s
Ass
ocia
tion
60Special
Children
Sub
Tota
l (D
)85
.51
74.0
874
.08
5946th Annual Report
Sl.
No.
Nam
e of
Pro
ject
with
a
brie
f
Sect
or in
whi
ch
the
Proj
ect
is c
over
ed
(Cla
use
no. o
f Sc
hedu
le V
II to
Com
pani
es
Act,
2013
, as
amen
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or
othe
r (2)
Spe
cify
th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
out
lay
(bud
get)
proj
ect o
r pr
ogra
m w
ise
(` L
akhs
)
Am
ount
spen
t on
the
proj
ects
or
pro
gram
s Su
b-he
ads:
(1
) Dire
ct
expe
nditu
re
on p
roje
ct o
r pr
ogra
ms
(2) O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Spe
nt:
Dire
ct o
r thr
ough
im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
Expensesfrom
PreviousYears(SwachhBharatP
rojects)
1.Co
nstr
uctio
n of
toiletsfor46houses
at C
hira
yant
huru
thu
islandvillageatK
ad-
amakudyPanchayat
inErnakulam
District
underSwacchBharat
AbhiyanofG
oI
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
Chira
yan-
thuruthuisland
villageatK
ada-
makudyPancha-
yatinErnakulam
District,Kerala
Stat
e
50.00
17.52
17.52
ErnakulamSocial
ServiceSociety,
Ernakulam
46household
fam
ilies
2.Fi
nanc
ial s
uppo
rt
forrenovationand
mai
nten
ance
of
KoitharaCh
idren’s
ParkatPanam
pilly
Nagar,Kochiunder
SwachhBharat
AbhiyanGoI
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
Panampilly
Nagar,Ernaku-
lam,KeralaState
30.00
15.00
15.00
Coch
in
Corp
orat
ion
Around2000
visit
ors
per
mon
th
3.Su
ppor
t for
re
nova
tion
of a
cla
ss
room
cum
training
centerforconducting
skilldevelopment
programmesfor
econ
omic
ally
backwardstudentsof
CottonHillGirlsHigh
School,Trivandrum
Cl.(i)Sw
achh
BharatAbhiyan
ofGoI
CottonHillGirls
HighSchool,
Trivandrum
,Ke
rala
Sta
te
4.10
2.10
2.10
CottonHillGirls
HighSchool,
Trivandrum
,Ke
rala
Sta
te
250Students
Sub
Tota
l (E)
84.1
034
.62
34.6
2
60 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
w
ith a
brie
f
Sect
or in
whi
ch th
e Pr
ojec
t is c
over
ed
(Cla
use
no. o
f Sch
edul
e V
II to
Com
pani
es A
ct,
2013
, as a
men
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or o
ther
(2)
Spec
ify th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
GeneralProjects
1.Fi
nanc
ial s
uppo
rt
for r
enov
atio
n of
one
of t
he
existingbuildings
oftheschool,
establish
ingsm
art
classroom
s,developm
entof
schoolground
andconstruction
oftoiletblockat
DevakiM
emorial
SeniorBasic
School,Kakkayur
Village,Chittur
Thaluk,Palakkad
Dist
rict
Cl.(ii)promoting
education
Kakkayur
Village,Chittur
Thaluk,
Palakkad
District,Kerala
Stat
e
12.00
4.80
4.80
Devaki
Mem
orial
SeniorBasic
School,
Kakkayur
Village,Chittur
Thaluk,
Palakkad
Dist
rict
380Students
2.Su
ppor
t for
Co
mm
on F
acili
ty
Cent
re c
um
OfficeBuildingof
Chennamangalam
FishW
orkers
Dev
elop
men
t Co
oper
ativ
e So
ciet
y at
Vadakkum
puram,
NorthParavoor
Cl.(ii)and(iii)Livelihood
enhancem
entprojects
andmeasuresfor
reducinginequalities
facedbySocially&
econom
icallybackw
ard
groups
Chen
nam
an-
galam,N
orth
Paravoor,
Ernakulam
District,Kerala
Stat
e
20.00
8.00
8.00
Chen
nam
an-
galamFish
Workers
Dev
elop
men
t Co
oper
ativ
e So
ciet
y at
Va-
dakkum
puram,
NorthPara-
voor,Ernaku-
lam
Dist
rict
420Mem
bers
6146th Annual Report
Sl.
No.
Nam
e of
Pro
ject
w
ith a
brie
f
Sect
or in
whi
ch th
e Pr
ojec
t is c
over
ed
(Cla
use
no. o
f Sch
edul
e V
II to
Com
pani
es A
ct,
2013
, as a
men
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or o
ther
(2)
Spec
ify th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
3.Fi
nanc
ial s
uppo
rt
to c
reat
e a
modernsetupfor
shipmodelmaking
at th
e D
epar
tmen
t ofShipTechnology
(CUSAT)
Cl.(ii)promoting
education
CochinUniver-
sity
of S
cien
ce
&Technology
(CUSAT),
Kalamassery,
Ernakulam
District,Kerala
Stat
e
25.00
20.00
20.00
Dep
artm
ent
of S
hip
Tech-
nology,Cochin
University
ofScience&
Technology
(CUSAT),
Kalamassery,
Ernakulam
District,Kerala
Stat
e
100students
per y
ear
4.AnanthaKripa-
providingfree
accommodation
andfoodforthe
finan
cial
ly c
hal-
lengedpatients
andby-standers
near
Thi
ruva
nan-
thapuram
Medical
College
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Thiru
vana
ntha-
pura
m D
istric
t of
Ker
ala
Stat
e
150.00
25.00
25.00
Sev-
abharathi,Thi-
ruva
nant
hapu-
ram
Dist
rict
130by-
standersof
Patients/per
day
5.Su
ppor
t for
co
nstr
uctio
n of
abuildingfor
tribalwom
enin
Punchavayalto
facilitatetrade
onagricultural
productsto
incr
ease
thei
r in
com
e
Cl.(ii)promoting
education,employment
enhancingvocational
skillsespeciallyamong
wom
enandlivelihood
enhancem
entproject
Cl.(iii)empowering
wom
enandmeasures
forreducinginequalities
facedbysociallyand
econom
icallybackw
ard
groups
Punchavayal,
Kott
ayam
D
istric
t of
Kera
la S
tate
30.00
6.35
6.35
Shre
e Sarasw
ati
Vila
sam
GirijanMahila
Samajam
,Punchavayal,
Kott
ayam
40Tribal
Wom
en
62 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
w
ith a
brie
f
Sect
or in
whi
ch th
e Pr
ojec
t is c
over
ed
(Cla
use
no. o
f Sch
edul
e V
II to
Com
pani
es A
ct,
2013
, as a
men
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or o
ther
(2)
Spec
ify th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
6.Prom
otion
ofeducation
throughthe
cons
truc
tion
of
ahostelbuilding
fortribalstudents
inKudayathoor,
IdukkiDistrict.
Cl.(ii)promoting
education
Kudayathur,
IdukkiDistrict
of K
eral
a St
ate
50.00
6.74
6.74
Sarasw
ati
Vidyanikethan
Secondary
School,
Kudayathoor
50TribalGirls
7.Fi
nanc
ial S
uppo
rt
forProjectEYES
(EnvisionedYouth
forEnvisaged
Society)
Cl.(ii)promoting
education
IdukkiDistrict
of K
eral
a St
ate
15.00
4.50
4.50
Confederation
ofIndian
Industry(CII)
Kerala,Kochi
Chap
ter
30000school
students
8.Co
nstr
uctio
n of
anewhospital
buildingforSwam
iVivekananda
MedicalMission,
Muttil,W
ayanad
Dist
rict
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Muttil,
Wayanad
District,Kerala
Stat
e
50.00
9.20
9.20
Vivekananda
Medical
Mission,
Muttil,
Wayanad
Dist
rict
100patients
perday
9.Su
pply
of
scubasetsto
Fire&Rescue
Department,
CentralD
ivision-
Ernakulam
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Fire&Rescue
Department,
Cent
ral
Division-
Ernakulam,
Kera
la S
tate
9.00
8.76
8.76
Fire&Rescue
Department,
Cent
ral
Division-
Ernakulam,
Kera
la S
tate
Vic
tims
of
waterrelated
accidents
10.
Fina
ncia
l sup
port
forSaukhyam
2017-Asuper
specialtymedical
camp,Ernakulam
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Ernakulam
District,Kerala
Stat
e6.00
6.00
6.00
Hospital
Dev
elop
men
t Co
mmittee,
Gen
eral
Hospital,
Ernakulam
3000poor
patie
nts
6346th Annual Report
Sl.
No.
Nam
e of
Pro
ject
w
ith a
brie
f
Sect
or in
whi
ch th
e Pr
ojec
t is c
over
ed
(Cla
use
no. o
f Sch
edul
e V
II to
Com
pani
es A
ct,
2013
, as a
men
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or o
ther
(2)
Spec
ify th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
11.
Fina
ncia
l as
sista
nce
to s
tate
leve
l sp
ecia
l sch
ool
‘Kalolsavam’,
Chilamboly2017
Cl.(ii)promoting
educationincluding
specialEducation
EntireStateof
Kera
la1.00
1.00
1.00
Ass
ocia
tion
for t
he
Intellectually
Disabled(AID),
Kott
ayam
District,Kerala
Stat
e
2000disabled
children
12.
Prom
otionof
spec
ial c
ultu
ral
form
s of
Ker
ala
atChanganpuzha
Samskarika
Kendram,Edapally
Cl.(v)protectionof
Nationalheritage,art
andculture
Edapally,
Ernakulam
District,Kerala
Stat
e
7.30
3.65
3.65
Kathakali
Asw
adhaka
Sadhas,Chan-
gampuzha
Samskarika
Kendram,
Edapally,
Ernakulam
Dist
rict
500audience
per e
vent
13.
Fina
ncia
l sup
port
forbuyingahome
carevehicle,
phys
ioth
erap
y equipm
ents
andsurgical
equipm
entsfor
AlphaPalliative
CareCentre,Kochi
CityLinkCentre,
Ernakulam
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Palarivattom,
Ernakulam
District,Kerala
Stat
e
5.00
0.73
0.73
AlphaPalliative
CareCentre,
Koch
i City
LinkCentre,
Ernakulam
12bedridden
patie
nts
per
day
64 Cochin Shipyard Ltd
Sl.
No.
Nam
e of
Pro
ject
w
ith a
brie
f
Sect
or in
whi
ch th
e Pr
ojec
t is c
over
ed
(Cla
use
no. o
f Sch
edul
e V
II to
Com
pani
es A
ct,
2013
, as a
men
ded)
Proj
ects
or
Prog
ram
s (1)
Lo
cal a
rea
or o
ther
(2)
Spec
ify th
e St
ate
and
dist
rict w
here
pr
ojec
ts o
r pr
ogra
ms w
as
unde
rtak
en
Am
ount
ou
tlay
(bud
get)
proj
ect o
r pr
ogra
m
wis
e
(` L
akhs
)
Am
ount
sp
ent o
n th
e pr
ojec
ts o
r pr
ogra
ms
Sub-
head
s:
(1) D
irect
ex
pend
iture
on
pro
ject
or
prog
ram
s (2)
O
verh
eads
(`
Lak
hs)
Cum
ulati
ve
expe
nditu
re
up to
the
repo
rting
pe
riod
(`
Lak
hs)
Am
ount
Sp
ent:
Dire
ct
or th
roug
h im
plem
entin
g ag
ency
Num
ber a
nd
Cate
gory
of
Pro
ject
Be
nefic
iarie
s
14.
Distributionof
freemedicine
(Insulin)toType1
DiabeticChildren
ofBPLFam
iliesin
ErnakulamDistrict
Cl.(i)prom
oting
healthcareincluding
prev
entiv
e he
alth
Alappuzha,
Kottayam
,Idukki,
Ernakulam
andThrissur
Dist
ricts
of
Kera
la S
tate
9.50
0.96
0.96
Lourdes
Hospital,
Ernakulam
66Type1
Diabetic
Patients
Sub
Tota
l (F)
389.
8010
5.69
105.
69In
dire
ct E
xpen
ses
Overhead/Ad
ministrativeexpenses
23.54
23.54
23.54
Sub
Tota
l (G
)23
.54
23.5
423
.54
Gra
nd To
tal (
A+B
+C+D
+E+F
+G)
1513
.72
857.
0885
7.08
6546th Annual Report
COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 143(6)(b) OF THE COMPANIES ACT, 2013 ON THE FINANCIAL STATEMENTS OF COCHIN SHIPYARD LIMITED, FOR THE YEAR ENDED 31 MARCH 2018ThepreparationoffinancialstatementsofCochinShipyardLimitedfortheyearended31March2018inaccordancewiththefinancialreportingframeworkprescribedundertheCompaniesAct,2013(Act) istheresponsibilityofthemanagementoftheCompany.Thestatutoryauditorsappointedby theComptrollerandAuditorGeneralof Indiaundersection139(5)of theActareresponsibleforexpressingopiniononthefinancialstatementsundersection143oftheActbasedonindependentauditinaccordancewiththestandardsonauditingprescribedundersection143(10)oftheAct.ThisisstatedtohavebeendonebythemvidetheirAuditReportdated24May2018.I,onbehalfoftheComptrollerandAuditorGeneralofIndia,haveconductedasupplementaryauditundersection143(6)(a)oftheActofthefinancialstatementsofCochinShipyardLimitedfortheyearended31March2018.Thissupplementaryaudithasbeencarriedoutindependentlywithoutaccesstotheworkingpapersofthestatutoryauditorsandislimitedprimarilytoinquiriesofthestatutoryauditorsandcompanypersonnelandaselectiveexaminationofsomeoftheaccountingrecords.Onthebasisofmyauditnothingsignificanthascometomyknowledgewhichwouldgiverisetoanycommentuponorsupplementtostatutoryauditors’report.
ForandonthebehalfoftheComptroller & Auditor General of India
(R. AMBALAVANAN)Principal Director of Commercial Audit
and Ex-Officio Member, Audit Board, Chennai
Place:ChennaiDate:11July2018
COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 143(6)(b) READ WITH SECTION 129(4) OF THE COMPANIES ACT, 2013 ON THE CONSOLIDATED FINANCIAL STATEMENTS OF COCHIN SHIPYARD LIMITED, FOR THE YEAR ENDED 31 MARCH 2018ThepreparationofconsolidatedfinancialstatementsofCochinShipyardLimitedfortheyearended31March2018inaccordancewiththefinancialreportingframeworkprescribedundertheCompaniesAct,2013(Act)istheresponsibilityofthemanagementoftheCompany.ThestatutoryauditorsappointedbytheComptrollerandAuditorGeneralofIndiaundersection139(5)readwithsection129(4)oftheActareresponsibleforexpressingopiniononthefinancialstatementsundersection143readwithsection129(4)oftheActbasedonindependentauditinaccordancewiththestandardsonauditingprescribedundersection143(10)oftheAct.ThisisstatedtohavebeendonebythemvidetheirAuditReportdated24May2018.I,onbehalfoftheComptrollerandAuditorGeneralofIndia,haveconductedasupplementaryauditundersection143(6)(a)readwithsection129(4)oftheActoftheconsolidatedfinancialstatementsofCochinShipyardLimitedfortheyearended31March2018.WeconductedasupplementaryauditofthefinancialstatementsofCochinShipyardLimitedandHooghlyCochinShipyardLimited for theyearendedonthatdate.Thissupplementaryaudithasbeencarriedout independentlywithoutaccess to theworkingpapersofthestatutoryauditorsandislimitedprimarilytoinquiriesofthestatutoryauditorsandcompanypersonnelandaselectiveexaminationofsomeoftheaccountingrecords.Onthebasisofmyauditnothingsignificanthascometomyknowledgewhichwouldgiverisetoanycommentuponorsupplementtostatutoryauditors’report.
ForandonthebehalfoftheComptroller & Auditor General of India
(R. AMBALAVANAN)Principal Director of Commercial Audit
and Ex-Officio Member, Audit Board, Chennai
Place:ChennaiDate:11July2018
Annexure-5
66 Cochin Shipyard Ltd
Annexure-6
FormNo.MR-3 SECRETARIALAUDITREPORT
FORTHEFINANCIALYEARENDED31.03.2018[PursuanttoSection204(1)oftheCompaniesAct,2013andRuleNo.9ofthe
Companies(AppointmentandRemunerationofManagerialPersonnel)Rules,2014]
ToTheMembersCochin Shipyard LimitedAdministrativeBuilding,39/6080CochinShipyardPremisesPerumanoor,M.G.RoadErnakulam,Kerala-682015We,SVJS&Associates,CompanySecretaries,haveconductedtheSecretarialAuditofthecomplianceofapplicablestatutoryprovisionsandtheadherencetogoodcorporatepracticesbyCochin Shipyard Limited [CIN: U63032KL1972GOI002414] (hereinaftercalled“theCompany”).SecretarialAuditwasconductedinamannerthatprovidedusareasonablebasisforevaluatingthecorporateconducts/statutorycompliancesandexpressingouropinionthereon.BasedonourverificationoftheCompany’sbooks,papers,minutebooks,formsandreturnsfiledandotherrecordsmaintainedby theCompanyandalso the informationprovidedby theCompany, itsofficers,agentsandauthorized representativesduringtheconductofSecretarialAudit,weherebyreportthat inouropinion,theCompanyhas,duringtheauditperiodcoveringthefinancialyearendedon31stMarch2018compliedwiththestatutoryprovisionslistedhereunderandalsothattheCompanyhasproperBoardprocessesandcompliancemechanisminplacetotheextent,inthemannerandsubjecttothereportingmadehereinafter:Wehaveexaminedthebooks,papers,minutebooks,formsandreturnsfiledandotherrecordsmaintainedbytheCompanyforthefinancialyearendedon31stMarch2018accordingtotheprovisionsof:(i) TheCompaniesAct,2013(theAct)andtheRulesmadethereunder;(ii) TheSecuritiesContracts(Regulation)Act,1956(SCRA)andtheRulesmadethereunder;(iii) TheDepositoriesAct,1996andtheRegulationsandBye-lawsframedthereunder;(iv) TheForeignExchangeManagementAct,1999andtheRulesandRegulationsmadethereundertotheextentofForeign
DirectInvestment,OverseasDirectInvestmentandExternalCommercialBorrowings;(v) ThefollowingRegulationsandGuidelinesprescribedundertheSecuritiesandExchangeBoardofIndiaAct,1992:-
(a) SecuritiesandExchangeBoardofIndia(IssueofCapitalandDisclosureRequirements)Regulations,2009;(b) SecuritiesandExchangeBoardofIndia(IssueandListingofDebtSecurities)Regulations,2008;(c) TheSecuritiesandExchangeBoardofIndia(ProhibitionofInsiderTrading)Regulations,2015;(d) TheSecuritiesandExchangeBoardofIndia(RegistrarstoanIssueandShareTransferAgents)Regulations,1993
regardingtheCompaniesActanddealingwithclient;(e) TheSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015.
(vi) Asinformedtous,thefollowingotherlawsarespecificallyapplicabletotheCompany:1. TheFactoriesAct,1948;2. TheEnvironment(Protection)Act,1986;3. TheWater(PreventionandControlofPollution)Act,1974;4. TheAir(PreventionandControlofPollution)Act,1981;5. HazardousWastes(Management,HandlingandTransboundaryMovement)Rules,2008;
6746th Annual Report
6. TheElectricityAct,2003andCentralElectricityRegulations2010;7. GuidelinesonCorporateGovernanceforCentralPublicSectorEnterprises,2010;8. GuidelinesonCorporateSocialResponsibilityandSustainabilityforCentralPublicSectorEnterprises.
Wehavealsoexaminedcompliancewiththeapplicableclausesofthefollowing:(i) SecretarialStandardsrelatingtoBoard(SS1)andGeneralMeetings(SS2)issuedbyTheInstituteofCompanySecretaries
ofIndia;(ii) TheListingAgreementsentered intoby theCompanywithBSELimitedand theNationalStockExchangeof India
Limited.DuringtheperiodunderreviewtheCompanyhascompliedwiththeprovisionsoftheActs,Rules,Regulations,Guidelines,etc.mentionedabove.InrespectofotherlawsspecificallyapplicabletotheCompanywehavereliedoninformation/recordsproducedbytheCompanyduringthecourseofourauditandthereportingislimitedtothatextent.We report that:TheBoardofDirectorsof theCompany is duly constitutedwithproperbalanceofExecutiveDirectors,Non-executiveDirectorsandIndependentDirectors.ThechangesinthecompositionoftheBoardofDirectorsthattookplaceduringtheperiodunderreviewwerecarriedoutincompliancewiththeprovisionsoftheActandincompliancewithordersissuedbythe Central Government.AdequatenoticesweregiventoalldirectorstoscheduletheBoardMeetings,Agendaanddetailednotesonagendaweresentatleastsevendaysinadvanceandasystemexistsforseekingandobtainingfurtherinformationandclarificationsontheagendaitemsbeforethemeetingandformeaningfulparticipationatthemeeting.AlldecisionsoftheBoardwereunanimousandthesamewascapturedandrecordedaspartoftheminutes.We further report that there are adequate systems and processes in the Company commensurate with the size andoperationsoftheCompanytomonitorandensurecompliancewithapplicablelaws,rules,regulationsandguidelines.We further report that duringtheauditperiod:1. TheCompanyhasraisedRs.1,442croresthroughInitialPublicOffer(IPO)whichwasacombinationoffreshissueof
22,656,000equitysharesandofferforsaleof11,328,000equitysharesandtherespectiveallotmentofthesecuritieswascompletedon09thAugust,2017.
2. TheCompanyhasformedaJointVenturewithHooghlyDock&PortEngineeringLimitedviz.HooghlyCochinShipyardLimitedon23rdOctober2017withatotalstakeof74%intheJointVenture.
We further report thatduringtheauditperiodtherewerenoinstancesof:i. Right/Preferentialissueofshares/debentures/sweatequity;ii. Redemption/buy-backofsecurities;iii. MajordecisionstakenbythemembersinpursuancetoSection180oftheAct;iv. Merger/amalgamation/reconstructionetc.;v. Foreigntechnicalcollaborations.
ThisReportistobereadwithourletterofevendatewhichisannexedas‘Annexure A’andformsanintegralpartofthisReport.
For SVJS & AssociatesCompany Secretaries
P. SivakumarManagingPartner
CP.No.2210
Kochi30.06.2018
68 Cochin Shipyard Ltd
ToTheMembersCochin Shipyard LimitedAdministrativeBuilding,39/6080CochinShipyardPremisesPerumanoor,M.G.RoadErnakulam,Kerala-682015
OurSecretarialAuditReportofevendateistobereadalongwiththisletter.
1. MaintenanceoftheSecretarialrecordsistheresponsibilityofthemanagementoftheCompany.OurresponsibilityasSecretarialAuditorsistoexpressanopinionontheserecords,basedonouraudit.
2. Duringtheaudit,wehavefollowedthepracticesandprocessaswereappropriate, toobtainreasonableassuranceaboutthecorrectnessofthecontentsoftheSecretarialrecords.WebelievethattheprocessandpracticeswefollowedprovideareasonablebasisforourReport.
3. ThecorrectnessandappropriatenessoffinancialrecordsandBooksofAccountsoftheCompanyhavenotbeenverified.
4. Wherever required, we have obtained the Management representation about the Compliance of laws, rules andregulationsandhappeningofeventsetc.
5. The compliance of the provisions of corporate and other applicable laws, rules, regulations, standards etc. is theresponsibilityofmanagement.Ourexaminationislimitedtotheverificationoftheproceduresandcompliancesontestbasis.
6. WhileforminganopiniononcomplianceandissuingtheSecretarialAuditReport,wehavealsotakenintoconsiderationthecompliancerelatedactionstakenbytheCompanyafter31stMarch2018butbeforeissueoftheReport.
7. WehaveconsideredactionscarriedoutbytheCompanybasedonindependentlegal/professionalopinionasbeingincompliancewithlaw,wherevertherewasscopeformultipleinterpretations.
For SVJS & AssociatesCompany Secretaries
P. SivakumarManagingPartner
CP.No.2210
Kochi30.06.2018
Annexure A
6946th Annual Report
Annexure-7
EXTRACTOFANNUALRETURNAsonfinancialyearendedon31.03.2018
PursuanttoSection92(3)oftheCompaniesAct,2013andRule12(1)oftheCompanies (Management&Administration)Rules,2014.
I. REGISTRATION & OTHER DETAILS:
1. CIN U63032KL1972GOI0024142. RegistrationDate March29,19723. NameoftheCompany CochinShipyardLtd4. Category/Sub-categoryoftheCompany PublicCompany/LimitedbyShares5. AddressoftheRegisteredoffice&contactdetails AdministrativeBuilding,
CochinShipyardPremises,PerumanoorCochin,Ernakulam–682015,Kerala,India.Ph:+91484-2501307Fax:+91484-2384001e-mail:[email protected]:www.cochinshipyard.com
6. Whetherlistedcompany Yes 7. Name,Address&contactdetailsoftheRegistrar&
TransferAgent,ifany.LinkIntimeIndiaPvt.LtdSurya,35,MayflowerAvenue,BehindSenthilNagar,SowripalayamRoad,Coimbatore,TamilNadu,641028Phone:+914222314792,2315792Fax:+914222314792E-mail:[email protected]:www.linkintime.co.in
II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the business activities contributing 10 % or more of the total turnover of the company shall be stated)
Sl. No. Name and Description of main products / services
NIC Code of the Product/service
% to total turnover of the Company
1 BuildingofShips&FloatingStructures 3011 73.362 SpecialisedRepairandmaintenanceof
shipsandfloatingstructures 3315 26.46
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Sl. No. Name and Address of the Company CIN/GLN
Holding/Subsidiary/Associate
% of shares held
Applicable Section
1 HOOGHLYCOCHINSHIPYARDLIMITEDTheLegacy,25AShakespeareSarani,Level1Kolkata-700017
U35900WB2017GOI223197 Subsidiary 74 2(87)
70 Cochin Shipyard Ltd
IV.
SHA
RE H
OLD
ING
PAT
TERN
(Equ
ity S
hare
Cap
ital B
reak
up a
s per
cent
age
of To
tal E
quity
)
(i)
Cate
gory
-wis
e Sh
are
Hol
ding
Sl
No
Cate
gory
of
Shar
ehol
ders
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Shar
ehol
ding
at t
he
end
of th
e ye
ar -
31.0
3.20
18%
Cha
nge
durin
g th
e ye
ar
Dem
atPh
ysic
alTo
tal
% o
fTo
tal
Shar
esD
emat
Ph
ysic
al
Tota
l %
of
Tota
l Sh
ares
(A)
ShareholdingofPromoterand
Prom
oterGroup
[1]
Indian
(a)
Individuals/HinduUndivided
Fam
ily0
00
0.0000
00
00.0000
0.0000
(b)
CentralG
overnm
ent/State
Governm
ent(s)
0113280000
113280000
100.0000
101951700
300
101952000
75.0000
-25.0000
(c)
FinancialInstitutions/Banks
00
00.0000
00
00.0000
0.0000
(d)
AnyOther(Specify)
SubTotal(A)(1)
0113280000
113280000
100.0000
101951700
300
101952000
75.0000
-25.0000
[2]
Foreign
(a)
Individuals(Non-Resident
Individuals/ForeignIndividuals)
00
00.0000
00
00.0000
0.0000
(b)
Gov
ernm
ent
00
00.0000
00
00.0000
0.0000
(c)
Institutions
00
00.0000
00
00.0000
0.0000
(d)
ForeignPortfolioInvestor
00
00.0000
00
00.0000
0.0000
(e)
AnyOther(Specify)
SubTotal(A)(2)
00
00.0000
00
00.0000
0.0000
TotalShareholdingofPromoter
andProm
oterGroup
(A)=(A)(1)+(A)(2)
0113280000
113280000
100.0000
101951700
300
101952000
75.0000
-25.0000
(B)
PublicShareholding
[1]
Institutions
(a)
MutualFunds/UTI
00
00.0000
13983664
013983664
10.2869
10.2869
(b)
VentureCapitalFunds
00
00.0000
00
00.0000
0.0000
(c)
AlternateInvestmentFunds
00
00.0000
00
00.0000
0.0000
(d)
ForeignVentureCapitalInvestors
00
00.0000
00
00.0000
0.0000
(e)
ForeignPortfolioInvestor
00
00.0000
4697022
04697022
3.4553
3.4553
(f)FinancialInstitutions/Banks
00
00.0000
1129302
01129302
0.8308
0.8308
7146th Annual Report
Sl
No
Cate
gory
of
Shar
ehol
ders
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Shar
ehol
ding
at t
he
end
of th
e ye
ar -
31.0
3.20
18%
Cha
nge
durin
g th
e ye
ar
Dem
atPh
ysic
alTo
tal
% o
fTo
tal
Shar
esD
emat
Ph
ysic
al
Tota
l %
of
Tota
l Sh
ares
(g)
InsuranceCo
mpanies
00
00.0000
00
00.0000
0.0000
(h)
ProvidentFunds/PensionFunds
00
00.0000
00
00.0000
0.0000
(i)AnyOther(Specify)
SubTotal(B)(1)
00
00.0000
19809988
019809988
14.5730
14.5730
[2]
CentralG
overnm
ent/State
Governm
ent(s)/Presid
entofIndia
SubTotal(B)(2)
00
00.0000
00
00.0000
0.0000
[3]
Non-Institutions
(a)
Individuals
(i)Individualshareholdersholding
nom
inal
sha
re c
apita
l upt
o Rs
. 1
lakh.
00
00.0000
9133659
79133666
6.7191
6.7191
(ii)
Individualshareholdersholding
nominalsharecapitalinexcessof
Rs.1lakh
00
00.0000
1587365
01587365
1.1677
1.1677
(b)
NBF
CsregisteredwithRBI
00
00.0000
00
00.0000
0.0000
(c)
EmployeeTrusts
00
00.0000
00
00.0000
0.0000
(d)
OverseasDepositories(holding
DRs)(balancingfigure)
00
00.0000
00
00.0000
0.0000
(e)
AnyOther(Specify)
Tr
usts
00
00.0000
12987
012987
0.0096
0.0096
HinduUndividedFam
ily0
00
0.0000
504360
0504360
0.3710
0.3710
NonResidentIndians(N
onRepat)
00
00.0000
127654
0127654
0.0939
0.0939
NonResidentIndians(Repat)
00
00.0000
541373
0541373
0.3983
0.3983
ForeignPortfolioInvestor
(Individual)
00
00.0000
900
0900
0.0007
0.0007
ClearingMem
ber
00
00.0000
382424
0382424
0.2813
0.2813
Bo
diesCorporate
00
00.0000
1883283
01883283
1.3854
1.3854
SubTotal(B)(3)
00
00.0000
14174005
714174012
10.4270
10.4270
TotalPublicShareholding(B)=(B)
(1)+(B)(2)+(B)(3)
00
00.0000
33983993
733984000
25.0000
25.0000
Total(A)+(B)
0113280000
113280000
100.0000
135935693
307
135936000
100.0000
0.0000
72 Cochin Shipyard Ltd
Sl
No
Cate
gory
of
Shar
ehol
ders
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Shar
ehol
ding
at t
he
end
of th
e ye
ar -
31.0
3.20
18%
Cha
nge
durin
g th
e ye
ar
Dem
atPh
ysic
alTo
tal
% o
fTo
tal
Shar
esD
emat
Ph
ysic
al
Tota
l %
of
Tota
l Sh
ares
(C)
NonPromoter-NonPublic
[1]
Custodian/DRHolder
00
00.0000
00
00.0000
0.0000
[2]
EmployeeBenefitTrust(under
SEBI(SharebasedEmployee
Benefit)Regulations,2014)
00
00.0000
00
00.0000
0.0000
Total(A)+(B)+(C)
0113280000
113280000
100.0000
135935693
307
135936000
100.0000
0.0000
(ii)
Shar
ehol
ding
of P
rom
oter
s
Sl
No
Shar
ehol
der’s
Nam
e
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Shar
ehol
ding
at t
he
end
of th
e ye
ar -
31.0
3.20
18
No.
of
shar
es h
eld
% o
f tot
al
Shar
es
of th
e co
mpa
ny
% o
f Sha
res
Pled
ged
/en
cum
bere
d to
to
tal s
hare
s
No.
of
shar
es h
eld
% o
f tot
al
Shar
es
of th
e co
mpa
ny
% o
f Sha
res
Pled
ged/
en
cum
bere
d to
tota
l sha
res
% c
hang
e in
sh
areh
oldi
ng
durin
g th
e ye
ar
1TH
EPR
ESIDEN
TOF
INDIA
113279700
99.9997
0.0000
101952000
75.0000
0.0000
-24.9997
2BA
RUNMITRA
100
0.0001
0.0000
00.0000
0.0000
-0.0001
3MADHUSNAIR
100
0.0001
0.0000
00.0000
0.0000
-0.0001
4DPAU
LRA
NJAN
700.0001
0.0000
00.0000
0.0000
-0.0001
5PR
ADEEPKU
MARRO
Y10
0.0000
0.0000
00.0000
0.0000
0.0000
6SU
NNYTH
OMAS
100.0000
0.0000
00.0000
0.0000
0.0000
7SU
RESH
BABU
NV
100.0000
0.0000
00.0000
0.0000
0.0000
To
tal
1132
8000
010
0.00
000.
0000
1019
5200
075
.000
00.
0000
-25.
0000
7346th Annual Report
(iii)
Chan
ge in
Pro
mot
ers’
Shar
ehol
ding
(ple
ase
spec
ify, i
f the
re is
no
chan
ge)
Sl.
No.
Nam
e of
the
Shar
ehol
der
Shar
ehol
ding
at t
he
begi
nnin
g of
the
ye
ar -
01.0
4.20
17D
ate
Reas
on
Incr
ease
/Dec
reas
e in
sh
areh
oldi
ngCu
mul
ative
Sha
reho
ldin
g du
ring
the
year
- 31
.03.
2018
No.
of s
hare
s
% o
f tot
al
shar
es
of th
e Co
mpa
ny
No.
of s
hare
s%
of t
otal
sh
ares
of t
he
Com
pany
No.
of s
hare
s%
of t
otal
sh
ares
of t
he
Com
pany
1.ThePresident
ofIndia
11,32,79,700
99.99
11
August,
2017
Sale
of
Shar
es(1,13,28,000)
(10.00)
10,19,51,700
74.99
2.ThePresident
ofIndia
11,32,79,700
99.99
08
January
2018
Tran
sfer
fr
om th
e Nom
inee
Shareholders
300
0.00
10,19,52,000
75.00
(iv)
Shar
ehol
ding
Patt
ern
of to
p te
n Sh
areh
olde
rs: (
Oth
er th
an D
irect
ors,
Prom
oter
s and
Hol
ders
of G
DRs
and
AD
Rs)
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny1
RELIANCE
CAPITALTR
USTEE
CO.LTD
.-A/CRELIANCE
TAX
SAVER(ELSS)FUND
00.0000
00.0000
Tr
ansf
er
11Aug2017
192088
192088
0.1413
Tr
ansf
er
18Aug2017
5313165
5505253
4.0499
Tr
ansf
er
25Aug2017
1469600
6974853
5.1310
Tr
ansf
er
01Sep2017
14500
6989353
5.1416
Tr
ansf
er
26Jan2018
90000
7079353
5.2079
Tr
ansf
er
23Feb2018
2600
7081953
5.2098
Tr
ansf
er
02Mar2018
22400
7104353
5.2262
ATTHEEN
DOFTH
EYEAR
7104353
5.2262
2HDFC
TRU
STEECOMPA
NY
LIMITED
-HDFC
PRU
DEN
CE
FUND
00.0000
00.0000
Tr
ansf
er
11Aug2017
271308
271308
0.1996
Tr
ansf
er
18Aug2017
1550000
1821308
1.3398
Tr
ansf
er
08Sep2017
242258
2063566
1.5180
74 Cochin Shipyard Ltd
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny
Tran
sfer
15Sep2017
114400
2177966
1.6022
Tr
ansf
er
29Sep2017
(4647)
2173319
1.5988
Tr
ansf
er
27Oct2017
267000
2440319
1.7952
Tr
ansf
er
17Nov2017
100000
2540319
1.8688
Tr
ansf
er
24Nov2017
134000
2674319
1.9673
Tr
ansf
er
08Dec2017
157000
2831319
2.0828
Tr
ansf
er
15Dec2017
71000
2902319
2.1351
Tr
ansf
er
29Dec2017
27000
2929319
2.1549
Tr
ansf
er
05Jan2018
100000
3029319
2.2285
Tr
ansf
er
19Jan2018
50000
3079319
2.2653
Tr
ansf
er
02Mar2018
54000
3133319
2.3050
ATTHEEN
DOFTH
EYEAR
3133319
2.3050
3PINEB
RIDGEGLO
BAL
FUNDS-P
INEB
RIDGEINDIA
EQUITYFU
ND
00.0000
00.0000
Tr
ansf
er
18Aug2017
616367
616367
0.4534
Tr
ansf
er
25Aug2017
345625
961992
0.7077
Tr
ansf
er
01Sep2017
158115
1120107
0.8240
Tr
ansf
er
22Sep2017
8269
1128376
0.8301
Tr
ansf
er
29Sep2017
1107210
2235586
1.6446
Tr
ansf
er
06Oct2017
423714
2659300
1.9563
Tr
ansf
er
13Oct2017
55249
2714549
1.9969
ATTHEEN
DOFTH
EYEAR
2714549
1.9969
4PA
RVESTEQ
UITYINDIA
00.0000
00.0000
Tr
ansf
er
15Sep2017
134000
134000
0.0986
Tr
ansf
er
22Sep2017
125388
259388
0.1908
Tr
ansf
er
29Sep2017
50283
309671
0.2278
Tr
ansf
er
06Oct2017
191000
500671
0.3683
Tr
ansf
er
13Oct2017
217481
718152
0.5283
Tr
ansf
er
27Oct2017
111348
829500
0.6102
Tr
ansf
er
03Nov2017
40000
869500
0.6396
ATTHEEN
DOFTH
EYEAR
869500
0.6396
7546th Annual Report
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny5
ITPL-INVESCO
INDIA
CONTR
AFU
ND
00.0000
00.0000
Tr
ansf
er
11Aug2017
18348
18348
0.0135
Tr
ansf
er
25Aug2017
59867
78215
0.0575
Tr
ansf
er
01Sep2017
201460
279675
0.2057
Tr
ansf
er
08Sep2017
81308
360983
0.2656
Tr
ansf
er
13Oct2017
187541
548524
0.4035
Tr
ansf
er
27Oct2017
65635
614159
0.4518
Tr
ansf
er
22Dec2017
7575
621734
0.4574
Tr
ansf
er
05Jan2018
35555
657289
0.4835
Tr
ansf
er
12Jan2018
63661
720950
0.5304
Tr
ansf
er
26Jan2018
26420
747370
0.5498
Tr
ansf
er
31Mar2018
115331
862701
0.6346
ATTHEEN
DOFTH
EYEAR
862701
0.6346
6ADITYABIRLASUNLIFE
TRUSTEEPRIVA
TELIM
ITED
A/CADITYABIRLASUNLIFE
SMALLANDMIDCA
PFU
ND
00.0000
00.0000
Tr
ansf
er
11Aug2017
300810
300810
0.2213
Tr
ansf
er
25Aug2017
(136731)
164079
0.1207
Tr
ansf
er
01Sep2017
(53786)
110293
0.0811
Tr
ansf
er
22Sep2017
(25568)
84725
0.0623
Tr
ansf
er
06Oct2017
(19779)
64946
0.0478
Tr
ansf
er
22Dec2017
(17091)
47855
0.0352
Tr
ansf
er
02Mar2018
310986
358841
0.2640
Tr
ansf
er
09Mar2018
149014
507855
0.3736
Tr
ansf
er
16Mar2018
40000
547855
0.4030
Tr
ansf
er
23Mar2018
200000
747855
0.5502
ATTHEEN
DOFTH
EYEAR
747855
0.5502
7IDFC
INFRASTRU
CTURE
FUND
00.0000
00.0000
Tr
ansf
er
11Aug2017
94451
94451
0.0695
76 Cochin Shipyard Ltd
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny
Tran
sfer
18Aug2017
220636
315087
0.2318
Tr
ansf
er
25Aug2017
(6249)
308838
0.2272
Tr
ansf
er
01Sep2017
5741
314579
0.2314
Tr
ansf
er
15Sep2017
(1579)
313000
0.2303
Tr
ansf
er
22Sep2017
(13000)
300000
0.2207
Tr
ansf
er
01Dec2017
45000
345000
0.2538
Tr
ansf
er
08Dec2017
90000
435000
0.3200
Tr
ansf
er
15Dec2017
18347
453347
0.3335
Tr
ansf
er
29Dec2017
47230
500577
0.3682
Tr
ansf
er
05Jan2018
108423
609000
0.4480
Tr
ansf
er
19Jan2018
32000
641000
0.4715
Tr
ansf
er
26Jan2018
16348
657348
0.4836
Tr
ansf
er
09Feb2018
9000
666348
0.4902
Tr
ansf
er
16Mar2018
25000
691348
0.5086
ATTHEEN
DOFTH
EYEAR
691348
0.5086
8MIRAEASSETIN
DIAEQUITY
FUND
00.0000
00.0000
Tr
ansf
er
11Aug2017
46102
46102
0.0339
Tr
ansf
er
18Aug2017
1500445
1546547
1.1377
Tr
ansf
er
01Sep2017
164000
1710547
1.2583
Tr
ansf
er
08Sep2017
4000
1714547
1.2613
Tr
ansf
er
10Nov2017
(255724)
1458823
1.0732
Tr
ansf
er
17Nov2017
(66078)
1392745
1.0246
Tr
ansf
er
24Nov2017
(206900)
1185845
0.8724
Tr
ansf
er
01Dec2017
(42842)
1143003
0.8408
Tr
ansf
er
08Dec2017
(6934)
1136069
0.8357
Tr
ansf
er
22Dec2017
(11213)
1124856
0.8275
Tr
ansf
er
05Jan2018
(26982)
1097874
0.8076
Tr
ansf
er
19Jan2018
(118369)
979505
0.7206
Tr
ansf
er
26Jan2018
(128696)
850809
0.6259
Tr
ansf
er
02Feb2018
(127047)
723762
0.5324
7746th Annual Report
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny
Tran
sfer
09Feb2018
(25772)
697990
0.5135
Tr
ansf
er
16Feb2018
(117281)
580709
0.4272
Tr
ansf
er
23Feb2018
(20221)
560488
0.4123
ATTHEEN
DOFTH
EYEAR
560488
0.4123
9STATEBA
NKOFINDIA
00.0000
00.0000
Tr
ansf
er
11Aug2017
495090
495090
0.3642
Tr
ansf
er
18Aug2017
(323065)
172025
0.1265
Tr
ansf
er
25Aug2017
(150000)
22025
0.0162
Tr
ansf
er
01Sep2017
(22025)
00.0000
Tr
ansf
er
08Sep2017
8000
8000
0.0059
Tr
ansf
er
15Sep2017
4000
12000
0.0088
Tr
ansf
er
22Sep2017
70200
82200
0.0605
Tr
ansf
er
29Sep2017
69000
151200
0.1112
Tr
ansf
er
06Oct2017
20000
171200
0.1259
Tr
ansf
er
13Oct2017
(20000)
151200
0.1112
Tr
ansf
er
20Oct2017
(18000)
133200
0.0980
Tr
ansf
er
27Oct2017
54000
187200
0.1377
Tr
ansf
er
03Nov2017
19000
206200
0.1517
Tr
ansf
er
10Nov2017
63000
269200
0.1980
Tr
ansf
er
17Nov2017
36000
305200
0.2245
Tr
ansf
er
24Nov2017
12000
317200
0.2333
Tr
ansf
er
01Dec2017
(25000)
292200
0.2150
Tr
ansf
er
08Dec2017
29000
321200
0.2363
Tr
ansf
er
15Dec2017
25449
346649
0.2550
Tr
ansf
er
22Dec2017
15882
362531
0.2667
Tr
ansf
er
05Jan2018
(15295)
347236
0.2554
Tr
ansf
er
12Jan2018
10000
357236
0.2628
Tr
ansf
er
19Jan2018
(13350)
343886
0.2530
Tr
ansf
er
26Jan2018
1801
345687
0.2543
Tr
ansf
er
02Feb2018
8199
353886
0.2603
Tr
ansf
er
09Feb2018
(6086)
347800
0.2559
78 Cochin Shipyard Ltd
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he b
egin
ning
of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18
No.
of sh
ares
he
ld
% o
f tot
al
shar
es o
f the
co
mpa
ny
Dat
e of
tr
ansa
ction
No.
of s
hare
sN
o of
shar
es
held
% o
f tot
al
shar
es o
f the
co
mpa
ny
Tran
sfer
23Feb2018
20000
367800
0.2706
Tr
ansf
er
31Mar2018
(8000)
359800
0.2647
ATTHEEN
DOFTH
EYEAR
359800
0.2647
10MAHINDRA
UNNATI
EMERGINGBUSINESS
YOJANA
00.0000
00.0000
Tr
ansf
er
19Jan2018
127743
127743
0.0940
Tr
ansf
er
26Jan2018
76022
203765
0.1499
Tr
ansf
er
02Feb2018
103037
306802
0.2257
Tr
ansf
er
09Feb2018
17000
323802
0.2382
Tr
ansf
er
02Mar2018
2100
325902
0.2397
Tr
ansf
er
09Mar2018
16669
342571
0.2520
Tr
ansf
er
23Mar2018
9600
352171
0.2591
ATTHEEN
DOFTH
EYEAR
352171
0.2591
Not
e:
1.PaidupShareCapitaloftheCom
pany(FaceValue
`10.00)attheendoftheyearis13,59,36,000Shares.
2.ThedetailsofholdinghasbeenclubbedbasedonPAN.
3.%oftotalSharesoftheCo
mpanyisbasedonthepaidupCapitaloftheCom
panyattheendoftheYear.
(v)
Shar
ehol
ding
of D
irect
ors a
nd K
ey M
anag
eria
l Per
sonn
el
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18N
o.of
sh
ares
he
ld
% o
f tot
al sh
ares
of
the
com
pany
Dat
e of
tran
sacti
onN
o. o
f sh
ares
No
of
shar
es
held
% o
f tot
al sh
ares
of
the
com
pany
1BA
RUNMITRA
100
0.0001
Tran
sfer
15Jun2017
(100)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
2MADHUSNAIR
100
0.0001
Tr
ansf
er
08Jan2018
(100)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
3DPAU
LRA
NJAN
700.0001
7946th Annual Report
Sl
No.
Nam
e &
Typ
e of
Tra
nsac
tion
Shar
ehol
ding
at t
he
begi
nnin
g of
the
year
- 01
.04.
2017
Tran
sacti
ons d
urin
g th
e ye
arCu
mul
ative
Sha
reho
ldin
g at
the
end
of th
e ye
ar -
31.0
3.20
18N
o.of
sh
ares
he
ld
% o
f tot
al sh
ares
of
the
com
pany
Dat
e of
tran
sacti
onN
o. o
f sh
ares
No
of
shar
es
held
% o
f tot
al sh
ares
of
the
com
pany
Tr
ansf
er
08Jan2018
(70)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
4SU
NNYTH
OMAS
100.0000
Tr
ansf
er
08Jan2018
(10)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
5SU
RESH
BABU
NV
100.0000
Tr
ansf
er
08Jan2018
(10)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
6PR
AVIRKRISH
NA
00.0000
Tr
ansf
er
15Jun2017
100
100
0.0001
Tr
ansf
er
08Jan2018
(100)
00.0000
ATTHEEN
DOFTH
EYEAR
00.0000
7RA
DHAKR
ISHNAMEN
ON
00.0000
11Aug2017
3030
0.0000
8KR
ISHNADASE
00.0000
18Aug2017
100
100
0.0001
Not
e:1.PaidupShareCapitaloftheCom
pany(FaceValue
`10.00)attheendoftheyearis13,59,36,000Shares.
2.ThedetailsofholdinghasbeenclubbedbasedonPAN.
(V)
IND
EBTE
DN
ESS -IndebtednessoftheCo
mpanyincludinginterestoutstanding/accruedbutnotdueforpayment.
(`InCrore)
Se
cure
d Lo
ans
excl
udin
g de
posi
tsU
nsec
ured
Lo
ans
Dep
osits
Tota
l In
debt
edne
ssIn
debt
edne
ss a
t the
beg
inni
ng o
f the
fina
ncia
l yea
r
i)PrincipalAmount
123.00
--
123.00
ii)Interestduebutnotpaid
--
--
iii)Interestaccruedbutnotdue
2.82
--
2.82
Tota
l (i+
ii+iii
)12
5.82
--
125.
82Ch
ange
in In
debt
edne
ss d
urin
g th
e fin
anci
al y
ear
Addition
--
--
Reduction
--
--
Net
Cha
nge
--
--
Inde
bted
ness
at t
he e
nd o
f the
fina
ncia
l yea
ri)PrincipalAmount
123.00
--
123.00
ii)Interestduebutnotpaid
--
--
iii)Interestaccruedbutnotdue
2.82
--
2.82
Tota
l (i+
ii+iii
)12
5.82
--
125.
82
80 Cochin Shipyard Ltd
(VI)
REM
UN
ERAT
ION
OF
DIR
ECTO
RS A
ND
KEY
MA
NAG
ERIA
L PE
RSO
NN
EL
(A) Rem
unerationtoManagingDirector,W
hole-timeDirectorsand/orManager
(In`)
Sl.
No.
Parti
cula
rs o
f Rem
uner
ation
Nam
e of
MD
/WTD
/ M
anag
er
Tota
l Am
ount
Shri
Mad
hu S
N
air,
Chai
rman
&
Man
agin
g D
irect
or (D
IN:
0737
6798
)
Shri
D P
aul
Ranj
an, D
irect
or
(Fin
ance
) &
CFO
(DIN
: 06
8694
52)
Shri
Sunn
y Th
omas
, D
irect
or
(Tec
hnic
al) (
DIN
: 06
8822
28)
Shri
Sure
sh B
abu
N V
, Dire
ctor
(O
pera
tions
) (D
IN: 0
7482
491)
1.G
ross
Sal
ary
3370458.40
3414367.50
4440852.69
3194332.62
14420011.21
(a)Salaryasperprovisio
ns
containedinsection17(1)of
theIncome-taxAct,1961
3313248.40
3375739.50
4440852.69
3166117.62
14295958.21
(b)Valueofperquisitesu/s
17(2)oftheIncome-tax
Act,1961
57210.00
38628.00
-28215.00
124053.00
(c)Profitsinlieuofsalary
undersection17(3)ofthe
Income-taxAct,1961
--
--
-
2.StockOption
--
--
-3.
SweatEquity
--
--
-4.
Com
miss
ion
--
--
-5.
Others,pleasespecify
--
--
-To
tal (
A)
3370
458.
4034
1436
7.50
4440
852.
6931
9433
2.62
1442
0011
.21
CeilingaspertheAct
InaccordancewithMinistryofC
orporateAffairsnotificationno.G
SR463(E)dated5th
June,2015,Governm
entC
ompaniesareexemptfrom
Section197oftheCo
mpaniesAct,
2013anditsrulesthereof.
8146th Annual Report
(B) Rem
unerationtootherDirectors
(In`)
Sl.
No.
Parti
cula
rs o
f Re
mun
erati
onN
ame
of D
irect
ors
Tota
l Am
ount
1.In
depe
nden
t D
irect
ors
Smt.
Roop
a Sh
ekha
r Rai
(DIN
: 07
5651
56)
Shri
Radh
akris
hna
Men
on (D
IN:
0751
8727
)
Shri
Kris
hna
Das
E (D
IN:
0273
1340
)
Shri
Jiji
Thom
son
(DIN
: 01
1782
27)
Shri
Prad
ipta
Ba
nerji
(DIN
: 00
6306
15)
Shri
Nan
da
Kum
aran
Pu
thez
hath
(D
IN:
0254
7619
)Fe
e fo
r attendingBo
ard/
Com
mitt
ee
meetings
285000
330000
270000
105000
75000
150000
1215000
Com
miss
ion
--
--
--
-
Others,please
spec
ify-
--
--
--
Tota
l (1)
2850
0033
0000
2700
0010
5000
7500
015
0000
1215
000
2.O
ther
Non
-Ex
ecut
ive
Dire
ctor
s
Shri
Baru
n M
itra
IAS,
N
omin
ee
Dire
ctor
, Gov
t. of
Indi
a(D
IN:
0701
2558
)
Shri
Prav
ir Kr
ishn
a IA
S,
Nom
inee
D
irect
or, G
ovt.
of In
dia
(DIN
: 06
5191
04)
Shri
Satin
der
Pal S
ingh
IPS,
N
omin
ee
Dire
ctor
, Gov
t. of
Indi
a(D
IN:
0749
0296
)
Shri
Elia
s G
eorg
e IA
S (R
etd.
),N
omin
ee
Dire
ctor
, Gov
t. of
Ker
ala
(DIN
: 00
2045
10)
Fee
for
attendingBo
ard/
Com
mitt
ee
meetings
--
--
Com
miss
ion
--
--
Others,please
spec
ify-
--
-
To
tal (
2)-
--
--
To
tal (
B)=(
1+2)
2850
0033
0000
2700
0010
5000
7500
015
0000
1215
000
To
tal M
anag
eria
l Re
mun
erat
ion
(A+B
)
1563
5011
.21
OverallCeiling
as p
er th
e Ac
tInaccordancewithMinistryofC
orporateAffairsnotificationno.
GSR463(E)dated5thJune2015;Governm
entC
ompaniesare
exem
ptfrom
Section197oftheCo
mpaniesAct,2013andits
rule
s th
ereo
f.
82 Cochin Shipyard Ltd
C. REM
UNERATIONTOKEYMANAG
ERIALPERSONNELOTH
ERTHANMD/M
ANAG
ER/W
TD(In`)
Sl.
No.
Parti
cula
rs o
f Rem
uner
ation
Key
Man
ager
ial P
erso
nnel
Smt.
Kala
V, C
ompa
ny S
ecre
tary
Tota
l1.
Gro
ss s
alar
y2856176.44
2856176.44
(a)Salaryasperprovisio
nscontainedinsection17(1)ofthe
Income-taxAct,1961
2856176.44
2856176.44
(b)Valueofperquisitesu/s17(2)oftheIncome-taxAct,1961
--
(c)Profitsinlieuofsalaryu/s17(3)oftheIncome-taxAct,
1961
--
2.StockOption
--
3.Sw
eatEquity
--
4.Co
mm
issio
n-
--as%ofprofit
--
others,specify
--
5.Others,pleasespecify
--
Tota
l28
5617
6.44
2856
176.
44
VII.
PEN
ALT
IES
/ PU
NIS
HM
ENT/
CO
MPO
UN
DIN
G O
F O
FFEN
CES:
Type
Secti
on o
f the
Co
mpa
nies
Act
Brie
f D
escr
iptio
nD
etai
ls of
Pen
alty
/ P
unis
hmen
t/
Com
poun
ding
fees
impo
sed
Auth
ority
[R
D /
NCL
T/ C
OU
RT]
App
eal m
ade,
if
any
(giv
e de
tails
)A
. CO
MPA
NY
Penalty
--
--
-Punishment
--
--
-Co
mpounding
--
--
-B.
DIR
ECTO
RSPenalty
--
--
-Punishment
--
--
-Co
mpounding
--
--
-C.
OTH
ER O
FFIC
ERS
IN D
EFAU
LTPenalty
--
--
-Punishment
--
--
-Co
mpounding
--
--
-BytheOrderoftheBoardofD
irectors
Mad
hu S
Nai
rCh
airman&ManagingDirector
DIN:07376798
Place:Kochi
Date:June30,2018
8346th Annual Report
MAnAgEMEnT DISCuSSIOn AnD AnAlySIS REPORT
Forward looking statements
1. StatementsinthisManagementDiscussionandAnalysisof Financial Condition and Results of Operations ofthe Company describing the Company’s objectives,expectations or predictions may be forward lookingwithin themeaningof applicable securities lawsandregulations.Forwardlookingstatementsarebasedoncertainassumptionsandexpectationsoffutureevents.TheCompanycannotguaranteethattheseassumptionsandexpectationsareaccurateorwillberealised.TheCompanyassumesnoresponsibilitytopubliclyamend,modify or revise forward looking statements on thebasis of any subsequent developments, informationor events. Actual results may differ materially fromthose expressed in the statement. Important factorsthatcouldinfluencetheCompany’soperationsincludegovernment’sstrategyrelatingtoacquisitionofnavalplatforms, changes in government regulations, taxlaws,economicdevelopmentswithinthecountryandsuch other factors globally.The financial statementsare prepared under historical cost convention, onaccrual basis of accounting and in accordance withtheprovisionsoftheCompaniesAct,2013(the“Act”)and complywith theAccountingStandards specifiedunder Section 133 of the Act. The management ofCochinShipyardLimited(“CSL”or“theCompany”)hasusedestimatesandjudgmentsrelatingtothefinancialstatementsonaprudentandreasonablebasis,inorderthatthefinancialstatementsreflectinatrueandfairmanner,thestateofaffairsfortheyear.
2. The following discussions on our financial conditionandresultofoperationsshouldbereadtogetherwithourauditedconsolidatedfinancialstatementsandthenotestothesestatementsincludedintheannualreport.
Shipbuilding and Shiprepair Industry
Global Shipbuilding Industry
3. Latest forecast of International Monetary Fund(IMF)putsworld’seconomicgrowthof2018at3.7%comparedto3.6%of2017and3.2%of2016.WorldBankpredictstheGDPtoaccelerateat2.9%comparedto2.7%intheyear2017.Clarksonspredictsintermsof global seaborne trade an annual growth of 3.5%whichislesserthan2017figuresof4.1%.Atthesametimethefleetislikelytogrowat4.3%comparedtothefleetgrowthof3.8%in2017.
4. AsperthereportofM/s.ATKearney,theshipbuildingindustry is still going through a cyclical downturngloballyduetooversupplyofvesselsduringtheperiod2006-2010 and overall decline in commodity tradeespeciallyinChinaandEU.Throughouttheearlypartof FY 2017 the shipping and consecutively the oilexploration industrywasseverely impactedowingtoavolatile anddepressedoil prices. Since then,whileoilpriceshaverebounded,aquickturnaroundoftheshippingandoilexplorationindustryisnotforecasted.As per the Maritime outlook report 2017 by theNorwegian Ship ownersAssociation, therewill be adeclineinprofitabilityandturnoveroftheirmembersduringFY2017.
5. The major freight indices are still hovering all timelowbutshowingsomeimprovements.TheChinanewbuildingpriceIndexisalsoshowingsametrendashadeabove the all time low levels. Maritime IntelligenceOutlook2018publishedby Lloyd’s List, reports thatthere are positive catalysts across the segmentsfor maritime Industry. At the same time the fragilerecovery can be easily derailed bymacro economicsandfleetgrowth.
6. The above reports indicated that the industry is notoutofitsdepressionandisfairtosaythatitmaytakesomemore time for the Industry to stabilise beforegainingmomentumandtakeapositivetrajectory.
Indian Shipbuilding Industry
7. Defence Shipbuilding: In the defence sector, theindustry outlook remainedpositive.The IndianNavyand Coast Guard are working on various projectsto modernise the fleet. Also, other agencies underMinistryofHomeAffairs (MHA)arealsoworkingonmany projects on coastal security. Defence buildingopportunity at present is estimated to be USD 23billionandtheestimateisUSD50billionina3-5yearstime(AsperthereportofM/s.ATKearney).
8. CSLhas emerged as lowest bidder inASWCorvettevessels for Indian Navy estimated at ` 5392 coresplus taxes and 56 Boats for MHA estimated at `358.83croreplustaxes.
9. Commercial Ship Building: Indian commercialshipbuildingorderinglevelsremainedlow.Atpresent,thereisnonewbuildingshiponorderbythecountry’s
84 Cochin Shipyard Ltd
largestcommercial shipowner,ShippingCorporationof India. Whenever a demand arises, to meet thechallengingcommercialcharterratesprevailinginthemarket,shipownersaremorefocussedonsecondhandshipswhich are readily available atvery competitiveprice.Inadditiontotheinternationaldepressedmarketconditions,thedifficultytoraisethefundfrombanksfornewacquisitionandtheimpositionofGSTontheincome of ship owners have dampened the interestto increase the Indianfleet.However, followingnewsegmentsareshowingpositiveoutlook.
10. InlandandCoastalWaterSegment:Thegovernment’sfocusondevelopmentofinlandandcoastalwaterwaysinfrastructureisexpectedtospurdemandofshipsforthissector.TheGovernmentisinvestingsubstantiallytoimprovetheinfrastructureinthemajorwaterways.This will spur the demand for such vessels in theinlandwatersegment.Itisestimatedthatthevesselsrequiredtomeetthedemandby2030willtriplewhichmaybearound3000+vessels.CSLisworkingcloselywithInlandWaterAuthorityofIndia(IWAI)andotherpotential customers to provide efficient productsolutionsinthissegment.
11. SpecialPurposeVessels:Variousagenciesarelookingformodernandefficientvesselstoequipandupgradetheassetstomeettheoperationaldemands.Thisgivesan opportunity to offer custom made vessels suchas Polar Research Vessels, Well Stimulation Vessel,Cement Carriers etc.
12. FishingSegment:Governmentof India (GOI)hasgotan ambitious plan under the “Blue Revolution” toequip the segment with more modern and efficientfishing vessels. This segment is presently managedbyunregulatedplayersandgivesagoodopportunityforCSLtofocusandpositionitselfasaqualityplayer.CSL isworking closelywithTamil Nadu Fisheries byprovidingcustommadesolutiontothefishermenandhascontractedfortheconstructionof16vesselsasapilotproject.Thetotalrequirementforthedepartmentforfishermenisabout2000vessels.Inadditiontotheabovetherearealsopotentialrequirementsformorebigger and sophisticated vessels in this segment forthedomesticandinternationalmarket.
Shiprepair Industry
13. WhileIndia’sshareinglobalshiprepairmarketislessthan1%,around7-9%ofglobaltradeispassingwithin300NMofitscoastline.India’sstrategicpositionalongthe east bound andwest bound international traderoutesoffersanopportunitytocatertovesselsplyingon these routes.Amain container route connectingAmericaandEuropetotheEastpassesveryclosetothe Indian coastline presenting amajor opportunity
for repairs. This presents huge untapped potentialwhichisvaluedaround`3500to`4000crore.
14. The captive market for shiprepair in India isestimated at around ` 2500 crore. It is estimatedthat only 15% of the potential is being tappedpresently. Lack of infrastructure and poor ease ofdoingbusinessdue togovernment regulationsandweak ancillary support are the main reasons forfailuretotaptheaboveopportunities.AsapartoftheSagarmalaproject,governmenthasembarkedonaprogrammeforfullutilisationofexistingdrydockin major ports for providing shiprepair services.Towards this end, CSL has entered into an MOUwiththeMumbaiPortTrustonJanuary11,2018foroperations and management of ship repair facilityatIndiraDock.CSLshallutilizethefacilitiesforthepurpose of ship repair and allied services and forfurtherexpansioninthefieldofshiprepair.SimilarMOU has been signedwith Kolkata Port Trust onMarch17,2018foroperationsandmanagementofshiprepairfacilityatNetajiSubhasDock.CSLshallutilize the facilities for the purpose of ship repairandalliedservicesandforthegrowthofshiprepairin the region and similarMOU is on the anvil forAndamanandNicobarIsland.
Government Policy on Shipbuilding and ShiprepairSagarmala
15. TheSagarmaladevelopmentinitiativesofGovernmentofIndiaaimsatportleddevelopmenttoreplicatethemodel followed by some of the successful maritimenationslikeUSAorSingapore.Variousinitiativeshavebeen planned under Sagarmala perspective plan forport led development such as port modernisation,improvingportconnectivity,port ledindustrialisationand coastal community development. Around 150+projectsatacostof`4 lakhscroreof infrastructureinvestmentisenvisaged.Thedevelopmentofportsisexpected to foster clusterdevelopmentof industriesincluding that of Shipbuilding and shiprepair. Apartfromthis,anumberofkeypoliciesandinitiativeshavebeen instituted byGovernment of India focusing onthedevelopmentof theshipbuildingsector.Someofthesekeyinitiativesinclude:-
(a) Financial Assistance for local shipbuilders:-Introductionof`4000crorefinancialassistancepolicyfor10years
Asperthepolicy,commencing2015-16,financialassistance is to be granted to Indian shipyardsstarting with 20% of the lower of “Contractprice”or the“FairPrice”ofeachvesselbuiltbythemanddiminishingupto10%overaperiodof10years.
8546th Annual Report
(b) ExemptionfromCustomsandCentralExcisedutyoninputsusedinshipbuilding.
(c) Infrastructure status:- This move is to helpIndian shipyards avail flexible structuring oflongtermproject loans, longtermfundingfrominfrastructure funds at lower interest rates andlongertenureequivalenttotheeconomiclifeoftheirassets.Shipyardstohaveaccesstorelaxedexternal commercial borrowing norms, issuanceof infrastructure bonds for meeting workingcapitalrequirementsandIncomeTaxbenefits.
(d) 100% Foreign Direct Investment permitted inshipbuilding.
(e) Revisionofdomesticeligibilitycriteria:–AllGovt.departments and agencies shall undertake bulktendering for their vessel related requirementswith deliveries starting from 2016-17 and willgrantarightoffirstrefusalforIndianshipyardsforsuchorderstill2025.From2025onlyIndianbuildvesselsaretobeprocuredbytheseagencies.
16. In the shiprepair segment the focus of GOI is betterutilizationofexistinginfrastructureinmajorportsandbuildingupofnewinfrastructurethroughuniformpolicygoverningleaseofrepairinfrastructuretospecialists.
Operations
17. OurCompany’sperformancecontinuedtobepromisinginallsegments.ThetotalturnoveroftheCompanyis`2355.12croreasagainstthatofthepreviousyearof`2058.87crore.Theshipbuildingincomeduringtheyear
is `1731.86croreasagainstthepreviousyearincomeof `1515.82crore.Duringtheyear,CSLdeliveredtwoRO-RO Ferries to KochiMunicipal Corporation. TheCompanycontracted threeoutof16Nos. tuna longlining and gillnetting fishing boats for diversificationofthetrawlfishingboatsfrompalkbayintodeepseafishingboatsundercentralsectoronBluerevolutionscheme with assistance from Government of IndiaandtheGovernmentofTamilNadu.ThisisCSL’sfirstentry into the fishing vessel construction segment.CSL,known for its capabilities inconstructionofbigand high end specialised vessels wishes to bring inquality,modernandefficientproductstothiscurrentlyunorganised sector thereby benefitting not only thefishing community, but also partnering in the effortto sustain the ecology by promoting long lining andgillnetting activities as against the highly damagingtrawling that currently exists in this space.Also, theCompany’s foray in the coastal security boats usingFRP/ Composite material will leverage the overallexperience to bring new products to cater to thisgrowingsegmentforthefuture.
18. The year was really remarkable with reference tothe shiprepair performance of the Company. The income from shiprepair increased to ` 623.27 crorefrom ` 543.05crore in thepreviousyear.Themajorshiprepair projects undertaken during the yearwerenormal refit of INSShakthi, INSNireekshak and INSAiravat for Indian Navy and refit of Sagar Bhushanof ONGC. Around ` 46.50 crore of turnover wascontributed from International Ship Repair Facility(ISRF)atCochinPortTrustpremises.
Financial Information
19. ThefinancialinformationoftheCompanypertainingtothelastdecadeisgivenbelow:(Amountin`Crore)
Year Paid up capital
Nominal value of shares (` per share)
Capital employed
Net worth
Profit Before
Tax
Tax on Profits
Net Profits EPS Dividend Payout
ratio
17-18 135.94 10 3212.22 3255.87 604.86 208.11 396.75 31.03 163.12 0.4116-17 113.28 10 2089.05 2028.58 493.40 171.85 321.55 28.39 101.61 0.3215-16 113.28 10 1695.35 1814.33 419.65 145.86 273.79 24.07 86.65 0.3214-15 113.28 10 1621.24 1561.07 367.56 132.49 235.07 20.75 16.99 0.0713-14 113.28 10 1389.98 1352.53 290.96 96.71 194.24 17.15 16.99 0.0812-13 113.28 10 970.84 1175.70 275.55 90.28 185.27 16.35 16.99 0.0911-12 152.42 10 918.68 1050.83 252.97 80.63 172.33 15.21 16.99 0.1010-11 192.42 10 829.27 967.80 344.23 116.70 227.53 20.09 11.32 0.0509-10 192.42 10 578.32 680.32 331.25 108.21 223.04 19.69 11.32 0.0508-09 232.42 10 550.31 566.49 247.63 87.56 160.07 14.13 11.32 0.07
86 Cochin Shipyard Ltd
Proposed / Declared Dividend
20. As per Office Memorandum F.No.5/2/2016-Policydated May 27, 2016 issued by the Department ofInvestment and Public Asset Management (DIPAM),everyCPSEhavetopayaminimumannualdividendof30%ofPATor5%ofthenetworth,whicheverishigher.Accordingly,yourDirectorsarepleasedtorecommenda dividend of ` 12 per share on the 1,35,93,60,000fullypaidequitysharesof`10each.Thetotaloutgofordividendanddividendtaxwouldbeapproximately`196.65crore.
Segment wise/ product wise performance
21. TheCompany is engaged in twomajor activitiesviz.shipbuilding and repair of ships /Offshore Rigs etc.Segmentwise analysis hasbeenmadeon the abovebasisandamountsallocatedonareasonablebasis.Thedetailofsegmentwiseperformanceisgivenbelow.
(`Lakhs)
Particulars As at 31.03.2018
As at 31.03.2017
SegmentAssets Shipbuilding 231887.20 169699.79Ship Repair 168349.50 125884.57Others 146692.04 36068.78Total 546928.74 331653.14SegmentLiability Shipbuilding 89620.66 40854.99Ship Repair 23368.86 21547.62Others 108352.53 66392.29Total 221342.05 128794.90ExternalSales Shipbuilding 173185.70 151582.17Ship Repair 62326.63 54304.93Unallocated 3494.36 2777.73Total 239006.69 208664.83
SWOT
22. Cochin Shipyard perceives the following to be itsStrengths,Weaknesses,OpportunitiesandThreats.
Strengths:(a) Highly trained, motivated and knowledgeable
manpower with an average of 15 years ofexperience at all levels of hierarchy resulting inextremelyhighqualityworkmanship;
(b) A well planned and laid out shipyard enablingsmoothworkflow;
(c) Amodern‘StateoftheArt’DesignCentremannedby highly trained, experienced and competentNavalArchitects/Engineers,draftsmenetc.;
(d) Highly evolved shipbuilding processes andpractices permitting modular construction ofships;
(e) Averygoodproductmixcompatibilitycomprisingof defence ships, commercial ships, offshoresupportships;
(f) Availability of quality sub contractors and goodsupplychainnetwork;and
(g) ‘Stateof theArt’ facilitiesespecially in termsofcraneage, transporters, covered mobile shops,covered marine coating facility, high qualitywelding equipment, international standard hullfabricationfacilities,substantialmaterialstoragefacilitiesetc.
Weaknesses:(a) Virtually non-existent indigenous ancillary
industries and consequently non availability ofmajorequipment/rawmaterialsinIndia;
(b) Infrastructureconstraintsduetononavailabilityof large sized dock to build and repair shipsbeyond 1,10,000 DWT and 1,25,000 DWTrespectively. (This will be overcome with theproposednewdrydock);
(c) Difficultytoarrangelongtermprojectfinancetoshipownerswhich is offeredbyotheroverseasshipbuildingcountries;and
(d) Comparatively higher social and employeeoverheadsandcertainrestrictivelabourpracticesespeciallyforcontractinglabour.
Opportunities:(a) Projected increase in requirement of ships
for the domestic commercial segment, owingto thenewGOIpolicy toencourage “Make inIndia”;
(b) Projecteddemandinthedefencesector.(c) Indian Navy, Coast Guard and other maritime
securityagencieshaveembarkedonanambitiousexpansion programme which will open newopportunities;
(d) LNGfuelledvessels,bothdeepseaandcoastal;(e) Emergingopportunities in the inlandwaterways
andcoastalshippingsectorinIndia;(f) Fishing vessels for both domestic and overseas
market;
(g) Tap opportunities for FRP boats for coastalsecurity;and
(h) Huge demand - supply gap for the repair ofCommercial andDefence ships andvirtually nocompetitioninIndia.
8746th Annual Report
Threats:
(a) Distresspricingpoliciesofcompetitors;(b) Adverse reputational impact on the Indian
Shipbuilding industryduetounderperformancebyIndianyards;
(c) Risingcostoflabour;and(d) Non flexible government regulations on
procurement policies delaying the productdeliverytimelinesandcost.
CSL 2030 - Strategic Plan
23. CSL has constituted a ten member core group fortakingforwardtheeffortsinformulatingaCSL2030-Strategic Plan. Towards this, an EOI was issued onJune08,2017forshort-listingabestinclassstrategicconsultancy firmof international reputewho in turnwillworkcloselywithCSLteamtoformulatethisplan.Tenderingforfinalisingthefirmisundeway.
Risks and concerns
24. Thecommercialshipbuildingindustryishighlycyclicalinnatureandisalsosensitivetocyclicalnatureoftheindustriesitservessuchastheoil,naturalgas,shipping,transportationandothertrade-relatedindustries.
25. TheCompany’soperationsaresubjecttoinherentriskssuchasequipmentdefects,malfunctionsandfailures,equipment misuse and disasters that can result infiresandexplosions.CSLmaintainastandardfireandspecial perils policy but CSL do not have insurancefor business interruption. Substantial portion of theCompany’s activities involve the fabrication andrefurbishmentoflargesteelstructures,theoperationofcranesandotherheavymachineryandotheroperatinghazards. These risks could expose the Company tosubstantialliabilityforpersonalinjury,wrongfuldeath,productliability,propertydamage,pollutionandotherenvironmentaldamages.
26. ThemajorcomponentoftheCompany’sexpenditureinclude raw materials such as steel (the grade andquality of which, in each project, depends on theapplicable classification rules) and other materials,equipment and other components such as pumps,propellersandengines.InFiscals2015,2016and2017respectively, the Company’s material consumptioncosts constituted 64.57%, 64.01% and 58.36% ofits total costs, respectively. In particular, bought outcomponentsaccountedfornearly90%ofourtotalrawmaterialcostintheserecentfiscals.
27. Shortages in thesupplyof rawmaterialsmayresultinanincreaseinthepriceoftheserawmaterials.Forexample,therearesupply-sideconstraintsinrelationto steel in India which we expect will continue infuture.TheIndiansteelindustryhasbeenunableto
competegloballyduetowhichtheGOIhasimposedsignificantdutieson the importof steel fromothercountries such as China to protect the domesticsteel industry. This has adversely affected CSL byincreasing thecostofprocurement. Inaddition, thecost of certain raw materials, such as steel, mayfluctuate in line with any changes in their globalsupplyanddemand.
28. In the event that the price of the Company’s rawmaterials increase, the Company will not be ableto pass these price increases to its customers on its existing fixed contracts and its business, financialconditionandresultsofoperationsmaybeadverselyaffected.
Product Diversification
29. CSLhasidentifiedCompositesasafastgrowingsegmentandinitiatedeffortstowardsdiversifyinginthisdirection.Asaresult,CSLhasparticipatedintheMHAtenderfor225CoastalPatrolBoatsandhasemergedL1bidderfor56boats.Similarly,with theGOI focusingon theBluerevolutionandtherecentimpetusfortheupliftmentofthe fishing community all along the coastal India, CSLserves a surge both in the demand as well as in thequality of the fishing vessel segment in India. ProductdiversificationinthisdirectionwasonlylogicalandCSLhasalreadymanagedtosecureordersfor16fishingboatsfrom Tamil Nadu.With volumes to the tune of manythousandsbeingprojectedbytheindustry,CSLfeelsthatthiscouldeventuallyturnouttobeaseparateverticalbyitself,ifeverythinggoesasplannedbythegovernment.
Internal Control
30. The Company has promulgated an internal controlandinternalauditmanualandhas inplaceadequateinternal control systems.The internal audit functionis carried out by an independent firm of CharteredAccountants who carry out an in-depth reviewof internal control systems in critical areas basedon the audit programme approved by the boardlevel audit committee headed by an independentdirector.Areviewof the internalcontrolprocedureswas undertaken byM/s.Varma andVarma, InternalAuditorsasaseparateexercise.
Human Resource Development and Industrial Relations
31. Thedetails regardingHumanResourceDevelopmentandIndustrialRelationsaremorespecificallycoveredintheDirectors’Report.
Women Empowerment
32. Cochin Shipyard Limited has constituted an InternalComplaints Committee in accordance with theguidelines and norms prescribed by the enactmentnamely Sexual Harassment ofWomen atWorkplace
88 Cochin Shipyard Ltd
(Prevention,ProhibitionandRedressel)Act,2013.TheChairpersonoftheInternalComplaintsCommitteeisaseniorwomanexecutiveoftheCompany.TheCertifiedStanding Orders applicable to Workmen have alsobeenamendedincorporatingSexualHarassmentasanactconstitutingmisconduct.The InternalComplaintsCommitteehasbeendulyempoweredtoinquireintosuchcomplaintsinaccordancewiththeprocedurelaiddown in theCertifiedStandingOrdersand IndustrialEmployment(StandingOrders)ActandRules.
33. Delegates from CSL were nominated to attendthe Southern Regional Meet of WIPS held atMahabalipuramonSeptember16,2017andthe28thNationalMeetofWIPSheldatGuwahationFebruary12and13,2018.
34. WIPSCellofCSLhadinitiatedthefollowingactivitiesthroughtheCSRprojectsofCSL:• “SupportforConstructionofaWorkCentrethat
Promotes Environment Friendly products andincreases the Income of Marginalized Women”through ‘Society of Theresians for EnvironmentProtection (STEP), an outreach body of thestudentsofSt.Terasa’s;and
• Provided fund for constructing Office cumCommon Facility Centre for Fish WorkersDevelopment Cooperative Society inChendamangalam.Most of themembers of thesocietyarepoorwomenfishworkers,whobelongto theVala Samajam, functioning at the coastalbeltnearParur,Ernakulam.
35. Forum ofWomen in Public Sector (WIPS), CSL unitin association with the Indian Women Network,organised sessions on Soft Skill Development andStressReleaseon the InternationalWomen’sDayonMarch08,2018.
36. The Company has ensured participation of womenemployees as part of joint forum of employees andmanagement such as Joint Council, Shop Councils,CentralSafetyCouncil,ShopSafetyCouncil,EmployeeContributoryProvidentFundTrust,EmployeesCochinShipyardRecreationClub,EmployeesCochinShipyardConsumer Society etc.
Technology Conservation
37. CSL continuously strives for conservation andupgradation of technology to remain competitivein the global shipbuilding market. Towards this theCompanyhastakenthefollowinginitiatives:i. Developed contract & basic design for 16 nos.
gill net long liner fishing vessels in technicalcollaboration with the Central Institute ofFisheriesTechnology,ICAR;
ii. DevelopedconceptdesignforMarineAmbulanceboatforKeralaGovt.;
iii. DevelopmentofspecificationforimplementationofAccommodationsystem&HVACPackagefor500PAX;
iv. DevelopmentofspecificationforimplementationofAccommodationsystemfor1200PAX;
v. DevelopmentofspecificationforimplementationofHVAC&Refrigerationsystemfor1200PAX;
vi. Development of specification for theprocurement of equipment/systems incompliance to SRtP (Safe Return to Port)requirementsfor1200PAX;
vii. Developmentofspecificationfortheprocurementof Power and Automation system, Navigationand communication system, Lighting, ElectricalCables for 1200 PAX in compliance with SRtPrequirements;
viii. In-house development of 3D modeling forAccommodation & other outfit Systems inAccommodation spaces for the TechnologyDemonstrationVessel(Ship020)forDRDO/500PAXforA&NAdministration/1200PAXforA&NAdministrationinTribonunderprogress;
ix. In-house development of 3D modeling forElectrical outfitting for 1200 PAX for A&NAdministrationis inprogress incompliancewithSRtPrequirements;
x. Inhouseconceptualdesignof integratedfireandflood detection system by suitably combiningexistingstandalonesystemsforfiredetectionandflooddetectionforSRtPcompliancefor1200PAX;
xi. Softwareupgradesfor“CableManager”-Inhousedevelopedcableschedulingandnestingsoftwareforusageonboardprojects;
xii. Softwareupgradesfor“ElectricalApps”-InhousedevelopedproductiondesigncustomizationtoolforTribonM3forusageinongoingprojects;
xiii. Functional design drawings developed forelectricalcableroutesandantennaarrangementbased on the EMI/EMC requirements forTechnologyDemonstrationVessel(Ship020)forDRDO,specialpurposevesselforGovt.ofIndia;
xiv. DevelopmentofspecificationfortheprocurementofspecializedHatchCoversrequiredforthearticlelaunching for the Technology DemonstrationVessel (Ship 020) for DRDO, special purposevesselforGovt.ofIndia;
xv. Installation of High Voltage Power generation& distribution system, high power propulsion
8946th Annual Report
system, UPS systemswith neutral arrangementforClientSystempowerdistribution,Navigation&CommunicationsystemsmeetingDNVNaut-AWand IRS IBS notations, SPS code requirements,onboardTechnologyDemonstrationVessel(Ship020),specialpurposevesselforGovt.ofIndia;
xvi. Structural interface of Client systems (DRDO)withShipsystemsforTechnologyDemonstrationVessel(Ship020),specialpurposevesselforGovt.ofIndia,specialpurposevesselforGovt.ofIndia;
xvii. Installation of 1500NB valve with electricactuation onboard Technology DemonstrationVessel(Ship020),specialpurposevesselforGovt.ofIndia;and
xviii.Preparation of Technical specification and3D modeling of completely explosion prooftype Electrical Overhead Cranes for ClientArticle Handling operations for TechnologyDemonstrationVessel(Ship020),specialpurposevesselforGovt.ofIndia.
Corporate Social Responsibility (CSR) and Sustainability
38. Formoredetails,pleaserefertheannualreportonCSRactivitiesplacedatAnnexure-4toDirectors’Report.
Micro Small and Medium Enterprises (MSME) as per the Public Procurement Policy 2012
39. Though the scope of procurement of material/equipment/ spares and availing services fromMicro,SmallandMediumEnterprises(MSME)forshipbuildingand shiprepair projects undertaken by the Companyareextremely limited, theCompany ismakingallouteffortstoincreasetheprocurement/availingservicesfromMSMEs.Thetargetof20%procurementofgoodsand services from MSMEs out of total indigenousprocurementforFY2017-18,tillJanuary31,2018,hasbeenachievedbytheCompany.
40. Withaviewtopromoteprocurement/availservices,through MSMEs, as per the Public ProcurementPolicy 2012, promulgated by the Government ofIndia (GOI),CochinShipyardLimited(CSL)attendedSix (6) Vendor Development Programmes (VDPs)organizedbytheDept.ofMSME,GOIwhichincludedoneconclaveonSC/STMSMEvendors,atBolgattyPalace, Cochin, on January 17, 2018, in whichCSL representative made a presentation on CSL’srequirement of product and services fromMSMEs.Othernotableeventamong theabove6VDPswastheNationalVDPheldatThrissurfromDecember07to09,2017, inwhichCSLputupastallwhichwas
declaredas thebest stall in theexhibitionandwaspresentedwithanawardinthatregard.
41. In addition to the above, CSL conducted a majorexhibition for the MSMEs named ‘LAGHU UDYOGEXPO-2017’onMay15and16,2017atMarineDriveGround,Ernakulam.TheexhibitionwasorganisedwiththesupportofDepartmentofIndustries&Commerce,Govt. of Kerala and MSME Development Institute,Thrissur,andwasinauguratedbytheHon’bleMinisterfor Industries,Youth andSportsAffairs,Governmentof Kerala. The programme consisted of IndustrialExhibition&B2BMeetforMSMEs.Theeventofferedmeaningful platform forMSMEspredominantly fromKeralaforshowcasingtheirproducts/servicesandforinteracting/marketingwithprospectiveclients.MajorCentral andStatePSUsofKerala andbanks activelyparticipatedintheprogram.80stallsand10B2Bmeetcounters/roomswerearrangedatMarineDrive,Kochiinafullyair-conditionedexhibitionvenue.Further,thetwodayswere enrichedwith different seminars andpresentationsbyvariousMSMEs,industries&experts.Nofeeswerechargedfromtheparticipantsaswellasfromvisitors of commonpublic andCSL funded theentireexpenditure.
42. Other initiatives include, making CSL website user-friendly for MSME vendors and regular uploadingof procurement data and other details in “MSMESAMBANDH” portal launched by Ministry ofMSME,GOI.
Cautionary Statement
43. Statements in this ‘Management Discussion andAnalysisReport’describingtheobjectives,expectations,assumptions or predictions of the Company may beforward looking statements within the meaning ofapplicablerulesandregulations.Actualresultscoulddiffermaterially from those expressed or implied. Importantfactors thatcouldmakeadifference to theoperationsof theCompany includeeconomicconditionsaffectingdemand/supply, price conditions in the domesticand international markets, Government policies andregulations,statutesandotherincidentalfactors.
ForandonbehalfoftheBoardofDirectors
Madhu S NairChairman&ManagingDirector
DIN:07376798KochiJune30,2018
90 Cochin Shipyard Ltd
BuSInESS RESPOnSIBIlITy REPORT
About this report
IntermsofRegulation34oftheSEBI (ListingObligationsand Disclosure Requirements) Regulations, 2015, theAnnualReportsofthetopfivehundredlistedentitiesbasedonmarketcapitalizationattheBSEandNSEshallcontaina Business Responsibility Report (BRR) describing theinitiatives taken by the Company from an environmental,socialandgovernanceperspectivewhichincludesCSL.
Section A: General Information about the Company
1. CorporateIdentityNumber(CIN)oftheCompany U63032KL1972GOI0024142. NameoftheCompany CochinShipyardLimited3. Registeredaddress AdministrativeBuilding,CochinShipyardPremises,
Perumanoor,Cochin,Ernakulam,Kerala-6820154. Website www.cochinshipyard.com5. E-mailid [email protected]. FinancialYearreported 2017-187. Sector(s) that the Company is engaged in (industrial
activitycode-wise)ShipbuildingandShiprepair(IndustrialGroup301and331asperNationalIndustrialClassificationoftheMinistryofStatisticsandProgrammeImplementation)
8. Listthreekeyproducts/servicesthattheCompanymanufactures/provides(asinbalancesheet)
TheCompanyisengagedinbusinessofshipbuildingandshiprepair.Inter-aliaconsideringnatureofproductionprocessandinfrastructurefacilitiesused,therearenootherreportablesegment.
9. TotalnumberoflocationswherebusinessactivityisundertakenbytheCompanya. NumberofInternationalLocations(Provide
detailsofmajor5)b. NumberofNationalLocations
Nil
One10. Markets served by the Company – Local/State/
National/InternationalLocal,State,NationalandInternational
Section B: Financial Details of the Company1. PaidupCapital(INR) 135.94crores2. TotalTurnover(INR) 2355.12crores3. Totalprofitaftertaxes(INR) 396.75crores4. Total spending on Corporate Social Responsibility
(CSR)aspercentageofprofitaftertax(%)2.16
5. Listofactivities inwhichexpenditure in4abovehasbeenincurred:-
CSL’sCSRactivitiesarecarriedoutinthefollowingfocusareas:• Education&SkillDevelopment• SwachhBharatProjects• Healthcareinitiatives• Empowermentofwomenanddifferentlyabledpersons
ThereportingframeworkisbasedontheNationalVoluntaryGuidelines on Social, Environmental and EconomicResponsibilitiesofBusiness(NVGs)releasedbytheMinistryof Corporate Affairs, Government of India, in July 2011whichcontains9PrinciplesandCoreElementsforeachofthe 9 Principles. Following is the Business ResponsibilityReport of our Company based on the format suggestedbySEBI.
9146th Annual Report
Section C: Other Details
1. Does the Company have any Subsidiary Company/Companies?
Yes,CSLhasonesubsidiaryviz.,HooghlyCochinShipyardLimited.
2. Do the Subsidiary Company/ Companies participatein theBR initiativesofparent company? Ifyes, thenindicatethenumberofsuchsubsidiarycompany(s)
No.TheSubsidiarycompanywasincorporatedonlyinOctober2017andisyettocommenceoperations.HencethecompanyhasnotstartedtoparticipateintheBRinitiativesofCSL.
3. Doanyotherentity/entities(e.g.suppliers,distributorsetc.)thattheCompanydoesbusinesswith,participatein the BR initiatives of the Company? If yes, thenindicatethepercentageofsuchentity/entities?[Lessthan30%,30-60%,Morethan60%]
ThecompanyhasadoptedwellestablishedproceduresforOutsourcingandprocurementactivitiesinordertoensurequality,ontimedeliveryandoptimumcost.Careistakentohaveapanelofvendorswithsoundintegrity.Thecompanyhasintroducedepayment,integritypactetcforamoretransparentmethodofprocurement.Thestandardtermsandconditionsofpurchaseorderconformstothecompanypolicyonsafety,environmentetcandareacceptedbythevendor.Hencemajority(morethan60%)conformtothekeyprinciplesofthebusinessresponsibility
Section D: BR Information1. Details of Director/Directors responsible for BR (a) Details of the Director/
Directors responsible forimplementation of the BRpolicy/policies
1.DIN
2.Name
3.Designation
(b) DetailsoftheBRhead
BRfunctionrelatingtoCorporatesocialresponsibilityandsustainabilityismonitoredbytheCorporateSocialResponsibility&SustainableDevelopment(CSR&SD)CommitteeoftheBoardofDirectors.ThedetailsoftheCompositionoftheCSR&SDCommitteeareprovidedintheCorporateGovernanceReport.
TheCSR&SDCommitteeoftheCompanyisundertheChairpersonshipofSmt.RoopaShekharRai.
ThedetailsoftheChairpersonofCSR&SDCommitteeofCSLareasfollows:DIN:07565156Name:Smt.RoopaShekharRaiDesignation:IndependentDirectorEmailID:[email protected]
TheBoardhasnotassignedresponsibilitiesspecificallytoanyDirectortofunctionastheBRhead.
2. Principle-wise (as per NVGs) BR Policy/policies (Reply in Y/N)The9principlesoutlinedintheNationalVoluntaryGuidelinesareasfollows:P1 BusinessesshouldconductandgovernthemselveswithEthics,TransparencyandAccountability.P2 Businessesshouldprovidegoodsandservicesthataresafeandcontributetosustainabilitythroughouttheirlife
cycle.P3 Businessesshouldpromotethewell-beingofallemployees.P4 Businessesshouldrespecttheinterestsofandberesponsivetowardsallstakeholders,especiallythosewhoare
disadvantaged,vulnerableandmarginalized.P5 Businessesshouldrespectandpromotehumanrights.P6 Businessesshouldrespect,protectandmakeeffortstorestoretheenvironment.P7 Businesseswhenengagedininfluencingpublicandregulatorypolicy,shoulddosoinaresponsiblemanner.P8 Businessesshouldsupportinclusivegrowthandequitabledevelopment.P9 Businessesshouldengagewithandprovidevaluetotheircustomersandconsumersinaresponsiblemanner.
92 Cochin Shipyard Ltd
Sl.No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P91 Doyouhaveapolicy/policiesfor.... Y Y Y Y Y Y Y Y Y2 Hasthepolicybeingformulatedin
consultationwiththerelevantstakeholders?Y Y Y Y Y Y - Y Y
3 Doesthepolicyconformtoanynational/internationalstandards?Ifyes,specify? (50words)
Y Y Y Y Y Y Y Y YVariouspoliciesatCSLconformtodifferentapplicablestatutes/guidelines/rulesetc.issuedbyGOI,andupdatedfromtimetotime.Industrypractices,national/internationalstandardsarekeptinviewwhileformulatingpolices.
4 HasthepolicybeingapprovedbytheBoard?Ifyes,hasitbeensignedbyMD/owner/CEO/appropriateBoardDirector?
Y Y Y Y Y Y - Y YDifferentpoliciesareapprovedbytheBoard/CompetentAuthoritiesasperdelegationofpower.
5 DoesthecompanyhaveaspecifiedcommitteeoftheBoard/Director/Officialtooversee the implementation of the policy?
Y Y Y Y Y Y - Y Y
6 Indicatethelinkforthepolicytobeviewedonline?
ThepoliciesareavailableonCompany’swebsite:http://www.cochinshipyard.com/investors.htm
7 Hasthepolicybeenformallycommunicatedtoallrelevantinternalandexternalstakeholders?
Yes.ThepolicieshavebeencommunicatedtothestakeholdersbyuploadingontheCompany’sabovementionedwebsite.Quality,Health,SafetyandEnvironmentalPolicyisuploadedinintranetoftheCompanyaswellasCSL’swebsite.ThesameisalsodisplyedatallmajorlocationoftheCompany.
8 Doesthecompanyhavein-housestructuretoimplementthepolicy/policies.
Yes
9 DoestheCompanyhaveagrievanceredressalmechanismrelatedtothepolicy/policiestoaddressstakeholders’grievancesrelatedtothepolicy/policies?
TheBoardhassetupaCommitteetoaddressthegrievancesofthestakeholders,debentureholdersandotherpersonsholdingsecuritiesintheCompanyasrequiredundertheCompaniesAct,2013andundertheSEBI(ListingObligationsandDisclosureRequirements)Regulations2015.Inaddition,theCompanyhasalsosetupavigilmechanismtoaddressthegenuineconcerns,ofanyofthedirectorsandemployees.
10 Hasthecompanycarriedoutindependentaudit/evaluationoftheworkingofthispolicybyaninternalorexternalagency?
TheCompanyissubjecttovariousauditssuchasStatutoryAuditbyfirmofCharteredAccountantsappointedbytheComptroller&AuditorGeneral,InternalAudit,C&AGAudit,CostAudit,SecretarialAudit,EnergyAudit,SafetyAudit,IntegratedManagementSystemsAuditetc.Theseauditsensurecompliancetovariousinternalandexternalpolicies.
3. Governance related to BR
(a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance of the Company. Within 3 months, 3-6 months, Annually, More than 1 year
TheseniormanagementoftheCompanyreviewsBRperformanceonanon-goingbasis.TheBoard/Committees constituted by it review the sameannually.
(b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it is published?
Yes.TheCompanypublishesBRReportannuallyaspartof itsannualreport.This isthefirstyearafter the applicability of Regulation34(f) of theSecurities and Exchange Board of India (ListingObligations and Disclosure Requirements)Regulations, 2015. The hyperlink for viewingthe report: http://www.cochinshipyard.com/annualreport.htm
9346th Annual Report
Section E: Principle-Wise Performance
Principle 1: Businesses should conduct and govern themselves with Ethics, Transparency and Accountability
1. Does the policy relating to ethics, bribery and corruption cover only the company? Yes/ No. Does it extend to the Group/Joint Ventures/ Suppliers/Contractors/NGOs /Others?
TheCompanyhaspositionedanIntegrityPactwhichis signed with bidders to enable them to raise anyissueswithregardtohighvaluetendersofmorethan100 lakhs floated fromtime totime. People of highrepute and integrity are appointed as IndependentExternalMonitors to oversee implementation of thesaidIntegrityPact.
Thepactessentiallyenvisagesanagreementbetweentheprospectivevendors/biddersandCSLcommittingthePersons/officialsofbothsides,nottoresorttoanycorruptpracticesinanyaspect/stageofthecontract.Anyviolationofthesamewouldentaildisqualificationof the bidders and exclusion from future businessdealings.
2. How many stakeholder complaints have been received in the past financial year and what percentage was satisfactorily resolved by the management?
During the financial year 2017-18, 397 investorcomplaintshavebeen receivedby theCompanyandthrough SEBI SCORES Platform, NSE and BSE andRegistrar&TransferAgent.Allthesecomplaintswereattendedtoandresolvedonprioritybasis.
Further,CSLhadreceivedsomefeedbacks/concernsregardingsomeoftheequipmentsusedforthevesselsBY85-86fromacorporateclient.Thefeedbacksweremore of an advice due to the poor service receivedfromtheOEM’s,andYardhadnotinitiatedanyactionsinthisregardsincethiswasmainlyafterthecompletionofguaranteeperiod.
CSLhadcompletedtheNPCCBargeGuaranteeperiodfor the equipments, systems, quality, workmanship,etc, (exceptforPaintingwhich isfiveyears),andhadnotreceivedanyclaimsforanyearafterthedelivery,showingthequalityofconstruction.
Furtherallthecontractedvesselsareconductedwitha Customer Satisfaction Survey, and feedbacks aretakenfromOwnerswillingtosharetheirexperience.The surveys are conducted by an independent thirdpartyfirminordertohaveopen&genuinefeedbackfrom the customer.
Customer Satisfaction Survey is conducted in twophasesforthevesselscontracted,oneonConstructionPhase(PhaseI)andoneaftercompletionofwarranty
period (Phase II). Phase I is intended for an interimfeedback during the ongoing construction stage,in order to identify any concerns from the Ownerduring the construction phase. This also helps Yardto understand the areaof concerns (if any), and caninitiateactionsappropriatelyforimprovementstothelevel ofOwnerexpectations.Phase II survey is afterthe delivery and the completion of warranty periodof the vessel where Owner would have sufficienttime to understand the performance & quality ofconstruction,whichwillprovideanoverallperspectiveoftheirsatisfactionforthenewbuildingcontracted&delivered.
Thesurveysconductedcoverallphasesofconstructionstarting from the pre-contract stage. Feedbacks arerequested from Owners regarding approachability,accessibility,qualityofconstruction,overall technicalcapabilitiesoftheYard&PostDeliveryservices.Theindependentagencysubmitsareportineachfinancialyear for the surveys conducted, and elaboratesregardingthefeedbacksfromvariousclients,specifyingthe areaswhere shipyard is performingwell& areaswhereimprovementsaresuggested.Thisindependentreportprovidesascopetounderstandthestrength&weaknessoftheYardfromtheOwnerperspective,andismuch helpfulwhile approaching the same client /similar clients.
Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle
1. List up to 3 of your products or services whose design has incorporated social or environmental concerns, risks and/or opportunities.
TheCompanyisengagedinthebusinessofShipbuildingand Shiprepair. As such the Company has only oneproduct, which has been designed to incorporatesocial or environmental concerns as well as benefitfromtheavailableopportunities.
2. For each such product, provide the following details in respect of resource use (energy, water, raw material etc.) per unit of product (optional):
(a) Reduction during sourcing / production / distribution achieved since the previous year throughout the value chain?
The company recognizes its commitmentto achieve economic development throughsustainable methods. This is proposed to beachieved through employment of appropriatetechnology, transparency in procurement andoutsourcing and participation in sustainabledevelopment programmes. The company
94 Cochin Shipyard Ltd
contributes immensely to the society throughits CSR initiatives in major areas of Education& Skill Development, Swachh Bharat Projects,Healthcare initiatives, Empowerment ofwomenanddifferentlyabledpersons.
(b) Reduction during usage by consumers (energy, water) has been achieved since the previous year?
CSL has implemented various energyconservation measure viz. installation of solarpower plant, electrification of new buildingsis carried out with LED lights instead ofconventional discharge lamps, replacement ofconventional discharge lamp street lights withLEDlightsetc.Energysavingsofapproximately10.93Lakhsunitsperannumhavebeenachievedwith the implementation ofmeasures specifiedabove.
3. Does the company have procedures in place for sustainable sourcing (including transportation)? If yes, what percentage of your inputs was sourced sustainably?
The Company has been following approvedcriteria for the selection of vendors to ensuresustainable sourcing which inter alia includesvendors having ISO 9000 certification, vendorsapprovedbyregulatorybodies,variousauthorizeddealers of the manufacturer, ability to providematerials as per laid down specification andotherrequirements,abilitytosupplymaterialsasperstipulateddeliveryperiod,annualevaluationof the orders placed on a vendor is completedto decide the average performance, a vendoris removed/suspended from approved vendorlist based on his average performance over theperiodofevaluation,vendorslistisreviewedandupdatedonceinayear.
4. Has the company taken any steps to procure goods and services from local and small producers, including communities surrounding their place of work? If yes, what steps have been taken to improve their capacity and capability of local and small vendors?
With a view to promote procurement/ availservices, through local and small producersand service providers including Micro Smalland Medium Enterprises (MSME), as per thePublicProcurementPolicy2012,promulgatedby the Government of India (GOI), theCompany attended Six Vendor DevelopmentProgrammes (VDPs) organized by the Dept.of MSME, GOI which included one conclave
onSC/STMSMEvendors,atBolgattyPalace,Cochin, on January 17, 2018, in which CSLrepresentative made a presentation on CSL’srequirement of product and services fromMSEs.Other notable event among the above6VDPswastheNationalVDPheldatThrissurfrom07 to09December2017, inwhichCSLputupa stallwhichwasdeclaredas thebeststall intheexhibitionandwaspresentedwithanawardinthatregard.
Inadditiontotheabove,CSLconductedamajorexhibition for the MSMEs named ‘LAGHUUDYOGEXPO-2017’onMay15and16,2017atMarineDriveGround,Ernakulum.Theexhibitionwas organisedwith the support ofDepartmentof Industries & Commerce, Govt. of Kerala andMSME Development Institute, Thrissur, andwas inaugurated by the Hon’ble Minister forIndustries,YouthandSportsAffairs,GovernmentofKerala.TheprogrammeconsistedofIndustrialExhibition & B2BMeet forMSMEs. The eventoffered meaningful platform for MSMEspredominantly from Kerala for showcasingtheir products/ services and for interacting/marketingwithprospectiveclients.MajorCentraland State PSUs of Kerala and banks activelyparticipatedintheprogram.80stallsand10B2Bmeetcounters/ roomswerearrangedatMarineDrive,Kochi inafullyair-conditionedexhibitionvenue.Further,thetwodayswereenrichedwithdifferent seminars and presentations byvariousMSMEs, industries & experts. No fees werecharged from the participants as well as fromvisitors of common public and CSL funded theentireexpenditure.
5. Does the company have a mechanism to recycle products and waste? If yes what is the percentage of recycling of products and waste (separately as <5%, 5-10%, >10%)?
Duetothenatureoftheproductsofthecompanyandthewastegenerated,mechanismtorecycleisnotavailable.However thewastesaredisposedoff through agencies dealing in such diposal orrecycling and approved by the Environmentalauthorities.
Principle 3: Businesses should promote the well being of all employees
1. Total number of employees: 1781 (permanent employees)
2. Total number of employees hired on temporary / contractual /casual basis: Average 2500 per day.
9546th Annual Report
3. The number of permanent women employees: 151
4. The number of permanent employees with disabilities: 58
5. Do you have an employee association that is recognized by management?: Yes, CSL has four employees association recognised by the Management.
6. What percentage of your permanent employees is members of this recognized employee association? : 72%
7. Number of complaints relating to child labour, forced labour, involuntary labour, sexual harassment in the last financial year and pending, as on the end of the year
Sl. No. Category No of complaints filed during the financial year No of complaints pending as on end of the financial year
1. ChildLabour/forcedLabour/involuntarylabour
TheCompanydoesnothirechildlabour,forcedlabourorinvoluntarylabour.NoCompliant. NotApplicable
2. Sexualharassment NoComplaintsreceived NotApplicable3. Discriminatory employment Nil Nil
8. What percentage of your under mentioned employees were given safety and skill upgradation training in the last year.
PermanentEmployees:100percent
PermanentWomenEmployees:100percent
Casual/Temporary/ContractualEmployees:100percent
EmployeeswithDisabilities:100percent
Principle 4: Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized.
1. Has the company mapped its internal and external stakeholders?
Yes,TheCompanyhasmappedits internalaswellasexternalstakeholders.
2. Out of the above, has the company identified the disadvantaged, vulnerable and marginalized stakeholders.
CSL’sCSRprojectsaimsatbenefitingthedisadvantaged,vulnerable and marginalised community who arepresentacrossKeralaparticularlyinremoterural/tribalcommunities.FurtherCSLensuresthatthereservationpolicy as advised by Govt of India is implemented.CSLisalsoinvolvedinimprovingthequalityoflifeofpersonsforwhomprojectsarespeciallydesigned.Thecompanyhasidentified(i)SC/ST(ii)Differentlyabledas disadvantaged, vulnerable and marginalized foremployment purpose.
3. Are there any special initiatives taken by the company to engage with the disadvantaged, vulnerable and marginalized stakeholders. If so, provide details thereof, in about 50 words or so.
CSL has made commitments for various projectsacrossKerala in itsCSRthrustareas, largelycateringto disadvantaged, vulnerable and marginalizedstakeholders viz. education, sanitation& smart classrooms for children, healthcare initiatives for tribalcommunities, several initiatives for differently abledpersons, empowerment of women through incomeenhancing skill development programs and otherinterventions in rural/tribal/semi-urban areas. Thecompany follows all the GOI regulations regardingreservationsforSC/STandDifferentlyabled.
Principle 5: Businesses should respect and promote human rights
1. Does the policy of the company on human rights cover only the company or extend to the Group/Joint Ventures/Suppliers/Contractors/NGOs/Others?
TheHumanresourcepoliciesoftheCompanycoverallaspectsofhumanrightsof itsemployeesandothersassociated with it for operation of its business andcovers human rights of employees of the subsidiaryalso. No complaints have been received in the pastfinancialyearonhumanrights.
The Company is committed to uphold and maintainthe dignity ofwomen employees and it has in placeapolicywhichprovides forprotectionagainstsexualharassmentofwomenatworkplaceandforpreventionand redressal of such complaints. During the yearunderreview,nosuchcomplaintwasreceived.
The Company is committed to comply with allhuman rights, practices across subsidiary and otherstakeholdersassociatedwiththeCompany.
2. How many stakeholder complaints have been received in the past financial year and what percent was satisfactorily resolved by the management?
96 Cochin Shipyard Ltd
During the year under review, no such complaintswerereceived.
Principle 6: Business should respect, protect, and make efforts to restore the environment
1. Does the policy related to Principle 6 cover only the company or extends to the Group/Joint Ventures/Suppliers/Contractors/NGOs/others.
Covers the Company. As a part of the integratedapproach of the Company, our commitment tothe mother nature is demonstrated through ourongoing effort to reduce the adverse impact onthe environment and reinforcing the positivecontribution.Westrivetoachievethisby identifyingthe significantenvironmental aspectsof its activitiesandproductsanddevelopingprogramsandprocessesto reduceor control themwith an aimofprotectingthe environment. The Company also persuades andencouragesitsbusinesspartners/vendors/contractorsto move towards environmental friendly processes,rightfromdesigntodisposal.
2. Does the company have strategies/ initiatives to address global environmental issues such as climate change, global warming, etc? If yes, please give hyperlink for webpage etc.
TheCompanyhasadetailedmanualwhichdescribethecommonprocedurestobeestablishedfortheeffectiveimplementation of the environmental managementsystemmeetingtherequirementsoftheinternationalstandardsISO14001:2004.
3. Does the company identify and assess potential environmental risks?
Yes
4. Does the company have any project related to Clean Development Mechanism? If so, provide details thereof, in about 50 words or so. Also, if Yes, whether any environmental compliance report is filed?
Presently,CSLdoesnothaveanyprojectunderCleanDevelopmentMechanism
5. Has the company undertaken any other initiatives on – clean technology, energy efficiency, renewable energy, etc. If yes, please give hyperlink for web page etc.
CSL has implemented various energy conservationmeasure viz. installation of solar power plant,electrification of new buildings is carried outwith LED lights instead of conventional dischargelamps, replacement of conventional discharge lampstreet lightswith LED lights etc. Energy savings ofapproximately 10.93 Lakhs units per annum have
beenachievedwiththeimplementationofmeasuresspecified above. The Company has undertakenvariousinitiativeslikeelectrificationofnewbuildingswith LED lights instead of conventional dischargelamps, replacement of conventional discharge lampstreetlightswithLEDlights.Theseinitiativesresultsin energy saving in approx. 10.93 Lakhs units perannum.
6. Are the Emissions/Waste generated by the company within the permissible limits given by CPCB/SPCB for the financial year being reported?
Yes
7. Number of show cause/ legal notices received from CPCB/SPCB which are pending (i.e. not resolved to satisfaction) as on end of Financial Year.
Infinancialyear2017-18,therearenopendingCPCB/SPCBshowcause/legalnotices.
Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner.
1. Is your company a member of any trade and chamber or association? If Yes, Name only those major ones that your business deals with:
(a) IndianShipbuildersAssociation
(b) IndoJapanChamberofCommerce
(c) ConfederationofIndianIndustry(CII)
(d) CochinChamberofCommerceandIndustry
(e) AllIndiaManagementAssociation
2. Have you advocated/lobbied through above associations for the advancement or improvement of public good? Yes/No; if yes specify the broad areas (drop box: Governance and Administration, Economic Reforms, Inclusive Development Policies, Energy security, Water, Food Security, Sustainable Business Principles, Others)
The above-mentioned organisations act as aplatformforCSLtoaddress issuesthatmight impactits stakeholders. CSL encourages participation inadvocatingpolicylevelprocessesratherthanlobbyingonanyspecificissues.
Principle 8: Businesses should support inclusive growth and equitable development
1. Does the company have specified programmes/initiatives/projects in pursuit of the policy related to Principle 8? If yes details thereof.
Asmentionedinthesectionsabove,CSL’sCSRprojectsaim at benefitting the community from low socio-economic strata, across the state of Kerala and are
9746th Annual Report
identifiedasvulnerable.Theseprojectsareattemptingforinclusivegrowth&equitabledevelopmentofsuchcommunities.
2. Are the programmes/projects undertaken through in-house team/own foundation/external NGO/government structures/any other organization?
CSL largely collaborates with various NGOs,foundations, government agencies, and otherprofessionalagenciesforexecutionoftheprojectontheground.
3. Have you done any impact assessment of your initiative?
Yes. Impact assessment is crucial to view the effectof the activity conducted. CSL conducts impactassessmentasapartoftheprojectforthemajorityofprojects.
4. What is your company’s direct contribution to community development projects- Amount in INR and the details of the projects undertaken.
In financial year 2017-18, the contribution tocommunity development projectswas` 8.57 crores.Please refer to theAnnual Report on CSRActivitiesformingpartofthisAnnualReport.
5. Have you taken steps to ensure that this community development initiative is successfully adopted by the community? Please explain in 50 words, or so.
Engagement of the community is paramount forsustaining any community development program onground.Weensureengagementofthecommunityatthe very planning stage and thereafter induct themat the implementation level. This not only ensuresacceptanceoftheprogrammeongroundbutalso itscontinuityandsustainability.
Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner
1. What percentage of customer complaints/consumer cases are pending as on the end of financial year.
The Company’s customers are large corporatehouses, corporations both national and internationalorMinistriesof theCentralGovernment.During theyearunderreviewtheCompanyhasnotreceivedanyComplaints.
All the contracted vessels are conducted with aCustomer Satisfaction Survey, and feedbacks aretakenfromOwnerswillingtosharetheirexperience.The surveys are conducted by an independent thirdpartyfirminordertohaveopen&genuinefeedbackfrom the customer.
Customer Satisfaction Survey is conducted in twophasesforthevesselscontracted,oneonConstructionPhase(PhaseI)andoneaftercompletionofwarrantyperiod (Phase II). Phase I is intended for an interimfeedback during the ongoing construction stage,in order to identify any concerns from the Ownerduring the construction phase. This also helps Yardto understand the areaof concerns (if any), and caninitiateactionsappropriatelyforimprovementstothelevel ofOwnerexpectations.Phase II survey is afterthe delivery and the completion of warranty periodof the vessel where Owner would have sufficienttime to understand the performance & quality ofconstruction,whichwillprovideanoverallperspectiveoftheirsatisfactionforthenewbuildingcontracted&delivered.
Thesurveysconductedcoverallphasesofconstructionstarting from the pre-contract stage. Feedbacks arerequested from Owners regarding approachability,accessibility,qualityofconstruction,overall technicalcapabilitiesoftheYard&PostDeliveryservices.Theindependentagencysubmitsareportineachfinancialyear for the surveys conducted, and elaboratesregardingthefeedbacksfromvariousclients,specifyingthe areaswhere shipyard is performingwell& areaswhereimprovementsaresuggested.Thisindependentreportprovidesascopetounderstandthestrength&weaknessoftheYardfromtheOwnerperspective,andismuch helpfulwhile approaching the same client /similar clients.
2. Does the company display product information on the product label, over and above what is mandated as per local laws? Yes/No/N.A. /Remarks(additional information)
Not Applicable as it engages in Shipbuilding andShiprepairoperations.
3. Is there any case filed by any stakeholder against the company regarding unfair trade practices, irresponsible advertising and/or anti-competitive behaviour during the last five years and pending as on end of financial year. If so, provide details thereof, in about 50 words or so.
NocaseshavebeenfiledbyanystakeholdersagainsttheCompany regardingunfair tradepracticesduringtheyearunderreview.
4. Did your company carry out any consumer survey/ consumer satisfaction trends?
No.TheCompany, however, ensure that complaints,if any, received from any stakeholders are promptlyattendedto.
98 Cochin Shipyard Ltd
REPORT On CORPORATE gOVERnAnCE
Company’s Philosophy on Corporate Governance
1. CochinShipyardrecognizestheimportanceofCorporateGovernancetoemergeasamodelcorporate.TheCompanyhasadoptedpoliciesandprocedureswhichareaimedateffectivelydischargingitsresponsibilitiestovariousstakeholdersviz.shareholders,creditors,customers,employeesandsocietyatlarge.CSLstronglybelievesthattheCompanycanemergeasastronggloballeaderonlybyfollowinggood&soundCorporateGovernanceprinciples.TheCompanyhasbeenrated‘Excellent’inCorporateGovernancepracticesaspertheevaluationcriteriaprescribedbytheDepartmentofPublicEnterprisesconsistentlyforthelastseveralyears.
Board of Directors
2. TheBoardofDirectorsofCochinShipyardLimitedplaysapivotalroleinensuringgoodCorporateGovernance.ThecompositionoftheBoardoftheCompanyisgovernedbytheprovisionsoftheCompaniesAct,2013(“theAct”)andtheSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015(the“ListingRegulations”).TheBoardcomprisesofanoptimummixofExecutiveandNon-ExecutiveDirectors.TheBoardhasonewomandirector.HalfoftheBoardcomprisesofIndependentDirectors.ThecompositionoftheBoardasonMarch31,2018isasfollows:-
Sl. No. Name of Director Director Identification
Number (DIN) Category of Directorship
1 ShriMadhuSNair,Chairman&ManagingDirector 07376798 ExecutiveDirector
2 ShriDPaulRanjan,Director(Finance) 06869452 ExecutiveDirector
3 ShriSureshBabuNV,Director(Operations) 07482491 ExecutiveDirector
4 ShriSatinderPalSinghIPS* 07490296 OfficialPartTime(Nominee)Director,GovernmentofIndia
5 ShriEliasGeorgeIAS(Retd.) 00204510 OfficialPartTime(Nominee)Director,Government of Kerala
6 Smt.RoopaShekharRai 07565156 NonOfficialPartTime(Independent)Director7 ShriRadhakrishnaMenon 07518727 NonOfficialPartTime(Independent)Director8 Adv.KrishnaDasE 02731340 NonOfficialPartTime(Independent)Director9 ShriJijiThomsonIAS(Retd.)** 01178227 NonOfficialPartTime(Independent)Director10 ShriPradiptaBanerji** 00630615 NonOfficialPartTime(Independent)Director11 ShriNandaKumaranPuthezhath** 02547619 NonOfficialPartTime(Independent)Director
*TheMinistryofShipping,videletterF.No.SY-11012/1/2017-CSLdatedOctober04,2017appointedShriSatinderPalSinghIPS,JointSecretary(Shipping)asOfficialPartTime(Nominee)DirectorofCSL,inplaceofShriPravirKrishnaIAS.
**MinistryofShippingvideletterF.No.SY-11012/1/2016-CSLdatedJuly15,2017appointedShriJijiThomsonIAS(Retd.),ShriPradiptaBanerjiandShriNandaKumaranPuthezhathasNonOfficialPartTime(Independent)Directors.
3. DisclosureofrelationshipbetweenDirectorsinter-se: Nil
4. NoneofthedirectorsoftheCompanyweremembersinmorethantencommitteesoractasChairpersonofmorethanfivecommitteesacrossalllistedentitiesinwhichheisaDirector.NoneoftheIndependentDirectorsoftheCompanyhelddirectorshipsinmorethansevenlistedcompanies.
9946th Annual Report
5. TheCompaniesAct,2013readwithrelevantRulesmadethereunder,facilitatestheparticipationoftheDirectorintheBoard/Committeemeetingsthroughvideoconferencing.Thedirectorsviz.,ShriPravirKrishnaIASandShriSatinderPalSinghIPShaveavailedthefacilityduringtheperiod.
6. ThemeetingsoftheBoardofdirectorsandcommitteeshavebeenconducted inthemannerasspecified inListingRegulationsandCompaniesAct,2013.
Attendance of Directors at Board Meetings and last Annual General Meeting (AGM)
7. TenBoardMeetingswereheldduringtheyearunderreview.DetailsofattendanceofDirectorsattheBoardMeetingsandAGMheldduring2017-18aregivenbelow
Name of Director2017 2018 AGM
Jul 17, 2017
Apr 27
May 11
Jun 10
Jul 17
Jul 21
Aug 04
Sep 11
Nov 10
Feb 05
Feb 22
ShriMadhuSNair Y Y Y Y Y Y Y Y Y Y YShriPravirKrishnaIAS* @ @ @ - Y - - NA NA NA -ShriSatinderPalSinghIPS NA NA NA NA NA NA NA - Y @ NAShriEliasGeorgeIAS(Retd.) - - - - Y - - - - - -ShriDPaulRanjan Y Y Y Y Y Y Y Y Y Y YShriSunnyThomas** Y Y Y Y Y Y Y Y NA NA YShriSureshBabuNV Y Y Y Y Y Y Y Y Y Y YSmt.RoopaShekharRai Y Y Y Y Y Y Y Y Y Y YShriRadhakrishnaMenon Y Y Y Y Y Y Y Y Y Y YAdv.KrishnaDasE Y Y - Y Y Y Y Y Y Y YShriJijiThomsonIAS(Retd.) NA NA NA - Y Y Y Y Y Y -ShriPradiptaBanerji NA NA NA - Y Y Y - Y Y -ShriNandaKumaranPuthezhath NA NA NA - Y Y Y Y Y Y -
@attendedthroughvideoconferencing *ShriPravirKrishnaIAS,ceasedtobeDirectoroftheCompanywitheffectfromOctober04,2017.**ShriSunnyThomas,superannuatedfromtheservicesoftheCompanyonNovember30,2017.
Other Directorships and Committee positions:
8. ThetotalnumberofDirectorship(s)heldbyDirectorsandthepositionsofMembership/ChairmanshiponCommittees,asonMarch31,2018aregivenbelow:
Name of the Director No. of other Directorship in other public
limited companiesOther Board Committee positions held in
other public limited companiesChairman Member Chairman Member
ShriMadhuSNair 1 - - -ShriSatinderPalSinghIPS - 3 - 2ShriEliasGeorgeIAS(Retd.) - 1 - -ShriDPaulRanjan - 1 - -ShriSureshBabuNV - 1 - -Smt.RoopaShekharRai - - - -ShriRadhakrishnaMenon - - - -Adv.KrishnaDasE - - - -ShriJijiThomsonIAS(Retd.) - - - -ShriPradiptaBanerji - - - -ShriNandaKumaranPuthezhath - 3 2 -
• TheDirectorshipsheldbyDirectorsasmentionedabovedoesnotincludeAlternateDirectorshipsandDirectorshipsinPrivateLimitedCompanies,ForeignCompaniesandCompaniesregisteredundersection8oftheCompaniesAct,2013.
• Memberships/ Chairmanships of only theAudit Committees and Stakeholders Relationship Committees of allPublicLimitedCompaniesandGovernmentCompanieshavebeenconsidered.
100 Cochin Shipyard Ltd
9. None of the Directors are inter-se related to eachother.
10. Noneof theDirectorsexcept the followingholdanysharesintheCompanyasonMarch31,2018:
Name of the Director No. of Equity Shares HeldAdv.KrishnaDasE 100ShriRadhakrishnaMenon 30
Independent Directors
11. Independent Directors have been appointed by theMinistryofShipping,Governmentof Indiaforatermof 3 years. The main terms of appointment can beaccessedathttp://www.cochinshipyard.com/dir.htm
12. Familiarizationprogrammefor IndependentDirectorsgenerally form part of the Board process. TheIndependent Directors are updated on an on-goingbasisattheBoard/Committeemeetings,inter-alia,onthefollowing:
– NatureofindustryinwhichtheCompanyoperates;
– Business environment and operational modelof various business divisions of the Companyincludingimportantdevelopmentsthereon;
– Important changes in regulatory frameworkhavingimpactontheCompany.
13. Details of the familiarization programme forIndependentDirectorscanbeaccessedathttp://www.cochinshipyard.com/links/familiarisation%20new.pdf
Meetings of Independent Directors14. AccordingtoScheduleIVtotheCompaniesAct,2013
a separate meeting of the Independent Directorsof the Company was held on February 22, 2018whichwasattendedbyalltheNonOfficialPartTime(Independent)Directors,viz.,Smt.RoopaShekharRai,ShriRadhakrishnaMenon,ShriKrishnaDasE,ShriJijiThomson IAS (Retd.), Shri Pradipta Banerji and ShriNandaKumaranPuthezhath.
Availability of information to the members of the Board15. The Board has complete access to any information
within the Company and to any employee of theCompany. The Board welcomes the presence ofexecutives in the BoardMeetings, who can provideadditional insights into the issuesbeingdiscussed inthemeeting.TheinformationnormallyrequiredtobeplacedbeforetheBoardincludethefollowing:a) Tomakecallsonshareholdersinrespectofmoney
unpaidonshares.b) Toauthorizebuy-backofsecurities.c) Toissuesecuritiesincludingdebentures,inIndia
orabroad.
d) Toborrowmonies.
e) Toinvestfundsofthecompany.
f) To grant loans or give guarantee or providesecurity in respect of loans.
g) ToapprovefinancialstatementandBoard’sReport.
h) Todiversifythebusinessofthecompany.
i) To approve amalgamation, merger orreconstruction.
j) Totakeoveracompanyoracquireacontrollinginterestorsubstantialstakeinanothercompany.
k) Toappointor removekeymanagerialpersonnel(KMP).
l) Toappointinternalauditorandsecretarialauditor.
m) GeneralnoticesofinterestofDirectors.
n) TermsofreferenceofBoardCommittees.
o) Minutes of meetings of Audit Committee andother Committees of the Board, resolutionspassed by circulation and also the minutes ofBoardmeetingofsubsidiarycompany.
p) Annual operating plans of businesses, capitalbudgetsandanyupdates.
q) Quarterly results of the Company and itsoperatingdivisionsorbusinesssegments.
r) Declarationofdividend.
s) Saleofmaterialnatureofinvestmentsandassets,whichisnotinnormalcourseofbusiness.
t) Quarterlydetailsof foreignexchangeexposuresandthestepstakenbythemanagementtolimittherisksofadverseexchangeratemovement, ifmaterial.
u) Internalauditfindingsandexternalauditreports(throughtheAuditCommittee).
v) Statusofbusinessriskexposures,itsmanagementandrelatedactionplans.
w) Details of any joint venture or collaborationagreement.
x) Show cause, demand, prosecution notices andpenaltynoticeswhicharemateriallyimportant.
y) Fatalorseriousaccidents,dangerousoccurrences,anymaterialeffluentorpollutionproblems.
z) Allpolicymattersdeliberatedandintroducedforimplementation.
aa) Any material default in financial obligations toandbytheCompany,orsubstantialnon-paymentforgoodssoldbytheCompany.
10146th Annual Report
bb) Any issue which involves possible public orproduct liability claims of substantial nature,includinganyjudgmentororder,whichmayhavepassedstricturesontheconductoftheCompanyor taken an adverse view regarding anotherenterprisethatcanhavenegativeimplicationsonthe Company.
cc) Theinformationonrecruitmentandremunerationof senior officers just below the Board levelincluding appointment or removal of ChiefFinancialOfficerandtheCompanySecretary.
dd) Non-compliance of any regulatory, statutory orlisting requirements and shareholders servicesuchasnon-paymentofdividend,delayinsharetransfer etc.
ee) Significant labour problems and their proposedsolutions.AnysignificantdevelopmentinHumanResources / Industrial Relations front likeimplementationofVoluntaryRetirementScheme(VRS),etc.
ff) Capitalbudgetsandanyupdates.gg) Transactions that involve substantial payment
towards goodwill, brand equity, or intellectualproperty.
hh) Quarterlydetailsofforeignexchangeexposuresandthestepstakenbymanagementtolimittherisksofadverseexchangeratemovement,ifmaterial.
Board material distributed in advance
16. Notice of each Board Meeting and CommitteeMeeting is sent to all the members not less thanseven days in advance exceptwhen it is convenedas emergency meeting. The agenda notes for eachBoard/Committeemeeting isdrafted inconsultationwiththeChairmanandarecirculatedtotheDirectorsnotlessthansevendaysinadvanceexceptwhenitisconvenedasemergencymeetingwiththeconcurrenceof all Board/Committee members. All materialinformation is incorporated in the agenda papersfor facilitating meaningful and focused discussionsatthemeeting.Whereit isnotpracticabletoattachany document to the agenda, the same is tabled atthemeetingwithspecificreferencetothesubjectintheagenda.Inspecialandexceptionalcircumstances,additionalorsupplementaryitem(s)ontheagendaarepermittedwiththeconsentofallDirectorspresentatthemeeting.
Recording Minutes of proceedings at Board and Committee meeting
17. The Company Secretary records the minutes of theproceedingsofeachBoardandCommitteemeetings.
DraftminutesarecirculatedtoallthemembersoftheBoard/Committee for their comments within fifteendays from the conclusion of the Meeting. The finalminutesareenteredintheminutebookwithin30daysfromconclusionofthemeeting.
Post Meeting Follow-up Mechanism
18. The important decisions taken at the Board/Committeemeetings are promptly communicated tothe departments/divisions concerned. Action takenreport on the decisions/minutes of the previousmeeting(s) is placed at the immediately succeedingmeetingoftheBoard/Committee.
Compliance
19. The Company Secretarywhile preparing the agendanotes,minutesetc.ofthemeeting(s)isresponsibleforandisrequiredtoensureadherencetoalltheapplicablelaws and regulations including the Companies Act,2013 readwith the Rules issued thereunder as alsothe Secretarial Standards issued by the Institute ofCompany Secretaries of India and notified by theGovernmentofIndia.
Board Committees
20. During the financial year 2017-18, the Board ofCSL had eight Committees viz. Audit Committee,Nomination&RemunerationCommittee,Contracts&CapexCommittee,CorporateSocialResponsibilityandSustainable Development Committee, StakeholdersRelationship Committee, Committee for NewTechnology, Strategy and New Initiatives, ShareAllotmentCommitteeandShareTransferCommittee.
Audit Committee
21. TheAuditCommitteeofCSLwasformedonAugust21,2008andwasreconstitutedonSeptember21,2012,December 13, 2012, March 30, 2015 and May 07,2016.ThepresentAuditCommitteewasconstitutedvideCircularResolutionNo.CR03/2017adoptedonAugust30,2017.
Terms of reference of Audit Committee
22. ThefollowingarethetermsofreferenceoftheAuditCommittee:
(i) Oversightofthelistedentity’sfinancialreportingprocess and the disclosure of its financialinformationtoensurethatthefinancialstatementiscorrect,sufficientandcredible;
(ii) Recommendationforappointment,remunerationand terms of appointment of auditors of ourCompany based on the order of Comptroller &AuditorGeneralofIndia;
102 Cochin Shipyard Ltd
(iii) Approvalofpaymenttostatutoryauditorsforanyotherservicesrenderedbythestatutoryauditors;
(iv) Reviewing, with the management, the annualfinancialstatementsandauditor’sreportthereonbeforesubmissiontotheBoardforapproval,withparticularreferenceto:
(a) Matters required to be included in thedirector’s responsibility statement to beincluded in the Board’s report in terms ofclause (c)of sub-section (3)of section134oftheCompaniesAct,2013;
(b) Changes, if any, in accounting policies andpracticesandreasonsforthesame;
(c) Major accounting entries involvingestimatesbasedontheexerciseofjudgmentbymanagement;
(d) Significantadjustmentsmadeinthefinancialstatementsarisingoutofauditfindings;
(e) Compliance with listing and other legalrequirementsrelatingtofinancialstatements;
(f) Disclosureofanyrelatedpartytransactions;
(g) Modifiedopinion(s)inthedraftauditreport;
(v) Reviewing,with themanagement, the quarterlyfinancial statements before submission to theBoardforapproval;
(vi) Reviewing,withthemanagement,thestatementof uses/application of funds raised through anissue(publicissue,rightsissue,preferentialissue,etc.),thestatementoffundsutilizedforpurposesother than those stated in theofferdocument/prospectus/notice and the report submitted bythemonitoringagency,monitoringtheutilisationofproceedsofapublicorrightsissue,andmakingappropriate recommendations to the Board totakeupstepsinthismatter;
(vii) Reviewing and monitoring the auditor’sindependence and performance, andeffectivenessofauditprocess;
(viii) Approval or any subsequent modification oftransactionsofourCompanywithrelatedparties;
(ix) Scrutinyofinter-corporateloansandinvestments;
(x) Valuation of undertakings or assets of ourCompany,whereveritisnecessary;
(xi) Evaluationof internalfinancial controls and riskmanagementsystems;
(xii) Reviewing, with the management, performanceof statutory and internal auditors, adequacy oftheinternalcontrolsystems;
(xiii)Reviewing the adequacy of internal auditfunction, if any, including the structure of theinternalauditdepartment,staffingandseniorityoftheofficialheadingthedepartment,reportingstructure coverage and frequency of internalaudit;
(xiv) Discussionwithinternalauditorsofanysignificantfindingsandfollowupthereon;
(xv) Reviewing the findings of any internalinvestigationsbytheinternalauditorsintomatterswherethereissuspectedfraudorirregularityora failure of internal control systems of a material natureandreportingthemattertotheBoard;
(xvi) Discussion with statutory auditors before theauditcommences,aboutthenatureandscopeofauditaswellaspost-auditdiscussiontoascertainanyareaofconcern;
(xvii)To look intothereasonsforsubstantialdefaultsin the payment to the depositors, debentureholders,shareholders(incaseofnon-paymentofdeclareddividends)andcreditors;
(xviii)To review the functioning of the whistle blowermechanism;
(xix) Approvalofappointmentofchieffinancialofficerafterassessingthequalifications,experienceandbackground,etc.ofthecandidate;
(xx) Reviewthefollowinginformation:
(a) Management discussion and analysis offinancialconditionandresultsofoperations;
(b) Statement of significant related partytransactions (as defined by the auditcommittee),submittedbymanagement;
(c) Management letters/letters of internalcontrolweaknessesissuedbythestatutoryauditors;
(d) Internal audit reports relating to internalcontrolweaknesses;and
(e) The appointment, removal and terms ofremuneration of the chief internal auditorshall be subject to review by the auditcommittee;
(f) Statementofdeviations:
(a) Quarterly statement of deviation(s)includingreportofmonitoringagency,if applicable, submitted to stockexchange(s)intermsofregulation32(1)oftheSEBIListingRegulations;and
10346th Annual Report
(b) Annual statement of funds utilized for purposes other than those stated in the offer document/prospectus/noticeintermsofregulation32(7)oftheSEBIListingRegulations.
(xxi) ToreviewthefollowupactionontheauditobservationsoftheC&AGaudit;(xxii)Recommendtheappointment,removalandfixingofremunerationofCostAuditorsandSecretarialAuditors;
and(xxiii)CarryingoutanyotherfunctionasspecifiedbytheBoardfromtimetotime.
Powers of the Audit Committee
23. TheCommitteeisentrustedwiththefollowingpowers:(a) Toinvestigateanyactivitywithinitstermsofreference;(b) Toseekinformationonandfromanyemployee;(c) Toobtainoutsidelegalorotherprofessionaladvice,subjecttotheapprovaloftheBoardofDirectors;and(d) Tosecureattendanceofoutsiderswithrelevantexpertise,ifitconsidersnecessary.
24. TherecommendationsoftheAuditCommitteeonanymatterrelatingtothefinancialmanagement,includingtheauditreport,shallbebindingontheBoard.
25. IftheBoarddoesnotaccepttherecommendationsoftheAuditCommittee,itshallrecordthereasonsthereofandcommunicatesuchreasonstotheshareholders.
Constitution
26. AsonMarch31,2018,theAuditCommitteeisconstitutedwithShriRadhakrishnaMenon,NonOfficialPartTime(Independent)DirectorasChairman,ShriKrishnaDasE,NonOfficialPartTime(Independent)Director,andShriNandaKumaranPuthezhath,NonOfficialPartTime(Independent)Directorasmembers.
27. AuditCommitteemeetingsarealsoattendedbyDirector(Finance),representativesofSecretarialAuditors,StatutoryAuditorsandInternalAuditorsoftheCompanyasinvitees.TheInternalAuditfunctionhasbeenoutsourcedtoafirmofCharteredAccountants.TheCompanySecretaryactsastheSecretarytotheCommittee.
Audit Committee meetings held during 2017-18 and attendance:
28. TheCommitteemetsixtimesduringtheyear2017-18onMay11,2017,June10,2017,July17,2017,September11,2017,November10,2017andFebruary05,2018.Thenecessaryquorumwaspresentat thesemeetings.Theattendanceduringthesemeetingswereasfollows:
Name of the Director May 11, 2017
Jun 10, 2017
Jul 17, 2017
Sep 11, 2017
Nov 10, 2017
Feb 05, 2018
ShriRadhakrishnaMenon
ShriKrishnaDasE
ShriEliasGeorge,IAS(Retd.) × × × NA NA NAShriNandaKumaranPuthezhath NA NA NA
Nomination & Remuneration Committee
29. The Nomination & Remuneration Committee of Cochin Shipyard Limited was constituted vide CircularResolution adopted on December 13, 2008 and was reconstituted on May 13, 2014, March 30, 2015, May07,2016,andonMay06,2018.
Terms of reference
30. ThefollowingaretermsofreferenceoftheNomination&RemunerationCommittee:
(i) Decide on the annual bonus/ performance pay/ variable pay pool and policy for its distribution across theexecutivesandnon-unionizedsupervisorsofourCompany;
(ii) Formulation andmodification of schemes for providing perks and allowances for officers and non-unionizedsupervisors;
104 Cochin Shipyard Ltd
(iii) Any new scheme of compensation like medicalscheme, pension etc. to officers, non-unionizedsupervisorsandtheemployeesas thecasemaybe;and
(iv) Exercisingsuchotherrolesassignedto itbytheprovisionsoftheSEBIListingRegulationsandanyother laws and their amendments fromtime totime.
Constitution
31. AsonMarch31,2018,theCommitteecomprisesofShriKrishnaDasE,NonOfficial PartTime (Independent)Director as Chairman, Shri Elias George IAS (Retd.),Official Part Time (Nominee) Director, Smt. RoopaShekhar Rai, Non Official Part Time (Independent)Director,asmembers.
Nomination & Remuneration Committee meetings held during 2017-18 and attendance:
32. Threemeetings of theNomination& RemunerationCommittee were held during 2017-18 on May11,2017,September27,2017andFebruary05,2018. The necessary quorumwas present at thesemeetings. The attendance during these meetingswereasfollows:
Sl No
Name of the Member
May 11, 2017
September 27, 2017
February 05, 2018
1 Shri Krishna DasE
2 ShriEliasGeorgeIAS(Retd.)
× × ×
3 Smt. Roopa ShekharRai
Remuneration Policy
33. Under Article 21(a) of the Articles of Associationof the Company, the Directors shall be paid suchremunerationasthePresidentofIndiamayfromtimetotimedetermine.ThepayandallowancesofBoardlevelexecutives are paid in accordancewith the terms ofappointment,DepartmentofPublicEnterprises(DPE)Guidelines on the above subject and other benefitsandperquisites in accordancewith the rules ofCSL.TheremunerationofbelowBoardlevelexecutivesandnon-unionized supervisors is as per DPE guidelinesand as approvedby administrativeministry (MinistryofShipping).Theremunerationofworkersareasperthe long term settlement between themanagementandrecognizedtradeunions.
34. Details of Remuneration paid to the Chairman &ManagingDirectorandtheWholeTimeDirectorsareplacedatEnclosure I to this report.
Sitting fees
35. The Non Official Part Time (Independent) Directorsare paid sitting fees at the rate of ` 15,000/- forattending each meeting of the Board or Committeethereof. The Official Part Time (Nominee) Directorsarenotpaidanyremuneration.ThecriteriaformakingpaymenttoNon-ExecutiveDirectorsisavailableintheCompany’swebsiteatthefollowinglink:https://www.cochinshipyard.com/dir.htm.
36. SittingfeespaidtotheNonOfficialPartTimeDirectorsfor2017-18areasfollows:
SlNo Name Fees(in`)
1 ShriRadhakrishnaMenon 3,30,000
2 ShriKrishnaDasE 2,70,000
3 Smt.RoopaShekharRai 2,85,000
4 ShriJijiThomsonIAS(Retd.) 1,05,000
5 ShriPradiptaBanerji 75,000
6 ShriNandaKumaranPuthezhath 1,50,000
37. Since the Non Official Part Time (Independent)DirectorsareappointedbythePresidentofIndia,theevaluation of performance of such Directors is alsodonebytheGOI.
Stakeholders Relationship Committee
38. In connection with the proposals for IPO and listingofequitysharesofCSL, theStakeholdersRelationshipCommittee, a sub-Committee of the Board wasconstituted vide resolution no 227/08 at the 227thBoardMeetingheldonSeptember20,2016.ThepresentCommitteewasconstitutedvideCircularResolutionNo.CR03/2017adoptedonAugust30,2017.
Terms of reference
39. FollowingisthetermsofreferenceoftheStakeholdersRelationshipCommittee:
(i) The Stakeholder Relationship Committee shallconsiderandresolvethegrievancesofthesecurityholdersof the listedentity including complaintsrelatedtotransferofshares,non-receiptofannualreportandnon-receiptofdeclareddividends.
Constitution
40. AsonMarch31,2018,theCommitteecomprisesofShriKrishnaDasE,NonOfficial PartTime (Independent)Director asChairmanof theCommittee, ShriDPaulRanjan,Director (Finance)andShriSureshBabuNV,Director(Operations),asmembers.
10546th Annual Report
Stakeholders Relationship Committee meetings held during the year and attendance:
41. Nomeetingwasconductedduringtheyear2017-18.
Name, designation and address of the Compliance Officer
Smt. Kala VCompanySecretary&ComplianceOfficerAdministrativeBuilding,CochinShipyardLimited,Perumanoor,Kochi, Kerala–682015Tel:+91(484)2501306,Fax:+91(484)2384001 Email:[email protected]:www.cochinshipyard.com
Status of Investor Complaints as on March 31, 2018 and reported under Regulation 13(3) of the Listing Regulations is as under:
ComplaintsasonApril01,2017 0Receivedduringtheyear 397Resolvedduringtheyear 396Notsolvedtothesatisfactionofshareholders 0PendingasonMarch31,2018 1
Contracts & Capex Committee
42. TheContractsCommitteeoftheBoardwasconstitutedvidecircularresolutionno01/2010adoptedonMarch09, 2010. The Capex Committee of the Board wasconstitutedvideCircularResolutionNo.CR07/2012and adopted at the 203rd Board Meeting held onDecember13,2012.TheCompanydecidedtomergeContracts Committee and Capex Committee andfurtheritwasnamedasContracts&CapexCommittee.TheContracts&CapexCommitteewasre-constitutedvide Circular ResolutionNo.01/2014 passed on July05, 2014, Circular Resolution No.02/2015 adoptedonMarch 30, 2015 and Circular Resolution No. CR03/2017 adopted on August 30, 2017 and CircularResolution No.CR 02/2018 adopted on May 06,2018.ThepresentCommitteewasconstitutedbywayof Circular Resolution No. CR 02/2018 adopted onMay06,2018.
Terms of reference43. The following are the terms of reference of the
Contracts&CapexCommittee:
(a) Examine and recommend the annual capitalbudget.
(b) QuarterlyreviewandreporttoBoardoncapitalprojects.
(c) Quarterly review and report to Board onshipbuildingprojects.
(d) To advise on various business models adoptedin thecourseofoperationssuchasMOUs,JVs,SPVs,worksharearrangementetc.
(e) Toreviewproposalsforamendmenttocontractsduring the pendency of shipbuilding projectswhich has a financial implication above 10%of the contractual value and make suitablerecommendationstotheBoard.
(f) AnyothermatterthatmaybereferredtoitfromtimetotimebyCMD,CSL.
Constitution
44. AsonMarch31,2018, theCommitteecomprisesofShriJijiThomson,NonOfficialPartTime(Independent)Director as Chairman, Shri D Paul Ranjan, Director(Finance) and ShriNanda Kumaran Puthezhath,NonOfficialPartTime(Independent)Director,asmembers.
Contracts & Capex Committee meetings held during the year and attendance:
45. One meeting of Contracts & Capex Committeewas held during 2017-18 on November 10, 2017.The necessary quorumwas present at the meeting.Theattendanceduringthemeetingwasasfollows:
Sl No Name of the Member November 10, 20171 ShriJijiThomson 2 ShriDPaulRanjan 3 ShriSunnyThomas*
4 ShriNandaKumaranPuthezhath
*ShriSunnyThomas,superannuatedfromtheservicesoftheCompanyonNovember30,2017.
Corporate Social Responsibility & Sustainable Development (CSR & SD) Committee46. A Sub-committee of the Board was constituted vide
resolutionno181/09atthe181stmeetingoftheBoardheldonSeptember05,2008todecideonthemattersrelatingtoCorporateSocialResponsibilityinCPSEs.
47. The Sustainable Development Committee wasconstituted at the 197th Board Meeting heldon November 23, 2011. The DPE vide OM No.3(9)/2010-DPE(MoU)datedSeptember23,2011hasissueddetailedguidelinesonSustainableDevelopmentinCPSEs.
48. Company decided to merge the CorporateSocial Responsibility Committee and SustainableDevelopmentCommitteetodecidethemattersrelatingtoCSRactivitiesinlinewiththeguidelineslaiddownunderScheduleVIIof theCompaniesAct2013.Thepresent CSR & SD Committeewas constituted videCircularResolutionNo.CR/02/2018adoptedonMay06,2018.
106 Cochin Shipyard Ltd
Terms of reference
49. ThefollowingarethetermsofreferenceoftheCorporateSocialResponsibility&SustainableDevelopmentCommittee:(i) RecommendCSRandsustainabilitydevelopmentpolicytotheBoard;(ii) Recommendplanofactionandprojectstobeinitiatedintheshort,mediumandlongtermforCSRandsustainability
development;(iii) TorecommendtheannualCSRandsustainabilitydevelopmentplanandbudget;and(iv) PeriodicreviewofCSRandsustainabilitydevelopmentpolicy,plansandbudgets.
Constitution
50. AsonMarch31,2018,theCommitteecomprisesofSmt.RoopaShekharRai,NonOfficialPartTime(Independent)DirectorasChairpersonoftheCommittee,ShriRadhakrishnaMenon,NonOfficialPartTime(Independent)DirectorandShriDPaulRanjan,Director(Finance)asmembers.
CSR & SD Committee meetings held during the year and attendance
51. SixmeetingsofCSR&SDCommitteewereheldduringtheyear2017-18onApril27,2017,May11,2017,September11,2017,November10,2017,January09,2018andMarch22,2018.Theattendanceduringthesemeetingswereasfollows:
Sl. No. Name of Director Apr 27 2017
May 11 2017
Sep 11 2017
Nov 10 2017
Jan 09 2018
Mar 22 2018
1 Smt.RoopaShekharRai
2 ShriRadhakrishnaMenon
3 ShriDPaulRanjan
4 ShriSunnyThomas* NA NA
*ShriSunnyThomas,superannuatedfromtheservicesoftheCompanyonNovember30,2017.
Committee for New Technology, Strategy and New Initiatives
52. The Committee for New Technology, Strategyand New Initiatives was constituted vide CircularResolutionNo. CR 03/2017 adopted onAugust 30,2017andwas reconstitutedvideCircularResolutionNo.CR/02/2018adoptedonMay06,2018.
Terms of reference
53. FollowingisthetermsofreferenceoftheCommitteeforNewTechnology,StrategyandNewInitiatives:
(i) The Committee shall deliberate on adoption ofnewtechnology,strategiesandnewinitiatives.
Constitution
54. AsonMarch31,2018,theCommitteecomprisesofShriPradiptaBanerji,NonOfficialPartTime(Independent)Director as Chairman of the Committee and ShriJiji Thomson, Non Official Part Time (Independent)Director,asmember.
Meetings of the Committee for New Technology, Strategy and New Initiatives held during the year and attendance:
55. Nomeetingwasconductedduringtheyear2017-18.
Share Allotment Committee
56. The ShareAllotment Committee of Cochin ShipyardLimitedwasconstitutedvideResolutionNo.236/05atthe236thBoardMeetingheldonAugust04,2017asonetimecommitteeforthepurposeofallotmentofequitysharespursuanttoInitialPublicOffer (IPO)ofthe Company.
Terms of reference
57. The Share Allotment Committee was authorised totakeallthenecessarysteps,actionsanddecisionsasrequiredinconnectionwiththeissueandallotmentofEquitySharestothesubscribersintheIPOtransactionoftheCompanyandtodoallsuchacts,deeds,mattersandthingsandtofinaliseandexecuteallsuchdeeds,documentsandwritingsasitmaydeemnecessaryorexpedientinthisregard.
Constitution58. The Committee comprised of Shri Madhu S Nair,
Chairman&ManagingDirector, Shri.D Paul Ranjan,Director (Finance), Shri Sunny Thomas, Director(Technical) and Shri Suresh Babu N V, Director(Operations)asmembers.
10746th Annual Report
Share Allotment Committee meetings held during 2017-18 and attendance:59. TheShareAllotmentCommitteemeetingwasheldon
August09,2017.Thenecessaryquorumwaspresentat the meeting. The attendance during the meetingwasasfollows:
Sl No Name of the Member Aug 09, 20171 ShriMadhuSNair
2 ShriDPaulRanjan
3 Shri Sunny Thomas
4 ShriSureshBabuNV
Share Transfer Committee
60. The Share Transfer Committee of Cochin ShipyardLimitedwasconstitutedvideResolutionNo.237/19Batthe237thBoardMeetingheldonSeptember11,2017.
Terms of reference
61. The following are terms of reference of the ShareTransferCommittee:(i) Toapprovesharetransfersinphysicalmode;(ii) Toapprovesharetransmissions;(iii) To approve dematerialisation of shares and
rematerialisation of shares and to issue sharecertificatesthereafter;
(iv) Toissueduplicatesharescertificates;(v) To approve format of new share certificates,
printingofblanksharecertificatesasandwhenrequired;and
(vi) To approve and issue fresh share certificatebyway of split or consolidation of the existingcertificateorinanyothermanner.
Constitution
62. AsonMarch31,2018, theCommitteecomprisesofShriDPaulRanjan,Director(Finance)andShriSureshBabuNV,Director(Operations)asmembers.
Share Transfer Committee meetings held during 2017-18 and attendance:
63. TwomeetingsoftheShareTransferCommitteewereheldduring2017-18onJanuary08,2018andJanuary23, 2018. Necessary quorum was present at thesemeetings.Theattendanceduringthesemeetingswereasfollows:
Sl No Name of the Member January
08, 2018January
23, 20181 ShriDPaulRanjan
2 ShriSureshBabuNV
General Body Meetings
64. The date, time and venue of the last three AnnualGeneralMeetingswereasfollows:
Year Date Time VenueSpecial
resolution passed
2016-17
Jul17,2017
09:30Hrs
AdministrativeBuilding,CochinShipyardPremises,Perumanoor,Cochin682015
Nil
2015-16
Sep20,2016
16.00Hrs
AdministrativeBuilding,CochinShipyardPremises,Perumanoor,Cochin682015
4
2014-15
Sep25,2015
10.00Hrs
AdministrativeBuilding,CochinShipyardPremises,Perumanoor,Cochin682015
1
Postal Ballot
65. DuringtheFY2017-18,noresolutionwasputthroughbypostalballot.
66. None of the business proposed to be transacted inthe ensuing AGM requires the passing of a SpecialResolutionbywayofpostalballot.
Means of Communication
67. All price-sensitive information andmatters that arematerialtoshareholderaredisclosedtotherespectiveStock Exchanges, where the securities of theCompanyarelisted.AllsubmissiontotheExchangesare made through the respective electronic filingsystems.
68. Thefinancialresultsforthequarter/half-year/yearwerepublishedasunder:
Quarterly / half-year / year In the month ofQuarterendingJune30,2017 SeptemberQuarter/half-yearending September30,2017 November
QuarterendingDecember31,2017 February
YearendingMarch31,2018 May
69. Quarterly/half-yearly/annual results, notices andinformation relating to General Meetings, etc. arepublished in leading newspapers viz., The Economic
108 Cochin Shipyard Ltd
Times(AllIndiaedition),Mathrubhumi(Cochinedition)and Malayala Manorama (Cochin edition) and arenotifiedtotheStockExchangesasrequiredundertheListingRegulations.
70. The quarterly/half-yearly/annual financial resultsandothercommunicationtoshareholdersandStockExchanges, inter-alia, presentations to institutionalinvestors & analysts, press releases etc., aremade available in the Company’s website www.cochinshipyard.comunder ‘investorscorner’ section.TheyarealsofiledwiththeNationalStockExchangeof India Limited (NSE) through NSE ElectronicApplication Processing System (NEAPS) and withBombay Stock Exchange Limited (BSE) throughBSEOnlinePortal.
71. TheManagement hold quarterly briefswith analystsandinstitutional investors.Thepresentationmadetothe institutional investorsandanalysts forquarterly/annualresultsareavailableontheCompany’swebsiteunder‘InvestorsCorner’.
General Shareholder Information
AnnualGeneralMeeting–date,time,venue:
72. 46th Annual General Meeting (AGM): 11.00 hrs,August 14, 2018 at Kerala Fine Arts Society Hall,Foreshore Rd, Pallimukku, Ernakulam, Kerala – 682016
73. FinancialYear:April01,2017toMarch31,2018
Dividend Payment:
74. The final dividend for the year ended March 31,2018ifapprovedattheAGM,willbepaidonorafter
August 20, 2018. Dividendwarrants in respect ofsharesheld inelectronic/dematerializedformwillbepostedtothebeneficialownersattheiraddressaspertheinformationfurnishedbyNSDLandCDSLasontherecorddate.
75. The particulars of dividend declared in the previousthreefinancialyearsaregivenbelow:
Financial Year Dividend Per Share (INR)2014-15 1.502015-16 7.652016-17 8.97
Listing of shares and stock code:
76. TheCompany’sequitysharesarelistedatthefollowingStockExchangesandlistingfeesfortheyear2017-18hasbeenpaidtotheStockExchanges.
Name and address of the Stock Exchange Stock Code
BSELimitedPhirozeJeejeebhoyTower,DalalStreet,Mumbai–400001
540678
NationalStockExchangeofIndiaLimitedExchangePlaza,5thFloor,Bandra-KurlaComplex,Bandra(East),Mumbai–400051
COCHINSHIP
77. The International Securities IdentificationNumber (ISIN) for the Company’s shares is INE704P01017
78. MarketPricedata–high,lowduringeachmonthinthelastfinancialyear(i.e.yearunderreview):
Price and volume of shares traded
Month/ YearBSE Limited National Stock Exchange of India Limited
High (INR) Low (INR) Volume (Nos.) High (INR) Low (INR) Volume (Nos.)Aug 2017* 575.00 435.00 76,23,370 575.00 435.00 13,81,980
Sep 2017 580.00 511.10 32,85,626 579.80 511.00 1,87,93,173
Oct 2017 597.40 514.00 33,63,083 597.80 515.00 2,13,58,045
Nov 2017 598.90 539.65 9,68,696 599.00 541.00 77,14,365
Dec 2017 573.00 525.00 4,43,950 574.00 523.55 32,51,896
Jan 2018 569.75 531.35 9,07,288 570.00 532.00 60,72,718
Feb 2018 544.80 501.05 3,45,999 544.70 500.00 29,63,353
Mar 2018 537.50 460.00 3,43,556 537.90 480.00 26,23,527
* EquityshareswerelistedonAugust11,2017.
10946th Annual Report
CSL vs NSE NIFTY CSL vs BSE SENSEX
Details of securities suspended: Not applicable.
Registrar and Share Transfer Agents (RTA):
LinkIntimeIndiaPrivateLimited,Surya,35,MayflowerAvenue,BehindSenthilNagar,SowripalayamRoad,Coimbatore,TamilNadu–641028Tel:04222315792;Fax:04222314792E-mail:[email protected]
Performance in comparison to broad based indices:
Share Transfer System
79. The Company’s shares being in the compulsorydemat list, are transferable through the depositorysystem. However, shares held in physical form areprocessed by its Registrar & Share Transfer Agentin co-ordination with the Company and sharecertificates are returned within fifteen days fromthedateof receiptof the transferby theCompanyprovidedthat thetransferdocumentsarecompletein all respects.
Distribution of Shareholding:
80. Distributionofshareholding(asonMarch31,2018)
No. of shares heldMembers Shares
No. % No. %1-500 1,68,182 98.5971 73,10,903 5.3782
501-1000 1,261 0.7393 10,02,873 0.73781001-2000 517 0.3031 7,68,844 0.56562001-3000 189 0.1108 4,75,998 0.35023001-4000 76 0.0446 2,68,324 0.19744001-5000 93 0.0545 4,17,870 0.30745001-10000 96 0.0563 7,01,931 0.5164>10000 161 0.0944 12,49,89,257 91.9471
Total 1,70,575 100.0000 13,59,36,000 100.0000
110 Cochin Shipyard Ltd
Dematerialisation of shares and liquidity
81. The Company’s shares are compulsorily traded indematerialized form and are available for trading onboththedepositories,viz.NSDLandCDSL.
Percentageofsharesheldin:-
Physicalform : 0
ElectronicformwithNSDL : 4.02
ElectronicformwithCDSL : 95.98
TheCompany’ssharesareregularlytradedontheBSEandNSE.
Outstanding Global Depository Receipts (GDRs) or American Depository Receipts (ADRs) or warrants or any convertible instruments, conversion date and likely impact on equity: None.
Commodity price risk or foreign exchange risk and hedging of activities:
82. TheCompanyhasformulatedForexRiskManagementPolicy duly approved by the Board and the Forexexposures are being hedged depending upon themarket conditions. Considering the complexityof Forex market operations, A.V. Rajwade & Co, areputed and well known Forex consulting firm hasbeenappointedastheForexconsultantssince2010to adviseCSL regardingForexhedging transactions.They advise CSL on need basis and also brief theBoardperiodically.
83. Tokeeptheminimumimpactduetoadverseexchangevariations, the Company is keeping a constantwatch on the Forex market fluctuations and hasbeen exploring various options of foreign currencyborrowingslikeBuyer’sCreditetc.aspartofeffectiveworking capital management. However, since thetotalcostofbuyer’scredit includinghedgingcost ishigherthandepositrateofbanks,wewerenotableto avail any buyer’s credit during the recent times.However,variousoptionsarebeing looked intoandacontinuouswatchonthesameisbeingkept.Statusof the forex exposure and the hedging position isreviewedbytheAuditCommitteeandtheBoardonaquarterlybasis.
Plant Locations:
Kochi
• Perumanoor,ErnakulamDistrict,Kochi–682015
• International Ship Repair Facility: M/s. Cochin PortTrust,WillingdonIsland,Kochi–682009
Address for Correspondence:
CompanySecretary&ComplianceOfficerAdministrativeBuilding,CochinShipyardLimited,Perumanoor,Kochi,Kerala–682015Tel:+91(484)2501306,Fax:+91(484)2384001Email:[email protected]:www.cochinshipyard.com
Other Disclosures
RelatedPartyTransactions84. Duringtheyearunderreview,therewerenomaterially
significant related party transactions that had ormay have conflictwith the interest of the Companyat large. The Company has a policy for relatedparty transactions, which can be accessed at thefollowing link: http://www.cochinshipyard.com/links/Relatedpartytransactionpolicy.pdf
Non-compliancebytheCompany85. No penalties/strictures have been imposed on the
Company by the Sock Exchanges or Securities andExchangeBoardofIndia(SEBI)oranyotherstatutoryauthority on any matter relating to capital marketsduringthelastthreeyears.
VigilMechanismandWhistleBlowerPolicy86. CochinShipyardhasadoptedaWhistleBlowerPolicy
approvedby theBoardat its199thmeetingheldonApril 20, 2012.Cochin Shipyard is aGovernment ofIndiaundertakingandfollowsGovernmentguidelineson reporting of any illegal or unethical practices.Directors/employees/stakeholders/representativebodies of employees are given freedom to report totheir immediate supervisor/Chief Vigilance Officeror Chairman and Managing Director, details of anyviolationof rules, regulations andunethical conduct.TheDirectorsandSeniorManagementarebound tomaintainconfidentialityofsuchreportingandensurethat the whistle blowers are afforded protectionagainst any harassment and not subjected to anydiscriminatory practices. During the period underreport no personnel has been denied access to theAudit Committee. The said policy is available in thewebsiteoftheCompanyathttp://www.cochinshipyard.com/links/CSLVIGILMECHANISMANDWHISTEBL OWERPOLICY.pdf
CodeofConductforPreventionofInsiderTrading
87. The Company has in place a Code of Conduct forPreventionofInsiderTradingforitsDesignatedPersons,
11146th Annual Report
incompliancewiththeSecuritiesandExchangeBoardof India (Prohibition of Insider Trading) Regulations,2015. The Code lays down guidelines,which advisethemonprocedurestobefollowedanddisclosurestobemade,whiledealingwiththesharesoftheCompany,andcautioningthemoftheconsequencesofviolations.TheCodeofConductforPreventionofInsiderTradingishostedonthewebsiteoftheCompanyandcanbeaccessed at: http://www.cochinshipyard.com/links/Policy%20on%20Insider%20Trading%20237BM%2011Sep2017%20-%20website%20upload.pdf
MandatoryRequirements
88. Acomprehensivereportonthestatusofcompliancewithalltheapplicablecorporatelaws,rulesandregulationsbytheCompanyisplacedbeforetheBoardonaquarterlybasis for their information and review. The Companyhas complied with all the mandatory requirementsof the Code of Corporate Governance as specifiedin Regulations 17 to 27 and clauses (b) to (i) of subregulation(2)ofRegulation46oftheListingRegulations.
Non-MandatoryRequirements
89. TheCompany has compliedwith the following non-mandatory requirements of the Listing Regulationsrelating to Corporate Governance. The status ofcompliance with the non-mandatory requirementslistedinRegulation27(1)readwithPartEofScheduleIIoftheListingRegulationsisasunder:
• During the year under review, there is noaudit qualification in the Company’s financialstatements. The Company continues to adoptbest practices to ensure regime of unmodifiedauditopinion.
SubsidiaryCompany:
90. Regulation 16 of the Listing Regulations defines a‘material subsidiary’ as subsidiary, whose income ornet worth exceeds 20% of the consolidated incomeornetworth respectively, of the listedentity and itssubsidiaries in the immediately preceding accountingyear.Underthisdefinition,theCompanydoesnothaveanyunlistedmaterialsubsidiaryincorporatedinIndia.
91. Hooghly Cochin Shipyard Limited is the subsidiarycompany of Cochin Shipyard Limited which wasincorporatedasJointVentureCompanyonOctober23,2017,venturingwithHooghlyDock&PortEngineersLimited.
92. PursuanttotheexplanationunderRegulation16(1)(c)oftheListingRegulations,theCompanyhasformulatedapolicyfordetermining‘materialsubsidiaries’whichisdisclosedontheCompany’swebsiteatthefollowingweb link: http://www.cochinshipyard.com/links/Material%20Subsidiary%20Policy.pdf
Details of compliancewith the requirement of CorporateGovernanceguidelines
93. In terms of Listing Regulations and DPE guidelineson Corporate Governance, Certificate regardingComplianceofCorporategovernanceguidelinesfromPracticingCompanySecretaryisplacedatEnclosure II to this report.
Details of Presidential Directives issued by CentralGovernmentandtheircomplianceduringtheyearandalsoin the last three years
94. The Company has complied with all presidentialdirectivesissuedbyCentralGovernmentregardingtheoperationofPSUs.
95. Items of expenditure debited in books of accounts,whicharenotforthepurposesofthebusiness:Nil
96. Expenses incurred which are personal in natureand incurred for the Board of Directors and TopManagement:Nil
97. The administrative and office expenditure of theCompanyfortheyear2017-18was2.23%ofthetotalexpenditure as against 1.88% in 2016-17. Financialexpenditurestoodat0.59%ofthetotalexpenditurein2017-18,against0.61%inthepreviousyear.
Code of Conduct
98. TheBoardhasprescribedaCodeofConduct(‘Code’)for all the Board members and Senior Managementof the Company. All Board members and SeniorManagement personnel have confirmed compliancewith the Code for the year 2017-18. The Code ishosted on thewebsite of the Company and can beaccessed at: http://www.cochinshipyard.com/links/CodeofConduct.pdf
99. Adeclarationsignedby theChairmanandManagingDirectoroftheCompanyisgivenbelow:
I hereby declare that all the members of the Board of Directors and Senior Management personnel have affirmed compliance with the Code of Conduct of the Board of Directors and Senior Management personnel in respect of the financial year 2017-18.
Sd/-Madhu S Nair
Chairman and Managing DirectorDIN: 07376798
CEO/CFO Certification
100.The CEO/CFO certification of the financialstatementsfortheyearisappendedatEnclosure III to this report.
112 Cochin Shipyard Ltd
Risk Management Process
101.CSLreviewedtheexistingriskmanagementpolicyandadoptedarevisedpolicyencompassingacomprehensivesystemofRiskManagement at its 214th BoardMeetingheldon September16, 2014.The salient features of the new riskmanagementpolicyisasfollows:
(i) RiskManagementVision Statement:Minimize the organizational risks to an acceptable level and adopt riskmanagementpracticeswhichwouldhelptheCompanytoattainitsgoalsandobjectiveswhileatthesametimeensuringminimizationofrisks.
(ii) RiskManagementPolicy:
(a) TheRiskManagementprocessisimplementedtoimprovetheCompany’sabilitytopreventrisksandensuretimelydetectionofrisk.
(b) Toidentifyrisksanditsmitigation.
(c) RiskManagementprocesstobestandardized.
(d) Facilitatesharingofriskinformation.
102.The riskmanagement policy intends to put in place an effective riskmanagement framework and an appropriatereportingmechanism.ThemanagementofCochinShipyardwouldperiodicallyidentifythevariousrisksandassess/analyzetheirimpactontheCompany.Riskmitigationandmanagementmeasureswouldbeputinplacetoeffectivelymanagetheserisks.TheBoardmayapprovechangestothepolicyfromtimetotimeinordertoalignitwiththechangesinbusinessenvironment.
Risk Management System and Structure
103.TheBoardatthehelmwillreviewtheriskmanagementsystemwithinCSL.TheBoardshalldischargeitsresponsibilityof risk oversight by ensuring the review at periodical intervals.TheBoardmay also delegate to any other personorcommitteethetaskofindependentlyassessingandevaluatingtheeffectivenessoftheriskmanagementsystem.TheCSLmanagementcomprisingofCSLBoardLevelandbelowBoard levelexecutiveswillbeentrustedwith theimplementation of the risk management process. In this respect the Risk Management Committees and RiskManagementSteeringCommitteehavebeenconstitutedtoimplementthepolicyinCSL.
Share holding pattern
104.TheCompanyhas issued13,59,36,000 equitysharesofRs.10each,detailsofwhichasonMarch31,2018areasfollows:
Sl. No. Category No. of shareholders No. of shares % holding1. Central Government 1 10,19,52,000 75.00002. ClearingMembers 338 3,82,424 0.28133. FinancialInstitutions 5 7,12,568 0.52424. ForeignPortfolioInvestors(Corporate) 33 46,97,022 3.45535. ForeignPortfolioInvestors(Individual) 1 900 0.00076. HinduUndividedFamily 6,090 5,04,360 0.37107. MutualFunds 34 1,39,83,664 10.28698. NationalisedBanks 2 3,69,800 0.27209. NonNationalisedBanks 3 46,934 0.034510. NonResident(NonRepatriable) 670 46,934 0.093911. NonResidentIndians 2,092 5,41,373 0.398312. OtherBodiesCorporate 616 18,83,283 1.385413. Public 1,60,681 1,07,21,031 7.886814 Trusts 8 12,987 0.0096
Total 1,70,574 13,59,36,000 100.0000
11346th Annual Report
Means of Communication
105.Thequarterly/halfyearlyfinancialresultsarepostedon thewebsitesof theBSE,NSEand theCompanyafterconsiderationandapprovalbytheBoardandalsowillbepublishedinoneEnglishnationaldailyhavingall India circulation and atleast in one Malayalamnational daily Kochi edition within 48 hours of itsadoption. The Annual Report of the Company ispostedinthewebsiteviz.www.cochinshipyard.com.ThewebsiteoftheCompanyalsodisplaysallofficialnewsreleases.
Audit Qualifications
106.The Report submitted by M/s Krishnamoorthy &Krishnamoorthy, StatutoryAuditors of the Companydoes not contain any qualification, reservation oradverseremarkordisclaimer.
107.The Report submitted by M/s SVJS & Associates,SecretarialAuditorsoftheCompanydoesnotcontainany qualification, reservation or adverse remark ordisclaimer.
Training Board Members
108.TheBoardmembersofCSLareseniorexecutiveswhohave a very vast,wide and varied experience in theareas of education, industry, defence, management,human resource management and administration.CSL has benefited from their vision and knowledge.PresentationsaremadetotheBoardmembersontheCompany’s performance, business model, corporateplan and future outlook, on their induction in theBoard. In addition, at the Board/ Committee/ othermeetings,detailedpresentationsaremadebytheseniormanagement personnel/ professionals/ consultantsonbusinessrelatedissues,riskassessment,riskpolicyetc. The directors are encouraged to identify andattendspecific trainingprogrammes to improve theireffectiveness. The Board has also adopted a policyregardingtrainingofDirectors.
ForandonbehalfoftheBoardofDirectors
Madhu S NairChairman&ManagingDirector
DIN:07376798KochiJune30,2018
114 Cochin Shipyard Ltd
Encl
osur
e I t
o Co
rpor
ate
Gov
erna
nce
Repo
rt
DET
AIL
S O
F M
AN
AGER
IAL
REM
UN
ERAT
ION
(A
mou
nt in
`)
Nam
e of
the
Dire
ctor
Tota
l of B
asic
Pa
y, D
A, H
RA
& o
ther
per
ks
& A
llow
ance
s
Perf
orm
ance
Re
late
d Pa
ymen
t
Perf
orm
ance
Cr
iteria
Det
ails
of S
ervi
ce C
ontr
acts
, Noti
ce p
erio
d, se
vera
nce
fees
Stoc
k O
ption
de
tails
Tota
l
ShriMadhuS
Nair
Chairman&
Managing
Dire
ctor
3133638
626493
Basedon
perf
orm
ance
criterialaid
downby
DPE.
AppointedvideMOSletterNo.SY-11011/1/2009-CS
Ldated
11Decem
ber2015foraperiodof5yearswitheffectfromthe
dateofassum
ptionofchargeofthepostortillthedateofhis
superannuationoruntilfurtherordersw
hichevereventoccurs
theearliest.Noticeperiodincaseofleavingservicebefore
thecontractualtermis3monthsorintheabsenceofnotice3
monthspaymayberemitted.ShriM
adhuSNairtookchargeas
CMDon01January2016.
NIL
3760131
ShriDPaul
Ranjan,
Dire
ctor
(Finance)
2852625
928933
Sam
e as
above
AppointedvideMOSletterNo.SY-11012/1/2009-CSL.Vol-II
datedAp
ril04,2014foraperiodof5yearswitheffectfrom
thedateofassum
ptionofchargeofthepostonorafter
01stMay2014ortillthedateofhissuperannuationoruntil
furtherordersw
hichevereventoccurstheearliest.N
oticeperiod
incaseofleavingservicebeforethecontractualtermis3months
orintheabsenceofnotice3monthsp
aymayberemitted.
NIL
3781558
Shri
Sunn
y Thom
as,
Dire
ctor
(Technical)
1876850
926673
Sam
e as
above
AppointedvideMOSletterNo.SY-11012/3/2010-CS
Ldated
12thMay2014foraperiodof5yearswitheffectfromthe
dateofassum
ptionofchargeofthepostonorafter01June
2014ortillthedateofhissuperannuationoruntilfurther
orderswhichevereventoccurstheearliest.Noticeperiodin
caseofleavingservicebeforethecontractualtermis3months
orintheabsenceofnotice3monthspaymayberemitted.
NIL
2803523
Shri
Sure
sh
BabuNV,
Dire
ctor
(Operations)
2688507
400578
Sam
e as
above
AppointedvideMOSletterNo.SY-11012/2/2010-C
SLdated
April26,2016foraperiodof5yearswitheffectfromthedate
ofassum
ptionofchargeofthepostonorafterApril26,2016
ortillthedateofhissuperannuationoruntilfurtherorders
whichevereventoccurstheearliest.Noticeperiodincaseof
leavingservicebeforethecontractualtermis3monthsorin
theabsenceofnotice3monthspaymayberemitted.
NIL
3089085
ForandonbehalfoftheBo
ardofDirectors
Mad
hu S
Nai
rCh
airman&ManagingDirector
DIN:07376798
Koch
iJune30,2018
11546th Annual Report
{UnderRegulation34(3)andScheduleV(E)oftheSEBI (ListingObligationsandDisclosureRequirements)Regulations,2015}
RegistrationNo.oftheCompany:U63032KL1972GOI002414NominalCapital:250,00,00,000/-
To,TheMembersM/sCochinShipyardLimitedCochin-682015
IhaveexaminedthecomplianceoftheconditionsofCorporateGovernancebyM/sCochinShipyardLimited(TheCompany),fortheyearendedMarch31,2018,asstipulatedinRegulation34(3)readwithScheduleV(E)oftheSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015.Ihaveobtainedallthenecessaryinformationandexplanationswhichtothebestofmyknowledgeandbeliefwerenecessaryforthepurposeofcertification.
Thecomplianceofconditionsofcorporategovernanceistheresponsibilityofthecompany’smanagement.Myexaminationwaslimitedtoareviewofproceduresandimplementationthereof,adoptedbythecompanyforensuringthecomplianceoftheconditionsofthecorporategovernance.Itisneitheranauditnoranexpressionofopiniononthefinancialstatementsof the company.
Onthebasisofmyexaminationoftherecordsproduced,explanationsandinformationfurnished,IcertifythatthecompanyhascompliedwithalltheconditionsofthecorporategovernanceasstipulatedintheSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015.
ThisCertificateisneitheranassuranceastothefutureviabilityoftheCompanynoroftheefficacyoreffectivenesswithwhichthemanagementhasconductedtheaffairsoftheCompany.
M.C.SAJUMON,MCOM,ACMA,ACS,ACIS(UK)PRACTISINGCOMPANYSECRETARY
Place:Kochi-18 ACS:9868,CP:2385Date:28.06.2018
CORPORATE gOVERnAnCE CERTIFICATE
Enclosure II
116 Cochin Shipyard Ltd
(AsstipulatedintheguidelinesoncorporategovernanceforCPSESissuedbythe DepartmentofPublicEnterprises,GovernmentofIndia).
TotheMembersofCochinShipyardLimited
I have examined the compliance of conditions of corporate governance byCochin Shipyard Limited (the company) forthefinancialyearended31-03-2018,asstipulatedintheGuidelinesonCorporateGovernanceforCentralPublicSectorEnterprises(CPSEs)issuedbytheDepartmentofPublicEnterprises(DPE),GovernmentofIndia.
Thecomplianceofconditionsofcorporategovernanceistheresponsibilityofthemanagement.Myexaminationwaslimitedtoproceduresandimplementationthereof,adoptedbythecompanyforensuringthecomplianceoftheconditionsoftheCorporateGovernance.Itisneitheranauditnoranexpressionofopiniononthefinancialstatementsofthecompany.
Inmyopinionandtothebestofmyinformationandaccordingtotheexplanationsgiventome,IcertifythatthecompanyhascompliedwiththeconditionsofCorporateGovernanceasstipulatedintheabovementionedguidelines.
I further state that such compliance is neither an assurance as to futureviability of the companynor the efficiencyoreffectivenesswithwhichthemanagementhasconductedtheaffairsofthecompany.
M.C.SAJUMON,MCOM,ACMA,ACS,ACIS(UK)PRACTISINGCOMPANYSECRETARY
Place:Kochi-18 ACS:9868,CP:2385Date:28.06.2018
CORPORATE gOVERnAnCE CERTIFICATE
Enclosure II
11746th Annual Report
CEO/CFO CERTIFICATIOn
To TheBoardofDirectorsCochinShipyardLimitedCochin-15
DearSirs,
Sub: CEO/CFO Certificate
1. WehavereviewedFinancialStatements,readwiththeCashFlowStatementofCochinShipyardLimitedfortheyearended31stMarch2018andthattothebestofourknowledgeandbelief,westatethat:
(i) Thesestatementsdonotcontainanymateriallyuntruestatementoromitanymaterialfactorcontainstatementsthatmightbemisleading;
(ii) These statements present a true and fair view of the Company’s affairs and are in compliancewith currentAccountingStandards,applicablelawsandregulations.
2. Thereare,tothebestofourknowledgeandbelief,notransactionsenteredintobytheCompanyduringtheyearwhicharefraudulent,illegalorviolationoftheCompany’scodeofconduct.
3. Weacceptresponsibilityforestablishingandmaintaininginternalcontrolforfinancialreporting.WehaveevaluatedtheeffectivenessoftheinternalcontrolsystemsoftheCompanypertainingtofinancialreportingandhavedisclosedtotheAuditorsandtheAuditCommittee,deficienciesinthedesignoroperationofsuchinternalcontrols,ifany,ofwhichweareawareand;
4. WehaveindicatedtotheAuditorsandtheAuditCommitteethat:
(i) Therearenosignificantchanges,ininternalcontroloverfinancialreportingduringtheyear;
(ii) Therearenosignificantchanges,inaccountingpoliciesmadeduringtheyearand;
(iii) Therearenoinstancesofsignificantfraudofwhichwehavebecomeawareandtheinvolvementtherein,ifany,ofthemanagementoranemployeehavingasignificantroleintheCompany’sinternalcontrolsystemoverfinancialreporting.
D Paul Ranjan Madhu S NairDirector(Finance) ChairmanandManagingDirectorDIN:06869452 DIN:07376798
KochiJune30,2018
Enclosure III
118 Cochin Shipyard Ltd
INDEPENDENT AUDITOR’S REPORTTo TheMembersofCochin Shipyard Limited
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying Standalone Ind ASfinancial statements of Cochin Shipyard Limited (‘theCompany’),whichcomprisetheBalanceSheetasatMarch31,2018,theStatementofProfitandLoss(includingOtherComprehensiveIncome),theStatementofCashFlowsandtheStatementofChangesinEquityfortheyearthenended,and a summary of the significant accounting policies andother explanatory information (hereinafter referred to as‘IndASfinancialstatements’).
Management’s Responsibility for the Standalone Ind AS Financial Statements
The Company’s Board of Directors is responsible for thematters stated in Section 134(5) of the Companies Act,2013 (‘theAct’)with respect to the preparation of theseStandaloneIndASfinancialstatementsthatgiveatrueandfairviewofthestateofaffairs(financialposition),profitorloss (financialperformance includingothercomprehensiveincome),cashflowsandchangesinequityoftheCompanyin accordance with the accounting principles generallyacceptedinIndia,includingtheIndianAccountingStandards(IndAS)prescribedunderSection133oftheAct.
This responsibility also includesmaintenanceof adequateaccounting records in accordance with the provisions oftheActforsafeguardingtheassetsoftheCompanyandforpreventing and detecting frauds and other irregularities;selectionandapplicationofappropriateaccountingpolicies;making judgments and estimates that are reasonable andprudent; and design, implementation andmaintenance ofadequate internal financial controls, that were operatingeffectivelyforensuringtheaccuracyandcompletenessofthe accounting records, relevant to the preparation andpresentationoftheStandaloneIndASfinancialstatementsthat give a true and fair view and are free frommaterialmisstatement,whetherduetofraudorerror.
Auditor’s Responsibility
Our responsibility is to express an opinion on theseStandaloneIndASfinancialstatementsbasedonouraudit.
We have taken into account the provisions of the Act,theaccountingandauditingstandardsandmatterswhichare required tobe included in the audit report under theprovisionsoftheActandtheRulesmadethereunder.
WeconductedourauditoftheStandaloneIndAsfinancialstatements in accordancewith theStandardsonAuditingspecifiedunderSection143(10)oftheAct.ThoseStandardsrequirethatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassuranceaboutwhethertheStandaloneIndASfinancialstatementsarefreefrom material misstatement.
An audit involves performing procedures to obtain auditevidence about the amounts and the disclosures in theStandalone Ind AS financial statements. The proceduresselected depend on the auditor’s judgment, includingthe assessment of the risks of material misstatement ofthe Standalone IndAS financial statements,whether dueto fraud or error. In making those risk assessments, theauditorconsiders internalfinancialcontrol relevant to theCompany’spreparationof theStandalone IndASfinancialstatementsthatgiveatrueandfairviewinordertodesignauditproceduresthatareappropriateinthecircumstances.An audit also includes evaluating the appropriateness ofthe accounting policies used and the reasonableness oftheaccountingestimatesmadebytheCompany’sBoardofDirectors,aswellasevaluatingtheoverallpresentationoftheStandaloneIndASfinancialstatements.
We believe that the audit evidencewe have obtained issufficientandappropriate toprovideabasis forourauditopinionontheStandaloneIndASfinancialstatements.
Opinion
In our opinion and to the best of our information andaccording to the explanations given to us, the aforesaidStandaloneIndASfinancialstatementsgivetheinformationrequiredbytheActinthemannersorequiredandgiveatrueandfairviewinconformitywiththeaccountingprinciplesgenerallyacceptedinIndiaincludingtheIndAS,ofthestateofaffairs(financialposition)oftheCompanyasatMarch31,2018,and itsprofit (financialperformance includingothercomprehensiveincome), itscashflowsandthechangesinequityfortheyearendedonthatdate.
Emphasis of Matter
Wedrawattentiontothefollowing:-
i) Note No.29 to the Standalone IndAS financialstatements regarding the basis on whichthe Company has recognized revenue fromship building/ ship repair activities based onthe Company’s own assessment of physicalcompletion and further, reliance is placed onthetechnicalassessmentandactivitybasedcost
11946th Annual Report
estimates defined by the Management for thepurposeofrecognitionofincome;
ii) NoteNo.41.atotheStandaloneIndAsfinancialstatements regarding environmental Clearancefor the International Ship Repair Facility (‘ISRF’)project from the National Board for Wildlife(‘NBWL’)whichhasrecommendedenvironmentalclearance for the ISRF project along with theconditions imposed by State Chief Wild LifeWarden (‘CWLW’) and subsequent utilizationof the Initial Public Offer proceeds relating tothe ISRF project based on the managementcontention that the conditions imposed bytheCWLWare to be compliedwith during theimplementationoftheISRFproject.
Ouropinionisnotmodifiedinrespectofthesematters.
Report on Other Legal and Regulatory Requirements
1. AsrequiredbytheCompanies(Auditor’sReport)Order,2016(‘theOrder’) issuedbytheCentralGovernmentintermsofsub-section(11)ofsection143oftheAct,wegivein“AnnexureA”,astatementonthemattersspecifiedinparagraphs3and4oftheOrder.
2. Basedontheverificationof recordsof theCompanyandbasedon information and explanations given tous,wegivein“AnnexureB”reportsontheDirectionsissued by the Comptroller and Auditor General ofIndia in terms of Sec 143(5) of the Companies Act,2013.
3. As requiredbySection143 (3)of theAct,wereportthat:
a. Wehavesoughtandobtainedalltheinformationand explanations which to the best of ourknowledge and belief were necessary for thepurposesofouraudit;
b. In our opinion, proper books of account asrequiredbylawhavebeenkeptbytheCompanysofarasitappearsfromourexaminationofthosebooks;
c. TheBalanceSheet, theStatementofProfit andLossincludingothercomprehensiveincome,theStatement ofCash Flows and the Statement ofChangesinEquitydealtwithbythisReportareinagreementwiththebooksofaccount;
d. Inouropinion, the aforesaidStandalone IndASfinancial statements comply with the IndianAccounting Standards prescribed under Section133oftheAct;
e. Inviewofexemptiongivenvidenotificationno.G.S.R.463(E)datedJune52015,issuedbyMinistry
ofCorporateAffairs,provisionsofSection164(2)oftheActregardingdisqualificationofDirectors,arenotapplicabletotheCompany;
f. With respect to the adequacy of the internalfinancial controlsoverfinancial reportingof theCompanyandtheoperatingeffectivenessofsuchcontrols,refertoourseparatereportin“AnnexureC”.
g. Withrespecttotheothermatterstobeincludedin theAuditor’sReport in accordancewithRule11oftheCompanies(AuditandAuditors)Rules,2014, in our opinion and to the best of ourinformation and according to the explanationsgiventous:
i. The Company has disclosed the impact ofpending litigations on its financial positioninitsStandaloneIndASfinancialstatements– Refer Notes 40, 42, 43 and 44 to theStandaloneIndASfinancialstatements;
ii. The Company has made provision,as required under the applicable lawor accounting standards, for materialforeseeable losses, if any, on long-termcontracts. Further the Company did nothaveanylong-termderivativecontractsforwhich therewere anymaterial foreseeablelosses. – ReferNote 53 to the StandaloneIndASfinancialstatements;
iii. Therewerenoamounts,whichwererequiredtobetransferred,totheInvestorEducationandProtectionFundbytheCompany;and
iv. Thedisclosuresregardingdetailsofspecifiedbank notes held and transacted duringNovember8, 2016 toDecember30,2016has not been made since the requirementdoes not pertain to financial year endedMarch31,2018.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182
Cochin-16May24,2018
120 Cochin Shipyard Ltd
Annexure A to the Independent Auditor’s Report
With reference to the Annexure A referred to in theIndependent Auditor’s Report to the members of theCompanyontheStandaloneIndAsfinancialstatementsfortheyearendedMarch31,2018,wereportthefollowing:
i) InrespectoftheCompany’sfixedassets:
(a) The Company has maintained proper recordsshowing full particulars, including quantitativedetailsandsituationoffixedassets.
(b) As explained to us, the fixed assets have beenphysicallyverifiedbytheManagementduringtheyearandthereisaregularprogrammeofphysicalverification,which in our opinion, is reasonablehavingregardtothesizeofthecompanyandthenatureofitsassets.Asexplainedtous,nomaterialdiscrepancieswerenoticedonsuchverification.
(c) According to the information and explanationsgiventousandonthebasisofourexaminationoftherecordsoftheCompany,thetitledeedsofimmovablepropertiesareheldinthenameoftheCompany.
ii) As explained to us, the inventories (excluding goodsin transit)were physicallyverified during theyear inaccordancewiththe inventoryverificationprocedureadopted by the Management. In our opinion, thefrequency of such physical verification needs to beincreased.Thediscrepanciesnoticedonsuchphysicalverificationbetweenthephysicalstockandthebookrecordswerenotmaterial.
iii) According to the informationandexplanationsgiventous,theCompanyhasnotgrantedanyloans,securedor unsecured to companies, firms, Limited LiabilityPartnerships or other parties covered in the registermaintainedundersection189oftheAct.Accordinglytheprovisionsofclause3(iii)(a),(b)and(c)oftheOrderarenotapplicabletotheCompany.
iv) Inouropinion andaccording to the informationandexplanationsgiventous, theCompanyhascompliedwiththeprovisionsofSections185and186oftheAct,with respect to loans, investments, guarantees andsecurities.
v) Accordingtotheinformationandexplanationgiventous,thecompanyhasnotacceptedanydepositsfromthepublicwithinthemeaningofthedirectivesissuedbytheReserveBankofIndia,provisionsofSections73to76oranyotherrelevantprovisionsoftheActandtherulesframedthereunder.
vi) We have broadly reviewed the books of accountmaintained by the Company in respect of productswhere the maintenance of cost records has been
specified by the Central Government under Section148(1)oftheActandtherulesframedthereunderandweareoftheopinionthatprima-facie,theprescribedbooks of account and cost records have beenmadeand maintained. We have not, however, made adetailedexaminationofthecostrecordswithaviewtodeterminingwhethertheyareaccurateorcomplete.
vii) AccordingtotheinformationandexplanationsgiventousandonthebasisofourexaminationoftherecordsoftheCompany,inrespectofstatutorydues:
(a) The Company is generally regular in depositingundisputed statutory dues including ProvidentFund, Employees’ State Insurance, Income Tax,Sales Tax, Service Tax, Goods and Service Tax,Duty of Customs, Duty of Excise, ValueAddedTax, Cess and other material statutory duesapplicabletoitwiththeappropriateauthorities.
There were no undisputed amounts payable inrespect of Provident Fund, Employees’ StateInsurance, Income Tax, Sales Tax, Service Tax,GoodsandServiceTax,DutyofCustoms,DutyofExcise,ValueAddedTax,Cessandothermaterialstatutorydues inarrearsasatMarch31,2018,for a period ofmore than sixmonths from thedatetheybecamepayable.
(b) TherearenoduesofIncometax,Salestax,ServiceTax, Goods and Service Tax, Duty of Customs,Duty of Excise and Value added tax whichhave not been deposited with the appropriateauthorities on account of disputes, except asgivenin“AnnexureD”.
viii) According to the information and explanationsgiven to us, the Company does not have any loansor borrowings from any financial institution, banksor government during the year. In respect of bondsissued,theCompanyhasnotdefaultedinpaymentofanydues.
ix) Inouropinion andaccording to the informationandexplanationsgiventous,moneyraisedbywayofinitialpublicofferhavebeenappliedbytheCompanyduringtheyearforthepurposesforwhichtheywereraised,otherthantemporarydeploymentpendingapplicationof proceeds. The Company has not raised any termloansduringtheyear.
x) To the best of our knowledge and according to theinformationandexplanationsgiventous,nomaterialfraud by the Company or on the Company by itsofficers or employees has been noticed or reportedduringthecourseofouraudit.
xi) In view of exemption given vide notification no.G.S.R.463(E)datedJune5,2015, issuedbyMinistry
12146th Annual Report
of CorporateAffairs, provisions of Section 197 readwith Schedule V of the Act regarding managerialremuneration are not applicable to the Company.Accordingly, paragraph 3(xi) of the Order is notapplicabletotheCompany.
xii) In our opinion and according to the informationgiventous, theCompany isnotaNidhicompanyasprescribedunderSection406oftheAct.Accordinglyparagraph3(xii)of theOrder isnotapplicable to theCompany.
xiii) According to the informationandexplanationsgiventousandbasedonourexaminationoftherecordsofthe Company, transactions with the related partiesare in compliancewith sections177 and188of theAct,whereapplicableanddetailsofsuchtransactionshavebeendisclosedintheStandaloneIndASfinancialstatements as required by the applicable IndianAccountingStandards.
xiv) According to the informationandexplanationsgivento us and based on our examination of the recordsof the Company, the Company has not made anypreferentialallotmentorprivateplacementof sharesor fully or partly convertible debentures during theyear.Accordingly,paragraph3(xiv)oftheOrderisnotapplicabletotheCompany.
xv) According to the informationandexplanationsgiventousandbasedonourexaminationoftherecordsoftheCompany,theCompanyhasnotenteredintonon-cashtransactionswithdirectorsorpersonsconnectedwiththem.Accordingly,paragraph3(xv)oftheOrderisnotapplicabletotheCompany.
xvi) TheCompany isnot required tobe registeredundersection45-IAoftheReserveBankofIndiaAct1934.Accordingly, paragraph 3(xvi) of the Order is notapplicabletotheCompany.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182
Cochin-16May24,2018
122 Cochin Shipyard Ltd
Annexure B to the Independent Auditor’s Report
With reference to the Annexure B referred to in theIndependent Auditor’s Report to the members of theCompanyontheStandaloneIndAsfinancialstatementsfortheyearendedMarch31,2018,wereportthefollowing:
A. Directions
1. Whether the company has clear title / lease deeds for freehold and leasehold land respectively? If not, please state the area of freehold and leasehold land for which title / lease deeds are not available.
Based on our examination of the records of theCompany and according to the information andexplanations given to us and the confirmation fromBondTrusteesinrespectoftitledeedsdepositedwiththemandbasedon thedetails of landandbuildingsfurnishedtousbytheCompany,thetitle/leasedeedsforfreeholdandleaseholdlandrespectivelyareheldin the name of the Company.
2. Whether there are any cases of waiver/write off debts/loans/interest etc., if yes, the reasons therefore and the amount involved.
Based on our examination of the records of theCompany and according to the information andexplanationsgiventous,duringtheyear,theCompanyhasnotwaivedorwrittenoffanydebts/loans/interest.Asperthepolicyfollowedbythecompany,liquidateddamages, where the levies depend on decisionsregarding force majeure condition of contract, areaccountedforoncompletionofcontractand/orwhen
final decision is taken. Based on our examinationof the recordsof theCompanyandaccording to theinformationandexplanationsgiven tous, Liquidateddamagesaccountedforhasnotbeenwaived/writtenoff during the year. Based on the explanation givento us, the Company does not have the practice ofclaiminginterestondelayedpaymentfromcustomersthoughcertaincontractsprovideforthesame.
3. Whether proper records are maintained for inventories lying with third parties & assets received as gift/grant(s) from the Government or other authorities.
Based on our examination of the records as weconsidered appropriate and further based on theinformation and explanations given to us, theCompany ismaintaining proper records of inventorysentoutduringtheyearand lyingwith thirdparties.TheCompany has not received any assets as gift orgrant(s)fromGovernmentorotherauthorities.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182
Cochin-16May24,2018
12346th Annual Report
Annexure C to the Independent Auditor’s Report
(Referredtoinparagraph3(f)under‘ReportonOtherLegalandRegulatoryRequirements’ sectionof the IndependentAuditor’sReport to themembersof theCompanyon theStandaloneIndAsfinancialstatementsfortheyearendedMarch31,2018.)
Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)
Wehaveauditedtheinternalfinancialcontrolsoverfinancialreporting of Cochin Shipyard Limited (‘the Company’) asof March 31, 2018 in conjunctionwith our audit of theStandaloneIndASfinancialstatementsoftheCompanyfortheyearendedonthatdate.
Management’s Responsibility for Internal Financial Controls
TheCompany’smanagementisresponsibleforestablishingand maintaining internal financial controls based on theinternalcontroloverfinancialreportingcriteriaestablishedby theCompanyconsidering theessentialcomponentsofinternal control stated in theGuidanceNote onAudit ofInternalFinancialControlsoverFinancialReportingissuedbytheInstituteofCharteredAccountantsof India (‘ICAI’).These responsibilities include the design, implementationand maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderlyandefficient conductof itsbusiness, includingadherenceto Company’s policies, the safeguarding of its assets, thepreventionanddetectionoffraudsanderrors,theaccuracyandcompletenessoftheaccountingrecords,andthetimelypreparation of reliable financial information, as requiredundertheAct.
Auditor’s Responsibility
OurresponsibilityistoexpressanopinionontheCompany’sinternalfinancialcontrolsoverfinancialreportingbasedonouraudit.WeconductedourauditinaccordancewiththeGuidanceNoteonAuditofInternalFinancialControlsoverFinancialReporting(‘theGuidanceNote’)andtheStandardsonAuditing, issuedby ICAIanddeemed tobeprescribedundersection143(10)oftheAct,totheextentapplicabletoanauditofinternalfinancialcontrols,bothapplicabletoanauditofInternalFinancialControlsand,bothissuedbyICAI.ThoseStandardsandtheGuidanceNoterequirethatwecomplywithethicalrequirementsandplanandperformthe audit to obtain reasonable assurance about whetheradequateinternalfinancialcontrolsoverfinancialreportingwas established and maintained and if such controlsoperatedeffectivelyinallmaterialrespects.
Our audit involvesperformingprocedures toobtain auditevidence about the adequacy of the internal financial
controlssystemoverfinancialreportingandtheiroperatingeffectiveness.Ourauditof internalfinancial controlsoverfinancialreportingincludedobtaininganunderstandingofinternalfinancialcontrolsoverfinancialreporting,assessingthe risk that amaterialweakness exists, and testing andevaluatingthedesignandoperatingeffectivenessofinternalcontrolbasedontheassessedrisk.Theproceduresselecteddependontheauditor’sjudgment,includingtheassessmentoftherisksofmaterialmisstatementoftheStandaloneIndASfinancialstatements,whetherduetofraudorerror.
We believe that the audit evidencewe have obtained issufficientandappropriate toprovideabasis forourauditopinionontheCompany’sinternalfinancialcontrolssystemoverfinancialreporting.
Meaning of Internal Financial Controls over Financial Reporting
Acompany’sinternalfinancialcontroloverfinancialreportingis a process designed to provide reasonable assuranceregarding the reliability of financial reporting and thepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.A company’s internal financial control over financialreporting includes those policies and procedures that (1)pertain to themaintenanceof records that, in reasonabledetail, accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded asnecessarytopermitpreparationoffinancialstatements inaccordancewithgenerallyacceptedaccountingprinciples,and that receipts and expenditures of the company arebeing made only in accordance with authorizations ofmanagementanddirectorsofthecompany;and(3)providereasonable assurance regarding prevention or timelydetectionofunauthorizedacquisition,use,ordispositionofthecompany’sassetsthatcouldhaveamaterialeffectonthefinancialstatements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financialcontrols over financial reporting, including the possibilityofcollusionorimpropermanagementoverrideofcontrols,materialmisstatementsduetoerrororfraudmayoccurandnotbedetected.Also,projectionsofanyevaluationoftheinternalfinancialcontrolsoverfinancialreportingtofutureperiods are subject to the risk that the internal financialcontrol over financial reporting may become inadequatebecause of changes in conditions, or that the degree ofcompliancewiththepoliciesorproceduresmaydeteriorate.
Opinion
Inouropinion, theCompanyhas, in allmaterial respects,
124 Cochin Shipyard Ltd
anadequateinternalfinancialcontrolssystemoverfinancialreportingandsuchinternalfinancialcontrolsoverfinancialreportingwereoperatingeffectivelyasatMarch31,2018,basedontheinternalcontroloverfinancialreportingcriteriaestablished by the Company considering the essentialcomponents of internal control stated in the GuidanceNoteonAuditofInternalFinancialControlsOverFinancialReportingissuedbytheICAI.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182
Cochin-16May24,2018
12546th Annual Report
Annexure D referred to under clause vii (b) to Annexure A
DetailsofduesoutstandingwithrespecttoIncometax,Salestax,ValueAddedTax,ServiceTaxandDutyofCustomsonaccountofdisputes:
(`inlakhs)
Sl. No Name of the statute Nature of
dues Amount*
₹
Amount paid/
adjusted₹
Amount unpaid
₹ Period Forum where dispute is
pending
1 IncomeTaxAct,1961 IncomeTax 3158.87 - 3158.87 AY1997-98 AY1998-99 AssessingOfficer
2 IncomeTaxAct,1961 IncomeTax 620.47 - 620.47AY1999-00 AY2000-01 AY2001-02
Hon’bleHighCourtofKerala
3 IncomeTaxAct,1961 IncomeTax 29.99 29.99 - AY2002-03 IncomeTaxAppellateTribunal
4 IncomeTaxAct,1961 IncomeTax 2268.52 2267.95 0.57
AY2009-10 AY2010-11 AY2011-12 AY2012-13 AY2013-14 AY2014-15
CommissionerofIncomeTax(Appeals)
5 KeralaGeneralSalesTaxAct,1963 SalesTax 266.89 20.38 246.51
1996-97 2000-01 2001-02
AssessingOfficer,CommercialTaxes
6 KeralaGeneralSalesTaxAct,1963 SalesTax 58.03 - 58.03 1999-2000
AssessingAuthority,CommercialTaxes(RemandedbacktoAssessingOfficerbyKeralaSalesTaxAppellateTribunal)
7 KeralaGeneralSalesTaxAct,1963 SalesTax 202.22 6.55 195.67 2004-05 **
8 KeralaValueAddedTaxAct,2003
ValueAddedTax 1008.70 130.00 878.70 2005-06
2007-08 KVATAppellateTribunal
9 FinanceAct,1994 ServiceTax 3284.49 1686.53 1597.96 2003-04to2014-15
Customs,Excise&ServiceTaxAppellateTribunal,Bangalore
10 FinanceAct,1994 ServiceTax 24.08 - 24.08 2003-04to2007-08
Hon’bleHighCourtofKerala
11 FinanceAct,1994 ServiceTax 50.62 3.45 47.18 Jul2012- Mar2013
Commissioner of Central Excise(Appeals)
12 CustomsAct,1962 Duty of Customs 27.46 - 27.46 1984-1990 Chief Commissioner of
Customs,Bangalore
13 CustomsAct,1962 Duty of Customs 283.34 261.22 22.12 2003-04
2013-14
Customs,Excise&ServiceTaxAppellateTribunal,Bangalore
14 CustomsAct,1962 Duty of Customs 23.31 - 23.31 2004-05 CommissionerofCustoms,
Kochi
15 CustomsAct,1962 Duty of Customs 14,891.39 - 14,891.39 2010-2015 Hon’bleHighCourtof
Kerala
*Duesincludespenaltyandinterestwhereverapplicable.
**TheCompanyisintheprocessoffilinganappealbeforeKVATAppellateTribunal.
126 Cochin Shipyard Ltd
BAlAnCE ShEETasatMarch31,2018
(`inlakhs)
Particulars Note No. As at 31.03.2018 As at 31.03.2017
ASSETSNon-current assets(a) Property,plantandequipment 3 28,446.72 30,285.30(b) Capitalwork-in-progress 4 11,484.34 5,392.33(c) Intangibleassets 5 6,451.75 6,775.89(d) Financialassets
(i) Investments 6 1,637.18 9.18(ii) Loans 7 147.77 145.39
(e) Incometaxassets(net) 8 5,400.03 3,601.27(f) Deferredtaxassets(net) 9 4,332.27 2,433.43(g) Othernon-currentassets 10 7,688.25 2,467.23
65,588.31 51,110.02 Current assets(a) Inventories 11 31,455.67 18,647.09(b) FinancialAssets
(i) Investments 12 0.16 0.00(ii) Tradereceivables 13 58,012.76 30,699.22(iii) Cashandcashequivalents 14 79,194.06 67,598.15(iv) Bankbalancesotherthan(iii)above 15 269,840.19 131,530.99(v) Loans 16 38.14 46.70(vi) OtherFinancialassets 17 26,083.13 23,269.18
(c) Currenttaxassets(net) 8 0.00 1,694.74(d) Othercurrentassets 18 16,716.32 7,057.05
481,340.43 280,543.12 Total Assets 546,928.74 331,653.14 EQUITY AND LIABILITIESEquity :(a) Equitysharecapital 19 13,593.60 11,328.00(b) Otherequity 20 311,993.09 191,530.24
325,586.69 202,858.24 Liabilities :Non-current liabilities(a) Financialliabilities
(i) Borrowings 21 12,300.00 12,300.00(ii) Otherfinancialliabilities 22 261.22 261.22
(b) Provisions 23 2,265.70 2,141.60(c) Othernoncurrentliabilities 24 13.74 0.00
14,840.66 14,702.82 Current liabilities(a) Financialliabilities
(i) Tradepayables 25 27,382.97 16,088.06(ii) Otherfinancialliabilities 26 11,736.48 9,607.79
(b) Othercurrentliabilities 27 137,977.56 67,303.88(c) Provisions 28 28,332.91 21,092.35(d) Currenttaxliabilities(net) 8 1,071.47 0.00
206,501.39 114,092.08 Total Equity and Liabilities 546,928.74 331,653.14
CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheFinancialStatements 3-55TheaccompanyingnotesareanintegralpartofthesefinancialstatementsForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
12746th Annual Report
STATEMEnT OF PROFIT AnD lOSSfortheyearendedMarch31,2018
(`inlakhs)
Particulars Note No. For the year ended March 31, 2018
For the year ended March 31, 2017
I IncomeRevenuefromoperations 29 235512.33 205887.10Otherincome 30 18915.83 15863.26
Total Income 254428.16 221750.36
II Expenses:Costofmaterialsconsumed 31 116565.64 100872.67Changesininventoriesofwork-in-progress 32 2510.39 (1395.52)Subcontractandotherdirectexpenses 33 23528.99 31936.73Employeebenefitsexpense 34 27139.85 21726.64Finance costs 35 1141.03 1053.58Depreciationandamortisationexpense 36 3751.02 3850.99Otherexpenses 37 13479.06 13451.87Provisionforanticipatedlossesandexpenditure 38 5826.17 913.35Total expenses 193942.15 172410.31
III Profit before tax 60486.01 49340.05
IV Tax expense:(1) Currenttax 8 22412.00 16348.35(2) Deferredtax 8 (1601.00) 837.00
V Profit for the year 39675.01 32154.70 VI Other comprehensive income
A) Itemsthatwillnotbereclassifiedtoprofitorlossi) Remeasurementsofdefinedemployeebenefitobligations (205.04) (163.00)ii) Incometaxrelatingtoitemsthatwillnotbereclassifiedtoprofitorloss 70.96 56.41
Other comprehensive income for the year (134.08) (106.59)
VII Total Comprehensive income for the year 39540.93 32048.11 VIII Earnings per equity share of Rs 10 each : 39
(1) Basic (Rs) 31.03 28.39 (2) Diluted (Rs) 31.03 28.39
CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheFinancialStatements 3-55TheaccompanyingnotesareanintegralpartofthesefinancialstatementsForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
128 Cochin Shipyard Ltd
STATEMEnT OF CASh FlOwSfortheyearendedMarch31,2018
(`inlakhs)
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
A. Cash flow from operating activities
Profit before tax 60,486.01 49,340.05
Adjustmentsfor:
Depreciationandamortisation 3,497.59 3,584.23
Interestexpense 1,141.03 1,053.58
Interestincome (15,421.47) (13,085.52)
Rental income (58.18) (55.39)
Dividendincome (185.84) (199.02)
Lossonsale/writeoffofpropertyplantandequipment 9.86 414.85
Profitonsaleofpropertyplantandequipment (1.34) (6.56)
Profitonsaleofinvestments (669.82) (460.96)
IncomerecognisedonGovt.assistance (1.14) 0.00
Loss/(gain)onderivativecontracts(net) 0.00 (222.84)
Unrealisedloss/(gain)onderivativecontracts(net) 0.00 38.68
Netgain/(loss)onforeigncurrencytransactions (217.73) (227.22)
ExpensesonInitialPublicOffer 668.89 182.11
Effectiveloss/gainofcashflowhedges 0.00 35.53
Operatingcashflowbeforeworkingcapitalchanges 49,247.86 40,391.52
Movementsinworkingcapital:
(Increase)/decreaseininventories (12,808.58) 4,516.71
(Increase)/decreaseintradeandotherreceivables (181,602.26) 15,781.35
Increase/(decrease)intradeandotherpayables 85,596.22 (24,458.54)
(59,566.76) 36,231.04
Incometaxpaidnetofrefunds (15,610.00) (15,003.00)
Net cash flows from operating activities (A) (75,176.76) 21,228.04
B. Cash flow from investing activities
Purchaseofproperty,plantandequipment (1,364.27) (4,042.71)
(Increase)/decreaseincapitalworkInprogress (6,092.01) (2,975.17)
InvestmentinMutualFunds (203,750.00) (113,785.00)
RedemptionofMutualFunds 203,749.84 113,785.00
Dividendreceived 185.84 199.02
Profitonsaleofinvestments 669.82 460.96
Govt.assitancereceived 16.03 0.00
InvestmentinHCSLSubsidiary (1,628.00) 0.00
Saleorwithdrawalofproperty,plantandequipment 20.91 10.55
Interestreceived 13,607.52 12,766.91
Rentreceived 59.50 55.39
Net cash flows from investing activities (B) 5,475.18 6,474.95
12946th Annual Report
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
C. Cash flow from financing activities
ProceedsfromIPOincludingsecuritiespremium 96,195.36 0.00
Loss/(gain)onderivativecontracts(Net) 0.00 222.84
Netgain/(loss)onforeigncurrencytransactions 217.73 227.22
Dividendpaid (10,161.21) (8,665.92)
Dividenddistributiontaxpaid (2,068.58) (1,764.18)
Interestpaid (1,141.15) (1,053.70)
ExpensesonInitialPublicOffer (1,744.66) (218.28)
Net cash flows from financing activities (C) 81,297.49 (11,252.02)
D. Net Increase in Cash & Cash Equivalents (A)+(B)+(C) 11,595.91 16,450.97
Cash and cash equivalent at the beginning of the Year
Cashonhand 0.00 1.24
BalancewithBanksincurrentaccountanddepositaccount 67,598.15 51,145.94Cashandcashequivalents(asperNote16) 67,598.15 51,147.18
Cash and cash equivalent at the end of the Year
Cashonhand 0.12 0.00
BalancewithBanksincurrentaccountanddepositaccount 79,193.94 67,598.15Cashandcashequivalents(asperNote14) 79,194.06 67,598.15
Note:Figuresinbracketsindicateoutflow.CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheFinancialStatements 3-55ForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
(`inlakhs)
130 Cochin Shipyard Ltd
STATEMEnT OF ChAngES In EquITyfortheyearendedMarch31,2018
A. Equity Share Capital (`inlakhs)
As at 01.04.2017 Changes in equity share capital during the year As at 31.03.2018
11,328.00 2,265.60 13,593.60
As at 01.04.2016 Changes in equity share capital during the year As at 31.03.2017
11,328.00 0.00 11,328.00
B.OtherEquity (`inlakhs)Reserves and Surplus
TotalCapital Reserve
Securities Premium Reserve
General Reserve
RetainedEarnings
Capital Redemption
Reserve
Debenture Redemption
Reserve
Balance as at April 01,2017 263.56 0.85 6,322.75 172,081.27 11,914.20 947.61 191,530.24
Profitfortheyear 39,675.01 39,675.01Othercomprehensiveincomefortheyear (134.08) (134.08)Total comprehensive income for the year 39,540.93 39,540.93 Dividends(includingtaxes) (12,229.79) (12,229.79)Transferfromretainedearnings (288.33) 288.33 0.00PremiumonIPOnetofDeferredTax 93,151.83 93,151.83Amortisationofpremium (0.12) (0.12)Balance as at March 31,2018 263.56 93,152.56 6,322.75 199,104.08 11,914.20 1,235.94 311,993.09
Balance as at April 01,2016 263.56 0.97 6,322.75 150,944.38 11,914.20 659.28 170,105.14
Priorperiodadjustments (192.79) (192.79)
Restatedbalanceatthebeginningofthereportingperiod 263.56 0.97 6,322.75 150,751.59 11,914.20 659.28 169,912.35
Profitfortheyear 32,154.70 32,154.70Othercomprehensiveincomefortheyear (106.59) (106.59)Total comprehensive income for the year 32,048.11 32,048.11Dividends(includingtaxes) (10,430.10) (10,430.10)Transferfromretainedearnings (288.33) 288.33 0.00Amortisationofpremium (0.12) (0.12)Balance as at March 31,2017 263.56 0.85 6,322.75 172,081.27 11,914.20 947.61 191,530.24
ForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
NotesTo Financial Statements for the year ended 31st March 2018
13146th Annual Report
1. CORPORATE OVERVIEW AND SIGNIFICANT ACCOUNTING POLICIES
1.1. Corporate information
CochinShipyardLimited(referredtoas“CSL”or“theCompany”) ismainly engaged in the construction ofvessels and repairs and refits of all types of vesselsincludingupgradationofshipsperiodicallayuprepairsandlifeextensionofships.
TheCompanyisapubliclimitedcompanyincorporatedand domiciled in India. The address of its corporateoffice is Perumanoor,Kochi,Kerala.As atMarch31,2018, the Government of India holds 75% of theCompany’sequitysharecapital.TheCompany’sequitysharesare listedfortradingonNSELimitedandBSELimitedinIndiaandtaxfreebondsarelistedfortradingonBSELimited.
ThefinancialstatementsfortheyearendedMarch31,2018were approved by the Board of Directors andauthorisedforissueonMay24,2018.
2. Significant Accounting Policies
2.1 Statement of compliance
These financial statements have been prepared inaccordance with the Indian Accounting Standards(referred toas “IndAS”) asprescribedunderSection133oftheCompaniesAct,2013readwithCompanies(IndianAccountingStandards)Rules,2015asamendedfromtimetotime.
2.2 Basis of preparation of Financial Statements
These financial statements have been prepared onthe historical cost basis, except for certain financialinstrumentswhicharemeasuredat fairvaluesat theend of each reporting period, as explained in theaccountingpoliciesbelow.Historicalcostisgenerallybased on the fair value of the consideration giveninexchange forgoodsand services.Fairvalue is theprice thatwouldbe received to sell anassetorpaidtotransferaliabilityinanorderlytransactionbetweenmarketparticipantsatthemeasurementdate.
2.3 Use of estimates and judgements
The preparation of the financial statements inconformitywith the IndAS requiresmanagement tomake judgements, estimates and assumptions thataffect the application of accounting policies and thereportedamountsofassets,liabilitiesanddisclosuresasatdateofthefinancialstatementsandthereportedamountsoftherevenuesandexpensesfortheyearspresented.Theestimatesandassociatedassumptionsare basedonhistorical experience andother factorsthat are considered to be relevant. Actual resultsmay differ from these estimates under differentassumptionsandconditions.
The estimates and underlying assumptions arereviewedonanongoingbasis.Revisionstoaccountingestimates are recognized in the period inwhich theestimate is revised if the revision affects only thatperiod or in the period of the revision and futureperiodsiftherevisionaffectsbothcurrentandfutureperiods.
2.4 Critical Accounting estimates and judgements:
Theapplicationofsignificantaccountingpoliciesthatrequirecriticalaccountingestimatesinvolvingcomplexandsubjectivejudgementsandtheuseofassumptionsinthefinancialstatementshavebeendisclosedbelow:
Useful lives of property, plant and equipment
The Company reviews the estimated useful livesandresidualvaluesofproperty,plantandequipmentat the end of each reporting period. Assumptionsare also made as to whether an item meets thedescriptionofassetsoastowarrantitscapitalisationandwhichcomponentoftheassetmaybecapitalised.Reassessment of life may result in change indepreciationexpenseinfutureperiods.
Valuation of deferred tax assets / liabilities
The Company reviews the carrying amount ofdeferred tax assets / liabilities at the end of eachreportingperiod.Significant judgementsare involvedindeterminingtheelementsofdeferredtaxitems.
NotesTo Financial Statements for the year ended 31st March 2018
132 Cochin Shipyard Ltd
Impairment of unquoted investments
TheCompanyreviewsitscarryingvalueofinvestmentsannually,ormorefrequentlywhenthereisindicationforimpairment. If the recoverableamount is less than itscarryingamount,theimpairmentlossisaccountedfor.
Recognition and measurement of provisions
The recognition and measurment of provisions arebased on the assessment of the probability of anoutflow of resources and on past experience andcircumstance known at the balance sheet date. Theactual outflow of resources at a future date maythereforevaryfromthefigureincludedinprovisions.
Provision towards Guarantee repairs
Aprovisionismadetowardsguaranteerepairs/claimsinrespectofnewlybuiltships/smallcraftsdeliveredandrepairedshipsonthebasisofthetechnicalestimationdonebytheCompany.Theguaranteeclaimsreceivedfrom the ship owners are reviewed every year tillsettlement of the same. In case of a shortfall in theprovisionmadeearlier,additionalprovisionsaremade.
Contingencies and commitments
Acontingentliabilityisapossibleobligationthatarisesfrompast eventswhose existencewill be confirmedbytheoccurrenceornon-occurrenceofoneormoreuncertainfutureeventsnotwhollywithinthecontrolof the Company or a present obligation that is notrecognisedbecauseitisnotprobablethatanoutflowof resourceswill be required to settle the obligationoritcannotbemeasuredwithsufficientreliability.TheCompanydoesnotrecogniseacontingentliabilitybutdisclosesitsexistenceinthefinancialstatements.
Recoverability of advances / receivables
TheCompanymakesprovisionsforexpectedcreditlossbasedonanassessmentoftherecoverabilityoftradeand other receivables. The identification of doubtfuldebtsrequiresuseofjudgementandestimates.Wheretheexpectationisdifferentfromtheoriginalestimate,suchdifferencewill impact the carryingvalueof thetradeandotherreceivablesandexpensesonaccount
ofprovisionfordoubtfuldebtsintheperiodinwhichsuchestimatehasbeenchanged.Ateachbalancesheetdate,basedonhistoricaldefault ratesobservedoverexpectedlife,themanagementassessestheexpectedcreditlossonoutstandingreceivablesandadvances.
Fair value measurements
Management applies valuation techniques todetermine the fair value of financial instruments(whereactivemarketquotesarenotavailable)andnon-financialassets.Thisinvolvesdevelopingestimatesandassumptionsconsistentwithhowmarketparticipantswould price the instrument. Management bases itsassumptionsonobservabledataasfaraspossiblebutthis isnotalwaysavailable.Inthatcasemanagementuses the best information available. Estimated fairvaluesmayvaryfromtheactualpricesthatwouldbeachievedinanarm’slengthtransactionatthereportingdate.
Classification of Leases
The Company enters into leasing arrangementsfor various assets. The classification of the leasingarrangement as a finance lease or operating lease isbasedonanassessmentofseveralfactors, including,but not limited to, transfer of ownership of leasedassetatendofleaseterm,lessee’soptiontopurchaseand estimated certainty of exercise of such option,proportion of lease term to the asset’s economiclife, proportion of present value of minimum leasepayments to fairvalueof leasedasset andextentofspecialisednatureoftheleasedasset.
Provision for inventories
Management reviews the inventory ageing on aperiodic basis. This review involves comparison ofthe carrying value of the aged inventory itemswiththerespectivenetrealisablevalue.Thepurposeistoascertainwhetheraprovisionisrequiredtobemadeinthefinancialstatementsforanyobsoleteandslow-movingitemsandthatadequateprovisionforobsoleteand slow-moving inventories has been made in thefinancialstatements.
NotesTo Financial Statements for the year ended 31st March 2018
13346th Annual Report
Provision for Liquidated Damages
Claims for liquidated damages against the Companyare recognized in the financial statements basedon the management’s assessment of the probableoutcomewith reference to the available informationsupplementedbyexperienceofsimilartransactions.
A provision in respect of liquidated damages isrecognised for the period of delay between the duedateofsupplyofgoodsasper thedeliveryscheduleandtheexpecteddateofdeliveryofthesaidgoods.
Revenue Recognition
The Company uses the percentage of completionmethodinaccountingforitsfixedpricecontracts.TheuseofthepercentageofcompletionmethodrequirestheCompanytoestimatethecostsexpendedtodateasaproportiontothetotalcosttobeexpendedonaproject considering thephysicalprogressorfinancialprogresswhichever is lower. Provision for estimatedlossesifanyontheuncompletedpartofthecontractsareprovidedintheperiodinwhichsuchlossesbecomeprobablebasedontheexpectedcontractestimatesatthereportingdate.
Recognition and measurement of defined benefit obligations
The obligation arising from defined benefit plan isdeterminedonthebasisofactuarialassumptions.Keyactuarial assumptions include discount rate, trendsin salary escalation and vested future benefits andlifeexpectancy.Thediscountrateisdeterminedwithreferencetomarketyieldsattheendofthereportingperiod on the Government bonds. The period tomaturity of the underlying bonds correspond to theprobable maturity of the post employment benefitobligations.
2.5 Property , Plant and Equipment (PPE)
TheCompanyhadappliedfortheonetimetransitionexemption of considering the carrying cost on thetransition date i.e. April 1, 2015 as the deemedcost under Ind AS. Hence regarded thereafter ashistorical cost.
Property,PlantandEquipmentsarestatedatcostlessaccumulated depreciation (other than free hold landwhicharestatedatcost)andimpairmentlosses,ifany.PPEareinitiallyrecognisedatcost.TheinitialcostofPPEcomprisesitspurchaseprice,andanycostsdirectlyattributabletobringingtheassettothe locationandconditionnecessaryfor it tobecapableofoperatinginthemannerintendedbymanagementincludingnonrefundabledutiesandtaxesnetofanytradediscountsandrebatesThecostofPPEalsoincludesinterestonborrowings (borrowing cost directly attributable toacquisition, construction or production of qualifyingassets)uptoinitialrecognition.
Subsequent costs are included in the asset’s carryingamountorrecognisedasaseparateasset,asappropriate,onlywhenitisprobablethatfutureeconomicbenefitsassociatedwiththeitemwillflowtotheCompanyandthecostoftheitemsarematerialandcanbemeasuredreliably. The carrying amount of any componentaccountedforasaseparateassetisderecognisedwhenreplaced.Allotherrepairsandmaintenancearechargedto Statement of profit and loss during the reportingperiodinwhichtheyareincurred.
2.6 Capital work in progress and intangible assets under development:
Capital work in progress and intangible assets underdevelopment are property, plant and equipment thatarenotyetreadyfortheirintendeduseatthereportingdate,whicharecarriedatcost,comprisingdirectcost,relatedincidentalexpensesandattributableborrowingcost.
2.7 Intangible Assets
Design development: Cost incurred on DesignDevelopment which are not directly chargeable ona product are capitalized as Intangible Asset andamortisedonastraight-linebasisoveraperiodoffiveyears.
Software: Cost of software which is not an integralpartof the relatedhardwareacquired for internaluseis capitalised as intangible asset and amortised on astraight-linebasisoveraperiodofthreeyears.
NotesTo Financial Statements for the year ended 31st March 2018
134 Cochin Shipyard Ltd
Right to use: Up- front fee paid for securing rightto use of land and other facility is capitalized asintangibleassetandamortisedonastraightlinebasisovertheperiodofleaseforwhichtherighthasbeenobtained.
Internally generated procedure: Cost of internallygeneratedweld procedure is capitalized as IntangibleAsset and amortised on a straight-line basis over aperiodofthreeyears.
The residual values, useful lives and methods ofamortization of intangible assets are reviewed ateach financial year end and adjusted prospectively, ifappropriate.
2.8 Leases
As a lessee:
Leases are classified as finance leaseswhenever thetermsof lease transfer substantially all the risks andrewards of ownership to the lessee. Leases wherea significant portion of the risks and rewards ofownershipareretainedbythelessorareclassifiedasoperatingleases.
(i) Operating Lease:
Operating lease payments are recognized as anexpense in the Statement of Profit and Loss on astraight-line basis over the lease term exceptwhereanothersystematicbasisismorerepresentativeofthetimepattern inwhicheconomicbenefitsfromleasedassets are consumed or unless the lease agreementexplicitlystatesthatincreaseisonaccountofinflation.
(ii) Finance Lease:
AssetstakenonleasebytheCompanyinitscapacityaslessee,wheretheCompanyhassubstantiallyalltherisksandrewardsofownershipareclassifiedasfinancelease. Such leases are capitalised at the inceptionof the leaseat lowerof the fairvalueor thepresentvalueoftheminimumleasepaymentsandaliabilityisrecognisedforanequivalentamount.Eachleaserentalpaidisallocatedbetweentheliabilityandtheinterestcostsoastoobtainaconstantperiodicrateofinterestontheoutstandingliabilityforeachyear.
As a lessor:
Lease income is recognised based on the leaseagreementsandischargedtoStatementofProfitandLoss
2.9 Investment Properties
Investment properties are properties held to earnrentals and/or for capital appreciation. Investmentproperties are measured initially at cost includingtransaction costs. Subsequent to initial recognition,investment properties are stated at cost lessaccumulated depreciation and impairment losses.Any gain or loss on disposal of investment propertyisdeterminedasthedifferencebetweennetdisposalproceedsandthecarryingamountofthepropertyandisrecognisedintheStatementofProfitandLoss
2.10 Depreciation
Depreciation on property, plant and equipment isprovided on straight-line method based on usefullife of the asset as prescribed in Schedule II to theCompaniesAct,2013.
For the assets acquired from Cochin Port Trust forInternational Ship Repair Facility (ISRF),depreciationis provided on the basis of remaining useful life asassessedbytechnicalexperts.
An item of property, plant and equipment and anysignificant part initially recognised is derecognisedupon disposal orwhen no future economic benefitsare expected from its use or disposal.Any gain/lossarising on derecognition of the asset is included inthe Statement of profit and loss when the asset isderecognised.Fully depreciated assets still in use areretainedinfinancialStatementsatresidualvalue.
Depreciationmethod,usefullivesandresidualvaluesare reviewed at each reporting date and adjustedprospectively,ifappropriate.
Management believes that useful life of assets aresame as those prescribed in Schedule II to theAct,exceptforcertaintypesofbuildingsandequipmentswhereinbasedontechnicalevaluation,usefullifehasbeen estimated to be different from that prescribed
NotesTo Financial Statements for the year ended 31st March 2018
13546th Annual Report
in Schedule II of the Act.Useful life considered forcalculationofdepreciationforvariousassetsclassareasfollows:
Asset Class Useful LifeBuildings 3-60yearsPlantandequipment 5-15yearsFurnitureandfixtures 8-10yearsVehicles 8-10yearsOfficeequipment 3-10yearsDataProcessingEquipments 3-6yearsDocksandquays 15 yearsRailwaysidings 15 yearsElectricalinstallation 10yearsDrainageandwatersupply 15 yearsVessels 13-28years
2.11 Impairment of Assets
TheCompanyassessestheimpairmentofassetswithreferencetoeachcashgeneratingunit,ateachBalanceSheet date. If events or changes in circumstancesbasedoninternalandexternalfactorsindicatethatthecarryingvaluemaynotberecoverableinfull,thelossonaccountandtherecoverableamount,isaccountedforaccordingly.Therecoverableamountisthehigherofanasset’sfairvaluelesscostsofdisposalandvaluein use.
2.12 Non-current assets held for sale
Company classifies a non-current asset as held forsaleifitscarryingamountwillberecoveredprincipallythroughasaletransaction.Thisconditionisregardedasmetonlywhentheassetisavailableforimmediatesale in its present condition and its sale is highlyprobable.
Non-currentassetsincludingdiscontinuedoperations,classifiedasheldforsalearemeasuredatthelowerofthecarryingamountsandfairvalue lesscosts tosellandpresentedseparately inthefinancialstatements.Once classified as held for sale, the assets are notsubjecttodepreciationoramortisation.
Any profit or loss arising from the sale or re-measurementofdiscontinuedoperationsispresentedaspartofasinglelineiteminstatementofprofitandloss
2.13 Investment in subsidiary
TheCompanyhasaccountedforitssubsidiaryatcostin its standalone financial statements in accordancewithIndAS-27,SeparateFinancialStatements.
2.14 Inventories
(a) Rawmaterials,components,storesandsparesarevaluedatweightedaveragecostmethodornetrealisablevaluewhicheverislower.Provisionforobsolescence / non- usability / deterioration isdeterminedonthebasisoftechnicalassessmentmade by the management. Goods in transit isvalued at lower of cost or net realisable value.Stock ofmaterials in respect of constructionofdefence vessels wherein the cost incurred isreimbursedbytheownerareshownasreductionfrom the advances paid by the owner forconstructionofthevessel.
(b) Workinprogress:
WorkinprogressShipBuilding:-Workinprogressisrecognisedonlywhenthepercentageofphysicalcompletionislessthanthefinancialcompletion,inwhichcasethecostproportionatetoexcessofpercentageoffinancialcompletionoverphysicalcompletion is treated as Work in progress. Inthe case of IndigenousAircraft Carrier since allthe materials belongs to Indian Navy, work inprogressisnotrecognized.
Work in progress of ships/offshore structures underrepair, which have not reached 75% stage ofphysicalcompletionandgeneralengineeringjobsare valued at cost.Work- in- progress of shipswhere physical construction has not started isalsovaluedatcost.
(c) Loose tools in stock are valued at cost afterproviding for loss on revaluation estimated at30%ofbookvalue.
NotesTo Financial Statements for the year ended 31st March 2018
136 Cochin Shipyard Ltd
(d) Stock of scrap is valued at net realizable valueafter adjusting customsduty, if any, payableonthe scrap.
2.15 Financial instruments
Financial assets and liabilities are recognised whenthe Company becomes a party to the contractualprovisions of the instrument
Financial assets and liabilities are initially measuredat fair value. Transaction costs that are directlyattributable to the acquisition or issue of financialassets and financial liabilities (other than financialassets and financial liabilities at fair value throughprofitorloss)areaddedtoordeductedfromthefairvaluemeasuredoninitialrecognitionoffinancialassetorfinancialliability.
Financial assets at fair value through other comprehensive income (FVTOCI)
Financial assets are measured at fair value throughothercomprehensive income if thesefinancialassetsareheldwithinabusinesswhoseobjectiveisachievedbybothcollectingcontractualcashflowsthatgiveriseonspecifieddatestosolelypaymentsofprincipalandinterest on theprincipal amount outstanding andbysellingfinancialassets.
Financial assets at fair value through statement of profit and loss (FVTPL)
Financial assets are measured at fair value throughprofitor lossunless it ismeasuredatamortisedcostorat fairvaluethroughothercomprehensive incomeon initial recognition. The transaction costs directlyattributable to the acquisition of financial assetsand liabilities at fair value through profit or loss areimmediatelyrecognisedinstatementofprofitandloss.
Financial Assets
Financial assets at amortised cost
Financial assets are subsequently measured atamortisedcostifthesefinancialassetsareheldwithina business whose objective is to hold these assets
in order to collect contractual cash flows and thecontractual terms of the financial asset give rise onspecifieddatestocashflowsthataresolelypaymentsof principal and interest on the principal amountoutstanding.
Investments
AllequityinvestmentsinscopeofIndAS109FinancialInstruments, are measured at fair value. Equityinstrumentswhich are held for trading are classifiedas at FVTPL. For all other equity instruments, theCompanymaymakeanirrevocableelectiontopresentin other comprehensive income subsequent changesinthefairvalue.TheCompanymakessuchelectiononaninstrument-by-instrumentbasis.Theclassificationismadeoninitialrecognitionandisirrevocable
Trade Receivables
The Company assesses at each Balance Sheet datewhetherafinancialassetoragroupoffinancialassetisimpaired.IndAS109requiresexpectedcreditlosstobemeasuredthroughalossallowance.TheCompanyrecognises lifetime expected credit losses for alltrade receivables that do not constitute a financingtransaction. Impairment lossallowance isbasedonasimplified approach as permitted by IndAS 109.Asa practical expedient, the company uses a provisionmatrix to determine the impairment loss on theportfolioofitstradereceivables.
Full provision is made for all trade receivablesconsidereddoubtfulofrecoverywhenthedebtismorethanthreeyearsorif it isprobable/certainthatthedebtisnotrecoverable.
Where debts are disputed in legal proceedings,provision ismade ifanydecision isgivenagainst thecompany even if the same is taken up on appeal tohigherauthorities/courts.
Impairmentlossallowance(orreversal)thatisrequiredtoberecognisedatthereportingdateisrecognisedasanimpairmentlossorgainintheStatementofProfit&LossAccount.
NotesTo Financial Statements for the year ended 31st March 2018
13746th Annual Report
Cash and cash equivalents
The Company considers all highly liquid financialinstruments,whicharereadilyconvertibleintoknownamounts of cash that are subject to an insignificantriskofchange invalueandhavingoriginalmaturitiesofthreemonthsorlessfromthedateofpurchase,tobecashequivalents.Cashandcashequivalentsconsistof balances with banks which are unrestricted forwithdrawalandusage.
Financial liabilities
Financial liabilities are measured at amortised costusingtheeffectiveinterestratemethod.
Equity Instruments
An equity instrument is a contract that evidencesresidual interest in the assets of the company afterdeducting all of its liabilities. Equity instruments arerecognised at the proceeds received net off directissue cost.
Off setting of financial instruments
Financialassetsandfinancialliabilitiesareoffsetandthenetamount is reported infinancial statements ifthere is a currently enforceable legal right to off setthe recognisedamounts and there is an intention tosettleonanetbasis,torealisetheassetsandsettletheliabilitiessimultaneously.
Foreign Currency Transactions
Functional & Presentation Currency
The financial statements are presented in IndianRupees (“INR”),which is the functional currencyandpresentationcurrencyoftheCompany.
Transactions & Balances:
Foreign exchange transactions are recorded infunctional currency adopting the exchange rateprevailing on the dates of respective transactions.Monetory items denominated in foreign currenciesattheyearendarere-measuredattheexchangerateprevailing on the balance sheet date.Nonmonetaryforeigncurrencyitemsarecarriedatcost.Anyincome
orexpenseonaccountofexchangedifferenceeitheronsettlementoronrestatement isrecognised inthestatementofProfitandLoss.
Derivative instruments and hedge accounting:
The Company designates certain foreign exchangeforwardcontractsashedgeinstrumentsinrespectofforeignexchangerisks.Thesehedgesareaccountedforascashflowhedges.Derivativesareinitiallyrecognisedatfairvalueonthedateaderivativecontactisenteredinto and are subsequently re-measured to their fairvalueattheendofeachreportingperiod.
Theuseof foreigncurrencyandderivativecontractsis governed by theCompany’s foreign exchange riskmanagementpolicyapprovedbytheBoardofDirectorswhich providewritten directives on the use of suchfinancial derivatives consistent with the Company’srisk management strategy. The company does notuse derivative financial instruments for speculativepurposes.
The hedge instruments are designated anddocumentedashedgesattheinceptionofthecontract.Theeffectivenessofhedgeinstrumentstoreducetheriskassociatedwiththeforeigncurrencyexposurethatisbeinghedgedisassessedandmeasuredatinceptionand on an ongoing basis. The ineffective portion ofdesignatedhedgesarerecognisedimmediatelyintheStatementofProfitandLoss.
Theeffectiveportionofchangeinthefairvalueofthedesignated hedging instrument is recognised in theOtherComprehensiveIncomeandaccumulatedundertheheadingcashflowhedgereserve.
Hedgeaccounting isdiscontinuedwhen thehedginginstrumentexpiresorissold,terminatedorexercisedwithout replacement or rollover (as part of hedgingstrategy), or if its designationas ahedge is revoked,orwhen the hedge no longermeets the criteria forhedge accounting. Any gain or loss recognised inOther Comprehensive Income and accumulated inequity till that time remains and is recognised inStatement of Profit and Loss when the forecasted
NotesTo Financial Statements for the year ended 31st March 2018
138 Cochin Shipyard Ltd
transactionultimatelyaffectstheprofitorloss.Whenaforecastedtransactionisnolongerexpectedtooccur,the cumulative gain or loss accumulated in equity istransferredtotheStatementofProfitandLoss.
2.16 Advance/progress payments received
Advance/progresspaymentsreceivedfromcustomersinrespectofrepairworkofships/offshorestructuresare shown as deduction from the amount of workin progress in respect of income recognized underproportionatecompletionmethod.Inthecaseofshipbuilding, the advance payment received is adjustedonlywhentheshipisinvoiced.
2.17 Provision , Contingent Liabilities and Contingent assets
A provision is recognised if, as a result of a pastevent, the Company has a present legal obligationthatcanbeestimatedreliably,andit isprobablethatan outflow of economic benefitswill be required tosettletheobligation.Provisions(excludingretirementbenefits and compensated leave) are not discountedto its presentvalue and are determined by the bestestimateoftheoutflowofeconomicbenefitsrequiredtosettletheobligationatthereportingdate.Thesearereviewedateachreportingdateadjustedtoreflectthecurrentbestestimates.
Provisiontowardsguaranteeclaimsinrespectofships/smallcraftsdeliveredwhereverprovidedmaintainedisbasedontechnicalestimation.Fortheshipsdelivered,guarantee claims are covered by way of insurancepoliciescoveringtheguaranteeperiodoncasetocasebasis,whereverrequired.
Inthenormalcourseofbusiness,contingentliabilitiesmay arise from litigations and other claims againstthe Company. Where the potential liabilities havea low probability of crystallizing or are very difficultto quantify reliably, we treat them as contingentliabilities. Such liabilities are disclosed in the notesbut are not provided for in the financial statements.Althoughtherecanbenoassuranceregardingthefinaloutcomeof the legalproceedings,wedonotexpect
them to have a materially adverse impact on ourfinancial position or profitability.The Company doesnot recognise a contingent liability but discloses itsexistenceinthefinancialstatements.
Contingentassetsareneitherrecognisednordisclosed.However, when realisation of income is virtuallycertain,relatedassetisrecognised
2.18 Revenue Recognition
a) Contracts for the construction of ships and small crafts (Other than Indigenous Aircraft Carrier)
Theincomefromshipbuildingisrecognizedonpercentageofcompletionmethod,intheproportion the cost incurred for the workperformeduptothereportingdatebeartotheestimatedtotalcontractcost,consideringthe physical progress or financial progress,whicheverislower.Wherecurrentestimatesoftotalcontractcostsandrevenueindicatealoss,provisionismadefortheentireloss,irrespectiveoftheamountofworkdone.
b) Construction of Indigenous Aircraft Carrier
In the case of construction of IAC whichis partly fixed price basis and partly costplus basis, the income from fixed price isrecognisedonthepercentageofcompletionmethod.
Mark up from cost plus part of contractactivities for materials and designoutsourcingarerecognisedwhenpaymentstowards the same are made. Cost ofmaterials, value of design outsourcing andother expenses incurred for the vesselwhicharerecoverableseparatelyfromNavyischargedofftostatementofProfitandLosswhenmaterialsareconsumed/activitiesareperformed/expenses are incurred and aregrossedupwiththevalueofworkdoneandrecognisedasincome.
NotesTo Financial Statements for the year ended 31st March 2018
13946th Annual Report
c) Contracts for repair of ships/ Offshore structures:Income from repair of ships /Offshorestructures is recognized based onproportionate completion method whenproportionate performance of each shiprepair activity exceeds 75% after takinginto consideration possible contingencieswith reference to the realizable value ofwork done. The proportionate progressis measured by the Company’s technicalevaluation of the percentage of physicalcompletionofeach job. Inthecaseofshiprepair contracts completed and invoicessettled during theyear, income recognizedis net of reductions due to price variationadmitted. Inthecaseofunsettled invoices,the income is recognised net of estimatedamountofreductions.Differences,ifany,onsettlement are adjusted against income intheyearofsettlement.
d) Government GrantsGovernment grants are recognised whenthere is reasonable assurance that theCompany will comply with the conditionsattachingtothemandthatthegrantswillbereceived.Government grants are recognised inStatementofProfitandLossonasystematicbasisovertheperiodsinwhichtheCompanyrecognises as expenses the related costsfor which the grants are intended tocompensate. Where the Grant relates toanassetvalue, it is recognisedasdeferredincome, and amortised over the expecteduseful life of the asset. Other grants arerecognisedinthestatementofProfit&Lossconcurrent to the expenses towhich suchgrantsrelate/areintendedtocover.Government grants that are receivableas compensation for expenses or losses
already incurred or for the purpose ofgiving immediate financial support to theCompany with no future related costsare recognised in statement of profit &loss in the period in which they becomereceivable.
e) Liquidated damages and interest on advances
No income has been recognized onaccount of (a) interest on advances givenand (b) liquidated damages, where theleviesdependondecisions regarding forcemajeure condition of contract. These areaccounted for on completion of contractsand/orwhenfinaldecisionsaretaken.
f) Accounting for insurance claims
(i) Warranty/Builder Risk claims
In the case of guarantee defectscovered under warranty insurancepolicies or claims under builders riskInsurance Policies, the insuranceclaims lodged will be recognized inthe financial statments in the year inwhich the survey is completed andthe probable amount of settlementintimatedbytheinsuranceCompany.
(ii) Other Insurance Policies
InthecaseofotherInsurancePolicieslikeAssetInsurance,TransitInsurance,Marine Insurance, Cash Insuranceetc., the claims are recognized in thethe financial statments on settlementof theclaimsbywayof receiptof theamountfromtheInsuranceCompany.
g) Others
Dividend income is recognized when theCompany’s right to receive payment hasbeenestablished.
NotesTo Financial Statements for the year ended 31st March 2018
140 Cochin Shipyard Ltd
2.19 Employee benefits
Employee benefits consist of salaries and wages,contribution to provident fund, superannuationfund, gratuity fund, towards medical assistance,which are short term in nature and contributiontowardscompensatedabsences,whichislongtermin nature.
Post-employment benefit plans
Defined Contribution plans
Defined contribution to Employees Pension schemeforeligibleemployeesaremadetoCSLSuperannuationPensionTrustforExecutivesandSupervisorsandCSLWorkmenPensionTrustandarechargedasexpenseastheyfalldue.SuchbenefitsareclassifiedasDefinedContributionSchemesastheCompanydoesnotcarryany further obligations, apart from the contributionsmade.
The Company also makes contribution towardsprovidentfund,insubstanceadefinedcontributionretirement benefit plan. The provident fund isadministeredbytheTrusteesoftheCochinShipyardLimited Employees Contributory Provident FundTrust. The rules of the Company’s provident fundadministeredbytheTrust,requirethatiftheBoardof Trustees are unable to pay interest at the ratedeclared by the Employees’ Provident Fund bythe Government under para 60 of the Employees’Provident Fund Scheme, 1952 for the reason thatthe return on investment is less or for any other reason, then the deficiency shall be made goodby the Company. Having regard to the assets ofthe fund and the return on the investments, theCompanydoesnotexpectanydeficiencyasat theyearend.
The Company also makes contribution towardsEmployees Medical Assistance Trusts which arecharged as expense as they fall due. Such benefitsareclassifiedasDefinedContributionSchemesastheCompanydoesnotcarryanyfurtherobligations,apartfromthecontributionsmade.
Defined benefit plans
TheCompanyprovidesforgratuity,adefinedbenefitretirement plan covering eligible employees. Theliability or asset recognised in the balance sheet inrespectofitsdefinedbenefitplanisthepresentvalueof the defined benefit obligation at the end of thereportingperiodlessthefairvalueofplanassets.Thedefinedbenefitobligationiscalculatedperiodicallybyactuariesusingtheprojectedunitcreditmethod.
Thepresentvalueofthesaidobligationisdeterminedby discounting the estimated future cash outflows,using market yields of government bonds that havetermsapproximatingthetermsoftherelatedliability.
The interest income / (expense) are calculated byapplyingthediscountratetothenetdefinedbenefitliabilityorasset.Thenetinterestincome/(expense)onthenetdefinedbenefitliabilityorassetisrecognisedintheStatementofProfitandloss.
Remeasurement gains and losses arising fromexperience adjustments and changes in actuarialassumptionsarerecognisedintheperiodinwhichtheyoccur, directly in other comprehensive income.Theyare includedinretainedearnings intheStatementofChangesinEquityandintheBalanceSheet.
Changes in the present value of the defined benefitobligation resulting from plan amendments orcurtailmentsarerecognisedimmediatelyinStatementofprofitandlossaspastservicecost.
Other employee benefits
Compensated absences
TheCompanyhasapolicyoncompensatedabsencewhich are both accumulating and non-accumulatingin nature. The expected cost of accumulatingcompensated absence is determined by Actuarialvaluation performed by an independent actuary ateach Balance Sheet date using projected unit creditmethod on the additional amount expected to bepaid/availedasaresultofunusedentitlementthathasaccumulated at the Balance Sheet date. Expense on
NotesTo Financial Statements for the year ended 31st March 2018
14146th Annual Report
non-accumulatingcompensatedabsenceisrecognisedintheperiodinwhichtheabsencesoccur.
2.20 Borrowing cost
General and specific borrowing costs directlyattributabletoacquisition/constructionorproductionofqualifyingassets(netofincomeearnedontemporarydeployment of funds) are capitalized as part of costof such assets upto the date when such assets areready for the intendeduse.Aqualifyingasset isonethatnecessarilytakessubstantialperiodoftimetogetready for its intendeduse.All otherborrowingcostsarechargedtotheStatementofProfitandLossintheperiodinwhichtheyareincurred.Borrowingcostalsoincludesexchangedifferencestotheextentregardedasanadjustmenttotheborrowingcosts
2.21 Corporate Social Responsibility
TheCompanyhasoptedtochargeitsCorporateSocialresponsibility (CSR) expenditure to the Statement ofProfit&Loss,exceptinrespectofexpenditureincurredagainst the non-lapsable provision held under theguidelinesofDepartmentofPublicEnterprises(DPE)
2.22 Prior period adjustment
Priorperiodadjustmentsduetoerrors,havingmaterialimpact on the financial affairs of the Company, arecorrectedretrospectivelybyrestatingthecomparativeamountsforpriorperiodspresentedinwhichtheerroroccurred or if the error occurred before the earliestperiodpresented,byrestatingtheopeningstatementoffinancialposition.
2.23 Taxes on Income
Income tax
Income tax expense comprises current tax expenseand the net change in the deferred tax asset orliability during the year.Current and deferred taxesarerecognisedinStatementofProfitandLoss,exceptwhentheyrelatetoitemsthatarerecognisedinothercomprehensive incomeordirectly inequity, inwhichcase,thecurrentanddeferredtaxarealsorecognisedin other comprehensive incomeor directly in equity,respectively.
Current tax
Currenttaxismeasuredattheamountoftaxexpectedtobepayableon the taxable income for theyear asdetermined in accordance with the provisions ofthe Income Tax Act, 1961.Current tax assets andcurrenttaxliabilitiesareoffsetwhenthereisalegallyenforceable right to set off the recognized amountsand there is an intention to settle the asset and theliabilityonanetbasis.
Deferred tax
Deferred incometax is recognisedusing theBalanceSheet approach. Deferred income tax assets andliabilities are recognised for deductible and taxabletemporarydifferencesarisingbetweenthetaxbaseofassetsandliabilitiesandtheircarryingamount,exceptwhen thedeferred income taxarises from the initialrecognition of an asset or liability in a transactionthatisnotabusinesscombinationandaffectsneitheraccountingnortaxableprofitorlossatthetimeofthetransaction.
Deferredtaxassetsarerecognisedonlytotheextentthat it is probable that either future taxable profitsor reversalofdeferredtax liabilitieswillbeavailable,against which the deductible temporary differences,andthecarryforwardofunusedtaxcreditsandunusedtaxlossescanbeutilised.
The carrying amount of a deferred tax asset shallbe reviewed at the end of each reporting date andreducedtotheextentthatitisnolongerprobablethatsufficienttaxableprofitwillbeavailabletoallowallorpartofthedeferredincometaxassettobeutilised.
Deferredtaxassetsandliabilitiesaremeasuredusingthe tax rates and tax laws that have been enactedorsubstantivelyenactedby theendof thereportingperiod and are expected to apply when the relateddeferred tax asset is realised or the deferred taxliabilityissettled.
Deferred tax assets and liabilities are off set whenthere is a legally enforceable right to offset currenttax assets and liabilities andwhen the deferred taxbalancesrelatetothesametaxationauthority.
NotesTo Financial Statements for the year ended 31st March 2018
142 Cochin Shipyard Ltd
Minimum Alternate Tax credit is recognised asdeferredtaxassetonlywhenandtotheextentthereisconvincingevidencethattheCompanywillpaynormalincometaxduringthespecifiedperiod.Suchasset isreviewedateachBalanceSheetdateandthecarryingamountoftheMATcreditassetiswrittendowntotheextentthereisnolongeraconvincingevidencetotheeffect that theCompanywill paynormal income taxduringthespecifiedperiod.
2.24 Earnings Per Share
Basic earnings per share is computed by dividingprofitorlossattributabletoequityshareholdersoftheCompanybytheweightedaveragenumberofequitysharesoutstandingduringtheyear.TheCompanydidnot have any potentially dilutive securities in any oftheyearspresented.
2.25 Segment Reporting
Operating segments are defined as components ofanenterpriseforwhichdiscretefinancial informationis available that is evaluated regularly by the chiefoperatingdecisionmaker,indecidinghowtoallocateresourcesandassessingperformance.TheCompany’schief operating decision maker is the Chairman &ManagingDirector.
The Company has identified business segments(industry practice) as reportable segments. Thebusiness segments comprise: 1) ShipBuilding and2)RepairofShips/offshorestructures.
Segmentrevenue,segmentexpenses,segmentassetsandsegmentliabilitieshavebeenidentifiedtosegmentson the basis of their relationship to the operatingactivities of the segment. Revenue, expenses, assetsandliabilitieswhichrelatetotheCompanyasawholeand are not allocable to segments on a reasonablebasishavebeenincludedunder“unallocatedrevenue/expenses/assets/liabilities”.
2.26 Statement of cash flow
Cash Flows are reported using the IndirectMethod,whereby profit/loss before tax is adjusted for theeffect of transactions of non-cash nature and anydeferralsoraccrualsofpastorfuturecashreceiptsor
paymentsanditemsofincomeorexpensesassociatedwith investing or financial cash flows. Cash flowsfrom operating, investing and financial activities ofthe Company are segregated based on the availableinformation.
Forthepurposeofstatementofcashflow,Cashandcashequivalentcomprisecashatbanksandonhandand short-term deposits with an original maturityof three months or less, which are subject to aninsignificantriskofchangesinvalue,netofoutstandingbank overdrafts, if any. Bank overdrafts, if any, aredisclosedwithinborrowingsincurrentliabilitiesintheBalanceSheet
2.27 Dividend to equity shareholders
Dividend to equity shareholders is recognised as aliability and deducted from shareholders’ equity, intheperiodinwhichthedividendsareapprovedbytheequityshareholdersinthegeneralmeeting.
2.28 Recent accounting pronouncements - Standards issued but not yet effective
Appendix B to Ind AS 21, Foreign currency transactions and advance consideration:
On 28 March 2018, MCA has notified the Companies(Indian Accounting Standards) Amendment Rules, 2018containing Appendix B to Ind AS 21, Foreign currencytransactionsandadvanceconsiderationwhichclarifiesthedateofthetransactionforthepurposeofdeterminingtheexchange rate to use on initial recognition of the relatedasset,expenseor income,whenanentityhas receivedorpaidadvanceconsiderationinaforeigncurrency.
Theamendmentwillcomeintoforcefrom1April2018.TheCompanyisevaluatingtherequirementoftheamendmentandthe impactonthefinancialstatements.TheeffectonadoptionofIndAS21isexpectedtobeinsignificant.
Ind AS 115, Revenue from Contract with Customers
IndAS115,RevenuefromContractwithCustomers:
On 28 March 2018, Ministry of Corporate Affairs hasnotified the Ind AS 115, Revenue from Contract withCustomers.
NotesTo Financial Statements for the year ended 31st March 2018
14346th Annual Report
The coreprinciple of IndAS115 is that an entity shouldrecognizerevenuetodepictthetransferofpromisedgoodsand services to customers in an amount that reflects theconsiderationtowhichtheentityexpectstobeentitledinexchange for those goods and services. Further the newstandard requires enhanceddisclosures about the nature,amount,timinganduncertaintyofrevenueandcashflowsarisingfromtheentity’scontractswithcustomers.
Thestandardpermitstwopossiblemethodsoftransition:
-Retrospectiveapproach-Underthisapproachthestandardwill be applied retrospectively to each prior reportingperiodpresentedinaccordancewithIndAS8-Accountingpolicies,changesinaccountingestimatesanderrors.
-Retrospectivelywithcumulativeeffectofinitiallyapplyingthe standard recognized at the date of initial application(Cumulativecatch-upapproach)
Theeffectivedate foradoptionof IndAS115 isfinancialperiodsbeginningonorafter1April2018.
Inviewofthesignificantcomplexitiesinvolved,theCompanyisintheprocessofevaluatingtheimpactonapplicationofIndAS115onitsfinancialstatements.
NotesTo Financial Statements for the year ended 31st March 2018
144 Cochin Shipyard Ltd
Note3:Property,PlantandEquipment
(`inlakhs))Gross carrying amount Depreciation Net Carrying amount
ParticularsAs at
1st April 2017
Additions/ adjustments during the
year
Disposal/ adjustments during the
year
As at 31st
March 2018
As at 1st April
2017
For the year
Adjust-ment/ (with-
drawal)
As at 31st
March 2018
As at 31st
March 2018
As at 31st
March 2017
Owned Assets
Land(Freehold) 587.54 - - 587.54 - - - - 587.54 587.54
Buildings 9,377.91 243.56 - 9,621.47 802.43 670.09 - 1,472.52 8,148.95 8,575.48
Plantandequipment 16,798.49 452.08 3.56 17,247.01 2,707.00 1,426.70 - 4,133.70 13,113.31 14,091.49
Furnitureandfixtures 813.24 64.26 1.67 875.83 165.35 102.94 1.03 267.26 608.57 647.89
Vehicles 344.49 177.14 27.77 493.86 92.74 53.67 3.23 143.18 350.68 251.75
Officeequipment 184.19 24.81 0.07 208.93 74.49 30.27 - 104.76 104.17 109.70
- - -
Others - - -
DataProcessingEquipments 727.21 142.54 0.61 869.14 324.29 177.45 0.02 501.72 367.42 402.92
Docksandquays 4,466.45 - - 4,466.45 644.32 299.41 - 943.73 3,522.72 3,822.13
Railwaysidings 1.10 - - 1.10 - - - - 1.10 1.10
Electricalinstallation 1,182.08 108.73 - 1,290.81 444.64 156.02 - 600.66 690.15 737.44
Drainageandwatersupply 6.67 - - 6.67 - - - - 6.67 6.67
Vessels 19.74 - - 19.74 1.64 1.36 - 3.00 16.74 18.10
SubTotal 34,509.11 1,213.12 33.68 35,688.55 5,256.90 2,917.91 4.28 8,170.53 27,518.02 29,252.21
Leased assets and assets on leased premises
Buildings 838.22 - 838.22 165.53 85.32 - 250.85 587.37 672.69
Plantandequipment 85.89 27.56 - 113.45 25.84 13.27 - 39.11 74.34 60.05
Docksandquays 9.62 - - 9.62 8.35 - 8.35 1.27 1.27
Electricalinstallation 329.54 - 329.54 30.46 33.36 - 63.82 265.72 299.08
SubTotal 1,263.27 27.56 - 1,290.83 230.18 131.95 - 362.13 928.70 1,033.09
Total 35,772.38 1,240.68 33.68 36,979.38 5,487.08 3,049.86 4.28 8,532.66 28,446.72 30,285.30
NotesTo Financial Statements for the year ended 31st March 2018
14546th Annual Report
(` inlakh)s) Gross carrying amount Depreciation Net Carrying amount
ParticularsAs at
1st April 2017
Additions/ adjustments during the
year
Disposal/ adjustments during the
year
As at 31st
March 2018
As at 1st April
2017
For the year
Adjust-ment/ (with-
drawal)
As at 31st
March 2018
As at 31st
March 2018
As at 31st
March 2017
Owned Assets
Land(Freehold) 587.54 - - 587.54 - - - - 587.54 587.54
Buildings 8,241.50 1,137.25 0.84 9,377.91 377.31 425.17 0.05 802.43 8,575.48 7,864.19
Plantandequipment 15,163.91 1,683.66 49.08 16,798.49 1,332.65 1,386.76 12.41 2,707.00 14,091.49 13,831.26
Furnitureandfixtures 599.27 214.45 0.48 813.24 75.65 89.99 0.29 165.35 647.89 523.62
Vehicles 227.23 123.48 6.22 344.49 53.18 43.85 4.29 92.74 251.75 174.05
Officeequipment 156.64 28.48 0.93 184.19 37.66 37.32 0.49 74.49 109.70 118.98
- -
Others - -
DataProcessingEquipments 565.14 162.78 0.71 727.21 153.57 171.28 0.56 324.29 402.92 411.57
Docksandquays 4,466.45 - - 4,466.45 344.91 299.41 - 644.32 3,822.13 4,121.54
Railwaysidings 1.10 - - 1.10 - - - - 1.10 1.10
Electricalinstallation 981.54 200.54 - 1,182.08 216.26 228.38 - 444.64 737.44 765.28
Drainageandwatersupply 6.67 - - 6.67 - - - - 6.67 6.67
Vessels 37.57 - 17.83 19.74 1.02 2.11 1.49 1.64 18.10 36.55
SubTotal 31,034.56 3,550.64 76.09 34,509.11 2,592.21 2,684.27 19.58 5,256.90 29,252.21 28,442.35
Leased assets and assets on leased premises
Buildings 1,155.76 72.79 390.33 838.22 93.28 100.26 28.01 165.53 672.69 1,062.48
Plantandequipment 77.18 8.71 - 85.89 13.32 12.52 - 25.84 60.05 63.86
Docksandquays 9.62 - - 9.62 7.72 0.63 - 8.35 1.27 1.90
Electricalinstallation 82.63 246.91 - 329.54 9.68 20.78 - 30.46 299.08 72.95
SubTotal 1,325.19 328.41 390.33 1,263.27 124.00 134.19 28.01 230.18 1,033.09 1,201.19
Total 32,359.75 3,879.05 466.42 35,772.38 2,716.21 2,818.46 47.59 5,487.08 30,285.30 29,643.54
NotesTo Financial Statements for the year ended 31st March 2018
146 Cochin Shipyard Ltd
Landincludesthevalueof(a)landallottedonleasebasisto(i)BharatiyaVidyaBhavan(0.69045hectare)(ii)M/sIndianOilCorporationLtd(0.620hectare)forlayingpipeline(iii)landleasedtoM/sCochinAirProducts(0.30hectare)and(b)landleasedtoKeralaStateElectricityBoard(0.47hectare).
Valueof land includesvalueofbuildingsacquiredalongwith the land forwhichdepreciationhasnotbeenprovidedasthevalueisnotseparatelyavailableandmostofthesebuildingsarelikelytobedemolishedforputtingupfacilitiesforthefactory.
AssetstakenoverfromCochinPortTrust(CoPT)(₹1291.52lakhs)havebeenvaluedandlifeassessedbytechnicalexperts.Thislifehasbeentakenasabaseforarrivingattheremainingusefullifeforprovidingdepreciationfortheseassets.Theseassets togetherwithassets constructed/installedon land takenon lease fromCoPT,havebeendisclosed separatelyasassetsonleasedpremisesinthenoteno3toProperty,Plant&Equipments.
TheCompanyhascreatedmortgagefor₹12300LakhsonthelandedpropertiesoftheCompanyassecurityforthetaxfreebondsissuedbytheCompanyduringtheyear2013-14.
Note4:Capitalwork-in-progress
(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Plantandmachinery,BuildingsandCivilworks 11,285.07 5,299.88
Capitalyarditems 199.27 92.45
Total 11,484.34 5,392.33
Note5:OtherIntangibleassets
(`inlakhs)
Particulars
Gross carrying amount Amortisation Net Carrying amount
As at 1st April
2017
Addi-tions/ ad-justments during the
year
Disposal/ adjust-ments
during the year
As at 31st
March 2018
As at 1st April
2017
For the year
Adjust-ment/ (with-
drawal)
As at 31st
March 2018
As at 31st
March 2018
As at 31st
March 2017
Internallygeneratedweldprocedure
27.67 - 27.67 10.75 9.22 - 19.97 7.70 16.92
Computer software 1,243.16 123.59 - 1,366.75 984.19 196.20 1,180.39 186.36 258.97
Righttouse-landandshiprepairfacility
7,000.00 - 7,000.00 500.00 242.31 - 742.31 6,257.69 6,500.00
8,270.83 123.59 - 8,394.42 1,494.94 447.73 - 1,942.67 6,451.75 6,775.89
NotesTo Financial Statements for the year ended 31st March 2018
14746th Annual Report
(`inlakhs)
Particulars
Gross carrying amount Amortisation Net Carrying amount
As at 1st April
2016
Addi-tions/ ad-justments during the
year
Disposal/ adjust-ments
during the year
As at 31st
March 2017
As at 1st April
2016
For the year
Adjust-ment/ (with-
drawal)
As at 31st
March 2017
As at 31st
March 2017
As at 31st
March 2016
Internallygeneratedweldprocedure
27.67 - 27.67 1.52 9.23 - 10.75 16.92 26.15
Computersoftware 1,079.50 163.66 - 1,243.16 477.65 506.54 - 984.19 258.97 601.85Righttouse-landandshiprepairfacility
7,000.00 - 7,000.00 250.00 250.00 - 500.00 6,500.00 6,750.00
8,107.17 163.66 - 8,270.83 729.17 765.77 - 1,494.94 6,775.89 7,378.00
TheRighttouseoflandandshiprepairfacilityshownunderIntangibleAssetsrepresentstheupfrontfeepaidtoCochinPortTrusttowardssettingupofInternationalShipRepairFacility(ISRF)project,tobeamortisedovertheperiodofleasewhichwasfurtherextendedbasedonthedateofobtainingofEnvironmentalClearance.AsallenvironmentalclearancesforISRFareobtainedasonJanuary09,2018,theleaseperiodof30yearseffectivelystartsfromthisdate.
Note6:Investments-NonCurrent(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017 Unquoted (Fully Paid up)Investment in equity instruments a) At Fair Value through statement of Profit and LossEquitysharesinsubsidiarycompanyHooghlyCochinShipyardLtd-16280000Equitysharesof₹10each 1,628.00 0.00b) At Fair Value Through Other Comprehensive IncomeCochinShipyardEmployeesConsumerCo-operativeSocietyLimited2175'BClass'sharesof₹100each 2.18 2.18
KeralaEnviroInfrastructureLimited-70000equitysharesof₹10each 7.00 7.00CochinWastetoEnergyPrivateLimited-100000equitysharesof₹10each 10.00 10.00LessdiminutioninvalueofInvestmentCochinWastetoEnergyPrivateLimited (10.00) (10.00)Total 1,637.18 9.18 Aggregatevalueofunquotedinvestment 1,647.18 19.18 Aggregatevalueofimpairmentinvalueofinvestment 10.00 10.00 Consideringtheindicatorsofthevalueofaninvestmentsuchasinvestee’sassets,resultsetc.adecline,otherthantemporary,inthevalueofinvestmentinCochinWastetoEnergy(P)LtdisnoticedandaccordinglyfairvalueisconsideredasNil.
M/sHooghlyCochinShipyardLimited(HCSL)asubsidiaryofCochinShipyardLtd,wasincorporatedonOctober23,2017asanarrangementbetweenM/sCochinShipyardLtd (CSL)andM/sHooghlyDock&PortEngineersLimited (HDPEL)whereinCSLhas16280000equitysharesoffacevalueof₹10eachforcash(74%)andHooghlyDock&PortEngineersLimitedhas5720000equitysharesoffacevalueof₹10eachforconsiderationotherthancash(26%)andthisinvestmentinHCSLisaccountedatcostasperIndAS27-SeparateFinancialStatements.
NotesTo Financial Statements for the year ended 31st March 2018
148 Cochin Shipyard Ltd
Note7:Loans-NonCurrent(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Unsecured,consideredgood:
Securitydeposits 66.89 55.94
Employeeadvances
Loanstorelatedparties 0.00 2.30
Otheremployees 80.88 87.15
Total 147.77 145.39
Note8:Incometaxassets/liability(net)(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Noncurrenttaxassets
Advanceincometaxnetofprovisions 5,400.03 3,601.27
Currenttaxassets/liabilities
Advanceincometaxnetofprovisions (1,071.47) 1,694.74
IncometaxrecognisedintheStatementofprofitandloss(`inlakhs)
Particulars For the year ended March 31,2018 For the year ended March 31,2017
Currenttax:
Currentincometaxcharge 22,406.57 16,394.91
Adjustmentinrespectofprioryears 5.43 (46.56)
Total(A) 22,412.00 16,348.35
Deferredtax:
Inrespectofcurrentyear (1,601.00) 837.00
Total(B) (1,601.00) 837.00
IncometaxexpenserecognisedintheStatementofProfitandLoss(A+B) 20,811.00 17,185.35
NotesTo Financial Statements for the year ended 31st March 2018
14946th Annual Report
Theincometaxexpensefortheyearcanbereconciledtotheaccountingprofitasfollows:-
(`inlakhs)
Particulars For the year ended March 31,2018
For the year ended March 31,2017
Profitbeforetax 60,486.01 49,340.05
[email protected]% 20,933.00 17,075.61
Effectofexpensesthatarenotdeductibleindeterminingtaxableprofit 5,312.99 3,470.33
Effectofexpensesthatareallowableindeterminingtaxableprofit (2,642.89) (5,297.65)EffectofexpensesincurredonCorporateSocialResponsibilitynotdeductibleindeterminingtaxableprofit 296.62 250.41
Effectofincomethatisexemptfromtaxation (64.32) (35.87)
Others (1,428.83) 932.08
22,406.57 16,394.91
Adjustmentsrecognisedinthecurrentyearinrelationtothecurrenttaxofprioryears 5.43 (46.56)
Adjustmentsforchangesinestimatesofdeferredtaxassets (1,601.00) 837.00
IncometaxexpenserecognisedintheStatementofProfitandLoss 20,811.00 17,185.35
Note9:Deferredtaxassets(net)(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Deferredtaxliabilities 3,954.57 4,072.90
Deferredtaxassets (8,286.84) (6,506.33)
Total (4,332.27) (2,433.43)
Deferredtaxliabilities/(assets)inrelationto2017-18(`inlakhs)
Particulars Opening balance
Recognised in Statement of
Profit and Loss
Recognised in Statement of
EquityClosing Balance
Provisions (5,226.67) (2,212.21) 0.00 (7,438.88)
Property,plantandequipment 4,045.04 (87.00) 0.00 3,958.04
Intangibleassets 27.86 (31.33) 0.00 (3.47)
Others (1,279.66) 729.54 (297.84) (847.96)
Total (2,433.43) (1,601.00) (297.84) (4,332.27)
NotesTo Financial Statements for the year ended 31st March 2018
150 Cochin Shipyard Ltd
Deferredtaxliabilities/(assets)inrelationto2016-17(`inlakhs)
Particulars Opening balanceRecognised in
Statement of Profit and Loss
Closing Balance
Provisions (6,676.87) 1,450.20 (5,226.67)
Property,plantandequipment 4,070.73 (25.69) 4,045.04
Intangibleassets 135.09 (107.23) 27.86
Others (799.38) (480.28) (1,279.66)
Total (3,270.43) 837.00 (2,433.43)
Note10:Othernon-currentassets(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Unsecured, considered good
Capitaladvances 6,641.69 1,674.48
Advancesotherthancapitaladvances:
Securitydeposits 209.75 167.85
Advanceleaserentals 575.59 363.68
DepositswithCustomsdepartment 261.22 261.22
Total 7,688.25 2,467.23
NotesTo Financial Statements for the year ended 31st March 2018
15146th Annual Report
Note11:Inventories(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
RawMaterialsandcomponents* 11,301.78 5,707.70
Less:Provisionforobsolescence,non-usability,deteriorationandreductioninvalueofinventory (331.27) (467.37)
Goods-intransit* 5,795.66 327.40
16,766.17 5,567.73
Work-in-progress(Valuedatcost) 6,284.46 8,794.85
Work-in-progress(Valuedatnetrealisablevalue) 6,787.00 2,649.78
13,071.46 11,444.63
Stores&Spares* 586.36 637.76
Less:Provisionforobsolescence,non-usability,deteriorationandreductioninvalueofinventory (27.97) (13.81)
Goods-intransit* 82.72 14.80
641.11 638.75
LooseTools* 794.58 893.32
Scrap* 182.35 102.66
Total 31,455.67 18,647.09
*ValuationofinventoriesaredoneinaccordancewithAccountingPolicyno.2.14giveninNoteno.2
(i)Inventorydoesnotincludestockofrawmaterialsandboughtoutcomponentsprocuredunder“costplus”partoftheIACcontractamountingto₹71053.76lakhs(previousyear₹57107.65lakhs)heldonbehalfofIndianNavylyingwiththeCompanyandisshownunderAdvancesfromIndianNavyforIndigenousAircraftCarrier.
(ii)Maintenancesparesincludedintheinventoryrepresentsparesofgeneralnatureandarenotrelatedtoaparticularasset.
Note12:Investments-Current(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
InvestmentinMutualFunds 0.16 0.00Total 0.16 0.00DetailsofMutualFunds Fund Value Fund Value
UTI-TreasuryAdvantageFund 0.16 -
NotesTo Financial Statements for the year ended 31st March 2018
152 Cochin Shipyard Ltd
Note13:TradeReceivables-Current(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
UnsecuredConsideredgood:Basedoninvoice 25,473.28 25,828.58Basedonproportionatecompletionmethod 32,539.48 4,870.64Considereddoubtful 9,263.32 5,987.03Less:Allowancefordoubtfuldebts(Expectedcreditlossallowance) (9,263.32) (5,987.03)Unsecured,considereddoubtful(Net) 0.00 0.00Total 58,012.76 30,699.22
Tradereceivables includedebtsamountingto₹32539.48 lakhs (previousyear₹4870.64 lakhs)onaccountof incomerecognizedunderproportionatecompletionmethodpertainingtoincompletevessels,againstwhichstagepaymentsreceivedamountingto₹88490.06lakhs(previousyear₹33928lakhs)forcompletedstageandisshownasadvanceundercurrentliabilities.
Tradereceivablesarenon-interestbearingandreceivableinnormaloperatingcycle.
Movementintheexpectedcreditlossallowance(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Openingbalance 5,987.03 5,300.14Add:Provisionmade/transferduringtheyear 3,832.20 1,193.09Less:Amountcollected/reversalofprovision 555.91 506.20Closing Balance 9,263.32 5,987.03
Note14:CashandCashequivalents(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Cashonhand 0.12 -BalancewithBanksIncurrentaccount 1,249.46 1,641.83IncurrentaccountonbehalfofIndianNavy 62,807.09 29,656.32Termdepositswithoriginalmaturityoflessthan three months 15,137.39 36,300.00
Total 79,194.06 67,598.15
Balanceincurrentaccountincludes₹3.84lakhs(previousyearNil)beingIPOproceedsandTermdepositswithoriginalmaturityoflessthanthreemonthsincludes₹9437.39lakhs(previousyearNil)beingproceedsfromIPOincludinginterestaccrued.
FundsreceivedfromIndianNavyfortheconstructionofIndigenousAircraftCarrierareheldinaseparateaccountandisseparatelydisclosed.
BankbalanceinCurrentAccountincludes₹838.65lakhtobeadjustedagainstGSTliabilityondeliveryofIACtowardsInputTaxCreditavailedonCostPlusprocurementsforIACfundedbyIndianNavy.
NotesTo Financial Statements for the year ended 31st March 2018
15346th Annual Report
Note15:Bankbalancesotherthancashandcashequivalents(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
TermDepositswithbankswithoriginalmaturitymorethan3monthsandlessthan12months 269,840.19 131,530.99
Total 269,840.19 131,530.99
Depositswithbankswithmaturityupto12months,includes₹74689.22lakhs(previousyearNil)relatingtoproceedsfromIPOincludinginterestaccrued.
Depositswithbankswithmaturityupto12months,includes₹76.96lakhs(previousyear₹71.99lakhs)islienmarkedinfavourofTheRegistrarofHighCourtofKerala.
Note16:Loans-Current
(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Unsecured,consideredgood
Employeeadvances
Loanstorelatedparties - 0.52
Otheremployees 38.14 46.18
Total 38.14 46.70
Note17:OtherFinancialAssets-Current(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Interestaccruedonfixeddeposits 6,059.78 4,235.91
Interestaccruedonemployeeadvances
Relatedparties - 0.50
Otheremployees 23.35 32.77
FixedDepositwithHDFCLtd 20,000.00 19,000.00
Total 26,083.13 23,269.18
NotesTo Financial Statements for the year ended 31st March 2018
154 Cochin Shipyard Ltd
Note18:OtherCurrentAssets(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
UnsecuredadvancesAdvancesotherthancapitaladvancesAdvancestorelatedparty 4.44 4.59Otheradvances 5,589.06 4,206.29Advancesconsidereddoubtful 0.07 0.07
5,593.57 4,210.95Less:Provisionfordoubtfuladvances 0.07 0.07
5,593.50 4,210.88OthersBalancewithSalesTaxdepartmentandCBEC 427.32 826.01Miscellaneousdeposits 9.94 7.36Prepaidexpenditure 1,720.56 533.49Miscellaneouscurrentassets(Includingclaimsreceivable) 8,965.00 1,479.31
Total 16,716.32 7,057.05
NotesTo Financial Statements for the year ended 31st March 2018
15546th Annual Report
Note19:EquityShareCapital
ParticularsAs at 31.03.2018 As at 31.03.2017
Number ` in lakhs Number ` in lakhs
Authorised
Equitysharesof₹10/-each 250000000 25,000.00 250000000 25,000.00
Issued,SubscribedandFullypaidup
Equitysharesof₹10eachfullypaidup 135936000 13,593.60 113280000 11,328.00
Total 135936000 13,593.60 113280000 11,328.00
19.1Reconciliationofnumberofsharesandamountsoutstanding
ParticularsAs at 31.03.2018 As at 31.03.2017
Number ` in lakhs Number ` in lakhs
EquitySharesoutstandingatthebeginningoftheyear 113280000 11,328.00 113280000 11,328.00
Add:sharesissuedduringtheyear 22656000 2265.60 - -
EquitySharesoutstandingattheendoftheyear 135936000 13,593.60 113280000 11,328.00
Duringtheyear,Companyhasraisedcapitalof₹2265.60lakhsthroughInitialPublicOffer(IPO)byissuing22656000equitysharesof₹10each.
Terms&RightsattachedtoEquityshares:TheCompanyhasonlyoneclassofequityshareshavingafacevalueof₹10persharewhichisfullypaidup.Equityshareholdersareeligibleforonevotepershareheld,andareentitledtodividendsasandwhendeclaredbytheCompany.InterimdividendispaidasandwhendeclaredbytheBoard.Finaldividendproposed/declaredbytheBoardofDirectorsissubjecttoapproval/regularisationbytheshareholdersintheAnnualGeneralmeeting.All dividends are paid in Indian Rupees. In the event of liquidation, the equity shareholders are eligible to receive theremainingassetsofthecompanyafterdistributionofallpreferentialamounts,inproportiontotheirshareholding.
19.2Detailsofshareholdersholdingmorethan5%sharesinthecompany
ParticularsAs at 31.03.2018 As at 31.03.2017
Number of Shares held % of holding Number of
Shares held % of holding
ThePresidentofIndia 101952000 75 113280000 100
RelianceCapitalTrusteeCo.Ltd.-A/CRelianceTaxSaver(Elss)Fund 7104353 5.23 0 0
NotesTo Financial Statements for the year ended 31st March 2018
156 Cochin Shipyard Ltd
Note20:OtherEquity(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Capital Reserves 263.56 263.56
CapitalRedemptionReserve 11,914.20 11,914.20
SecuritiesPremiumReserve 93,152.56 0.85
DebentureRedemptionReserve 1,235.94 947.61
General Reserve 6,322.75 6,322.75
RetainedEarnings 199,104.08 172,081.27
311,993.09 191,530.24
Capital Reserve:CapitalreserverepresentsrestorationchargesreceivedfromMsIndianOilCorporationLtdforlayingpipelinethroughtheCompany’sland.
Capital Redemption Reserve:CapitalRedemptionReserveof₹11914.20lakhsrepresentsthereservescreatedonredemptionofpreferenceshareswhichwillbeutilisedforthepurposedefinedundertheCompaniesAct2013.
Securities Premium Reserve:
Premiumontaxfreebondsisamortisedonstraightlinebasisovertheperiodofbonds.
TheCompanyhascompletedanInitialPublicOffer(‘IPO’)of33984000equitysharesoffacevalueof₹10each.Thiscomprisesofanofferforsaleof11328000equityshares(10%ofitsequityshareholding)undertheDisinvestmentprogramme ofGovt. of India, the President of India acting through theMinistry of Shipping and a fresh issue of22656000equitysharesandshareswereallottedon09Aug2017.TheequityshareswerelistedinBombayStockExchangeandNationalStockExchangeon11.08.2017.
ThecompanyhascompletedtheInitialPublicOffer(IPO)andhasallotted22656000equitysharesof₹10eachatpremium(₹93929.76lakhs).
ExpensesincurrednetofdefferedtaxadjustmenttowardssuchallotmentofsharesamountingRs777.93lakhshasbeendebitedinsecuritiespremiumreserveInaccordancewiththerequirementsofIndianAccountingStandard(IndAS)32-FinancialInstruments.
Debenture Redemption Reserve:InaccordancewithprovisionsofSection71(4)oftheCompaniesAct,2013readwithRule18(7)ofCompanies(SharecapitalandDebentures)Rules,2014andasperSEBI(IssueandListingofDebtSecurities)Regulations,2008theCompanyhascreatedDebentureRedemptionReserve(DRR)amountingto₹1235.94lakhs(cumulative)at25%ofthevalueofdebentureissuedbytheCompany,overthematurityperiodofsuchdebentures,proportionatelyfortheperiodupto31.03.2018.
NotesTo Financial Statements for the year ended 31st March 2018
15746th Annual Report
ReconciliationofOtherEquityasat31.03.2017
Particulars (` inlakhs)
OtherEquity(ReservesexcludingRevaluationReserve)asat31.03.2017asperauditedFinancialStatementsasat31.03.2017
191783.15
Adjustments during the year for prior period items:
DecreaseinretainedEarningsforincomes/expensesrelatingtoFY2016-17andperiodspriortoFY2016-17
(252.91)
OtherEquity(ReservesexcludingRevaluationReserve)asat31.03.2017nowrestated 191530.24
Taxexpenses(currenttaxanddeferredtax)includespreviousyeartaxadjustmentsalso.
Proposed dividend :TheBoardofDirectorsoftheCompanyhaverecommendedafinaldividendof₹12/-perequityshareoffacevalueof₹10/-forthefinancialyearendedMarch31,2018attheboardmeetingheldonMay24,2018.
Note21:Borrowings(` inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
(a) Bonds - from other parties (Secured)
TaxFreeRedeemableNonConvertibleBonds-Series2013-14 12,300.00 12,300.00
Total 12,300.00 12,300.00
Tax Free Infrastructure Bond Series 2013-14
a)Tranche 1:1000bondsoffacevalueof₹10lakhstotalling₹10000lakhswithinterestrateof8.51%payableannually,redeemableatpar,dueforredemptionon02ndDecember2023
b)Tranche 2:230bondsof facevalueof₹10 lakhstotalling₹2300 lakhswith interest rateof8.72%payableannually,redeemableatpar,dueforredemptionon28thMarch2029.
ThesebondsaresecuredagainstthelandedpropertiesoftheCompanyadmeasuring197.12ares(487.00cents)madeupof34.30aresinSyNo.713/11,23.57aresinSyNo.713/12,59.12aresinSyNo.713/13,50.18aresinSyNo.714/06,10.12aresinSyNo.714/2,8.90aresinSyNo.714/4and10.93aresinSyNo.714/5oflandallarelyingcontiguouslyinElamkulamvillage,Kanayannurtaluk,ErnakulamDist,Kerala.
Utilisation:Outoftheissueproceedsof₹12300lakhsreceived,theCompanyhasfullyutilised/adjustedfundstowardsvariousexpenditureincurredonInternationalShipRepairFacility(ISRF)project.
Differencebetweencarryingamountsandfairvaluesoffinancialliabilitiesofborrowingsisnotsignificantineachoftheyearpresented.
NotesTo Financial Statements for the year ended 31st March 2018
158 Cochin Shipyard Ltd
Note22:OtherFinancialliabilities-NonCurrent(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
PayabletoChennaiPortTrust 261.22 261.22
Total 261.22 261.22
Liabilityof₹261.22 lakhs toChennaiPortTrust in respectofcustomsduty iscoveredbya refundappeal lyingbeforeCommissioner(Appeals)whichisalsoshownasdepositswithCustomsdepartmentunderNoteNo.10
Note23:Provisions-NonCurrent(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Provisionforemployeebenefits-Compensatedabsences(ReferNoteNo34) 2,265.70 2,141.60
Total 2,265.70 2,141.60
Note24:Othernoncurrentliabilities(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
DeferredIncomearisingfromGovernmentAssistance 13.74 0.00
Total 13.74 0.00
Note25:TradePayables(`inlakhs)
Particulars As at 31.03.2018 As at 31.03.2017
Tradepayables(Unsecured)
OutstandingduesofMicroenterprisesandSmallenterprises 682.19 584.95
OutstandingduesofcreditorsotherthanMicroenterprisesandSmallenterprises 26,700.78 15,503.11
Total 27,382.97 16,088.06
Insomecases,theCompanyhasreceivedintimationfromMicroandSmallEnterprisesregardingtheirstatusunder“TheMicro,SmallandMediumEnterprisesDevelopmentAct,2006”.Theaveragecreditperiodongoodsandservicesarewithin30to60days.TheamountremainingunpaidtoMicroandSmallsuppliersasattheendofthefinancialyearis₹682.19lakhs.NointerestfordelaywaspaidorpayableundertheAct.
NotesTo Financial Statements for the year ended 31st March 2018
15946th Annual Report
Note26:OtherFinancialLiabilities-Current(`inlakhs)
Particulars Asat31.03.2018 Asat31.03.2017
Interestaccruedbutnotdue 281.98 281.98
OthersSecurityandotherdeposits 733.34 1,087.87
OthersPayables 10,721.16 8,237.94
Total 11,736.48 9,607.79
Note27:OtherCurrentLiabilities(`inlakhs)
Particulars Asat31.03.2018 Asat31.03.2017
AdvanceforIndigenousAircraftCarrier(Costplus) 691,656.37 555,275.22Less:IndigenousAircraftcarrierinventoryinstock 71,053.76 57,107.65Less:Materialissued 429,719.34 352,045.46Less:Designandotherdirectexpenses 30,758.47 30,474.65Less:Advancepaidforpurchaseofmaterialsandservices 30,555.83 34,719.45Less:Otherexpensesagainstcostplusactivities 68,684.02 57,466.57
60,884.95 23,461.44 AdvanceforIndigenousAircraftCarrierfixedpricecontract 309,179.83 267,883.84Less:incomerecognisedsofar 323,993.64 268,724.46
(14,813.81) (840.62)AdvanceforIndigenousAircraftCarrierinfrastructure 28,517.05 26,347.16Less:Assetsoninfrastructure 26,934.76 24,879.24Less:Prepayment 14.00 6.44
1,568.29 1,461.48 AdvanceoutstandingforIndigenousAircraftCarrierworks(Net) 47,639.43 24,082.30Advancesforothershipbuildingcontracts 88,515.06 41,967.69Advancesforshiprepairandothers 1,099.15 529.63Incomereceivedinadvance 23.28 22.22 Statutorydues 699.50 702.04DeferredIncomearisingfromGovernmentAssistance 1.14 0.00Total 137,977.56 67,303.88
CostofinfrastructurefacilitieswhichhasbeenmetoutoffundsfromNavyandadjustedbyIndianNavy,tilldate.(`inlakhs)
Details Asat31.03.2018 Asat31.03.2017Buildingsandothercivilworks 8,600.39 6,572.58
Dataprocessingequipment 1,294.44 1,294.44
FurnitureandOfficeequipments 249.17 221.46
Plantandmachinery 16,790.76 16,790.76Total 26,934.76 24,879.24
NotesTo Financial Statements for the year ended 31st March 2018
160 Cochin Shipyard Ltd
Note28:Provisions-Current(`inlakhs)
Particulars Asat31.03.2018 Asat31.03.2017
Provision for Employee benefits
Gratuity 2,361.82 261.96
Compensatedabsences 383.78 332.80
Others 1,220.93 21.31
3,966.53 616.07
Other Provisions
Taxesandduties 196.48 233.03
Provisionforshipbuildingloss 548.22 35.00
Expenditure/contingencies 23,621.68 20,208.25
24,366.38 20,476.28
Total 28,332.91 21,092.35
28.1 :Detailsofmovementofprovisions
(`inlakhs)
Particulars As at 01.04.2017
Provisionmadeduringtheperiod
Amountsusedduringtheperiod
Unusedamountsreversedduringtheperiod
As at 31.03.2018
a)Provisionfortaxesandduties 233.03 26.15 0.00 (62.70) 196.48
b)Provisionforshipbuildingloss 35.00 548.22 (35.00) 0.00 548.22
c)Provisionforexpenditure/contingencies 20,208.25 17,338.89 (12,155.46) (1,770.00) 23,621.68
d)Provisionforemployeebenefits-Others 21.31 1,220.93 (21.31) 0.00 1,220.93
(`inlakhs)
Particulars As at 01.04.2016
Provisionmadeduringtheperiod
Amountsusedduringtheperiod
Unusedamountsreversedduringtheperiod
As at 31.03.2017
a)Provisionfortaxesandduties 380.45 55.29 (22.85) (179.86) 233.03
b)Provisionforshipbuildingloss 810.00 35.00 0.00 (810.00) 35.00
c)Provisionforexpenditure/contingencies 20,321.36 17,685.34 (16,037.58) (1,760.87) 20,208.25
d)Provisionforemployeebenefits-Others 16.00 21.31 (16.00) 0.00 21.31
NotesTo Financial Statements for the year ended 31st March 2018
16146th Annual Report
Note29:Revenuefromoperations(`inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,017
Sale of productsShipbuilding:IndigenousAircraftCarrier(IAC) 144,334.95 131,504.38VesselsotherthanIAC 28,428.83 19,862.93Engineeringworks 4.26 -
172,768.04 151,367.31 Sale of servicesShip repairs 62,326.64 54,304.93
62,326.64 54,304.93 Other operating revenueSaleofstockitems 0.05 214.86ScripunderMEISscheme 417.60 -
417.65 214.86 Total 235,512.33 205,887.10
Disclosure as required by Ind AS 11 - Construction Contracts
(a)Shipbuildingincomeof₹172763.78lakhs(previousyear₹151367.31lakhs)includesrevenuerecognizedunderpercentageofcompletionmethodamountingto₹172729.20lakhs(previousyear₹136171.34lakhs)againstincompletevessels.
(b)Methodofrevenuerecognition-Percentageofcompletionmethod
(c)Methodusedtodeterminethestageofcompletion-Stageofcompletionismeasuredintheproportiontoexpensesincurredtilltheendoftheyeartotheestimatedtotalcostofcompletionoftheprojectorpercentageofphysicalcompletionwhicheverisless.
(d)Forcontractsinprogressasattheendoftheyear.
(`inlakhs)
2017-18 2016-17(i) Contractrevenuerecognizedintheperiod 172,729.20 136,171.34(ii) Contractcostincurredandrecognizedprofits(less
recognizedlosses)uptothereportingperiod 885,255.31 713,252.32
(iii) Advancereceivedfromcustomers 926,392.08 741,469.06
(iv) Grossamountduetocustomers 66,535.58 29,057.36(v) Grossamountduefromcustomers 25,398.81 840.62
Ship repair income includes incomerecognisedunderproportionatecompletionmethodamountingto₹21092.00 lakhs(previousyear₹4153.00lakhs)
Income from ship repair is net of actual / anticipated reductions amounting to ₹ 1922.81 lakhs (previous year ₹3903.13lakhs).
NotesTo Financial Statements for the year ended 31st March 2018
162 Cochin Shipyard Ltd
Note30:OtherIncome(`inlakhs)
Particulars FortheyearendedMarch31,2018
Fortheyearended March31,2017
Trainingfacilities 241.12 315.18Incomefromsaleofscrapandstores 457.51 173.45Profitonsaleoffixedassets 1.34 6.56Incomefromlaboratoryservices 33.52 37.90Rentreceived 187.01 130.83Hirechargesreceived 0.00 29.08Interestonbankdeposits 15,087.57 12,439.68Interestfromothers 333.90 645.85Dividendincomefromequityinvestments/MutualFunds 185.84 199.02ProfitonsaleofMutualFunds 669.82 460.96Netgain/(loss)onforeigncurrencytransactions 217.73 227.22Provisionnolongerrequired 1,103.03 949.63Miscellaneousincome 397.44 247.90Total 18,915.83 15,863.26
Miscellaneous income includes ₹ 1.14 lakhs being deferred government assistance in the form of subsidy relatingto installation of Solar Power plant inside the yard. The same has been accounted as per the requirements of IndAS20-AccountingforGovernmentGrantsandDisclosureofGovernmentAssistance.Incomefromsaleofscrapandstoresisnetofimportdutyamountingto₹45.33lakhs(previousyear₹234.49lakhs)onsaleofbondedscrapandstores.
Note31:CostofMaterialsConsumed(`inlakhs)
Particulars FortheyearendedMarch31,2018
FortheyearendedMarch31,2017
Raw Materials
Steel 4,235.44 2,286.54
Pipe 1,096.48 724.25
Paint 1,278.40 1,439.45
Boughtoutcomponents 109,955.32 96,422.43
Total 116,565.64 100,872.67
Note32:ChangesinInventoriesofWork-in-Progress(`inlakhs)
(Otherthanthosewhicharerecognisedasincomeonpercentage/proportionatecompletionmethod)
Particulars FortheyearendedMarch31,2018
FortheyearendedMarch31,2017
Work-in-progress:Atthebeginningoftheyear 8,794.85 7,399.33Less:attheendoftheyear 6,284.46 8,794.85Decretion/(Accretion)towork-in-progress 2,510.39 (1,395.52)
NotesTo Financial Statements for the year ended 31st March 2018
16346th Annual Report
Note33:SubContractandOtherDirectExpenses(`inlakhs)
Particulars FortheyearendedMarch31,2018
FortheyearendedMarch31,2017
Subcontractandoffloadedjobs 17,950.24 16,592.52Hullinsurance 51.04 76.12Otherdirectexpenses 5,527.71 15,268.09Total 23,528.99 31,936.73
Note34:EmployeeBenefitsExpense
(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
Salaries,wages,bonus/exgratiaandallowances 22,531.89 19,229.42ContributiontoProvidentFundandFamilyPensionFund 1,226.65 1,164.13Gratuity 2,188.68 110.20Staffwelfareexpenses 1,192.63 1,222.89Total 27,139.85 21,726.64
ContributiontoProvidentFundandFamilyPensionFundincludesprovidentfundinspectionandadministrationcharges₹15.16lakhs(previousyear₹14.67lakhs)
Salaries,Wages,bonus/exgratiaandallowancesincludesprovisionforencashmentofhalfpaycompensatedabsencesforworkmenamountingto₹175.08lakhs(previousyear₹19.18lakhs)
Theemployeebenefitsaccruing to theemployeesondeputationfromCochinPortTrustarebeingaccountedbasedondemandsreceivedfromCochinPortTrustaspertripartiteagreementbetweentheCompany,CochinPortTrustandtherecognisedTradeunionsofthePortandnotbasedonactuarialvaluationexceptforgratuitywhichisactuariallyvaluedfor2017-18.
Therevisioninpayandallowancesofofficersandnon-unionisedsupervisorswasduew.e.f01.01.2017andforworkmenw.e.f01.04.2017.Whilemostoftheduesinrespectoftheexecutiveshavecrystallisedandthesameforworkmenisunderfinalisation.Anamountof₹1200.96lakhshasbeencarriedasaliabilityasonMarch31,2018towardspendingdueonthisaccount.
Employeebenefitexpenses includes₹11.95Lakhs (previousyearNil)beingsecondmenttosubsidiary (HooghlyCochinShipyardLtd)
OtherBenefitPlan-Compensatedabsences
The principal assumptions used for the purpose of actuarial valuation were as follows:
Particulars Asat31.03.2018 Asat31.03.2017
DiscountRate(p.a) 7.72% 7.40%Rate of increase in compensation levels 3.00% 3.00%
NotesTo Financial Statements for the year ended 31st March 2018
164 Cochin Shipyard Ltd
AmountrecognisedintheStatementofProfitandLossinrespectofdefinedbenefitplansareasfollows:- (`inlakhs)
Particulars FortheyearendedMarch31,2018
FortheyearendedMarch31,2017
ServiceCost:Current Service Cost 172.90 173.48NetInterestexpense 151.84 176.63Acturial(Gain)/Lossrecognisedduringtheperiod 695.38 266.30Expensesrecognisedinthestatementofprofitandloss 1020.12 616.41The amount included in the Balance Sheet arising from the entity’s obligation in respect of its defined benefit planisasfollows:-
(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
PresentValueofDefinedBenefitObligationatendoftheyear 2,649.48 2,474.40FairValueofPlanAssetsattheendoftheyear -NetLiabilities/(Assets)recognizedintheBalanceSheet 2,649.48 2,474.40
Movementsinpresentvalueofthedefinedbenefitobligationareasfollows:-(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
DefinedBenefitObligationatbeginningoftheyear 2,474.40 2,557.66Current&PastServiceCost 172.90 173.48CurrentInterestCost 151.84 176.63Actuarial(Gain)/Loss 695.38 266.30Benefitspaid (845.04) (699.67)DefinedBenefitObligationatendoftheyear 2,649.48 2,474.40
Movementsinthefairvalueoftheplanassetsareasfollows:
(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
FairValueofPlanAssetsatthebeginningoftheyear - -
ExpectedReturnonPlanAssets - -
Actuarial(Gain)/Loss - -
Contributionsfromtheemployer 845.04 699.67
Benefitspaid (845.04) (699.67)
FairValueoftheAssetsattheendoftheyear - -
NotesTo Financial Statements for the year ended 31st March 2018
16546th Annual Report
DefinedBenefitPlan-Gratuity
Theprincipalassumptionsusedforthepurposeofactuarialvaluationwereasfollows:
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
DiscountRate(p.a) 7.72% 7.40%Rate of increase in compensation levels 3.00% 3.00%ExpectedRateofReturnonPlanAsset 7.72% 7.40%
AmountrecognisedintheStatementofProfitandLoss/Othercomprehensiveincomeinrespectofdefinedbenefitplansareasfollows:-
(₹inlakhs)
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
ServiceCost:
Current Service Cost 111.41 87.79
PastServiceCost 1567.90 0.00
NetInterestexpense 8.71 11.16
Components of defined benefit costs recognised in statement of profit and loss 1688.02 98.95
Remeasurementofthenetdefinedbenefitliability:
Actuarial(Gain)/LossonPlanObligations 220.67 181.36
DifferencebetweenActualReturnandInterestincomeonPlanassets(gain)/loss (15.63) (18.35)
Components of defined benefit costs recognised in Other Comprehensive Income 205.04 163.01
TheamountincludedintheBalanceSheetarisingfromtheentity’sobligationinrespectofitsdefinedbenefitplanisasfollows:-
(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
PresentValueofDefinedBenefitObligationatendoftheyear 5,077.72 3,713.66
Less:FairValueofPlanAssetsattheendoftheyear 3,211.31 3,451.70
NetLiabilities/(Assets)recognizedintheBalanceSheet 1,866.41 261.96
NotesTo Financial Statements for the year ended 31st March 2018
166 Cochin Shipyard Ltd
Movementsinpresentvalueofthedefinedbenefitobligationareasfollows:-(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
DefinedBenefitObligationatbeginningoftheyear 3,713.66 4,484.55
Current Service Cost 111.41 87.79
CurrentInterestCost 245.88 304.96
PastServiceCost 1,567.91 -
Actuarial(Gain)/Loss 220.67 181.36
Benefitspaid (781.81) (1,345.00)
DefinedBenefitObligationatendoftheyear 5,077.72 3,713.66
Movementsinthefairvalueoftheplanassetsareasfollows:(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
FairValueofPlanAssetsatthebeginningoftheyear 3,451.70 4,205.49
ExpectedReturnonPlanAssets 237.18 293.80
Actuarial(Gain)/Loss 15.63 18.35
Contributionsfromtheemployer 288.61 279.06
Benefitspaid (781.81) (1,345.00)
FairValueoftheAssetsattheendoftheyear 3,211.31 3,451.70
TheplanassetsaremanagedbytheGratuityTrustformedbytheCompany.
Note35:FinanceCosts(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
Bankinterest 36.42 2.10
Interestothers 53.17 0.04
Interestontaxfreebonds 1,051.44 1,051.44
Total 1,141.03 1,053.58
NotesTo Financial Statements for the year ended 31st March 2018
16746th Annual Report
Note36:DepreciationandAmortisationExpense(₹inlakhs)
Particulars Fortheyearended March31,2018
Fortheyearended March31,2017
Depreciationonproperty,plantandequipments 3,049.86 2,818.46Amortisationofotherintangibleasset 447.73 765.77Total 3,497.59 3,584.23Add:Lossonrevaluationoftools 253.43 266.76Total 3,751.02 3,850.99
Note37:OtherExpenses(₹inlakhs)
Particulars For the year ended March 31,2018 For the year ended March 31,2017Consumption of stores 1,446.32 1,659.13Consumption of spares 62.32 154.89Ratesandtaxes 36.01 212.90Power 1,863.16 1,856.23Fuel 651.62 774.07Water 173.36 218.95Repairsandmaintenance:Buildingandroads 553.73 517.27Plantandmachinery 80.91 105.63Others 1,119.77 1,037.85
Maintenancedredging 784.35 733.78Transportandstoreshandling 124.96 223.19Travellingandconveyanceexpenses 598.24 456.12Printingandstationery 64.05 73.98Postage,telephoneandtelex 44.34 60.10Advertisementandpublicity 525.65 316.03Leaserent 567.21 632.11GuaranteedAmountunderleaseagreement 2.25 -Hirecharges 506.02 574.58Insurancecharges 230.64 333.86Securityexpenses 1,342.98 1,310.93Auditorsremuneration 12.50 8.66Auditorsremunerationforotherservices 8.75 4.02Trainingexpenses 521.48 458.79Legalexpenses 16.68 12.42Consultancy 96.87 33.08Bankcharges 46.38 162.27Netloss/(gain)onderivativecontracts - (148.63)Corporatesocialresponsibility(ReferNoteno.45) 857.08 723.56Lossonsale/writeoffofproperty,plantandequipments 15.48 414.85Miscellaneousexpenses 1,125.95 531.25Total 13,479.06 13,451.87
NotesTo Financial Statements for the year ended 31st March 2018
168 Cochin Shipyard Ltd
Auditorsremuneration,AuditorsremunerationforotherservicesandMiscellaneousexpensesinclude:(₹inlakhs)
Particulars For the year ended March 31,2018
For the year ended March 31,2017
ForAuditFees 12.50 8.66
ForLimitedReview/otherservices 8.75 4.02
ForcertificationforInitialPublicOffer 12.00 9.20
Total 33.25 21.88
Note38:ProvisionforAnticipatedLossesandExpenditure(₹inlakhs)
Particulars For the year ended March 31,2018
For the year ended March 31,2017
Provisionfor:
Doubtfuldebts/advances 3,804.88 246.10
Nonmoving/perpetualinventoryverification 31.62 56.86
Expensesandcontingencies 1,476.45 575.39
ProvisionforlossonShipBuilding 513.22 35.00
Total 5,826.17 913.35
MODUSagarBhushan,anoilrigownedbyM/sONGCwasunderrepairatCSLandtherewasafireincidentonboardthevesselonFeb13,2018whilethevesselwasundergoingrepairs.Theincidentresultedindamagestothevessel.Thecompanyhasassessedtheestimateddamagecosttobe₹1851lakhs.CompanyhasanannualinsurancecoverforthevesselunderShipRepairer’sliabilitypolicywithalimitofliabilityforanyoneincidentof₹1500lakhswithanannuallimitof₹30000lakhs.Thecompanyhasaccordinglymadeaprovisionforanamountof₹351lakhsnetofinsuranceclaim,towardsprobablelosson this
Note39:EarningsperEquityShare(₹inlakhs)
Particulars For the year ended March 31,2018
For the year ended March 31,2017
NetProfitaftertax(₹inlakhs) 39,675.01 32,154.70
WeightedaveragenumberofEquityShares 127866740 113280000
BasicandDilutedEarningsPerShare(EPS)(in₹) 31.03 28.39
Facevalueperequity(in₹) 10.00 10.00
NotesTo Financial Statements for the year ended 31st March 2018
16946th Annual Report
Note40:CONTINGENTLIABILTIESANDCOMMITMENTS
ParticularsFor the period ended
31 Mar 2018(₹ in lakhs)
For the period ended31 Mar 2017
(₹ in lakhs)Brief Description of the nature and obligation
A
CONTINGENT LIABILITY (To the extent not provided for)
a Guarantees
i LettersofCredit 52,609.28 39,328.74RepresentsLetterofCreditopenedbytheCompanyinvariousbanksforprocurementofmaterials/assets
ii BankGuarantees 125,157.57 69,366.52
iiiCorporatePerformanceGuarantee to CochinPortTrust
3,925.00 3,925.00
PerformanceguaranteegivenbyCompanytoCoPTforperformanceofobligationsunderthecontractagreemententeredwithCoPTduringthecontractperiod.
bOther money for which the company is contingently liable
iGreater Cochin Development Authority (GCDA)
69.06 69.06
ClaimraisedbyGCDAforthelandacquiredfortheCompanyissettled.However8landacquisitionrevisionpetitioncases(ValuedatRs.69.06lakhs)filedbyevicteesispendingwiththeHon'bleSupremeCourtandHighCourt.
ii Customsduties 15,934.66 17,941.22
CustomsdutyformaterialsunderBondandIndigenousvesselsdelivered.IncludesanamountofRs69.83lakhs,beingCustomsdutyrefundgrantedbyCESTAT,Bangalore,againstwhichanappealispendingbeforetheHon'bleHighCourtofKerala.
iii SalesTax/KeralaValueAddedTax 1,259.75 1,259.75
2000-01-Rs.111.93Lakhs2001-02-Rs.73.44Lakhs2004-05-Rs195.67Lakhs2005-06-Rs.602.24Lakhs2007-08-Rs.276.47Lakhs(Underappeal.)Stayofcollectionoftaxobtainedinallcases.DemandreducedtotheextentofamountpaidandappealallowedbyDeputyCommissioner(Appeals).DetailednotesinNoteno.40.1(II&III)
12.10 12.10VATcreditfortheyear1996-97whichhasnotbeenconsideredinthedemand,forwhichnoprovisionexistsinthebooks
iv IncomeTax 6,077.85 6,077.85 DemandrelatingtoAssessmentYears:
NotesTo Financial Statements for the year ended 31st March 2018
170 Cochin Shipyard Ltd
ParticularsFor the period ended
31 Mar 2018(₹ in lakhs)
For the period ended31 Mar 2017
(₹ in lakhs)Brief Description of the nature and obligation
(a)AY2009-10-Rs77.67LakhsAY2010-11-Rs.126.25LakhsAY2011-12-Rs.420.19LakhsAY2012-13-Rs.546.14LakhsAY2013-14-Rs.221.37LakhsAY2014-15-Rs.876.90Lakhs(b)AY1997-98-Rs2191.60LakhsAY1998-99-Rs967.27LakhsAY1999-00-Rs353.72LakhsAY2000-01-Rs170.31LakhsAY2001-02-Rs96.44Lakhs(c)AY2002-03-Rs29.99LakhsDetailednotesinNoteno.40.1(I)
v ServiceTax 1,647.47 1,647.47DemandofServiceTaxonIAC(DesignConsultancy)asperShowCauseNoticeissued.Adjudicationpending
376.68 376.68
RefundclaimofServiceTaxonIACgrantedbyCommissioner(Appeal).HoweverDepartmentfiledAppealbeforeCESTATagainsttheorderofCommissioner(Appeals).AlsoissuedShowCauseNoticeonCSL&adjudicationpending.
323.04 323.04DemandofServiceTaxonIAC(ManagementFee/HandlingCharges)asperShowCauseNoticeissued.Adjudicationpending
- 2,339.64
ShowCauseNoticeissuedforlevyofservicetaxonshiprepairwithoutallowingdeductionofmaterialsforwhichVATpaidanddisallowanceofCenvatCredit.Proceedingsundertheshowcausehasbeendroppedvideorderno.COC-EXCUS-000-COM-18-17-18dt19.03.2018
- 1,885.60
ShowCauseNoticeissuedforlevyofServiceTaxontherepairofvesselsownedbyUTLAbydenyingthebenefitofNotificationNo.25/212-STdt.20-6-2012availablefortherepairofvesselsownedbyGovt.Departments.Proceedingsundertheshowcausehasbeendroppedvideorderno.COC-EXCUS-000-COM-11-17-18dt07.03.2018
24.08 24.08Penaltyonservicetaxfortheperiod2003-04to2007-08whichispendingbeforeHon’bleHighCourtofKerala.
NotesTo Financial Statements for the year ended 31st March 2018
17146th Annual Report
ParticularsFor the period ended
31 Mar 2018(₹ in lakhs)
For the period ended31 Mar 2017
(₹ in lakhs)Brief Description of the nature and obligation
B COMMITMENTS (To the extent not provided for)
a
Estimatedamountofcontractsremainingtobeexecutedoncapitalaccountandnotprovidedfor:
73,430.43 4,584.66
b Othercommitments
i
Investmentinsubsidiary(HooghlyCochinShipyardLtd)forwhichthecompany has restriction fortheirdisposalfor5years from the effective dateoftheconcessionagreement.
1,628.00 0.00
ii
UnutilisedamountofInitialPublicOffer(IPO)proceeds(Pendingutilisation amount depositedwithvariousbanksincurrentaccountandtermdeposits)
82,621.86 0.00 DetailednotesinNoteno.41.b
NotesTo Financial Statements for the year ended 31st March 2018
172 Cochin Shipyard Ltd
40.1. CONTINGENCIES AND COMMITMENTS
(I) Income Tax Assessments
(a) TheIncomeTaxAssessmentofthecompanyhavebeencompleteduptoAY2014-15Demandsraisedaspertheassessmentorderstotalingto₹2268.52lakhsfortheAssessmentYears2009-10,2010-11,2011-12,2012-13,2013-14and2014-15are shownunderContingent Liabilitypendingdisposal of the appealsfiledbefore theCommissionerofIncomeTax(Appeals).Thedemandsaremainlyduetodisallowanceofcertaingenuineclaims.HowevertheabovedemandshavebeenadjustedagainsttherefundduetoCompany.
(b) FortheAssessmentyears1997-98to2001-02,theIncomeTaxdepartmenthasgoneforappealagainsttheorderoftheITATallowedinfavourofCSLbeforetheHon'bleHighCourtofKerala.FortheAssessmentyear1997-98theappealwasdecidedinfavourofCSLandfortheAssessmentyear1998-99theappealwasdecidedagainstCSL.Howeverforboththeassessmentyearsordersareyettobegiveneffecttobythereassessingofficer.
(c) TheCompanyhasfiledappealbeforetheITATagainsttheorderofAssessingOfficer/CommissionerofIncomeTax(Appeals)andtheappealwaspartlyallowedinfavorofCompany,theeffecttotheorderhasnotyetbeengivenbythereassessingofficer.
(II) Sales Tax Assessment under KGST Act
TheSalesTaxassessmentsunderKeralaGeneralSalesTaxActuptotheAssessmentYear2004-05havebeencompletedandorderswere issued for all theyearsexcept for theyear2002-03&2003-04.Due to apparentmistake in theordersissuedfortheyear2000-01and2001-02,applicationshavebeenfiledforrectificationoftheorders.Pendingrectificationto theassessmentorders thedemandstheretohavebeenshownunderContingentLiabilities.For theAssessmentyear2004-05,theDeputyCommissioner(Appeals)hasdismissedtheappealfiledbytheCompanyagainstthedemandfor₹202.22lakhs.TheCompanyisintheprocessoffilingappealtoTribunal.
(III) Sales Tax Assessments under KVAT Act
The KVAT assessments from Assessment Year 2005-06 to Assessment Year 2007-08 have been completed andassessment orderswere issued forAssessmentYear 2005-06 andAssessmentYear 2007-08with a demand of ₹2836.63lakhsand₹5554.71lakhsrespectively.TheappealsfiledbytheCompanyagainsttheaboveorders,beforetheDeputyCommissioner (Appeals)havebeenpartiallydecided infavouroftheCompanyandremandedforfreshassessments.Accordinglythedemandsaspertheoriginalassessmentordershavebecomenull.Assuchnodemandexists ason reportingdate.Pending receiptof the revisedassessmentorder, thecompanyfiledappealbefore theHon’bleKVATAppellateTribunalontheotherissues.TheappealiscurrentlypendingbeforetheTribunal.Assessmentorderfortheyear2006-07ispending.
41.a.TheEnvironmentalClearances,fortheISRFprojectreceivedfromMinistryofEnvironment,ForestandClimateChange(MOEFCC), is subject to obtaining prior clearance of the Standing Committee of the National Board forWildlife(“NBWL”).Pursuant to theSEBIExemption letterdatedJuly14,2017,SEBIhadpermitted theCompany toutilizethenetproceedsoftheInitialPublicOfferassignedtowardstheproposedISRFprojectandutilizesuchfundsraisedoncethenecessaryapprovalsforEnvironmentalClearancefortheISRFprojectarereceived.TheCompanyhadalsoundertakentoSEBIvideletterdatedJuly10,2017andfurtherstatedintheProspectusdatedAugust4,2017thatthenetproceedsassignedfortheproposedISRFprojectshallbetransferredtoaseparatebankaccountwhichwouldbeutilisedonlyafterrequisitependingapproval(s)arereceivedandallexpenditureontheISRFprojectshallbeincurredthroughinternalaccrualstillthetimesuchpendingapprovalsarereceived.
TheStateBoardforWildLifeattheirmeetingheldonAugust16,2017specifiedcompensatorymangroveafforestationbytheCompanyasaconditionwhilerecommendingtheproposaltotheNBWL.TheStandingCommitteeofNBWLintheir46thmeetingheldonDecember8,2017hasrecommendedtheEnvironmentalClearancefortheISRFproject
NotesTo Financial Statements for the year ended 31st March 2018
17346th Annual Report
alongwithconditionsimposedbytheStateChiefWildLifeWarden(CWLW).TheconditionimposedbyStateCWLWistobecompliedduringtheimplementationoftheISRFprojectandthematterhasbeentakenupwiththeForestDepartment,GovernmentofKeralaand theprocessof identificationofnotifiedmangrovearea forafforestation isunderway.Accordingly, theCompanyhas considered thedateofEnvironmental clearance asJanuary9, 2018 andstartedutilisationofthefundssetapartforthispurposeafterintimatingSEBIvideletterdatedJanuary17,2018.
41.b. The Utilisation of IPO proceeds is summarised below:
(₹inlakhs)
ParticularsIPO proceeds
received -Based on Final allotment
Actual cash outflow upto
March 31, 2018
Unutilised amount as at
March 31, 2018SettingupofDryDock 51000.00* 330.72 50669.28
SettingupofISRF 26500.00* 1142.14 25357.86
General corporate purposes 16523.26 9956.42 6566.84
Issuerelatedexpenses(AttributtabletotheCompany) 2172.10** 2144.22 27.88
Total 96195.36 13573.50 82621.86
* As per Prospectus Filed
**IncreaseinIPOexpenditure(Rs.172.10lakhs)comparedtotheestimatesisadjustedagainstamountspecifiedforGeneralCorporatePurpose
42. ThedisputebetweenM/sApeejayShippingLtd(formerlyknownasSurendraOverseasLtd)andtheCompany,inthematterofship005wasreferredforarbitrationbytheHon'bleSupremeCourtofIndia.Thearbitrationaward(July2009)was in favourof theCompanyunderwhich theCompany is to receive₹2803.64 lakhs fromM/sApeejayShippingLtd.ThecompanyhasfiledapetitionbeforeSubCourt,Ernakulamforpassingadecree.M/sApeejayShippingLtdhasmovedtotheSubCourttoquashtheAwardoftheUmpireandtheCompanyhasfiledCounterAffidavitagainstthismove.Thematterispendingbeforethecourt.Nocredithasbeentakeninthebooksofaccount,pendingfinaldecreeoftheCourt.
43. PermanentMachinery forArbitration,DepartmentofPublic Enterprises,Govt. of India, hasnotified award infavour of the Company in the dispute between the Company andM/sOil andNatural Gas Corporation Ltd(ONGC)on theWorksContractTax issue andONGChaspaid to theCompany thedisputed sumalongwithinterestamountingto₹2642.22Lakhsaspertheaward.ONGChasgoneonappealbeforetheLawSecretary,MinistryofLaw&Justiceagainsttheaward.PendingdisposalofONGCappeal,noadjustmenthasbeenmadeinthe accounts.
44. Litigations :TheCompany is subject to legal proceedings and claims, in theordinary courseof business.TheCompany'sManagementdoesnot reasonablyexpect that these legal actions,whenultimatelyconcludedanddetermined,willhavematerialandadverseeffectontheCompany'sresultsofoperation.
NotesTo Financial Statements for the year ended 31st March 2018
174 Cochin Shipyard Ltd
Details of material litigations as on 31 March 2018
M/s.VigilMarineServicesin2004raisedclaimstowardsAgencyCommissionpayableforwinningordersforATCOTugs.Thearbitrationproceedingscommencedon10Oct2004.Examinationandcrossexaminationofwitnessescompletedandpostedthematterforargumentson01and02Feb2014.TheArbitratorcompletedtheproceedingsandpassedhisawarddirectingtheCompanytopaycommissiontoM/sVigilMarineServicesattherateof5%oftheATCOcontractvalueofUSDollar18.25Millionwithinterest@8%perannum.AggrievedonthisCSLfiledOriginalSuitNo187/2016beforeSubCourt,Ernakulamandobtainedaninterimorderstayingexecutionoftheaward.”
45.CorporateSocialResponsibility(CSR):Aspersection135oftheCompaniesAct2013,CSRcommitteehasbeenformedbytheCompany.TheareasofCSRactivityincludesHealthCare,Education,SocialEmpowerment,etc.,andthose specified in ScheduleVII of theCompaniesAct 2013.TheutilisationofCSR funds are done throughdirectspendingasper the recommendationsofCSRcommittee.Detailsofamount required tobespentand theamountutilisedaregivenbelow:
(a)GrossamountrequiredtobespentbytheCompanyduringtheperiodendedMarch31,2018 ₹853.75lakhs
(b)Amountspentduringtheyear ₹857.08lakhs ₹inLakhsParticulars In cash Yet to be paid in cash Total
(i)Construction/acquisitionofanyasset 611.03 - 611.03(ii)Onpurposesotherthan(i)above 246.05 - 246.05
46. Related Party disclosure as per Ind AS 24
Related PartyNature of Relationship
2017-18 2016-17Shri.MadhuSNairChairman&ManagingDirector KeyManagerialPersonnel KeyManagerialPersonnel
Shri.PaulRanjanDDirector(Finance)&ChiefFinancialOfficer KeyManagerialPersonnel KeyManagerialPersonnel
Shri. Sunny Thomas Director(Technical)(Upto30/11/2017) KeyManagerialPersonnel KeyManagerialPersonnel
Shri.SureshBabuNVDirector(Operations) KeyManagerialPersonnel KeyManagerialPersonnel
ShriBarunMitra(upto17/04/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel KeyManagerialPersonnel
ShriPravirKrishna(from17/04/2017to04/10/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel --
ShriSatinderPalSingh(from04/10/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel --
ShriEliasGeorgeOfficialPartTime(Nominee)Director,GovernmentofKerala KeyManagerialPersonnel KeyManagerialPersonnel
Smt.RoopaShekharRaiNonOfficialPartTime(Independent)Director KeyManagerialPersonnel KeyManagerialPersonnel
ShriRadhakrishnaMenonNonOfficialPartTime(Independent)Director KeyManagerialPersonnel KeyManagerialPersonnel
NotesTo Financial Statements for the year ended 31st March 2018
17546th Annual Report
Related PartyNature of Relationship
2017-18 2016-17ShriKrishnaDasENonOfficialPartTime(Independent)Director KeyManagerialPersonnel KeyManagerialPersonnel
ShriJijiThomson(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel --
ShriPradiptaBanerjee(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel --
ShriNandaKumaranPuthezhath(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel --
Smt V KalaCompany Secretary KeyManagerialPersonnel KeyManagerialPersonnel
M/sHooghlyCochinShipyardLtd. SubsidiaryCompanywith74%stakeholding -
Nature of transaction-Remuneration to Key Managerial Person₹inLakhs
Particulars As at 31.03.2018 As at 31.03.2017
Shorttermbenefit 142.20 148.34PostemploymentBenefit 17.11 23.12Total 159.31 171.46
Nature of transaction-Loans*₹inLakhs
Name of Related Party Opening Balance as on 1/4/2017
Loans/advances Taken during 2017-18
Repayment
Balance as on 31/03/18
Interest accrued as on 31/03/18
MADHUSNAIR 0.90 1.54 1.53 0.91 0.00PAULRANJAND 1.04 1.38 1.43 0.99 0.00SUNNYTHOMAS 0.96 0.82 0.96 0.82 0.00SURESHBABUNV 3.72 1.33 4.10 0.95 0.00KALAV 0.79 1.09 1.11 0.77 0.00
₹inLakhs
Name of Related Party Opening Balance as on 1/4/2016
Loans/advances Taken during 2016-17
Repayment
Balance as on 31/03/17
Interest accrued as on 31/03/17
MADHUSNAIR 2.27 1.14 2.51 0.90 0.00PAULRANJAND 0.13 1.28 0.37 1.04 0.00SUNNYTHOMAS 0.11 3.00 2.15 0.96 0.00SURESHBABUNV 3.45 1.14 0.87 3.72 0.50KALAV 0.11 1.03 0.35 0.79 0.00*LoanbalanceshavebeenconsideredfromtheyearofattainingKMPstatus.
NotesTo Financial Statements for the year ended 31st March 2018
176 Cochin Shipyard Ltd
Nature of transaction-Sitting Fee to Independent Directors₹inLakhs
Name of the meeting Roopa Shekhar Rai Krishna Das E Radhakrishna
Menon Jiji Thomson Nandakumaran Puthezhath
Pradipta Banerji
BoardMeeting 1.50 1.35 1.50 0.90 0.90 0.75
AuditCommittee 0.00 0.90 0.90 0.00 0.45 0.00Corporate Social Responsibility 0.90 0.00 0.90 0.00 0.00 0.00
NominationandRemuneration Committee 0.45 0.45 0.00 0.00 0.00 0.00
ContractandCapexCommittee 0.00 0.00 0.00 0.15 0.15 0.00
Total payment for 2017-18 2.85 2.70 3.30 1.05 1.50 0.75
Nature of transaction - Transaction with other related parties
AsCSLisaGovernmentcompanyunderthecontrolofMinistryofShipping(MoS),thecompanyhasavailedexemptionfromdetaileddisclosurespreparedunderIndAS24withrespecttorelatedpartytransactionswithGovernmentandGovernmentrelatedentities.
However,asrequiredunderIndAS24,followingaretheindividuvallysignificanttransactions:
TransactionswithGovernmentandGovernmentrelatedentitiesbytheparentcompany.
ParticularsAs at
31.03.2018` Lakhs
As at 31.03.2017
` Lakhs
Secondmenttosubsidiary-HooghlyCochinShipyardLtd. 11.95 0.00
AmountpayabletoGovernmentofIndia 235.40 0.00
Amountpaidasdividendduringtheyear 10161.21 8665.92InthecaseofsubsidiarycompanysharesissuedforconsiderationotherthancashtoM/sHDPEL 572.00 0.00
Inadditiontotheabove,around98%ofthecompaniesturnoverand100%(approx)oftradereceivablesandcustomeradvanceiswithrespecttoGovernmentandGovernmentrelatedentities.
Shares held by Nominee Directors in HCSL on behalf of CSL As at 31.03.2018No of shares
As at 31.03.2017No of shares
MADHUSNAIR(FirstDirector) 10 NilPAULRANJAND(FirstDirector) 10 NilSUNNYTHOMAS(FirstDirector) 10 NilSURESHBABUNV(FirstDirector) 10 NilKALAV(SubscribertoMemorandum) 10 NilKJRAMESH(SubscribertoMemorandum) 10 Nil
NotesTo Financial Statements for the year ended 31st March 2018
17746th Annual Report
47. FINANCIAL INSTRUMENTS
The fairvalue hierarchy is based on inputs tovaluation techniques that are used tomeasure fairvalue that are eitherobservableorunobservableandconsistofthefollowingthreelevels:
LevelIinputsarequotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilitiesthattheentitycanaccessatthemeasurementdate.
LevelIIinputsareinputsotherthanquotedpricesincludedwithinLevel1thatareobservablefortheassetorliability,eitherdirectlyorindirectly.
LevelIIIinputsareunobservableinputsfortheassetorliability.
Thefollowingtablesummarisesfinancialassetsandliabilitiesmeasuredatfairvalueonarecurringbasisandfinancialassetsthatarenotmeasuredatfairvalueonarecurringbasis(butfairvaluedisclosuresarerequired)
(`inLakhs)
Financial assets/ financial liabilitiesFair value as at Fair Value
hierarchyAs at 31.03.2018 As at 31.03.2017Financial Assets NonCurrent
(i)Investments 1,637.18 9.18 LevelIII(ii)TradeReceivables - - LevelII(iii)Loans 147.77 145.39 LevelII(iv)Others - - LevelII
Current(i)Investments 0.16 LevelI(ii)TradeReceivables 58,012.76 30,699.22 LevelII(iii)Cash&Cashequivalents 79,194.06 67,598.15 LevelII(iv)BankBalancesotherthan(iii) 269,840.19 131,530.99 LevelII(v)Loans 38.14 46.70 LevelII(vi)Others 26,083.13 23,269.18 LevelII
Total Financial Assets 434,953.39 253,298.81 FinancialLiabilitiesNonCurrent
(i)Borrowings 12,300.00 12,300.00 LevelI(ii)Otherfinancialliabilities 261.22 261.22 LevelII
LevelIICurrent
(i)TradePayables 27,382.97 16,088.06 LevelII(ii)Otherfinancialliabilities 11,736.48 9,607.79 LevelII
Total Financial Liabilities 51,680.67 38,257.07
NotesTo Financial Statements for the year ended 31st March 2018
178 Cochin Shipyard Ltd
Note:
1.Theinvestmentsinequityinstrumentsarenotheldfortrading.Instead,theyareheldformediumorlongtermstrategicpurpose.UpontheapplicationofIndAS109,theCompanyhaschosentodesignatetheseinvestmentsinequityinstrumentsasatFVTOCIasthedirectorsbelievethatthisprovidesamoremeaningfulpresentationofmediumorlongtermstrategicinvestments,thanreflectingchangesinfairvalueimmediatelyinprofitorloss.
Investments included in level 3 of fairvalue hierarchy have beenvalued using the cost approach to arrive at their fairvalue.Thecostofunquoted investmentsapproximate the fairvaluebecause there isawide rangeofpossible fairvaluemeasurementsandthecostrepresentsestimateoffairvaluewithinthatrange.
TherewerenotransfersbetweenLevel1and2intheperiod.
2.Loans,Borrowingsareatthemarketratesandthereforethecarryingvalueisthefairvalue.
3.Thecarryingamountoftradereceivables,tradeandotherpayablesandshorttermloansareconsideredtobethesameastheirfairvalueduetotheirshorttermnature.
Differencebetweencarryingamountsandfairvaluesofbankdeposits,otherfinancialassets,otherfinancialliabilitiesandborrowingssubsequentlymeasuredatamortisedcostisnotsignificantineachoftheyearspresented.
Financial Instruments by category(`inLakhs)
31st March 2018 31st March 2017
FVTPL/ at cost FVTOCI Amortised
Cost FVTPL FVTOCI Amortised Cost
Financial Assets
Investments(Non-current)
-Equityinstruments 1,628.00 9.18 9.18
Investments(Current)
-MutualFunds 0.16
Tradereceivables 58,012.76 30,699.22
Cash&Cashequivalents 349,034.25 199,129.14
OtherFinancialAssets 26,269.04 23,461.27
Total Financial Assets 1,628.16 9.18 433,316.05 0.00 9.18 253,289.63
Financial liabilities
Borrowings 12,300.00 12,300.00
Tradepayables 27,382.97 16,088.06
Capitalcreditors
Otherfinancialliabilties 11,997.70 9,869.01
Total Financial Liabilities 51,680.67 0.00 0.00 38,257.07
NotesTo Financial Statements for the year ended 31st March 2018
17946th Annual Report
48. Financial Risk Management Policy
Financial Risk Management Objective and Policies:
TheCompany’s principal financial liabilities, other than derivatives, comprise of loans and borrowings, trade and otherpayablesandadvancesfromcustomers.ThemainpurposeofthesefinancialliabilitiesistofinancetheCompany’soperations,projectsunderimplementationandtoprovideguaranteestosupportitsoperations.TheCompany’sprincipalfinancialassetsincludeInvestment,loansandadvances,tradeandotherreceivablesandcashandbankbalancesthatderivedirectlyfromitsoperations.TheCompany isexposedtomarketrisk,creditriskand liquidityrisk.TheCompany’sseniormanagementoverseesthemanagementoftheserisks.AllderivativeactivitiesforriskmanagementpurposesarecarriedoutbyunderthesupervisionoftheForexRiskManagementCommitteebyassigningnecessaryresources.ItistheCompany’spolicythatnotradinginderivativesforspeculativepurposesmaybeundertaken.TheBoardofDirectorsreviewsandagreespoliciesformanagingeachoftheserisks,whicharesummarisedbelow.
Market Risk
Marketriskistheriskthatthefairvalueoffuturecashflowsoffinancialassetswillfluctuatebecauseofchangesinmarketprices.Marketriskcomprisesthreetypesofrisk:interestraterisk,currencyriskandotherpricerisk,suchasequitypriceriskandcommodityrisk.FinancialAssetsaffectedbymarketriskincludeloansandborrowings,depositsandderivativefinancialinstruments.
Interest Rate Risk
Interestrateriskistheriskthatthefairvalueorfuturecashflowsofafinancialinstrumentwillfluctuatebecauseofchangesinmarket interestrates.TheCompany’sexposuretotheriskofchanges inmarket interestratesrelatesprimarilytotheCompany’slong-termdebtobligationswithfloatinginterestrates.
Foreign Currency Risk
Foreigncurrencyriskistheriskthatthefairvalueorfuturecashflowsofanexposurewillfluctuatebecauseofchangesinforeignexchangerates.TheCompany’sexposuretotheriskofchangesinforeignexchangeratesrelatesprimarilytotheCompany’soperatingactivities(whenrevenueorexpenseisdenominatedinaforeigncurrency).
Foreigncurrencyriskofthecompanyismanagedthroughaproperlydocumentedriskmanagementpolicyapprovedbytheboard.
Commodity Price Risk
TheCompanyisaffectedbythepricevolatilityofcertaincommodities.Itsoperatingactivitiesrequirethepurchaseofsteel,majormachineries,equipmentsetc.Therefore,theCompanyplansitspurchasescloselytooptimisetheprice.
Credit Risk
Creditriskistheriskthatacounterpartywillnotmeetitsobligationsunderafinancialinstrumentorcustomercontract,leadingtoafinancialloss.TheCompanyisexposedtocreditriskfromitsoperatingactivities(primarilytradereceivablesandadvancestosuppliers)andfromitsfinancingactivities,includingdepositswithbanksandfinancialinstitutions,foreignexchangetransactionsandotherfinancialinstruments.
NotesTo Financial Statements for the year ended 31st March 2018
180 Cochin Shipyard Ltd
49. Lease arrangements & Guaranteed amount₹inLakhs
Particulars As at 31.03.2018
As at 31.03.2017
a)Premisestakenonoperatinglease:TheCompanyhasoperatingleasesforfacilityatInternationalShipRepairFacility(ISRF).TheseleasearrangementswithCochinPortTrust(CoPT)isfor30years,whichisnon-cancellableleases.Withrespecttonon-cancellableoperatinglease,thefutureminimumleasepaymentasatBalanceSheetdateisasunder:b)Guaranteedamount:TheamountwhichCSLhasundertakentopaytoCochinPortTrustduringthecontractperiodof30years.Withrespecttonon-cancellableoperatinglease,thefutureminimumleasepaymentandGuaranteeamountasatBalanceSheetdateisasunder:Foraperiodnotlaterthanoneyear 606.55 558.67
Foraperiodlaterthanoneyearandnotlaterthanfiveyears 3509.96 2349.89
Foraperiodlaterthanfiveyears 62538.03 16847.21
50. Segment Reporting
The Company has identified twomajor operating segments viz, Shipbuilding and Repair of ships/ offshore structures.Segmentwiseanalysishasbeenmadeontheabovebasisandamountsallocatedonareasonablebasis.
₹inLakhs
Particulars As at 31.03.2018 As at 31.03.2017
SegmentAssetsShipbuilding 231887.20 169699.79
Ship Repair 168349.50 125884.57
Others 146692.04 36068.78
Total 546928.74 331653.14
SegmentLiabilityShipbuilding 89620.66 40854.99
Ship Repair 23368.86 21547.62
Others 108352.53 66392.29
Total 221342.05 128794.90
External Sales
Shipbuilding 173185.70 151582.17
Ship Repair 62326.63 54304.93
Unallocated 3494.36 2777.73
Total 239006.69 208664.83
NotesTo Financial Statements for the year ended 31st March 2018
18146th Annual Report
₹inLakhs
Particulars As at 31.03.2018 As at 31.03.2017
InterestIncome 15421.47 13085.53
UnallocatedTotal RevenueShipbuilding 173185.70 151582.17
Ship Repair 62326.63 54304.93
Unallocated 18915.83 15863.26
Total 254428.16 221750.36
Accretion(-)/DecretiontoWorkinprogressShipbuilding 1002.26 (3918.05)
Ship Repair (3512.65) 5313.57
Total (2510.39) 1395.52
SegmentResultShipbuilding 41471.88 23064.29
Ship Repair 13145.75 14577.80
Unallocated 5868.38 11697.96
Total 60486.01 49340.05
TheCompanyhastwomajorbusinesssegments–“ShipBuilding”and“ShipRepair”.RevenueunderShipbuildingincludesRs.144334.95lakhs(Previousyear:Rs.131504.38lakhs)fromoneCustomers(Previousyear:oneCustomer)havingmorethan10%revenueofthetotalrevenue.AndforShiprepair,revenueincludesRs.40014.22lakhs(Previousyear:Rs.38073.82lakhs)fromonecustomers(Previousyear:oneCustomer)havingmorethan10%revenueofthetotalrevenue.
51. Capital Management
Thecompany'sobjectivewhenmanagingcapitalaretosafeguardtheirabilitytocontinueasagoingconcernsothattheycancontinuetoprovidereturnsforshareholdersandmaintainanoptimalcapitalstructuretoreducethecostofcapital.
Forthepurposeofcapitalmanagement,capitalincludesissuedequitycapitalandallotherequityreservesattributabletotheequityholdersoftheparent.Thecompanyisnotsubjecttoanyexternallyimposedcapitalrequirements.
Tomaintainoradjustthecapitalstructure,thecompanymayadjustthedividendpaymenttoshareholders,returnoncapitaltoshareholdersorissuenewshares.Thecompanymonitorscapitalusingagearingratio,whichisnetdebtdividedbytotalequity.TheCompanyincludeswithinnetdebt,interestbearingloansandborrowings(includingbonds).
NotesTo Financial Statements for the year ended 31st March 2018
182 Cochin Shipyard Ltd
₹inLakhs
Particulars As at 31.03.2018 As at 31.03.2017
Longtermborrowings 12300.00 12300.00
NetDebt 12300.00 12300.00
EquityShareCapital 13593.60 11328.00
Otherequity 311993.09 191530.24
TotalEquity 325586.69 202858.24
GearingRatio 3.78% 6.06%
Nochangesweremadeintheobjectives,policiesorprocessesformanagingcapitalduringtheyearsendedMarch31,2018andMarch31,2017.
52a.Inthecaseofcontracts/sub-contracts,whereverfinalbillsarenotsubmittedbythecontractorsfortheworkdoneasatthecloseoftheyear,liabilityisestimatedandprovidedbasedontheworkdone.
52b.BalanceshownunderTradeReceivables,TradePayables,loans,depositsandclaimsaresubjecttoconfirmationandconsequentreconciliation,ifany
53.TheCompanyhasmadeadequateprovisiontowardsmaterialforeseeablelosseswhereverrequired,inrespectoflongtermcontracts.TheCompanydonothaveanylongtermderivativecontractsforwhichtherewereanymaterialforeseeablelosses.
54.Figuresinbracketsdenotenegativefigures.
55.Previousyearfigureshavebeenregroupedandclassifiedwherevernecessarytoconformtothecurrentyearpresentation.
ForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
18346th Annual Report
To TheMembersOfCochin Shipyard Limited
Report on the Consolidated Ind AS Financial Statements
We have audited the accompanying consolidated IndAS financial statements of Cochin Shipyard Limited (‘theHolding Company’) and its subsidiary Hooghly CochinShipyard Limited (collectively referred to as the ‘Group’),whichcomprisetheConsolidatedBalanceSheetasatMarch31, 2018, the Consolidated Statement of Profit and Loss(includingOtherComprehensiveIncome),theConsolidatedStatementofCashFlowsandtheConsolidatedStatementofChangesinEquityfortheyearthenended,andasummaryofthesignificantaccountingpoliciesandotherexplanatoryinformation(hereinafterreferredtoas‘theconsolidatedIndASfinancialstatements’).
Management’s Responsibility for the Consolidated Ind AS Financial Statements
TheHoldingCompany’sBoardofDirectors is responsibleforthemattersstatedinSection134(5)oftheCompaniesAct, 2013 (‘the Act’) with respect to the preparation ofthese Consolidated IndAS financial statements that givea true and fair view of the consolidated state of affairs(financial position), consolidated profit or loss (financialperformance including other comprehensive income),consolidatedcashflowsandconsolidatedchangesinequityoftheGroupinaccordancewiththeaccountingprinciplesgenerallyacceptedinIndia,includingtheIndianAccountingStandards(IndAS)prescribedunderSection133oftheAct.
The respective Board of Directors of the companiesincludedintheGroupareresponsibleforthemaintenanceof adequate accounting records in accordance with theprovisions of the Act for safeguarding the assets of theGroupand forpreventinganddetecting fraudsandotherirregularities; the selectionandapplicationof appropriateaccountingpolicies;making judgmentsandestimatesthatarereasonableandprudent;andthedesign,implementationand maintenance of adequate internal financial controlsthatwere operating effectively for ensuring the accuracyand completeness of the accounting records, relevant tothepreparationandpresentationoftheconsolidatedIndASfinancialstatementsthatgiveatrueandfairviewandarefreefrommaterialmisstatement,whetherduetofraudorerror,whichhavebeenusedforthepurposeofpreparationof the consolidated Ind AS financial statements by theDirectorsoftheHoldingCompany,asaforesaid.
Auditor’s Responsibility
Our responsibility is to express an opinion on theseconsolidatedIndASfinancialstatementsbasedonouraudit.Whileconductingtheaudit,wehavetakenintoaccounttheprovisionsoftheAct,theaccountingandauditingstandardsandmatterswhicharerequiredtobeincludedintheauditreportundertheprovisionsoftheActandtheRulesmadethereunder.
WeconductedourauditoftheconsolidatedIndASfinancialstatements in accordancewith theStandardsonAuditingspecifiedunderSection143(10)oftheAct.ThoseStandardsrequirethatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassuranceaboutwhether the consolidated IndASfinancial statements arefree from material misstatement.
An audit involves performing procedures to obtain auditevidence about the amounts and the disclosures in theconsolidated IndAS financial statements.The proceduresselected dependon the auditor’s judgment, including theassessment of the risks of material misstatement of theconsolidated IndASfinancial statements,whether due tofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalfinancialcontrolrelevanttotheHoldingCompany’spreparationoftheconsolidatedIndASfinancialstatementsthatgiveatrueandfairviewinordertodesignauditproceduresthatareappropriateinthecircumstances.An audit also includes evaluating the appropriateness oftheaccountingpoliciesusedandthereasonablenessoftheaccountingestimatesmadebytheHoldingCompany’sBoardofDirectors,aswellasevaluatingtheoverallpresentationoftheconsolidatedIndASfinancialstatements.
Webelievethattheauditevidenceobtainedbyusandtheauditevidenceobtainedbytheotherauditors intermsoftheirreportsreferredtoinOtherMattersparagraphbelow,issufficientandappropriatetoprovideabasisforourauditopinionontheconsolidatedIndASfinancialstatements.
Opinion
In our opinion and to the best of our information andaccording to the explanations given to us, and based onthe considerationof the reports of the other auditors onseparate financial statements and on the other financialinformation of the subsidiary, the aforesaid consolidatedIndASfinancial statements give the information requiredbytheActinthemannersorequiredandgiveatrueandfairviewinconformitywiththeaccountingprinciplesgenerallyacceptedinIndiaincludingtheIndAS,oftheconsolidatedstateofaffairs(financialposition)oftheGroupasatMarch
InDEPEnDEnT AuDITOR’S REPORT
184 Cochin Shipyard Ltd
31, 2018, its consolidated profit (financial performanceincluding other comprehensive income), its consolidatedcashflowsandtheconsolidatedchangesinequityfortheyearendedonthatdate.
Emphasis of Matter
Wedrawattentiontothefollowing:-
i) Note No.29 to the Consolidated Ind AS financialstatements regarding the basis onwhich the Grouphasrecognizedrevenuefromshipbuilding/shiprepairactivities based on the Group’s own assessment ofphysical completion and further, reliance is placedon the technical assessment and activity based costestimatesdefinedbytheManagementforthepurposeofrecognitionofincome;
ii) Note No.41.a to the Consolidated Ind AS financialstatementsregardingenvironmentalClearancefortheInternationalShipRepairFacility (‘ISRF’)project fromthe National Board for Wildlife (‘NBWL’) which hasrecommended environmental clearance for the ISRFproject along with the conditions imposed by StateChief Wild Life Warden (‘CWLW’) and subsequentutilizationoftheInitialPublicOfferproceedsrelatingtotheISRFprojectbasedonthemanagementcontentionthattheconditionsimposedbytheCWLWaretobecompliedwithduringtheimplementationoftheISRFproject.
Ouropinionisnotmodifiedinrespectofthesematters.
Other Matter
Wedidnotauditthefinancialstatementsofthesubsidiarycompany (Hooghly Cochin Shipyard Limited), whosefinancial statements (before eliminating inter Companybalances) reflect total assets of ₹ 2180.54 lakhs and netassets of ₹ 2162.93 lakhs as at March 31, 2018, totalrevenues(beforeeliminatinginterCompanytransactions)of₹18.57lakhsandnetcashinflowsamountingto₹1504.69lakhsfortheyearendedonthatdate,asconsideredintheconsolidated Ind AS financial statements. These financialstatements have been audited by another auditorwhosereporthasbeenfurnishedtousbythemanagementandouropinionontheconsolidatedIndASfinancialstatements,insofarasitrelatestotheamountsanddisclosuresincludedinrespectofthissubsidiary,andourreportintermsofsub-section(3)ofSection143oftheAct,insofarasitrelatestotheaforesaidsubsidiary,isbasedsolelyonthereportoftheotherauditor.
Our opinion above on the consolidated Ind AS financialstatements, and our report on other legal and regulatoryrequirements below, are not modified in respect of theabovematterwithrespecttoourrelianceontheworkdonebyandthereportoftheotherauditor.
Report on Other Legal and Regulatory Requirements
1. As requiredby Section143 (3) of theAct, basedonourauditandontheconsiderationofthereportoftheotherauditoronseparateFinancialStatementsandtheotherfinancialinformationofsubsidiary,incorporatedinIndia,referredintheOtherMatterparagraphabove,wereport,totheextentapplicable,that:
a. Wehavesoughtandobtainedalltheinformationand explanations which to the best of ourknowledge and belief were necessary forthe purposes of our audit of the aforesaidconsolidatedIndASFinancialStatements;
b. In our opinion, proper books of account asrequired by law relating to preparation ofthe aforesaid consolidated Ind AS FinancialStatements havebeen kept so far as it appearsfromourexaminationofthosebooksandreportoftheotherauditor;
c. TheConsolidatedBalanceSheet,theConsolidatedStatement of Profit and Loss (including OtherComprehensive Income), the ConsolidatedStatement of Cash Flows and the ConsolidatedStatementofChangesinEquitydealtwithbythisReportareinagreementwiththebooksofaccountmaintainedforthepurposeofpreparationoftheconsolidatedIndASFinancialStatements;
d. In our opinion, the aforesaid consolidated IndAS financial statements complywith the IndianAccounting Standards prescribed under Section133oftheAct;
e. Inviewofexemptiongivenvidenotificationno.G.S.R.463(E)datedJune52015,issuedbyMinistryofCorporateAffairs,provisionsofSection164(2)oftheActregardingdisqualificationofDirectors,arenotapplicable to theHoldingCompanyanditssubsidiary;
f. With respect to the adequacy of the internalfinancial controlsoverfinancial reportingof theGroup and the operating effectiveness of suchcontrols,refertoourseparatereportin“AnnexureA”.
g. Withrespecttotheothermatterstobeincludedin theAuditor’sReport in accordancewithRule11oftheCompanies(AuditandAuditors)Rules,2014, in our opinion and to the best of ourinformation and according to the explanationsgiventous:
i. The Group has disclosed the impact ofpending litigations on its consolidated
18546th Annual Report
financial position in its consolidated IndAS financial statements – Refer Notes 40,42, 43 and 44 to the consolidated IndASfinancialstatements;
ii. TheGrouphasmadeprovision,asrequiredunder the applicable law or accountingstandards, formaterial foreseeable losses,if any, on long-term contracts. Furtherthe Group did not have any long-termderivative contracts forwhich therewereany material foreseeable losses. – ReferNote 56 to the Consolidated Ind ASfinancialstatements;
iii. Therewerenoamounts,whichwererequiredtobetransferred,totheInvestorEducationandProtectionFundbytheGroup;and
iv. Thedisclosuresregardingdetailsofspecifiedbank notes held and transacted duringNovember8, 2016 toDecember30,2016has not been made since the requirementdoes not pertain to financial year endedMarch31,2018.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182
Cochin-16May24,2018
186 Cochin Shipyard Ltd
Annexure A to the Independent Auditor’s Report
(Referredtoinparagraph1(f)under‘ReportonOtherLegalandRegulatoryRequirements’ sectionof the IndependentAuditor’sReport to themembersof theCompanyon theConsolidatedIndAsfinancialstatementsfortheyearendedMarch31,2018.)
Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)
We have audited the internal financial controls overfinancialreportingofCochinShipyardLimited(“theHoldingCompany”) and its Subsidiary Hoogly Cochin ShipyardLimited (“the Subsidiary”), which is incorporated in India,togetherreferredtoasthe“Group”asofMarch31,2018in conjunctionwith our audit of the consolidated IndASfinancial statements of the Group for the year ended onthatdate.
Management’s Responsibility for Internal Financial Controls
TherespectiveBoardofDirectorsoftheHoldingCompanyanditssubsidiarycompanywhich is incorporated in India,are responsible for establishing and maintaining internalfinancial controls based on the internal control overfinancial reporting criteria established by the respectivecompanyconsideringtheessentialcomponentsofinternalcontrol stated in theGuidanceNote onAudit of InternalFinancial Controls over Financial Reporting issued by theInstituteofCharteredAccountantsof India (‘ICAI’).Theseresponsibilities include the design, implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly andefficient conduct of its business, including adherence tothe respective company’s policies, the safeguarding of itsassets, thepreventionanddetectionoffraudsanderrors,theaccuracyandcompletenessoftheaccountingrecords,andthetimelypreparationofreliablefinancialinformation,asrequiredundertheAct.
Auditor’s Responsibility
Ourresponsibility istoexpressanopinionontheGroup’sinternalfinancialcontrolsoverfinancialreportingbasedonouraudit.WeconductedourauditinaccordancewiththeGuidanceNoteonAuditofInternalFinancialControlsoverFinancialReporting(‘theGuidanceNote’)andtheStandardsonAuditing, issuedby ICAIanddeemed tobeprescribedundersection143(10)oftheAct,totheextentapplicabletoanauditofinternalfinancialcontrols,bothapplicabletoanauditofInternalFinancialControlsand,bothissuedbyICAI.ThoseStandardsandtheGuidanceNoterequirethatwecomplywithethicalrequirementsandplanandperformthe audit to obtain reasonable assurance about whether
adequateinternalfinancialcontrolsoverfinancialreportingwas established and maintained and if such controlsoperatedeffectivelyinallmaterialrespects.
Our audit involvesperformingprocedures toobtain auditevidence about the adequacy of the internal financialcontrolssystemoverfinancialreportingandtheiroperatingeffectiveness.Ourauditof internalfinancial controlsoverfinancialreportingincludedobtaininganunderstandingofinternalfinancialcontrolsoverfinancialreporting,assessingthe risk that amaterialweakness exists, and testing andevaluating the design and operating effectiveness ofinternalcontrolbasedontheassessedrisk.Theproceduresselected dependon the auditor’s judgment, including theassessmentoftherisksofmaterialmisstatementoftheIndASfinancialstatements,whetherduetofraudorerror.
Webelievethattheauditevidencewehaveobtainedandtheauditevidenceobtainedbytheotherauditor intermsof their report referred to in theOtherMatter paragraphbelow,issufficientandappropriatetoprovideabasisforourauditopinionon theHoldingCompanyand itsSubsidiaryCompanywhich is incorporated in India, internalfinancialcontrolssystemoverfinancialreporting.
Meaning of Internal Financial Controls over Financial Reporting
Acompany’sinternalfinancialcontroloverfinancialreportingis a process designed to provide reasonable assuranceregarding the reliability of financial reporting and thepreparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.A company’s internal financial control over financialreporting includes those policies and procedures that (1)pertain to themaintenanceof records that, in reasonabledetail, accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded asnecessarytopermitpreparationoffinancialstatements inaccordancewithgenerallyacceptedaccountingprinciples,and that receipts and expenditures of the company arebeing made only in accordance with authorizations ofmanagementanddirectorsofthecompany;and(3)providereasonable assurance regarding prevention or timelydetectionofunauthorizedacquisition,use,ordispositionofthecompany’sassetsthatcouldhaveamaterialeffectonthefinancialstatements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financialcontrolsoverfinancial reporting, including thepossibilityofcollusionorimpropermanagementoverrideofcontrols,material misstatements due to error or fraudmay occurand not be detected.Also, projections of any evaluation
18746th Annual Report
of the internal financial controls over financial reportingtofutureperiodsaresubject totheriskthatthe internalfinancial control over financial reporting may becomeinadequatebecauseofchanges inconditions,orthatthedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.
Opinion
Inouropinion, theHoldingCompanyand itsSubsidiaryCompany which is incorporated in India, have, in allmaterialrespects,anadequateinternalfinancialcontrolssystem over financial reporting and such internalfinancialcontrolsoverfinancialreportingwereoperatingeffectivelyasatMarch31,2018 ,basedonthe internalcontroloverfinancialreportingcriteriaestablishedbytherespectivecompanyconsideringtheessentialcomponentsofinternalcontrolstatedintheGuidanceNoteonAuditof Internal Financial Controls Over Financial ReportingissuedbytheICAI.
Other Matter
Ouraforesaidreportsundersection143(3)(i)oftheActonthe adequacy and operating effectiveness of the internalfinancial controls over financial reporting in so far as itrelates to the subsidiarywhich is incorporated in India, isbasedon the corresponding report of the auditor of thatcompany.
Ouropinionisnotqualifiedinrespectofthismatter.
For Krishnamoorthy & KrishnamoorthyCharteredAccountants
Firm’sregistrationnumber:001488S
C.R RemaPartner
Membershipnumber:029182Cochin-16May24,2018
188 Cochin Shipyard Ltd
COnSOlIDATED BAlAnCE ShEETasatMarch31,2018
(₹inlakhs)
Particulars Note No. As at 31.03.2018
ASSETSNon-current assets
(a)Property,plantandequipment 3 28,446.72(b)Capitalwork-in-progress 4 12,074.20(c)Intangibleassets 5 6,451.75(d)Financialassets
(i)Investments 6 9.18(ii)Loans 7 147.77
(e)Incometaxassets(net) 8 5,400.03(f)Deferredtaxassets(net) 9 4,345.12(g)Othernon-currentassets 10 7,697.27
64,572.04 Current assets
(a)Inventories 11 31,455.67(b)FinancialAssets
(i)Investments 12 0.16(ii)Tradereceivables 13 58,012.76(iii)Cashandcashequivalents 14 80,698.75(iv)Bankbalancesotherthan(iii)above 15 269,840.19(v)Loans 16 38.14(vi)OtherFinancialassets 17 26,084.73
(c)Currenttaxassets(net) 8 1.86(d)Othercurrentassets 18 16,765.03
482,897.29 Total Assets 547,469.33 EQUITY AND LIABILITIESEquity :
(a)Equitysharecapital 19 13,593.60(b)Otherequity 20 311,953.71
Equity attributable to owners 325,547.31 (c)NonControllinginterests 562.36
Total Equity 326,109.67 Liabilities :Non-current liabilities
(a)Financialliabilities(i)Borrowings 21 12,300.00(ii)Otherfinancialliabilities 22 261.22
(b)Provisions 23 2,265.70(c)Othernoncurrentliabilities 24 13.74
14,840.66 Current liabilities
(a)Financialliabilities(i)Tradepayables 25 27,382.97(ii)Otherfinancialliabilities 26 11,737.44
(b)Othercurrentliabilities 27 137,977.57(c)Provisions 28 28,349.55(d)Currenttaxliabilities(net) 8 1,071.47
206,519.00 Total Equity and Liabilities 547,469.32
CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheConsolidatedFinancialStatements 3-58TheaccompanyingnotesareanintegralpartofthesefinancialstatementsForandonbehalfofBoardofDirectorsV KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
18946th Annual Report
COnSOlIDATED STATEMEnT OF PROFIT AnD lOSSfortheyearendedMarch31,2018
(`inlakhs)
Particulars Note No. For the year ended March 31, 2018
I IncomeRevenue from operations 29 235512.33Otherincome 30 18922.45Total Income 254434.78
II Expenses:Costofmaterialsconsumed 31 116565.64Changesininventoriesofwork-in-progress 32 2510.39Subcontractandotherdirectexpenses 33 23528.99Employeebenefitsexpense 34 27139.85Finance costs 35 1141.03Depreciationandamortisationexpense 36 3751.02Otherexpenses 37 13547.55Provisionforanticipatedlossesandexpenditure 38 5826.17Total expenses 194010.64
III Profit before tax 60424.14 IV Tax expense:
(1)Currenttax 8 22412.00(2)Deferredtax 8 (1613.85)
V Profit for the year 39625.99 VI Other comprehensive income
A) Items that will not be reclassified to profit or lossi)Remeasurementsofdefinedemployeebenefitobligations (205.04)ii)Incometaxrelatingtoitemsthatwillnotbereclassifiedtoprofitorloss 70.96Other comprehensive income for the year (134.08)
VII Total Comprehensive income for the year 39491.91 Profit attributable to:
OwnersoftheCompany 39635.63 Non-controllinginterest (9.64)
Profit for the year 39625.99 Other comprehensive income attributable to:
OwnersoftheCompany (134.08)Non-controllinginterest 0.00
Other comprehensive income for the year (134.08)
Total Comprehensive Income attributable to:OwnersoftheCompany 39501.55 Non-controllinginterest (9.64)
Total Comprehensive Income for the year 39491.91 VIII Earnings per equity share of Rs 10 each : 39
(1)Basic(Rs) 31.00 (2)Diluted(Rs) 31.00
CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheConsolidatedFinancialStatements 3-58TheaccompanyingnotesareanintegralpartofthesefinancialstatementsForandonbehalfofBoardofDirectorsV KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
190 Cochin Shipyard Ltd
COnSOlIDATED STATEMEnT OF CASh FlOwSfortheyearendedMarch31,2018
(`inlakhs)
Particulars For the year ended March 31, 2018
A. Cash flow from operating activities
Profit before tax 60,424.14
Adjustmentsfor:
Depreciationandamortisation 3,497.59
Interestexpense 1,141.03
Interestincome (15,440.04)
Rental income (58.18)
Dividendincome (185.84)
Lossonsale/writeoffofpropertyplantandequipment 9.86
Profitonsaleofpropertyplantandequipment (1.34)
Profitonsaleofinvestments (669.82)
IncomerecognisedonGovt.assistance (1.14)
Loss/(gain)onderivativecontracts(net) 0.00
Unrealisedloss/(gain)onderivativecontracts(net) 0.00
Netgain/(loss)onforeigncurrencytransactions (217.73)
ExpensesonInitialPublicOffer 668.89
Effectiveloss/gainofcashflowhedges 0.00
Operatingcashflowbeforeworkingcapitalchanges 49,167.42
Movementsinworkingcapital:
(Increase)/decreaseininventories (12,808.58)
(Increase)/decreaseintradeandotherreceivables (181,661.85)
Increase/(decrease)intradeandotherpayables 85,613.83
(59,689.18)
Incometaxpaidnetofrefunds (15,610.00)
Net cash flows from operating activities (A) (75,299.18)
B. Cash flow from investing activities
Purchaseofproperty,plantandequipment (1,364.27)
(Increase)/decreaseincapitalworkInprogress (6,109.87)
InvestmentinMutualFunds (203,750.00)
RedemptionofMutualFunds 203,749.84
Dividendreceived 185.84
Profitonsaleofinvestments 669.82
Govt.assitancereceived 16.03
Saleorwithdrawalofproperty,plantandequipment 20.91
Interestreceived 13,624.49
Rentreceived 59.50
19146th Annual Report
Particulars For the year ended March 31, 2018
Net cash flows from investing activities (B) 7,102.29
C. Cash flow from financing activities
ProceedsfromIPOincludingsecuritiespremium 96,195.36
Loss/(gain)onderivativecontracts(Net) 0.00
Netgain/(loss)onforeigncurrencytransactions 217.73
Dividendpaid (10,161.21)
Dividenddistributiontaxpaid (2,068.58)
Interestpaid (1,141.15)
ExpensesonInitialPublicOffer (1,744.66)
Net cash flows from financing activities (C) 81,297.49
D. Net Increase in Cash & Cash Equivalents (A)+(B)+(C) 13,100.60
Cash and cash equivalent at the beginning of the Year
Cashonhand 0.00
BalancewithBanksincurrentaccountanddepositaccount 67,598.15Cashandcashequivalents(asperNote16) 67,598.15
Cash and cash equivalent at the end of the Year
Cashonhand 0.12
BalancewithBanksincurrentaccountanddepositaccount 80,698.63Cashandcashequivalents(asperNote14) 80,698.75
Note:Figuresinbracketsindicateoutflow.CorporateoverviewandSignificantAccountingPolicies 1-2NotestotheConsolidatedFinancialStatements 3-58ForandonbehalfofBoardofDirectorsV KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
(`inlakhs)
192 Cochin Shipyard Ltd
COnSOlIDATED STATEMEnT OF ChAngES In EquITyfortheyearendedMarch31,2018
A. Equity Share Capital
(`inlakhs)
As at 01.04.2017 Changes in equity share capital during the year As at 31.03.2018
11,328.00 2,265.60 13,593.60
B. Other Equity(`inlakhs)
Reserves and Surplus
Total other equityCapital
Reserve
Securities Premium Reserve
General Reserve
RetainedEarnings
Capital Redemp-tion Re-
serve
Debenture Redemption
Reserve
Total attrib-utable to the
Company
Attributable to NCI
Balance as at April 01,2017 263.56 0.85 6322.75 172081.27 11914.20 947.61 191530.24 0.00 191530.24
Profitfortheyear 39635.63 39635.63 (9.64) 39625.99
Othercomprehensiveincomeforthe year (134.08) (134.08) (134.08)
Total comprehensive income for the year 39501.55 39501.55 (9.64) 39491.91
Dividends(includingtaxes) (12229.79) (12229.79) (12229.79)
Transferfromretainedearnings (288.33) 288.33 0.00 0.00
PremiumonIPOnetofDeferredTax 93151.83 93151.83 93151.83
Amortisation of premium (0.12) (0.12) (0.12)
Balance as at March 31,2018 263.56 93152.56 6322.75 199064.70 11914.20 1235.94 311953.71 (9.64) 311944.07
EquityinfusedbyNCI 572.00
TOTAL 562.36
ForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798
Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
NotesTo Financial Statements for the year ended 31st March 2018
19346th Annual Report
1. CORPORATE OVERVIEW AND SIGNIFICANT ACCOUNTING POLICIES
1.1. Corporate information
CochinShipyardLimited(referredtoas“CSL”or“theCompany”) ismainly engaged in the construction ofvessels and repairs and refits of all types of vesselsincludingupgradationofshipsperiodicallayuprepairsandlifeextensionofships.
TheCompanyisapubliclimitedcompanyincorporatedand domiciled in India. The address of its corporateoffice is Perumanoor,Kochi,Kerala.As atMarch31,2018, the Government of India holds 75% of theCompany’sequitysharecapital.TheCompany’sequitysharesare listedfortradingonNSELimitedandBSELimited in India and tax free bonds are listed fortradingonBSE.
TheconsolidatedFinancialStatementsrelatetoCochinShipyardLimited(ParentCompany)anditsSubsidiaryCompany, Hooghly Cochin Shipyard Limited. ThesubsidiarycompanywasincorporatedonOctober23,2017 and is proposed to be mainly engaged in thebusiness of construction and repair of vessels of alltypes.
TheCompanyanditsSubsidiaryaretogetherreferredtoas“Group”.
The consolidated financial statements for the yearendedMarch31,2018wereapprovedby theBoardofDirectorsandauthorisedforissueonMay24,2018.
2. Significant Accounting Policies
2.1 Statement of compliance
These consolidated financial statements have beenprepared in accordance with the Indian AccountingStandards(referredtoas“IndAS”)asprescribedunderSection 133 of the CompaniesAct, 2013 readwithCompanies(IndianAccountingStandards)Rules,2015asamendedfromtimetotime.
2.2 Basis of preparation of Consolidated Financial Statements
These consolidated financial statements have beenpreparedonthehistoricalcostbasis,exceptforcertainfinancialinstrumentswhicharemeasuredatfairvalues
attheendofeachreportingperiod,asexplainedintheaccountingpoliciesbelow.Historicalcostisgenerallybased on the fair value of the consideration giveninexchange forgoodsand services.Fairvalue is theprice thatwouldbe received to sell anassetorpaidtotransferaliabilityinanorderlytransactionbetweenmarketparticipantsatthemeasurementdate.
2.2.1 Basis of consolidation of Consolidated Financial Statements
Subsidiariesareentities(includingstructuredentities)overwhichtheGrouphascontrol.TheGroupcontrolsanentitywhentheGroupisexposedto,orhasrightsto,variablereturnsfromitsinvolvementwiththeentityandhastheabilitytoaffectthosereturnsthroughitspower to direct the relevant activities of the entity.Subsidiaries are fully consolidated commencing fromthedateonwhichcontrolistransferredtotheGroupuntilthedateonwhichcontrolceases.
TheGroupconsolidatethefinancialstatementsoftheparentanditssubsidiariesonlinebylinebasisaddingtogetherlikeitemsofassets,liabilities,equity,incomeand expenses. Intercompany transactions,balancesand unrealised gains on transactions between groupcompanies are eliminated.Unrealised losses are alsoeliminated unless the transaction provides evidenceofanimpairmentofthetransferredasset.Accountingpolicies of subsidiaries have been changed wherenecessary to ensure consistency with the policiesadoptedbytheGroup.
Non-controllinginterests, intheresultsandequityofsubsidiariesareshownseparatelyintheConsolidatedStatementofProfitandLoss,ConsolidatedStatementofChangesinEquityandConsolidatedBalanceSheetrespectively. Subsidiary company was incorporatedinOctober2017andthisisthefirstyearpreparationof Consolidated Financial Statements. Consequently,previousyearfiguresarenotdisclosed.
2.3 Use of estimates and judgements
The preparation of the consolidated financialstatements in conformity with the Ind AS requiresmanagement to make judgements, estimates andassumptionsthataffecttheapplicationofaccountingpoliciesandthereportedamountsofassets,liabilitiesanddisclosuresasatdateofthefinancialstatements
NotesTo Financial Statements for the year ended 31st March 2018
194 Cochin Shipyard Ltd
and the reported amounts of the revenues andexpenses for the years presented. The estimatesand associated assumptions are based on historicalexperienceandotherfactorsthatareconsideredtoberelevant.Actualresultsmaydifferfromtheseestimatesunderdifferentassumptionsandconditions.
The estimates and underlying assumptions arereviewedonanongoingbasis.Revisionstoaccountingestimates are recognized in the period inwhich theestimate is revised if the revision affects only thatperiod or in the period of the revision and futureperiodsiftherevisionaffectsbothcurrentandfutureperiods.
2.4 Critical Accounting estimates and judgements: Theapplicationofsignificantaccountingpoliciesthatrequirecriticalaccountingestimatesinvolvingcomplexandsubjectivejudgementsandtheuseofassumptionsin the consolidated financial statements have beendisclosedbelow:
Useful lives of property, plant and equipmentThe Group reviews the estimated useful lives andresidual values of property, plant and equipmentat the end of each reporting period. Assumptionsare also made as to whether an item meets thedescriptionofassetsoastowarrantitscapitalisationandwhichcomponentoftheassetmaybecapitalised.Reassessment of life may result in change indepreciationexpenseinfutureperiods.
Valuation of deferred tax assets / liabilitiesTheGroupreviewsthecarryingamountofdeferredtaxassets/liabilitiesattheendofeachreportingperiod.Significantjudgementsareinvolvedindeterminingtheelementsofdeferredtaxitems.
Impairment of unquoted investments The Group reviews its carrying value of investmentsannually, ormore frequentlywhen there is indicationforimpairment.Iftherecoverableamountislessthanitscarryingamount,theimpairmentlossisaccountedfor.
Recognition and measurement of provisions
The recognition and measurment of provisions arebased on the assessment of the probability of an
outflow of resources and on past experience andcircumstance known at the balance sheet date. Theactual outflow of resources at a future date maythereforevaryfromthefigureincludedinprovisions.
Provision towards Guarantee repairs
Aprovisionismadetowardsguaranteerepairs/claimsin respect of newly built ships/small crafts deliveredand repaired ships on the basis of the technicalestimationdoneby theGroup.Theguaranteeclaimsreceivedfromtheshipownersarereviewedeveryyeartillsettlementofthesame.Incaseofashortfallintheprovisionmadeearlier,additionalprovisionsaremade.
Contingencies and commitments
Acontingentliabilityisapossibleobligationthatarisesfrompast eventswhose existencewill be confirmedbytheoccurrenceornon-occurrenceofoneormoreuncertainfutureeventsnotwhollywithinthecontrolof the Group or a present obligation that is notrecognisedbecauseitisnotprobablethatanoutflowof resourceswill be required to settle the obligationoritcannotbemeasuredwithsufficientreliability.TheGroup does not recognise a contingent liability butdiscloses its existence in the consolidated financialstatements.
Recoverability of advances / receivables
TheGroupmakesprovisions forexpectedcredit lossbasedonanassessmentoftherecoverabilityoftradeand other receivables. The identification of doubtfuldebtsrequiresuseofjudgementandestimates.Wheretheexpectationisdifferentfromtheoriginalestimate,suchdifferencewill impact the carryingvalueof thetradeandotherreceivablesandexpensesonaccountofprovisionfordoubtfuldebtsintheperiodinwhichsuchestimatehasbeenchanged.Ateachbalancesheetdate,basedonhistoricaldefault ratesobservedoverexpectedlife,themanagementassessestheexpectedcreditlossonoutstandingreceivablesandadvances.
Fair value measurements
Management applies valuation techniques todetermine the fair value of financial instruments(whereactivemarketquotesarenotavailable)andnon-financialassets.Thisinvolvesdevelopingestimatesandassumptionsconsistentwithhowmarketparticipants
NotesTo Financial Statements for the year ended 31st March 2018
19546th Annual Report
would price the instrument. Management bases itsassumptionsonobservabledataasfaraspossiblebutthis isnotalwaysavailable.Inthatcasemanagementuses the best information available. Estimated fairvaluesmayvaryfromtheactualpricesthatwouldbeachievedinanarm’slengthtransactionatthereportingdate.
Classification of Leases
TheGroupentersintoleasingarrangementsforvariousassets. The classification of the leasing arrangementas a finance lease or operating lease is based on anassessmentofseveralfactors,including,butnotlimitedto,transferofownershipofleasedassetatendofleaseterm,lessee’soptiontopurchaseandestimatedcertaintyofexerciseofsuchoption,proportionofleasetermtotheasset’seconomiclife,proportionofpresentvalueofminimum lease payments to fairvalue of leased assetandextentofspecialisednatureoftheleasedasset.
Provision for inventories
Management reviews the inventory ageing on aperiodic basis. This review involves comparison ofthe carrying value of the aged inventory itemswiththerespectivenetrealisablevalue.Thepurposeistoascertainwhetheraprovisionisrequiredtobemadeintheconsolidatedfinancialstatementsforanyobsoleteand slow-moving items and that adequate provisionfor obsolete and slow-moving inventories has beenmadeinthefinancialstatements.
Provision for Liquidated Damages
Claims for liquidateddamagesagainst theGrouparerecognized in the consolidated financial statementsbased on the management’s assessment of theprobable outcome with reference to the availableinformation supplemented by experience of similartransactions.
A provision in respect of liquidated damages isrecognised for the period of delay between the duedateofsupplyofgoodsasper thedeliveryscheduleandtheexpecteddateofdeliveryofthesaidgoods.
Revenue Recognition TheGroupusesthepercentageofcompletionmethodinaccountingfor itsfixedpricecontracts.Theuseof
the percentage of completion method requires theGroup to estimate the costs expended to date asa proportion to the total cost to be expended on aproject considering thephysicalprogressorfinancialprogresswhichever is lower. Provision for estimatedlossesifanyontheuncompletedpartofthecontractsareprovidedintheperiodinwhichsuchlossesbecomeprobablebasedontheexpectedcontractestimatesatthereportingdate.
Recognition and measurement of defined benefit obligations The obligation arising from defined benefit plan isdeterminedonthebasisofactuarialassumptions.Keyactuarial assumptions include discount rate, trendsin salary escalation and vested future benefits andlife expectancy.The discount rate is determinedwithreferencetomarketyieldsattheendofthereportingperiodontheGovernmentbonds.Theperiodtomaturityof the underlying bonds correspond to the probablematurityofthepostemploymentbenefitobligations.
2.5 Property , Plant and Equipment (PPE)TheGrouphad applied for theonetime transitionexemption of considering the carrying cost on thetransition date i.e. April 1, 2015 as the deemedcost under Ind AS. Hence regarded thereafter ashistorical cost.
Property,PlantandEquipmentsarestatedatcostlessaccumulated depreciation (other than free hold landwhicharestatedatcost)andimpairmentlosses,ifany.PPEareinitiallyrecognisedatcost.TheinitialcostofPPEcomprisesitspurchaseprice,andanycostsdirectlyattributabletobringingtheassettothe locationandconditionnecessaryfor it tobecapableofoperatinginthemannerintendedbymanagementincludingnonrefundabledutiesandtaxesnetofanytradediscountsandrebatesThecostofPPEalsoincludesinterestonborrowings (borrowing cost directly attributable toacquisition, construction or production of qualifyingassets)uptoinitialrecognition.
Subsequent costs are included in the asset’scarrying amount or recognised as a separate asset,as appropriate, onlywhen it is probable that futureeconomicbenefitsassociatedwith the itemwillflowto theGroup and the cost of the items arematerial
NotesTo Financial Statements for the year ended 31st March 2018
196 Cochin Shipyard Ltd
and can be measured reliably. The carrying amountofanycomponentaccounted forasa separateassetis derecognisedwhen replaced.All other repairs andmaintenance are charged to consolidated Statementofprofitandlossduringthereportingperiodinwhichtheyareincurred.
2.6 Capital work in progress and intangible assets under development:
Capital work in progress and intangible assets underdevelopmentareproperty,plantandequipmentthatarenotyetreadyfortheirintendeduseatthereportingdate,whicharecarriedatcost,comprisingdirectcost,relatedincidentalexpensesandattributableborrowingcost.
2.7 Intangible Assets
Design development: Cost incurred on DesignDevelopment which are not directly chargeable on aproductarecapitalizedasIntangibleAssetandamortisedonastraight-linebasisoveraperiodoffiveyears.
Software: Cost of software which is not an integralpartoftherelatedhardwareacquiredforinternaluseis capitalised as intangible asset and amortised on astraight-linebasisoveraperiodofthreeyears.
Right touse:Up- front feepaid forsecuring right touseoflandandotherfacilityiscapitalizedasintangibleassetandamortisedonastraight linebasisover theperiodofleaseforwhichtherighthasbeenobtained,commencingfromthedateonwhichtherightbecomescapableofbeingexercised.
Internally generated procedure: Cost of internallygeneratedweldprocedure iscapitalizedas IntangibleAsset and amortised on a straight-line basis over aperiodofthreeyears.
The residual values, useful lives and methods ofamortization of intangible assets are reviewed ateachfinancialyearendandadjustedprospectively, ifappropriate.
2.8 Leases
As a lessee:
Leases are classified as finance leaseswhenever thetermsof lease transfer substantially all the risks andrewards of ownership to the lessee. Leases where
a significant portion of the risks and rewards ofownershipareretainedbythelessorareclassifiedasoperatingleases.
(i) Operating Lease:
Operating lease payments are recognized as anexpense intheconsolidatedStatementofProfitand Loss on a straight-line basis over the leaseterm except where another systematic basisis more representative of the time pattern inwhicheconomicbenefitsfromleasedassetsareconsumedorunlesstheleaseagreementexplicitlystatesthatincreaseisonaccountofinflation.
(ii) Finance Lease:
AssetstakenonleasebytheGroupinitscapacityas lessee,where theGrouphas substantially alltherisksandrewardsofownershipareclassifiedasfinancelease.Suchleasesarecapitalisedattheinceptionoftheleaseatlowerofthefairvalueorthe present value of the minimum lease payments and a liability is recognised for an equivalentamount. Each lease rental paid is allocatedbetweenthe liabilityandthe interestcostsoastoobtainaconstantperiodicrateof interestontheoutstandingliabilityforeachyear.
As a lessor:
Lease income is recognised based on the leaseagreementsandischargedtoconsolidatedStatementofProfitandLoss
2.9 Investment Properties
Investmentpropertiesarepropertiesheldtoearnrentalsand/or forcapital appreciation. Investmentpropertiesare measured initially at cost including transactioncosts. Subsequent to initial recognition, investmentproperties are stated at cost less accumulateddepreciation and impairment losses.Any gain or losson disposal of investment property is determined asthedifferencebetweennetdisposalproceedsandthecarrying amountof theproperty and is recognised intheconsolidatedStatementofProfitandLoss
2.10 Depreciation
Depreciation on property, plant and equipment isprovided on straight-line method based on useful
NotesTo Financial Statements for the year ended 31st March 2018
19746th Annual Report
life of the asset as prescribed in Schedule II to theCompaniesAct,2013.For the assets acquired by the parent CompanyfromCochinPortTrustforInternationalShipRepairFacility (ISRF),depreciation is providedon thebasisof remaining useful life as assessed by technicalexperts.An item of property, plant and equipment and anysignificant part initially recognised is derecognisedupon disposal orwhen no future economic benefitsare expected from its use or disposal.Any gain/lossarisingonderecognitionoftheassetisincludedintheconsolidated Statement of profit and loss when theasset is derecognised.Fully depreciated assets still inuseare retained inconsolidatedfinancial statementsatresidualvalue.Depreciationmethod,usefullivesandresidualvaluesare reviewed at each reporting date and adjustedprospectively,ifappropriate.Management believes that useful life of assets aresame as those prescribed in Schedule II to theAct,exceptforcertaintypesofbuildingsandequipmentswhereinbasedontechnicalevaluation,usefullifehasbeen estimated to be different from that prescribedin Schedule II of the Act.Useful life considered forcalculationofdepreciationforvariousassetsclassareasfollows:
Asset Class Useful LifeBuildings 3-60years
Plantandequipment 5-15years
Furnitureandfixtures 8-10years
Vehicles 8-10years
Officeequipment 3-10years
DataProcessingEquipments
3-6years
Docksandquays 15 years
Railwaysidings 15 years
Electricalinstallation 10years
Drainageandwatersupply 15 years
Vessels 13-28years
2.11 Impairment of Assets
The Group assesses the impairment of assets withreferencetoeachcashgeneratingunit,ateachBalanceSheet date. If events or changes in circumstancesbasedoninternalandexternalfactorsindicatethatthecarryingvaluemaynotberecoverableinfull,thelossonaccountandtherecoverableamount,isaccountedforaccordingly.Therecoverableamountisthehigherofanasset’sfairvaluelesscostsofdisposalandvaluein use.
2.12 Non-current assets held for sale
Groupclassifiesanon-currentassetasheldforsaleifitscarryingamountwillberecoveredprincipallythrougha sale transaction.This condition is regarded asmetonlywhentheassetisavailableforimmediatesaleinitspresentconditionanditssaleishighlyprobable.
Non-currentassetsincludingdiscontinuedoperations,classifiedasheldforsalearemeasuredatthelowerofthecarryingamountsandfairvalue lesscosts tosellandpresentedseparatelyintheconsolidatedfinancialstatements.Onceclassifiedasheldforsale,theassetsarenotsubjecttodepreciationoramortisation.
Any profit or loss arising from the sale or re-measurementofdiscontinuedoperationsispresentedaspartofasinglelineiteminconsolidatedstatementofprofitandloss.
2.13 Inventories
(a) Raw materials, components, stores and sparesare valued at weighted average cost method ornet realisable value whichever is lower. Provisionfor obsolescence / non- usability / deterioration isdeterminedonthebasisoftechnicalassessmentmadebythemanagement.Goodsintransitisvaluedatlowerof cost or net realisable value. Stock ofmaterials inrespectofconstructionofdefencevesselswhereinthecost incurred is reimbursedby theownerare shownasreductionfromtheadvancespaidbytheownerforconstructionofthevessel.
(b) Work in progress:
Work in progress Ship Building :- Work in progressis recognised only when the percentage of physicalcompletion is less than the financial completion,in which case the cost proportionate to excess of
NotesTo Financial Statements for the year ended 31st March 2018
198 Cochin Shipyard Ltd
percentage of financial completion over physicalcompletionistreatedasWorkinprogress.Inthecaseof IndigenousAircraft Carrier since all the materialsbelongs to Indian Navy, work in progress is notrecognized.
Work in progress of ships/offshore structures underrepair,whichhavenotreached75%stageofphysicalcompletion and general engineering jobs are valuedat cost. Work- in- progress of ships where physicalconstructionhasnotstartedisalsovaluedatcost.
(c)Loosetoolsinstockarevaluedatcostafterprovidingforlossonrevaluationestimatedat30%ofbookvalue.
(d)Stockofscrapisvaluedatnetrealizablevalueafteradjustingcustomsduty,ifany,payableonthescrap.
2.14 Financial instruments
FinancialassetsandliabilitiesarerecognisedwhentheGroupbecomesapartytothecontractualprovisionsof the instrument
Financial assets and liabilities are initially measuredat fair value. Transaction costs that are directlyattributable to the acquisition or issue of financialassets and financial liabilities (other than financialassets and financial liabilities at fair value throughprofitorloss)areaddedtoordeductedfromthefairvaluemeasuredoninitialrecognitionoffinancialassetorfinancialliability.
Financial assets at fair value through other comprehensive income (FVTOCI)
Financial assets are measured at fair value throughothercomprehensive income if thesefinancialassetsareheldwithinabusinesswhoseobjectiveisachievedbybothcollectingcontractualcashflowsthatgiveriseonspecifieddatestosolelypaymentsofprincipalandinterest on theprincipal amount outstanding andbysellingfinancialassets.
Financial assets at fair value through statement of profit and loss (FVTPL)
Financial assets are measured at fair value throughprofitor lossunless it ismeasuredatamortisedcostorat fairvaluethroughothercomprehensive incomeon initial recognition. The transaction costs directlyattributable to the acquisition of financial assets
and liabilities at fair value through profit or loss areimmediately recognised inconsolidatedstatementofprofitandloss.
Financial Assets
Financial assets at amortised cost
Financial assets are subsequently measured atamortisedcostifthesefinancialassetsareheldwithinabusinesswhoseobjectiveistoholdtheseassetsinorderto collect contractual cashflows and the contractualtermsofthefinancialassetgiveriseonspecifieddatestocashflowsthataresolelypaymentsofprincipalandinterestontheprincipalamountoutstanding.
Investments
AllequityinvestmentsinscopeofIndAS109FinancialInstruments, are measured at fair value. Equityinstrumentswhich are held for trading are classifiedas at FVTPL. For all other equity instruments, theGroupmaymakeanirrevocableelectiontopresentinother comprehensive income subsequent changes inthe fairvalue.TheGroupmakessuchelectiononaninstrument-by- instrumentbasis.The classification ismadeoninitialrecognitionandisirrevocable
Trade Receivables
The Group assesses at each Balance Sheet datewhetherafinancialassetoragroupoffinancialassetis impaired. IndAS109requiresexpectedcredit losstobemeasuredthroughalossallowance.TheGrouprecognises lifetime expected credit losses for alltrade receivables that do not constitute a financingtransaction. Impairment lossallowance isbasedonasimplifiedapproachaspermittedbyIndAS109.Asapracticalexpedient,theGroupusesaprovisionmatrixtodeterminetheimpairmentlossontheportfolioofitstradereceivables.
Full provision is made for all trade receivablesconsidereddoubtfulofrecoverywhenthedebtismorethanthreeyearsorif it isprobable/certainthatthedebtisnotrecoverable.
Where debts are disputed in legal proceedings,provision ismade ifanydecision isgivenagainst theGroupevenifthesameistakenuponappealtohigherauthorities/courts.
NotesTo Financial Statements for the year ended 31st March 2018
19946th Annual Report
Impairmentlossallowance(orreversal)thatisrequiredto be recognised at the reportingdate is recognisedas an impairment loss or gain in the consolidatedStatementofProfit&Loss Account.
Cash and cash equivalents
The Group considers all highly liquid financialinstruments,whicharereadilyconvertibleintoknownamounts of cash that are subject to an insignificantriskofchange invalueandhavingoriginalmaturitiesofthreemonthsorlessfromthedateofpurchase,tobecashequivalents.Cashandcashequivalentsconsistof balances with banks which are unrestricted forwithdrawalandusage.
Financial liabilities
Financial liabilities are measured at amortised costusingtheeffectiveinterestratemethod.
Equity Instruments
AnequityinstrumentisacontractthatevidencesresidualinterestintheassetsoftheGroupafterdeductingallofits liabilities.Equity instrumentsare recognisedat theproceedsreceivednetoffdirectissuecost.
Off setting of financial instruments
Financial assets and financial liabilities are off setand the net amount is reported in the consolidatedfinancialstatementsifthereisacurrentlyenforceablelegalrighttooffsettherecognisedamountsandthereisan intentiontosettleonanetbasis, torealisetheassetsandsettletheliabilitiessimultaneously.
Foreign Currency Transactions
Functional & Presentation Currency
TheconsolidatedfinancialstatementsarepresentedinIndianRupees(“INR”),whichisthefunctionalcurrencyandpresentationcurrencyoftheGroup.
Transactions & Balances:
Foreign exchange transactions are recorded infunctional currency adopting the exchange rateprevailing on the dates of respective transactions.Monetory items denominated in foreign currenciesattheyearendarere-measuredattheexchangerateprevailing on the balance sheet date.Nonmonetary
foreigncurrencyitemsarecarriedatcost.Anyincomeorexpenseonaccountofexchangedifferenceeitheronsettlementoronrestatement isrecognised intheconsolidatedstatementofProfitandLoss.
Derivative instruments and hedge accounting:
TheGroupdesignatescertainforeignexchangeforwardcontracts ashedge instruments in respectof foreignexchange risks. These hedges are accounted for ascashflowhedges.Derivativesare initially recognisedatfairvalueonthedateaderivativecontactisenteredinto and are subsequently re-measured to their fairvalueattheendofeachreportingperiod.
Theuseof foreigncurrencyandderivativecontractsis governed by the Group’s foreign exchange riskmanagement policy approved by the Board ofDirectors which provide written directives on theuse of such financial derivatives consistentwith theGroup’s risk management strategy. The Group doesnotusederivativefinancialinstrumentsforspeculativepurposes.
The hedge instruments are designated anddocumentedashedgesattheinceptionofthecontract.Theeffectivenessofhedgeinstrumentstoreducetheriskassociatedwiththeforeigncurrencyexposurethatisbeinghedgedisassessedandmeasuredatinceptionand on an ongoing basis. The ineffective portion ofdesignatedhedgesarerecognisedimmediatelyintheconsolidatedStatementofProfitandLoss.
Theeffectiveportionofchangeinthefairvalueofthedesignated hedging instrument is recognised in theOtherComprehensiveIncomeandaccumulatedundertheheadingcashflowhedgereserve.
Hedgeaccounting isdiscontinuedwhen thehedginginstrumentexpiresorissold,terminatedorexercisedwithout replacement or rollover (as part of hedgingstrategy), or if its designationas ahedge is revoked,orwhen the hedge no longermeets the criteria forhedgeaccounting.AnygainorlossrecognisedinOtherComprehensiveIncomeandaccumulatedinequitytillthattimeremainsandisrecognisedintheconsolidatedStatement of Profit and Loss when the forecastedtransactionultimatelyaffectstheprofitorloss.Whenaforecastedtransactionisnolongerexpectedtooccur,the cumulative gain or loss accumulated in equity is
NotesTo Financial Statements for the year ended 31st March 2018
200 Cochin Shipyard Ltd
transferred to the consolidated Statement of ProfitandLoss.2.15 Advance/progress payments received Advance/progresspaymentsreceivedfromcustomersinrespectofrepairworkofships/offshorestructuresare shown as deduction from the amount of workin progress in respect of income recognized underproportionatecompletionmethod.Inthecaseofshipbuilding, the advance payment received is adjustedonlywhentheshipisinvoiced.2.16 Provision , Contingent Liabilities and Contingent assets Aprovisionisrecognisedif,asaresultofapastevent,theGrouphasapresent legalobligation thatcanbeestimated reliably, and it isprobable thatanoutflowof economic benefits will be required to settle theobligation. Provisions (excluding retirement benefitsand compensated leave) are not discounted to itspresentvalueandaredeterminedbythebestestimateof the outflow of economic benefits required tosettle theobligationat the reportingdate.Thesearereviewedateachreportingdateadjustedtoreflectthecurrentbestestimates.Provisiontowardsguaranteeclaimsinrespectofships/smallcraftsdeliveredwhereverprovidedmaintainedisbasedontechnicalestimation.Fortheshipsdelivered,guarantee claims are covered by way of insurancepoliciescoveringtheguaranteeperiodoncasetocasebasis,whereverrequired.Inthenormalcourseofbusiness,contingentliabilitiesmay arise from litigations and other claims againstthe Group. Where the potential liabilities have alowprobabilityof crystallizingorareverydifficult toquantifyreliably,wetreatthemascontingentliabilities.Such liabilitiesaredisclosed in thenotesbutarenotprovided for in the financial statements. Althoughtherecanbenoassuranceregardingthefinaloutcomeof the legal proceedings, we do not expect themto have amaterially adverse impact on our financialpositionorprofitability.TheGroupdoesnotrecogniseacontingentliabilitybutdisclosesitsexistenceintheconsolidatedfinancialstatements.Contingentassetsareneitherrecognisednordisclosed.However, when realisation of income is virtuallycertain,relatedassetisrecognised
2.17 Revenue Recognition
a) Contracts for the construction of ships and small crafts
(Other than Indigenous Aircraft Carrier)
Theincomefromshipbuildingisrecognizedonpercentageofcompletionmethod,intheproportion the cost incurred for the workperformeduptothereportingdatebeartotheestimatedtotalcontractcost,consideringthe physical progress or financial progress,whicheverislower.Wherecurrentestimatesoftotalcontractcostsandrevenueindicatealoss,provisionismadefortheentireloss,irrespectiveoftheamountofworkdone.
b) Construction of Indigenous Aircraft Carrier
Inthecaseofparentcompany,withrespecttoconstructionofIACwhichispartlyfixedprice basis and partly cost plus basis, theincomefromfixedpriceisrecognisedonthepercentageofcompletionmethod.
Mark up from cost plus part of contractactivities for materials and designoutsourcingarerecognisedwhenpaymentstowards the same are made. Cost ofmaterials, value of design outsourcing andother expenses incurred for the vesselwhich are recoverable separately fromNavy is charged off to the consolidatedstatementofProfitandLosswhenmaterialsare consumed/activities are performed/expenses are incurred and are grossed upwiththevalueofworkdoneandrecognisedas income.
c) Contracts for repair of ships/ Offshore structures:
Income from repair of ships /Offshorestructures is recognized based onproportionate completion method whenproportionate performance of each shiprepair activity exceeds 75% after takinginto consideration possible contingencieswith reference to the realizable value of
NotesTo Financial Statements for the year ended 31st March 2018
20146th Annual Report
work done. The proportionate progressis measured by the Group’s technicalevaluation of the percentage of physicalcompletionofeach job. Inthecaseofshiprepair contracts completed and invoicessettled during theyear, income recognizedis net of reductions due to price variationadmitted. Inthecaseofunsettled invoices,the income is recognised net of estimatedamountofreductions.Differences,ifany,onsettlement are adjusted against income intheyearofsettlement.
d) Government Grants
Government grants are recognised whenthereisreasonableassurancethattheGroupwillcomplywiththeconditionsattachingtothemandthatthegrantswillbereceived.
Government grants are recognised in theconsolidated Statement of Profit and Losson a systematic basis over the periods inwhich the Group recognises as expensesthe related costs forwhich the grants areintended to compensate.Where theGrantrelates to an asset value, it is recognisedas deferred income, and amortised overtheexpectedusefullifeoftheasset.Othergrants are recognised in the consolidatedstatementofProfit&Lossconcurrenttotheexpenses towhich such grants relate/ areintendedtocover.
Government grants that are receivableas compensation for expenses or lossesalreadyincurredorforthepurposeofgivingimmediate financial support to the Groupwithnofuturerelatedcostsarerecognisedin the consolidated statement of profit &loss in the period in which they becomereceivable.
e) Liquidated damages and interest on advances
No income has been recognized onaccount of (a) interest on advances givenand (b) liquidated damages, where theleviesdependondecisions regarding force
majeure condition of contract. These areaccounted for on completion of contractsand/orwhenfinaldecisionsaretaken.
f) Accounting for insurance claims
(i) Warranty/Builder Risk claims
In the case of guarantee defectscovered under warranty insurancepolicies or claims under builders riskInsurance Policies, the insuranceclaimslodgedwillberecognizedintheconsolidatedfinancialstatementsintheyear inwhichthesurvey iscompletedandtheprobableamountofsettlementintimatedbytheinsurancecompany.
(ii) Other Insurance Policies
InthecaseofotherInsurancePolicieslikeAssetInsurance,TransitInsurance,Marine Insurance, Cash Insuranceetc., the claims are recognized inthe consolidated financial statmentson settlement of the claims by wayof receipt of the amount from the Insurancecompany.
g) Others
Dividend income is recognized when theGroup’s right to receivepaymenthasbeenestablished.
2.18 Employee benefits
Employee benefits consist of salaries and wages,contribution to provident fund, superannuationfund, gratuity fund, towards medical assistance,which are short term in nature and contributiontowardscompensatedabsences,whichislongtermin nature.
Post-employment benefit plans
Defined Contribution plans
In respect of parent company defined contributiontoEmployeesPensionschemeforeligibleemployeesare made to CSL Superannuation Pension Trust forExecutivesandSupervisorsandCSLWorkmenPensionTrust and are charged as expense as they fall due.
NotesTo Financial Statements for the year ended 31st March 2018
202 Cochin Shipyard Ltd
Such benefits are classified as Defined ContributionSchemesas thecompanydoesnot carryany furtherobligations,apartfromthecontributionsmade.
Theparentcompanyalsomakescontributiontowardsprovident fund, in substance a defined contributionretirement benefit plan. The provident fund isadministeredby theTrusteesof theCochinShipyardLimitedEmployeesContributoryProvidentFundTrust.Therulesofthecompany’sprovidentfundadministeredbytheTrust,requirethatiftheBoardofTrusteesareunable to pay interest at the rate declared by theEmployees’ProvidentFundbytheGovernmentunderpara 60 of the Employees’ Provident Fund Scheme,1952forthereasonthatthereturnoninvestmentislessorforanyotherreason,thenthedeficiencyshallbemadegoodbythecompany.Havingregardtotheassetsofthefundandthereturnontheinvestments,thecompanydoesnotexpectanydeficiencyasattheyearend.
TheparentcompanyalsomakescontributiontowardsEmployees Medical Assistance Trusts which arecharged as expense as they fall due. Such benefitsareclassifiedasDefinedContributionSchemesasthecompanydoesnotcarryanyfurtherobligations,apartfromthecontributionsmade.
Defined benefit plans
The Group provides for gratuity, a defined benefitretirement plan covering eligible employees. Theliability or asset recognised in the balance sheet inrespectofitsdefinedbenefitplanisthepresentvalueof the defined benefit obligation at the end of thereportingperiodlessthefairvalueofplanassets.Thedefinedbenefitobligationiscalculatedperiodicallybyactuariesusingtheprojectedunitcreditmethod.
The present value of the said obligation isdetermined by discounting the estimated futurecash outflows, using market yields of governmentbonds thathave termsapproximating the termsoftherelatedliability.
The interest income / (expense) are calculated byapplyingthediscountratetothenetdefinedbenefitliabilityorasset.Thenetinterestincome/(expense)onthenetdefinedbenefitliabilityorassetisrecognisedintheconsolidatedStatementofProfitandloss.
Remeasurement gains and losses arising fromexperience adjustments and changes in actuarialassumptionsarerecognisedintheperiodinwhichtheyoccur, directly in other comprehensive income.Theyare included in retainedearnings in theconsolidatedStatementofChangesinEquityandintheconsolidatedBalanceSheet.
Changes in the present value of the defined benefitobligation resulting from plan amendments orcurtailments are recognised immediately in theconsolidated Statement of profit and loss as pastservice cost.
Other employee benefits
Compensated absences
TheGrouphasapolicyoncompensatedabsencewhicharebothaccumulatingandnon-accumulatinginnature.The expected cost of accumulating compensatedabsence is determined by Actuarial valuationperformedbyanindependentactuaryateachBalanceSheetdateusingprojectedunitcreditmethodontheadditional amount expected to be paid/availed as aresultofunusedentitlementthathasaccumulatedattheBalanceSheetdateandprovidedfor.Expenseonnon-accumulatingcompensatedabsenceisrecognisedintheperiodinwhichtheabsencesoccur.
2.19 Borrowing cost
General and specific borrowing costs directlyattributabletoacquisition/constructionorproductionofqualifyingassets(netofincomeearnedontemporarydeployment of funds) are capitalized as part of costof such assets upto the date when such assets areready for the intended use.A qualifying asset is onethatnecessarilytakessubstantialperiodoftimetogetreadyforitsintendeduse.Allotherborrowingcostsarecharged to the consolidated Statement of Profit andLossintheperiodinwhichtheyareincurred.Borrowingcostalso includesexchangedifferencestotheextentregardedasanadjustmenttotheborrowingcosts
2.20 Corporate Social Responsibility
TheGroup has opted to charge its Corporate Socialresponsibility (CSR) expenditure to the consolidatedStatement of Profit & Loss, except in respect ofexpenditure incurred against the non-lapsable
NotesTo Financial Statements for the year ended 31st March 2018
20346th Annual Report
provisionheldundertheguidelinesofDepartmentofPublicEnterprises(DPE)
2.21 Prior period adjustment Priorperiodadjustmentsduetoerrors,havingmaterialimpact on the financial affairs of the Group, arecorrectedretrospectivelybyrestatingthecomparativeamountsforpriorperiodspresentedinwhichtheerroroccurred or if the error occurred before the earliestperiodpresented,byrestatingtheopeningstatementoffinancialposition.
2.22 Taxes on Income Income tax Income tax expense comprises current tax expenseand the net change in the deferred tax asset orliability during the year.Current and deferred taxesarerecognisedintheconsolidatedStatementofProfitand Loss, exceptwhen they relate to items that arerecognisedinothercomprehensiveincomeordirectlyinequity,inwhichcase,thecurrentanddeferredtaxarealsorecognisedinother comprehensive income or directlyinequity,respectively.
Current tax
Currenttaxismeasuredattheamountoftaxexpectedtobepayableon the taxable income for theyear asdetermined in accordance with the provisions ofthe Income Tax Act, 1961.Current tax assets andcurrenttaxliabilitiesareoffsetwhenthereisalegallyenforceable right to set off the recognized amountsand there is an intention to settle the asset and theliabilityonanetbasis.
Deferred tax
Deferred incometax is recognisedusing theBalanceSheet approach. Deferred income tax assets andliabilities are recognised for deductible and taxabletemporarydifferencesarisingbetweenthetaxbaseofassetsandliabilitiesandtheircarryingamount,exceptwhen thedeferred income taxarises from the initialrecognition of an asset or liability in a transactionthatisnotabusinesscombinationandaffectsneitheraccountingnortaxableprofitorlossatthetimeofthetransaction.
Deferredtaxassetsarerecognisedonlytotheextentthat it is probable that either future taxable profits
or reversalofdeferredtax liabilitieswillbeavailable,against which the deductible temporary differences,andthecarryforwardofunusedtaxcreditsandunusedtaxlossescanbeutilised.
The carrying amount of a deferred tax asset shallbe reviewed at the endof each reportingdate andreduced to the extent that it is no longer probablethatsufficienttaxableprofitwillbeavailabletoallowall or part of the deferred income tax asset to beutilised.
Deferredtaxassetsandliabilitiesaremeasuredusingthe tax rates and tax laws that have been enactedorsubstantivelyenactedby theendof thereportingperiod and are expected to apply when the relateddeferred tax asset is realised or the deferred taxliabilityissettled.
Deferred tax assets and liabilities are off set whenthere is a legally enforceable right to offset currenttax assets and liabilities andwhen the deferred taxbalancesrelatetothesametaxationauthority.
Minimum Alternate Tax credit is recognised asdeferredtaxassetonlywhenandtotheextentthereisconvincingevidencethattheGroupwillpaynormalincometaxduringthespecifiedperiod.Suchasset isreviewedateachBalanceSheetdateandthecarryingamount of theMAT credit asset iswritten down totheextentthereisnolongeraconvincingevidencetotheeffectthattheGroupwillpaynormal incometaxduringthespecifiedperiod.
2.23 Earnings Per Share
BasicearningspershareiscomputedbydividingprofitorlossattributabletoequityshareholdersoftheGroupbythenumberofequitysharesoutstandingduringtheyear.TheGroupdidnothaveanypotentiallydilutivesecuritiesinanyoftheyearspresented.
2.24 Segment Reporting
Operating segments are defined as components ofanenterpriseforwhichdiscretefinancial informationis available that is evaluated regularly by the chiefoperatingdecisionmaker,indecidinghowtoallocateresources and assessing performance. The Group’schief operating decision maker is the Chairman &ManagingDirectoroftheparentcompany.
NotesTo Financial Statements for the year ended 31st March 2018
204 Cochin Shipyard Ltd
TheGrouphasidentifiedbusinesssegments(industrypractice) as reportable segments. The businesssegmentscomprise:1)ShipBuildingand2)RepairofShips/offshorestructures.
Segmentrevenue,segmentexpenses,segmentassetsandsegmentliabilitieshavebeenidentifiedtosegmentson the basis of their relationship to the operatingactivities of the segment. Revenue, expenses, assetsand liabilitieswhich relate to the Group as awholeand are not allocable to segments on a reasonablebasishavebeenincludedunder“unallocatedrevenue/expenses/assets/liabilities”.
2.25 Consolidated statement of cash flow
Cash Flows are reported using the IndirectMethod,whereby profit/loss before tax is adjusted for theeffect of transactions of non-cash nature and anydeferralsoraccrualsofpastorfuturecashreceiptsorpaymentsanditemsofincomeorexpensesassociatedwith investing or financial cash flows. Cash flowsfrom operating, investing and financial activities ofthe Group are segregated based on the availableinformation.
For the purpose of the consolidated statement ofcashflow,Cashandcashequivalentcomprisecashatbanks andonhand and short-termdepositswith anoriginal maturity of three months or less,which aresubjecttoaninsignificantriskofchangesinvalue,netofoutstandingbankoverdrafts,ifany.Bankoverdrafts,if any, are disclosed within borrowings in currentliabilitiesintheConsolidatedBalanceSheet
2.26 Dividend to equity shareholders
Dividend to equity shareholders is recognised as aliability and deducted from shareholders’ equity, intheperiodinwhichthedividendsareapprovedbytheequityshareholdersinthegeneralmeeting.
2.27 Recent accounting pronouncements - Standards issued but not yet effective
Appendix B to Ind AS 21, Foreign currency transactions and advance consideration:
On28March2018,MCAhasnotifiedtheCompanies(Indian Accounting Standards) Amendment Rules,2018 containing Appendix B to Ind AS 21, Foreign
currency transactions and advance considerationwhich clarifies the date of the transaction for thepurposeofdetermining theexchange rate touseoninitial recognition of the related asset, expense orincome,whenanentityhasreceivedorpaidadvanceconsiderationinaforeigncurrency.
The amendment will come into force from 1 April2018. The Group is evaluating the requirement oftheamendmentand the impacton theConsolidatedfinancialstatements.TheeffectonadoptionofIndAS21isexpectedtobeinsignificant.
Ind AS 115, Revenue from Contract with Customers
IndAS115,RevenuefromContractwithCustomers:
On28March2018,MinistryofCorporateAffairshasnotifiedtheIndAS115,RevenuefromContractwithCustomers.
The core principle of Ind AS 115 is that an entityshould recognize revenue to depict the transfer ofpromised goods and services to customers in anamount that reflects the consideration towhich theentity expects to be entitled in exchange for thosegoodsandservices.Furtherthenewstandardrequiresenhanceddisclosuresaboutthenature,amount,timinganduncertaintyofrevenueandcashflowsarisingfromtheentity’scontractswithcustomers.
The standard permits two possible methods oftransition:
- Retrospective approach - Under this approach thestandardwillbeappliedretrospectivelytoeachpriorreporting period presented in accordance with IndAS 8 - Accounting policies, changes in accountingestimatesanderrors.
- Retrospectively with cumulative effect of initiallyapplyingthestandardrecognizedatthedateofinitialapplication(Cumulativecatch-upapproach)
The effective date for adoption of Ind AS 115 isfinancialperiodsbeginningonorafter1April2018.
In view of the significant complexities involved, theGroup is in the process of evaluating the impact onapplicationofIndAS115onitsconsolidatedfinancialstatements.
NotesTo Financial Statements for the year ended 31st March 2018
20546th Annual Report
Note3:Property,PlantandEquipment
(`inlakhs)
Particulars
Gross carrying amount DepreciationNet
Carrying amount
As at 1st April
2017
Additions/ adjustments during the
year
Disposal/ adjustments during the
year
As at 31st March
2018
As at 1st April
2017
For the year
Adjust-ment/ (with-
drawal)
As at 31st March
2018
As at 31st March
2018
Owned Assets
Land(Freehold) 587.54 - - 587.54 - - - - 587.54
Buildings 9,377.91 243.56 - 9,621.47 802.43 670.09 - 1,472.52 8,148.95
Plantandequipment 16,798.49 452.08 3.56 17,247.01 2,707.00 1,426.70 - 4,133.70 13,113.31
Furnitureandfixtures 813.24 64.26 1.67 875.83 165.35 102.94 1.03 267.26 608.57
Vehicles 344.49 177.14 27.77 493.86 92.74 53.67 3.23 143.18 350.68
Officeequipment 184.19 24.81 0.07 208.93 74.49 30.27 - 104.76 104.17
- -
Others - -DataProcessingEquipments 727.21 142.54 0.61 869.14 324.29 177.45 0.02 501.72 367.42
Docksandquays 4,466.45 - - 4,466.45 644.32 299.41 - 943.73 3,522.72
Railwaysidings 1.10 - - 1.10 - - - - 1.10
Electricalinstallation 1,182.08 108.73 - 1,290.81 444.64 156.02 - 600.66 690.15 Drainageandwatersupply 6.67 - - 6.67 - - - - 6.67
Vessels 19.74 - - 19.74 1.64 1.36 - 3.00 16.74
SubTotal 34,509.11 1,213.12 33.68 35,688.55 5,256.90 2,917.91 4.28 8,170.53 27,518.02
Leased assets and assets on leased premises
Buildings 838.22 - 838.22 165.53 85.32 - 250.85 587.37
Plantandequipment 85.89 27.56 - 113.45 25.84 13.27 - 39.11 74.34
Docksandquays 9.62 - - 9.62 8.35 - 8.35 1.27
Electricalinstallation 329.54 - 329.54 30.46 33.36 - 63.82 265.72
SubTotal 1,263.27 27.56 - 1,290.83 230.18 131.95 - 362.13 928.70
Total 35,772.38 1,240.68 33.68 36,979.38 5,487.08 3,049.86 4.28 8,532.66 28,446.72
NotesTo Financial Statements for the year ended 31st March 2018
206 Cochin Shipyard Ltd
In repect of parent company:
Landincludesthevalueof(a)landallottedonleasebasisto(i)BharatiyaVidyaBhavan(0.69045hectare)(ii)M/sIndianOilCorporationLtd(0.620hectare)forlayingpipeline(iii)landleasedtoM/sCochinAirProducts(0.30hectare)and(b)landleasedtoKeralaStateElectricityBoard(0.47hectare).
Valueof land includesvalueofbuildingsacquiredalongwith the land forwhichdepreciationhasnotbeenprovidedasthevalueisnotseparatelyavailableandmostofthesebuildingsarelikelytobedemolishedforputtingupfacilitiesforthefactory.
AssetstakenoverfromCochinPortTrust(CoPT)(₹1291.52lakhs)havebeenvaluedandlifeassessedbytechnicalexperts.Thislifehasbeentakenasabaseforarrivingattheremainingusefullifeforprovidingdepreciationfortheseassets.Theseassets togetherwithassets constructed/installedon land takenon lease fromCoPT,havebeendisclosed separatelyasassetsonleasedpremisesinthenoteno3toProperty,Plant&Equipments.
TheCompanyhascreatedmortgagefor₹12300LakhsonthelandedpropertiesoftheCompanyassecurityforthetaxfreebondsissuedbytheCompanyduringtheyear2013-14.
Note4:Capitalwork-in-progress (`inlakhs)
Particulars As at 31.03.2018
Plantandmachinery,BuildingsandCivilworks 11,285.07Capitalyarditems 199.27ProjectManagementfeesandmiscellaneouscapitalexpenditure 14.86Intangibleassetsunderdevelopment 575.00Total 12,074.20
Note5:OtherIntangibleassets(`inlakhs)
Particulars
Gross carrying amount Amortisation Net Carrying amount
As at 1st April
2017
Additions/ adjustments during the
year
Disposal/ adjustments during the
year
As at 31st March
2018
As at 1st April
2017
For the year
Adjust-ment/ (with-
drawal)
As at 31st March
2018
As at 31st March
2018
Internallygeneratedweldprocedure
27.67 - 27.67 10.75 9.22 - 19.97 7.70
Computer software 1,243.16 123.59 - 1,366.75 984.19 196.20 1,180.39 186.36
Righttouse-landandshiprepair facility
7,000.00 - 7,000.00 500.00 242.31 - 742.31 6,257.69
8,270.83 123.59 - 8,394.42 1,494.94 447.73 - 1,942.67 6,451.75
NotesTo Financial Statements for the year ended 31st March 2018
20746th Annual Report
Note6:Investments-NonCurrent(`inlakhs)
Particulars As at 31.03.2018
Unquoted (Fully Paid up)
Investment in equity instruments
Subsidiary company at costCochinShipyardEmployeesConsumerCo-operativeSocietyLimited2175'BClass'sharesof₹100each 2.18
KeralaEnviroInfrastructureLimited-70000equitysharesof₹10each 7.00
CochinWastetoEnergyPrivateLimited-100000equitysharesof₹10each 10.00
LessdiminutioninvalueofInvestmentCochinWastetoEnergyPrivateLimited (10.00)
Total 9.18
Aggregatevalueofunquotedinvestment 19.18
Aggregatevalueofimpairmentinvalueofinvestment 10.00
Consideringtheindicatorsofthevalueofaninvestmentsuchasinvestee’sassets,resultsetc.adecline,otherthantemporary,inthevalueofinvestmentinCochinWastetoEnergy(P)LtdisnoticedandaccordinglyfairvalueisconsideredasNil.
Note7:Loans-NonCurrent(`inlakhs)
Particulars As at 31.03.2018
Unsecured,consideredgood:Securitydeposits 66.89
EmployeeadvancesLoanstorelatedparties 0.00
Otheremployees 80.88
Total 147.77
Note8:Incometaxassets/liability(net)(`inlakhs)
Particulars As at 31.03.2018
NoncurrenttaxassetsAdvanceincometaxnetofprovisions 5,400.03Currenttaxassets/liabilitiesAdvanceincometaxnetofprovisions (1,071.47)Taxdeductedatsource 1.86
NotesTo Financial Statements for the year ended 31st March 2018
208 Cochin Shipyard Ltd
IncometaxrecognisedintheStatementofprofitandloss(`inlakhs)
Particulars For the year ended March 31,2018
Currenttax:Currentincometaxcharge 22,406.57
Adjustmentinrespectofprioryears 5.43
Total(A) 22,412.00
Deferredtax:Inrespectofcurrentyear (1,613.85)
Total(B) (1,613.85)
IncometaxexpenserecognisedintheStatementofProfitandLoss(A+B) 20,798.15
Theincometaxexpensefortheyearcanbereconciledtotheaccountingprofitasfollows:(`inlakhs)
Particulars For the year ended March 31,2018
Profitbeforetax 60,424.14
[email protected]% 20,911.58
Effectofexpensesthatarenotdeductibleindeterminingtaxableprofit 5,312.99
Effectofexpensesthatareallowableindeterminingtaxableprofit (2,642.89)EffectofexpensesincurredonCorporateSocialResponsibilitynotdeductibleindeterminingtaxableprofit 296.62
Effectofincomethatisexemptfromtaxation (64.32)
Others (1,407.41)
22,406.57
Adjustmentsrecognisedinthecurrentyearinrelationtothecurrenttaxofprioryears 5.43
Adjustmentsforchangesinestimatesofdeferredtaxassets (1,613.85)
IncometaxexpenserecognisedintheStatementofProfitandLoss 20,798.15
Note9:Deferredtaxassets(net)(`inlakhs)
Particulars As at 31.03.2018
Deferredtaxliabilities 3,954.57
Deferredtaxassets (8,299.69)
Total (4,345.12)
NotesTo Financial Statements for the year ended 31st March 2018
20946th Annual Report
Deferredtaxliabilities/(assets)inrelationto2017-18(`inlakhs)
Particulars Opening balance
Recognised in Statement of Profit
and Loss
Recognised in Statement of
EquityClosing Balance
Provisions (5,226.67) (2,212.21) 0.00 (7,438.88)
Property,plantandequipment 4,045.04 (87.00) 0.00 3,958.04
Intangibleassets 27.86 (31.33) 0.00 (3.47)
Others (1,279.66) 716.69 (297.84) (860.81)
Total (2,433.43) (1,613.85) (297.84) (4,345.12)
Note10:Othernon-currentassets(`inlakhs)
Particulars As at 31.03.2018
Unsecured,consideredgoodCapitaladvances 6,641.69Advancesotherthancapitaladvances:Securitydeposits 218.77Advanceleaserentals 575.59DepositswithCustomsdepartment 261.22Total 7,697.27
NotesTo Financial Statements for the year ended 31st March 2018
210 Cochin Shipyard Ltd
Note11:Inventories(`inlakhs)
Particulars As at 31.03.2018
RawMaterialsandcomponents* 11,301.78
Less:Provisionforobsolescence,non-usability,deteriorationandreductioninvalueofinventory (331.27)
Goods-intransit* 5,795.66
16,766.17
Work-in-progress(Valuedatcost) 6,284.46
Work-in-progress(Valuedatnetrealisablevalue) 6,787.00
13,071.46
Stores&Spares* 586.36
Less:Provisionforobsolescence,non-usability,deteriorationandreductioninvalueofinventory (27.97)
Goods-intransit* 82.72
641.11
LooseTools* 794.58
Scrap* 182.35
Total 31,455.67
*ValuationofinventoriesaredoneinaccordancewithAccountingPolicyno.2.14giveninNoteno.2
(i) Inventorydoesnot includestockof rawmaterialsandboughtoutcomponentsprocuredunder “”costplus””partof the IACcontractamounting to ₹71053.76lakhsheldonbehalfofIndianNavylyingwiththeCompanyandisshownunderAdvancesfromIndianNavyforIndigenousAircraftCarrier.
(ii) Maintenancesparesincludedintheinventoryrepresentsparesofgeneralnatureandarenotrelatedtoaparticularasset.
Note12:Investments-Current(`inlakhs)
Particulars As at 31.03.2018
InvestmentinMutualFunds 0.16
Total 0.16DetailsofMutualFunds FundValueUTI-TreasuryAdvantageFund 0.16
NotesTo Financial Statements for the year ended 31st March 2018
21146th Annual Report
Note13:TradeReceivables-Current(`inlakhs)
Particulars As at 31.03.2018
UnsecuredConsideredgood:Basedoninvoice 25,473.28Basedonproportionatecompletionmethod 32,539.48Considereddoubtful 9,263.32Less:Allowancefordoubtfuldebts(Expectedcreditlossallowance) (9,263.32)Unsecured,considereddoubtful(Net) 0.00Total 58,012.76
Trade receivables include debts amounting to ₹32539.48 lakhs on account of income recognized under proportionate completionmethod pertaining toincompletevessels,againstwhichstagepaymentsreceivedamountingto₹88490.06lakhsforcompletedstage
Tradereceivablesarenon-interestbearingandreceivableinnormaloperatingcycle.
Movementintheexpectedcreditlossallowance(`inlakhs)
Particulars As at 31.03.2018
Openingbalance 5,987.03Add:Provisionmade/transferduringtheyear 3,832.20Less:Amountcollected/reversalofprovision 555.91ClosingBalance 9,263.32
Note14:CashandCashequivalents(`inlakhs)
Particulars As at 31.03.2018
Cashonhand 0.12BalancewithBanks
Incurrentaccount 1,264.15IncurrentaccountonbehalfofIndianNavy 62,807.09Termdepositswithoriginalmaturityoflessthan three months 16,627.39
Total 80,698.75Balanceincurrentaccountincludes₹3.84lakhsbeingIPOproceedsandTermdepositswithoriginalmaturityoflessthanthreemonthsincludes₹9437.39lakhsbeingproceedsfromIPOincludinginterestaccrued.
FundsreceivedfromIndianNavyfortheconstructionofIndigenousAircraftCarrierareheldinaseparateaccountandisseparatelydisclosed.
BankbalanceinCurrentAccountincludes` 838.65lakhtobeadjustedagainstGSTliabilityondeliveryofIACtowardsInputTaxCreditavailedonCostPlusprocurementsforIACfundedbyIndianNavy.
NotesTo Financial Statements for the year ended 31st March 2018
212 Cochin Shipyard Ltd
Note15:Bankbalancesotherthancashandcashequivalents(`inlakhs)
Particulars As at 31.03.2018
TermDepositswithbankswithoriginalmaturitymorethan3monthsandlessthan12months 269,840.19Total 269,840.19
Depositswithbankswithmaturityupto12months,includes₹74689.22lakhsrelatingtoproceedsfromIPOincludinginterestaccrued.
Depositswithbankswithmaturityupto12months,includes₹76.96lakhsislienmarkedinfavourofTheRegistrarofHighCourt of Kerala.
Note16:Loans-Current(`inlakhs)
Particulars As at 31.03.2018
Unsecured,consideredgoodEmployeeadvancesLoanstorelatedparties -Otheremployees 38.14
Total 38.14
Note17:OtherFinancialAssets-Current(`inlakhs)
Particulars As at 31.03.2018
Interestaccruedonfixeddeposits 6,061.38Interestaccruedonemployeeadvances
Relatedparties -Otheremployees 23.35
FixedDepositwithHDFCLtd 20,000.00Total 26,084.73
NotesTo Financial Statements for the year ended 31st March 2018
21346th Annual Report
Note18:OtherCurrentAssets(`inlakhs)
Particulars As at 31.03.2018
UnsecuredadvancesAdvancesotherthancapitaladvances
Advancestorelatedparty 4.44Otheradvances 5,589.06Advancesconsidereddoubtful 0.07
5,593.57Less:Provisionfordoubtfuladvances 0.07
5,593.50Others
BalancewithSalesTaxdepartmentandCBEC 427.32Miscellaneousdeposits 17.82AdvancetowardsSecuritydeposit 40.00Prepaidexpenditure 1,721.39Miscellaneouscurrentassets(Includingclaimsreceivable) 8,965.00
Total 16,765.03
NotesTo Financial Statements for the year ended 31st March 2018
214 Cochin Shipyard Ltd
Note19:EquityShareCapital
ParticularsAs at 31.03.2018
Number (`inlakhs) AuthorisedEquitysharesof₹10/-each 250000000 25,000.00Issued,SubscribedandFullypaidupEquitysharesof₹10eachfullypaidup 135936000 13,593.60Total 135936000 13,593.60
19.1Reconciliationofnumberofsharesandamountsoutstanding
ParticularsAs at 31.03.2018
Number (`inlakhs)EquitySharesoutstandingatthebeginningoftheyear 113280000 11,328.00Add:sharesissuedduringtheyear 22656000 2265.60EquitySharesoutstandingattheendoftheyear 135936000 13,593.60Duringtheyear,Companyhasraisedcapitalof₹2265.60lakhsthroughInitialPublicOffer(IPO)byissuing22656000equitysharesof₹10each.
Terms&RightsattachedtoEquityshares:TheCompanyhasonlyoneclassofequityshareshavingafacevalueof₹10persharewhichisfullypaidup.Equityshareholdersareeligibleforonevotepershareheld,andareentitledtodividendsasandwhendeclaredbytheCompany.InterimdividendispaidasandwhendeclaredbytheBoard.Finaldividendproposed/declaredbytheBoardofDirectorsissubjecttoapproval/regularisationbytheshareholders intheAnnualGeneralmeeting.Alldividendsarepaid in IndianRupees. Intheeventofliquidation,theequityshareholdersareeligibletoreceivetheremainingassetsofthecompanyafterdistributionofallpreferentialamounts,inproportiontotheirshareholding.
19.2Detailsofshareholdersholdingmorethan5%sharesinthecompany
ParticularsAs at 31.03.2018
Number of Shares held % of holding
ThePresidentofIndia 101952000 75.00
RelianceCapitalTrusteeCo.Ltd.-A/CRelianceTaxSaver(Elss)Fund 7104353 5.23
NotesTo Financial Statements for the year ended 31st March 2018
21546th Annual Report
Note20:OtherEquity(`inlakhs)
Particulars As at 31.03.2018
Capital Reserves 263.56CapitalRedemptionReserve 11,914.20SecuritiesPremiumReserve 93,152.56DebentureRedemptionReserve 1,235.94General Reserve 6,322.75RetainedEarnings 199,064.70
311,953.71
Capital Reserve:CapitalreserverepresentsrestorationchargesreceivedfromMsIndianOilCorporationLtdforlayingpipelinethroughtheCompany'sland.
Capital Redemption Reserve:CapitalRedemptionReserveof₹11914.20lakhsrepresentsthereservescreatedonredemptionofpreferenceshareswhichwillbeutilisedforthepurposedefinedundertheCompaniesAct2013.
Securities Premium Reserve:
Premiumontaxfreebondsisamortisedonstraightlinebasisovertheperiodofbonds.
TheparentcompanyhascompletedanInitialPublicOffer('IPO')of33984000equitysharesoffacevalueof₹10each.Thiscomprisesofanofferforsaleof11328000equityshares(10%ofitsequityshareholding)undertheDisinvestmentprogrammeofGovt.ofIndia,thePresidentofIndiaactingthroughtheMinistryofShippingandafreshissueof22656000equitysharesandshareswereallottedon09Aug2017.TheequityshareswerelistedinBombayStockExchangeandNationalStockExchangeon11.08.2017.
TheparentCompanyhasallotted22656000equitysharesof₹10eachatpremium(₹93929.76lakhs).
ExpensesincurrednetofdefferedtaxadjustmenttowardssuchallotmentofsharesamountingRs777.93lakhshasbeendebitedinsecuritiespremiumreserveInaccordancewiththerequirementsofIndianAccountingStandard(IndAS)32-FinancialInstruments.
ReconciliationofOtherEquityasat31.03.2017
Particulars (`inlakhs)OtherEquity(ReservesexcludingRevaluationReserve)asat31.03.2017asperauditedFinancialStatementsasat31.03.2017 191783.15
Adjustmentsduringtheyearforpriorperioditems:DecreaseinretainedEarningsforincomes/expensesrelatingtoFY2016-17andperiodspriortoFY2016-17 (252.91)
OtherEquity(ReservesexcludingRevaluationReserve)asat31.03.2017nowrestated 191530.24Taxexpenses(currenttaxanddeferredtax)includespreviousyeartaxadjustmentsalso.
Debenture Redemption Reserve: In accordancewith provisions of Section71(4) of theCompaniesAct, 2013 readwithRule 18(7) ofCompanies(SharecapitalandDebentures)Rules,2014andasperSEBI(IssueandListingofDebtSecurities)Regulations,2008theCompanyhascreatedDebentureRedemptionReserve(DRR)amountingto₹1235.94lakhs(cumulative)at25%ofthevalueofdebentureissuedbytheCompany,overthematurityperiodofsuchdebentures,proportionatelyfortheperiodupto31.03.2018.
Proposed dividend :TheBoardofDirectorsoftheparentCompanyhaverecommendedafinaldividendof₹12/-perequityshareoffacevalueof₹10/-forthefinancialyearendedMarch31,2018attheboardmeetingheldonMay24,2018.
NotesTo Financial Statements for the year ended 31st March 2018
216 Cochin Shipyard Ltd
Note21:Borrowings(`inlakhs)
Particulars As at 31.03.2018
(a)Bonds-fromotherparties(Secured)TaxFreeRedeemableNonConvertibleBonds-Series2013-14 12,300.00Total 12,300.00
TaxFreeInfrastructureBondSeries2013-14
a) Tranche 1: 1000 bonds of facevalue of ₹ 10 lakhs totalling ₹ 10000 lakhswith interest rate of 8.51% payable annually ,redeemableatpar,dueforredemptionon02ndDecember2023
b) Tranche 2:230bondsoffacevalueof₹10lakhstotalling₹2300lakhswithinterestrateof8.72%payableannually,redeemableatpar,dueforredemptionon28thMarch2029.
ThesebondsaresecuredagainstthelandedpropertiesoftheCompanyadmeasuring197.12ares(487.00cents)madeupof34.30aresinSyNo.713/11,23.57aresinSyNo.713/12,59.12aresinSyNo.713/13,50.18aresinSyNo.714/06,10.12aresinSyNo.714/2,8.90aresinSyNo.714/4and10.93aresinSyNo.714/5oflandallarelyingcontiguouslyinElamkulamvillage,Kanayannurtaluk,ErnakulamDist,Kerala.
Utilisation:TheCompanyhasfullyutilised/adjustedthebondissueproceedsof₹12300lakhstowardsvariousexpenditureincurredonInternationalShipRepairFacility(ISRF)project.
Differencebetweencarryingamountsandfairvaluesoffinancialliabilitiesofborrowingsisnotsignificantineachoftheyearpresented.
Note22:OtherFinancialliabilities-NonCurrent(`inlakhs)
Particulars As at 31.03.2018
PayabletoChennaiPortTrust 261.22Total 261.22
Liabilityof₹261.22 lakhs toChennaiPortTrust in respectof customsduty is coveredbya refundappeal lyingbeforeCommissioner(Appeals)whichisalsoshownasdepositswithCustomsdepartmentunderNoteNo.10
Note23:Provisions-NonCurrent(`inlakhs)
Particulars As at 31.03.2018
Provisionforemployeebenefits-Compensatedabsences(ReferNoteNo34) 2,265.70Total 2,265.70
Note24:Othernoncurrentliabilities(`inlakhs)
Particulars As at 31.03.2018
DeferredIncomearisingfromGovernmentAssistance 13.74Total 13.74
NotesTo Financial Statements for the year ended 31st March 2018
21746th Annual Report
Note25:TradePayables(`inlakhs)
Particulars As at 31.03.2018
Tradepayables(Unsecured)OutstandingduesofMicroenterprisesandSmallenterprises 682.19
OutstandingduesofcreditorsotherthanMicroenterprisesandSmallenterprises 26,700.78
Total 27,382.97
Insomecases,theGrouphasreceivedintimationfromMicroandSmallEnterprisesregardingtheirstatusunder“TheMicro,SmallandMediumEnterprisesDevelopmentAct,2006”.Theaveragecreditperiodongoodsandservicesarewithin30to60days.TheamountremainingunpaidtoMicroandSmallsuppliersasattheendofthefinancialyearis₹682.19lakhs.NointerestfordelaywaspaidorpayableundertheAct.
Note26:OtherFinancialLiabilities-Current(`inlakhs)
Particulars As at 31.03.2018
Interestaccruedbutnotdue 281.98
OthersSecurityandotherdeposits 734.16
OthersPayables 10,721.30
Total 11,737.44
NotesTo Financial Statements for the year ended 31st March 2018
218 Cochin Shipyard Ltd
Note27:OtherCurrentLiabilities(`inlakhs)
Particulars As at 31.03.2018
AdvanceforIndigenousAircraftCarrier(Costplus) 691,656.37
Less:IndigenousAircraftcarrierinventoryinstock 71,053.76
Less:Materialissued 429,719.34
Less:Designandotherdirectexpenses 30,758.47
Less:Advancepaidforpurchaseofmaterialsandservices 30,555.83
Less:Otherexpensesagainstcostplusactivities 68,684.02
60,884.95
AdvanceforIndigenousAircraftCarrierfixedpricecontract 309,179.83
Less:incomerecognisedsofar 323,993.64
(14,813.81)
AdvanceforIndigenousAircraftCarrierinfrastructure 28,517.05
Less:Assetsoninfrastructure 26,934.76
Less:Prepayment 14.00
1,568.29
AdvanceoutstandingforIndigenousAircraftCarrierworks(Net) 47,639.43
Advancesforothershipbuildingcontracts 88,515.06
Advancesforshiprepairandothers 1,099.15
Incomereceivedinadvance 23.28
Statutorydues 699.51
DeferredIncomearisingfromGovernmentAssistance 1.14
Total 137,977.57
CostofinfrastructurefacilitieswhichhasbeenmetoutoffundsfromNavyandadjustedbyIndianNavy,tilldate.(`inlakhs)
Details As at 31.03.2018
Buildingsandothercivilworks 8,600.39Dataprocessingequipment 1,294.44FurnitureandOfficeequipments 249.17Plantandmachinery 16,790.76Total 26,934.76
NotesTo Financial Statements for the year ended 31st March 2018
21946th Annual Report
Note28:Provisions-Current(`inlakhs)
Particulars As at 31.03.2018
ProvisionforEmployeebenefitsGratuity 2,361.82Compensatedabsences 383.78Others 1,220.93
3,966.53OtherProvisionsTaxesandduties 196.48Provisionforshipbuildingloss 548.22Expenditure/contingencies 23,638.32
24,383.02Total 28,349.55
28.1Detailsofmovementofprovisions(`inlakhs)
Particulars As at 01.04.2017
Provision made during
the period
Amounts used during the period
Unused amounts reversed during
the period
As at 31.03.2018
a)Provisionfortaxesandduties 233.03 26.15 0.00 (62.70) 196.48
b)Provisionforshipbuildingloss 35.00 548.22 (35.00) 0.00 548.22c)Provisionforexpenditure/contingencies 20,208.25 17,355.54 (12,155.46) (1,770.01) 23,638.32d)Provisionforemployeebenefits-Others 21.31 1,220.93 (21.31) 0.00 1,220.93
NotesTo Financial Statements for the year ended 31st March 2018
220 Cochin Shipyard Ltd
Note29:Revenuefromoperations(`inlakhs)
Particulars For the year ended March 31,2018
SaleofproductsShipbuilding:IndigenousAircraftCarrier(IAC) 144,334.95
VesselsotherthanIAC 28,428.83
Engineeringworks 4.26
172,768.04
Sale of servicesShip repairs 62,326.64
62,326.64
OtheroperatingrevenueSaleofstockitems 0.05
ScripunderMEISscheme 417.60
417.65
Total 235,512.33
DisclosureasrequiredbyIndAS11-ConstructionContracts
(a) Shipbuilding income of ₹ 172763.78 lakhs includes revenue recognized under percentage of completion methodamountingto₹172729.20lakhsagainstincompletevessels.
(b) Methodofrevenuerecognition-Percentageofcompletionmethod
(c) Methodusedtodeterminethestageofcompletion-Stageofcompletionismeasuredintheproportiontoexpensesincurredtill theendof theyear to theestimated totalcostofcompletionof theprojectorpercentageofphysicalcompletionwhicheverisless.
(d) Forcontractsinprogressasattheendoftheyear.(`inlakhs)
2017-18
(i)Contractrevenuerecognizedintheperiod 172,729.20(ii)Contractcostincurredandrecognizedprofits(lessrecognizedlosses)uptothereportingperiod 885,255.31
(iii)Advancereceivedfromcustomers 926,392.08
(iv)Grossamountduetocustomers 66,535.58
(v)Grossamountduefromcustomers 25,398.81
Shiprepairincomeincludesincomerecognisedunderproportionatecompletionmethodamountingto₹21092.00lakhs
Incomefromshiprepairisnetofactual/anticipatedreductionsamountingto₹1922.81lakhs
NotesTo Financial Statements for the year ended 31st March 2018
22146th Annual Report
Note30:OtherIncome(`inlakhs)
Particulars For the year ended March 31,2018
Trainingfacilities 241.12
Incomefromsaleofscrapandstores 457.51
Profitonsaleoffixedassets 1.34
Incomefromlaboratoryservices 33.52
Rentreceived 187.01
Interestonbankdeposits 15,106.14
Interestfromothers 333.90
Dividendincomefromequityinvestments/MutualFunds 185.84
ProfitonsaleofMutualFunds 669.82
Netgain/(loss)onforeigncurrencytransactions 217.73
Provisionnolongerrequired 1,103.03
Miscellaneousincome 385.49
Total 18,922.45
Miscellaneous income includes ₹ 1.14 lakhs being deferred government assistance in the form of subsidy relating toinstallationofSolarPowerplant inside theyard.Thesamehasbeenaccountedasper the requirementsof IndAS20 -AccountingforGovernmentGrantsandDisclosureofGovernmentAssistance.
Incomefromsaleofscrapandstoresisnetofimportdutyamountingto₹45.33lakhsonsaleofbondedscrapandstores.
Note31:CostofMaterialsConsumed(`inlakhs)
Particulars For the year ended March 31,2018
RawMaterialsSteel 4,235.44
Pipe 1,096.48
Paint 1,278.40
Boughtoutcomponents 109,955.32
Total 116,565.64
NotesTo Financial Statements for the year ended 31st March 2018
222 Cochin Shipyard Ltd
Note32:ChangesinInventoriesofWork-in-Progress(`inlakhs)
(Otherthanthosewhicharerecognisedasincomeonpercentage/proportionatecompletionmethod)
Particulars For the year ended March 31,2018
Work-in-progress:Atthebeginningoftheyear 8,794.85
Less:attheendoftheyear 6,284.46
Decretion/(Accretion)towork-in-progress 2,510.39
Note33:SubContractandOtherDirectExpenses(`inlakhs)
Particulars For the year ended March 31,2018
Subcontractandoffloadedjobs 17,950.24
Hullinsurance 51.04
Otherdirectexpenses 5,527.71
Total 23,528.99
Note34:EmployeeBenefitsExpense(`inlakhs)
Particulars For the year ended March 31,2018
Salaries,wages,bonus/exgratiaandallowances 22,531.89ContributiontoProvidentFundandFamilyPensionFund 1,226.65
Gratuity 2,188.68
Staffwelfareexpenses 1,192.63
Total 27,139.85
ContributiontoProvidentFundandFamilyPensionFundincludesprovidentfundinspectionandadministrationcharges ₹15.16lakhs
Salaries,Wages,bonus/exgratiaandallowancesincludesprovisionforencashmentofhalfpaycompensatedabsencesforworkmenamountingto₹175.08lakhs
Theemployeebenefitsaccruing to theemployeesondeputationfromCochinPortTrustarebeingaccountedbasedondemandsreceivedfromCochinPortTrustaspertripartiteagreementbetweentheCompany,CochinPortTrustandtherecognisedTradeunionsofthePortandnotbasedonactuarialvaluationexceptforgratuitywhichisactuariallyvaluedfor2017-18.
Therevisioninpayandallowancesofofficersandnon-unionisedsupervisorswasduew.e.f01.01.2017andforworkmenw.e.f01.04.2017.Whilemostoftheduesinrespectoftheexecutiveshavecrystallisedandthesameforworkmenisunderfinalisation.Anamountof₹1200.96lakhshasbeencarriedasaliabilityasonMarch31,2018towardspendingdueonthisaccount.
NotesTo Financial Statements for the year ended 31st March 2018
22346th Annual Report
OtherBenefitPlan-Compensatedabsences
Theprincipalassumptionsusedforthepurposeofactuarialvaluationwereasfollows:
Particulars As at 31.03.2018
DiscountRate(p.a) 7.72%
Rate of increase in compensation levels 3.00%
AmountrecognisedintheStatementofProfitandLossinrespectofdefinedbenefitplansareasfollows:-(`inlakhs)
Particulars For the year ended March 31, 2018
ServiceCost: Current Service Cost 172.90
NetInterestexpense 151.84
Acturial(Gain)/Lossrecognisedduringtheperiod 695.38
Expensesrecognisedinthestatementofprofitandloss 1020.12
TheamountincludedintheBalanceSheetarisingfromtheentity’sobligationinrespectofitsdefinedbenefitplanisasfollows:-
(`inlakhs)
Particulars For the year ended March 31, 2018
PresentValueofDefinedBenefitObligationatendofthe year 2,649.48
FairValueofPlanAssetsattheendoftheyearNetLiabilities/(Assets)recognizedintheBalanceSheet 2,649.48
Movementsinpresentvalueofthedefinedbenefitobligationareasfollows:-(`inlakhs)
Particulars For the year ended March 31, 2018
DefinedBenefitObligationatbeginningoftheyear 2,474.40
Current&PastServiceCost 172.90
CurrentInterestCost 151.84
Actuarial(Gain)/Loss 695.38
Benefitspaid (845.04)
DefinedBenefitObligationatendoftheyear 2,649.48
NotesTo Financial Statements for the year ended 31st March 2018
224 Cochin Shipyard Ltd
Movementsinthefairvalueoftheplanassetsareasfollows:(`inlakhs)
Particulars For the year ended March 31, 2018
FairValueofPlanAssetsatthebeginningoftheyear -
ExpectedReturnonPlanAssets -
Actuarial(Gain)/Loss -
Contributionsfromtheemployer 845.04
Benefitspaid (845.04)
FairValueoftheAssetsattheendoftheyear -
DefinedBenefitPlan-Gratuity
Theprincipalassumptionsusedforthepurposeofactuarialvaluationwereasfollows:
Particulars For the year ended March 31, 2018
DiscountRate(p.a) 7.72%
Rate of increase in compensation levels 3.00%
ExpectedRateofReturnonPlanAsset 7.72%
AmountrecognisedintheStatementofProfitandLoss/Othercomprehensiveincomeinrespectofdefinedbenefitplansareasfollows:-
(`inlakhs)
Particulars For the year ended March 31, 2018
ServiceCost: Current Service Cost 111.41
PastServiceCost 1567.90
NetInterestexpense 8.71
Componentsofdefinedbenefitcostsrecognisedinstatementofprofitandloss 1688.02
Remeasurementofthenetdefinedbenefitliability:Actuarial(Gain)/LossonPlanObligations 220.67
DifferencebetweenActualReturnandInterestincomeonPlanassets(gain)/loss (15.63)
ComponentsofdefinedbenefitcostsrecognisedinOtherComprehensiveIncome 205.04
NotesTo Financial Statements for the year ended 31st March 2018
22546th Annual Report
TheamountincludedintheBalanceSheetarisingfromtheentity’sobligationinrespectofitsdefinedbenefitplanisasfollows:-
(`inlakhs)
Particulars For the year ended March 31, 2018
PresentValueofDefinedBenefitObligationatendoftheyear 5,077.72
Less:FairValueofPlanAssetsattheendoftheyear 3,211.31
NetLiabilities/(Assets)recognizedintheBalanceSheet 1,866.41
Movementsinpresentvalueofthedefinedbenefitobligationareasfollows:-(`inlakhs)
Particulars For the year ended March 31, 2018
DefinedBenefitObligationatbeginningoftheyear 3,713.66
Current Service Cost 111.41
CurrentInterestCost 245.88
PastServiceCost 1,567.91
Actuarial(Gain)/Loss 220.67
Benefitspaid (781.81)
DefinedBenefitObligationatendoftheyear 5,077.72
Movementsinthefairvalueoftheplanassetsareasfollows:(`inlakhs)
Particulars For the year ended March 31, 2018
FairValueofPlanAssetsatthebeginningoftheyear 3,451.70ExpectedReturnonPlanAssets 237.18Actuarial(Gain)/Loss 15.63Contributionsfromtheemployer 288.61Benefitspaid (781.81)FairValueoftheAssetsattheendoftheyear 3,211.31
TheplanassetsaremanagedbytheGratuityTrustformedbytheCompany.
NotesTo Financial Statements for the year ended 31st March 2018
226 Cochin Shipyard Ltd
Note35:FinanceCosts(`inlakhs)
Particulars For the year ended March 31,2018
Bankinterest 36.42
Interestothers 53.17
Interestontaxfreebonds 1,051.44
Total 1,141.03
Note36:DepreciationandAmortisationExpense(`inlakhs)
Particulars For the year ended March 31,2018
Depreciationonproperty,plantandequipments 3,049.86Amortisationofotherintangibleasset 447.73Total 3,497.59Add:Lossonrevaluationoftools 253.43Total 3,751.02
NotesTo Financial Statements for the year ended 31st March 2018
22746th Annual Report
Note37:OtherExpenses(`inlakhs)
Particulars For the year ended March 31,2018
Consumption of stores 1,446.32
Consumption of spares 62.32
Ratesandtaxes 56.91
Power 1,863.16
Fuel 651.62
Water 173.36
Repairsandmaintenance:Buildingandroads 554.08
Plantandmachinery 82.72
Others 1,119.77
Maintenancedredging 784.35
Transportandstoreshandling 125.95
Travellingandconveyanceexpenses 598.28
Printingandstationery 64.12
Postage,telephoneandtelex 44.39
Advertisementandpublicity 525.65
Leaserent 567.21
GuaranteedAmountunderleaseagreement 2.25
Hirecharges 509.73
Insurancecharges 230.64
Securityexpenses 1,342.98
Auditorsremuneration 13.00
Auditorsremunerationforotherservices 8.75
Trainingexpenses 521.48
Legalexpenses 16.68
Consultancy 104.04
Bankcharges 46.39
Corporatesocialresponsibility(ReferNoteno.45) 857.08
Lossonsale/writeoffofproperty,plantandequipments 15.48
Miscellaneousexpenses 1,126.13
Preincorporationexpenses 32.71
Total 13,547.55
NotesTo Financial Statements for the year ended 31st March 2018
228 Cochin Shipyard Ltd
Auditorsremuneration,AuditorsremunerationforotherservicesandMiscellaneousexpensesinclude:(`inlakhs)
Particulars For the year ended March 31,2018
ForAuditFees 13.00
ForLimitedReview/otherservices 8.75
ForcertificationforInitialPublicOffer 12.00
Total 33.75
Note38:ProvisionforAnticipatedLossesandExpenditure(`inlakhs)
Particulars For the year ended March 31,2018
Provisionfor:Doubtfuldebts/advances 3,804.88Nonmoving/perpetualinventoryverification 31.62Expensesandcontingencies 1,476.45ProvisionforlossonShipBuilding 513.22
Total 5,826.17
MODUSagarBhushan,anoilrigownedbyM/sONGCwasunderrepairatCSLandtherewasafireincidentonboardthevesselonFeb13,2018whilethevesselwasundergoingrepairs.Theincidentresultedindamagestothevessel.Thecompanyhasassessedtheestimateddamagecosttobe₹1851lakhs.CompanyhasanannualinsurancecoverforthevesselunderShipRepairer’sliabilitypolicywithalimitofliabilityforanyoneincidentof₹1500lakhswithanannuallimitof₹30,000lakhs.Thecompanyhasaccordinglymadeaprovisionforanamountof₹351lakhsnetofinsuranceclaim,towardsprobableloss on this
Note39:EarningsperEquityShare(`inlakhs)
Particulars For the year ended March 31,2018
ProfitattributabletotheGroup 39,635.63WeightedaveragenumberofEquityShares 127866740BasicandDilutedEarningsPerShare(EPS)(in₹) 31.00
Facevalueperequity(in₹) 10.00
NotesTo Financial Statements for the year ended 31st March 2018
22946th Annual Report
NOTESONACCOUNTS
Note40:CONTINGENTLIABILTIESANDCOMMITMENTS
Particulars
For the period ended
31 Mar 2018 Brief Description of the nature and obligation
(` in Lakhs)
A CONTINGENT LIABILITY (To the extent not provided for)
a Guarantees
i LettersofCredit 52,609.28 RepresentsLetterofCreditopenedbytheCompanyinvariousbanksforprocurementofmaterials/assets
ii BankGuarantees 125,157.57
iii CorporatePerformanceGuaranteetoCochinPortTrust 3,925.00
PerformanceguaranteegivenbyCompanytoCoPTforperformanceofobligationsunderthecontractagreemententeredwithCoPTduringthecontractperiod.
b Other money for which the company is contingently liable
i GreaterCochinDevelopmentAuthority(GCDA) 69.06
ClaimraisedbyGCDAforthelandacquiredfortheCompanyissettled.However8landacquisitionrevisionpetitioncases(ValuedatRs.69.06lakhs)filedbyevicteesispendingwiththeHon'bleSupremeCourtandHighCourt.
ii Customsduties 15,934.66
CustomsdutyformaterialsunderBondandIndigenousvesselsdelivered.IncludesanamountofRs69.83lakhs,beingCustomsdutyrefundgrantedbyCESTAT,Bangalore,againstwhichanappealispendingbeforetheHon'bleHighCourtofKerala.
iii SalesTax/KeralaValueAddedTax
1,259.75
2000-01-Rs.111.93Lakhs2001-02-Rs.73.44Lakhs2004-05-Rs195.67Lakhs2005-06-Rs.602.24Lakhs2007-08-Rs.276.47Lakhs(Underappeal.)
Stayofcollectionoftaxobtainedinallcases.DemandreducedtotheextentofamountpaidandappealallowedbyDeputyCommissioner(Appeals).DetailednotesinNoteno.40.1(II&III)
12.10 VATcreditfortheyear1996-97whichhasnotbeenconsideredinthedemand,forwhichnoprovisionexistsinthebooks
NotesTo Financial Statements for the year ended 31st March 2018
230 Cochin Shipyard Ltd
iv IncomeTax 6,077.84
DemandrelatingtoAssessmentYears: DemandrelatingtoAssessmentYears:(a)AY2009-10-Rs77.67LakhsAY2010-11-Rs.126.25LakhsAY2011-12-Rs.420.19LakhsAY2012-13-Rs.546.14LakhsAY2013-14-Rs.221.37LakhsAY2014-15-Rs.876.90Lakhs(b)AY1997-98-Rs2191.60LakhsAY1998-99-Rs967.27LakhsAY1999-00-Rs353.72LakhsAY2000-01-Rs170.31LakhsAY2001-02-Rs96.44Lakhs(c)AY2002-03-Rs29.99LakhsDetailednotesinNoteno.40.1(I)
v ServiceTax
1,647.47 DemandofServiceTaxonIAC(DesignConsultancy)asperShowCauseNoticeissued.Adjudicationpending
376.68
RefundclaimofServiceTaxonIACgrantedbyCommissioner(Appeal).HoweverDepartmentfiledAppealbeforeCESTATagainsttheorderofCommissioner(Appeals).AlsoissuedShowCauseNoticeonCSL&adjudicationpending.
323.04 DemandofServiceTaxonIAC(ManagementFee/HandlingCharges)asperShowCauseNoticeissued.Adjudicationpending
24.08Penaltyonservicetaxfortheperiod2003-04to2007-08whichispendingbeforeHon’bleHighCourtofKerala.
B COMMITMENTS (To the extent not provided for)
a Estimatedamountofcontractsremainingtobeexecutedoncapitalaccountandnotprovidedfor: 73,430.43
b Othercommitments
i
Investmentinsubsidiary(HooghlyCochinShipyardLtd)forwhichthecompanyhasrestrictionfortheirdisposalfor5yearsfromtheeffectivedateaspertheconcessionagreement.
1,628.00
iiUnutilisedamountofInitialPublicOffer(IPO)proceeds(Pendingutilisationamountdepositedwithvariousbanksincurrentaccountandtermdeposits)
82,621.86 DetailednotesinNoteno.41.b
NotesTo Financial Statements for the year ended 31st March 2018
23146th Annual Report
40.1.CONTINGENCIESANDCOMMITMENTS
(I) Income Tax Assessments
(a) The IncomeTaxAssessmentof the companyhavebeen completedup toAY2014-15Demands raised as per theassessmentorderstotalingto₹2268.52lakhsfortheAssessmentYears2009-10,2010-11,2011-12,2012-13,2013-14and2014-15areshownunderContingentLiabilitypendingdisposaloftheappealsfiledbeforetheCommissionerofIncomeTax(Appeals).Thedemandsaremainlyduetodisallowanceofcertaingenuineclaims.HowevertheabovedemandshavebeenadjustedagainsttherefundduetoCompany.
(b) FortheAssessmentyears1997-98to2001-02,theIncomeTaxdepartmenthasgoneforappealagainsttheorderoftheITATallowedinfavourofCSLbeforetheHon'bleHighCourtofKerala.FortheAssessmentyear1997-98theappealwasdecidedinfavourofCSLandfortheAssessmentyear1998-99theappealwasdecidedagainstCSL.Howeverforboththeassessmentyearsordersareyettobegiveneffecttobythereassessingofficer.
(c) TheCompanyhasfiledappealbeforetheITATagainsttheorderofAssessingOfficer/CommissionerofIncomeTax(Appeals)andtheappealwaspartlyallowedinfavorofCompany,theeffecttotheorderhasnotyetbeengivenbythereassessingofficer.
(II) Sales Tax Assessment under KGST Act
TheSalesTaxassessmentsunderKeralaGeneralSalesTaxActuptotheAssessmentYear2004-05havebeencompletedandorderswere issued for all theyearsexcept for theyear2002-03&2003-04.Due to apparentmistake in theordersissuedfortheyear2000-01and2001-02,applicationshavebeenfiledforrectificationoftheorders.Pendingrectificationto theassessmentorders thedemandstheretohavebeenshownunderContingentLiabilities.For theAssessmentyear2004-05,theDeputyCommissioner(Appeals)hasdismissedtheappealfiledbytheCompanyagainstthedemandfor₹202.22lakhs.TheCompanyisintheprocessoffilingappealtoTribunal.
(III) Sales Tax Assessments under KVAT Act
The KVAT assessments from Assessment Year 2005-06 to Assessment Year 2007-08 have been completed andassessment orders were issued for Assessment Year 2005-06 and Assessment Year 2007-08 with a demand of₹2836.63lakhsand₹5554.71lakhsrespectively.TheappealsfiledbytheCompanyagainsttheaboveorders,beforetheDeputyCommissioner (Appeals)havebeenpartiallydecided infavouroftheCompanyandremandedforfreshassessments.Accordinglythedemandsaspertheoriginalassessmentordershavebecomenull.Assuchnodemandexists ason reportingdate.Pending receiptof the revisedassessmentorder, thecompanyfiledappealbefore theHon’bleKVATAppellateTribunalontheotherissues.TheappealiscurrentlypendingbeforetheTribunal.Assessmentorderfortheyear2006-07ispending.
41.a.TheEnvironmentalClearances,fortheISRFprojectreceivedfromMinistryofEnvironment,ForestandClimateChange(MOEFCC), is subject to obtaining prior clearance of the Standing Committee of the National Board forWildlife(“NBWL”).Pursuant to theSEBIExemption letterdatedJuly14,2017,SEBIhadpermitted theCompany toutilizethenetproceedsoftheInitialPublicOfferassignedtowardstheproposedISRFprojectandutilizesuchfundsraisedoncethenecessaryapprovalsforEnvironmentalClearancefortheISRFprojectarereceived.TheCompanyhadalsoundertakentoSEBIvideletterdatedJuly10,2017andfurtherstatedintheProspectusdatedAugust4,2017thatthenetproceedsassignedfortheproposedISRFprojectshallbetransferredtoaseparatebankaccountwhichwouldbeutilisedonlyafterrequisitependingapproval(s)arereceivedandallexpenditureontheISRFprojectshallbeincurredthroughinternalaccrualstillthetimesuchpendingapprovalsarereceived.
TheStateBoardforWildLifeattheirmeetingheldonAugust16,2017specifiedcompensatorymangroveafforestationbytheCompanyasaconditionwhilerecommendingtheproposaltotheNBWL.TheStandingCommitteeofNBWLintheir46thmeetingheldonDecember8,2017hasrecommendedtheEnvironmentalClearancefortheISRFproject
NotesTo Financial Statements for the year ended 31st March 2018
232 Cochin Shipyard Ltd
alongwithconditionsimposedbytheStateChiefWildLifeWarden(CWLW).TheconditionimposedbyStateCWLWistobecompliedduringtheimplementationoftheISRFprojectandthematterhasbeentakenupwiththeForestDepartment,GovernmentofKeralaand theprocessof identificationofnotifiedmangrovearea forafforestation isunderway.Accordingly, theCompanyhas considered thedateofEnvironmental clearance asJanuary9, 2018 andstartedutilisationofthefundssetapartforthispurposeafterintimatingSEBIvideletterdatedJanuary17,2018.
41.b.TheUtilisationofIPOproceedsissummarisedbelow:
(`inlakhs)
Particulars
IPO proceeds received
-Based on Final allotment
Actual cash outflow upto
March 31, 2018
Unutilised amount as at
March 31, 2018
SettingupofDryDock 51000.00* 330.72 50669.28
SettingupofISRF 26500.00* 1142.14 25357.86
General corporate purposes 16523.26 9956.42 6566.84
Issuerelatedexpenses(AttributtabletotheCompany) 2172.10** 2144.22 27.88
Total 96195.36 13573.50 82621.86
*AsperProspectusFiled**IncreaseinIPOexpenditure(Rs.172.10lakhs)comparedtotheestimatesisadjustedagainstamountspecifiedforGeneralCorporatePurpose
42. ThedisputebetweenM/sApeejayShippingLtd(formerlyknownasSurendraOverseasLtd)andtheCSL,inthematterofship005wasreferredforarbitrationbytheHon’bleSupremeCourtofIndia.Thearbitrationaward(July2009)wasinfavouroftheCSLunderwhichtheCSListoreceive₹2803.64lakhsfromM/sApeejayShippingLtd.ThecompanyhasfiledapetitionbeforeSubCourt,Ernakulamforpassingadecree.M/sApeejayShippingLtdhasmovedtotheSubCourttoquashtheAwardoftheUmpireandtheCompanyhasfiledCounterAffidavitagainstthismove.Thematterispendingbeforethecourt.Nocredithasbeentakeninthebooksofaccount,pendingfinaldecreeoftheCourt.
43. PermanentMachineryforArbitration,DepartmentofPublicEnterprises,Govt.ofIndia,hasnotifiedawardinfavouroftheCSLinthedisputebetweentheCSLandM/sOilandNaturalGasCorporationLtd(ONGC)ontheWorksContractTaxissueandONGChaspaidtotheCompanythedisputedsumalongwithinterestamountingto₹2642.22Lakhsaspertheaward.ONGChasgoneonappealbeforetheLawSecretary,MinistryofLaw&Justiceagainsttheaward.PendingdisposalofONGCappeal,noadjustmenthasbeenmadeintheaccounts.
44. Litigations:TheGroupissubjecttolegalproceedingsandclaims,intheordinarycourseofbusiness.TheCompany’sManagementdoesnotreasonablyexpectthattheselegalactions,whenultimatelyconcludedanddetermined,willhavematerialandadverseeffectontheCompany’sresultsofoperation.
NotesTo Financial Statements for the year ended 31st March 2018
23346th Annual Report
Details of material litigations as on 31 March 2018
M/s.VigilMarineServicesin2004raisedclaimstowardsAgencyCommissionpayableforwinningordersforATCOTugs.Thearbitrationproceedingscommencedon10Oct2004.Examinationandcrossexaminationofwitnessescompletedandpostedthematterforargumentson01and02Feb2014.TheArbitratorcompletedtheproceedingsandpassedhisawarddirectingtheCompanytopaycommissiontoM/sVigilMarineServicesattherateof5%oftheATCOcontractvalueofUSDollar18.25Millionwithinterest@8%perannum.AggrievedonthisCSLfiledOriginalSuitNo187/2016beforeSubCourt,Ernakulamandobtainedaninterimorderstayingexecutionoftheaward.”
45. CorporateSocialResponsibility(CSR):Aspersection135oftheCompaniesAct2013,CSRcommitteehasbeenformedby theCompany.TheareasofCSRactivity includesHealthCare,Education,SocialEmpowerment, etc., and thosespecifiedinScheduleVIIoftheCompaniesAct2013.TheutilisationofCSRfundsaredonethroughdirectspendingaspertherecommendationsofCSRcommittee.Detailsofamountrequiredtobespentandtheamountutilisedaregivenbelow:
(a)GrossamountrequiredtobespentbytheCSLduringtheperiodendedMarch31,2018 ₹853.75lakhs(b)Amountspentduringtheyear ₹857.08lakhs (`inlakhs)
Particulars In cash Yet to be paid in cash Total
(i)Construction/acquisitionofanyasset 611.03 - 611.03
(ii)Onpurposesotherthan(i)above 246.05 - 246.05
46.RelatedPartydisclosureasperIndAS24
Related PartyNature of Relationship
2017-18Shri.MadhuSNairChairman&ManagingDirector KeyManagerialPersonnel
Shri.PaulRanjanDDirector(Finance)&ChiefFinancialOfficer KeyManagerialPersonnel
Shri. Sunny Thomas Director(Technical) KeyManagerialPersonnel
Shri.SureshBabuNVDirector(Operations) KeyManagerialPersonnel
ShriBarunMitra(upto17/04/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel
ShriPravirKrishna(from17/04/2017to04/10/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel
ShriSatinderPalSingh(from04/10/2017)OfficialPartTime(Nominee)Director,GovernmentofIndia KeyManagerialPersonnel
ShriEliasGeorgeOfficialPartTime(Nominee)Director,GovernmentofKerala KeyManagerialPersonnel
Smt.RoopaShekharRaiNonOfficialPartTime(Independent)Director KeyManagerialPersonnel
ShriRadhakrishnaMenonNonOfficialPartTime(Independent)Director KeyManagerialPersonnel
ShriKrishnaDasENonOfficialPartTime(Independent)Director KeyManagerialPersonnel
NotesTo Financial Statements for the year ended 31st March 2018
234 Cochin Shipyard Ltd
Related PartyNature of Relationship
2017-18
ShriJijiThomson(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel
ShriPradiptaBanerjee(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel
ShriNandaKumaranPuthezhath(from15/07/2017)NonOfficialPartTime(Independent)Director KeyManagerialPersonnel
Shri.SBalajiArunkumar(from23/10/2017)Director,HCSL KeyManagerialPersonnel
Smt V KalaCompany Secretary KeyManagerialPersonnel
Natureoftransaction-RemunerationtoKeyManagerialPerson(`inlakhs)
Particulars As at 31.03.2018
Shorttermbenefit 142.20
PostemploymentBenefit 17.11
Total 159.31
Natureoftransaction-Loans*(`inlakhs)
Name of Related PartyOpening
Balance as on 1/4/2017
Loans/ advances
Taken during 2017-18
Repayment
Balance as on 31/03/18
Interest accrued as on
31/03/18
MADHUSNAIR 0.90 1.54 1.53 0.91 0.00
PAULRANJAND 1.04 1.38 1.43 0.99 0.00
SUNNYTHOMAS 0.96 0.82 0.96 0.82 0.00
SURESHBABUNV 3.72 1.33 4.10 0.95 0.00
KALAV 0.79 1.09 1.11 0.77 0.00
NotesTo Financial Statements for the year ended 31st March 2018
23546th Annual Report
Natureoftransaction-SittingFeetoIndependentDirectors(`inlakhs)
Name of the meeting Roopa Shekhar Rai
Krishna Das E
Radhakrishna Menon
Jiji Thomson
Nandakumaran Puthezhath
Pradipta Banerji
BoardMeeting 1.50 1.35 1.50 0.90 0.90 0.75
AuditCommittee 0.00 0.90 0.90 0.00 0.45 0.00
Corporate Social Responsibility 0.90 0.00 0.90 0.00 0.00 0.00
NominationandRemuneration Committee 0.45 0.45 0.00 0.00 0.00 0.00
ContractandCapexCommittee 0.00 0.00 0.00 0.15 0.15 0.00
Totalpaymentfor2017-18 2.85 2.70 3.30 1.05 1.50 0.75
Natureoftransaction-Transactionwithotherrelatedparties Transactions with Government and Government relatedentitiesbytheparentcompany.
AsCSLisaGovernmentcompanyunderthecontrolofMinistryofShipping(MoS),thecompanyhasavailedexemptionfromdetaileddisclosurespreparedunderIndAS24withrespecttorelatedpartytransactionswithGovernmentandGovernmentrelatedentities.
However,asrequiredunderIndAS24,followingaretheindividuvallysignificanttransactions:
Particulars As at 31.03.2018(` in Lakhs)
AmountpayabletoGovernmentofIndia 235.40
Amountpaidasdividendduringtheyear 10161.21
InthecaseofsubsidiarycompanysharesissuedforconsiderationotherthancashtoM/sHDPEL 572.00
Inadditionto theabove,around98%of thecompanies turnoverand100% (approx)of trade receivablesandcustomeradvanceiswithrespecttoGovernmentandGovernmentrelatedentities.
47.FINANCIALINSTRUMENTS
The fairvalue hierarchy is based on inputs tovaluation techniques that are used tomeasure fairvalue that are eitherobservableorunobservableandconsistofthefollowingthreelevels:
LevelIinputsarequotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilitiesthattheentitycanaccessatthemeasurementdate.
LevelIIinputsareinputsotherthanquotedpricesincludedwithinLevel1thatareobservablefortheassetorliability,eitherdirectlyorindirectly.
LevelIIIinputsareunobservableinputsfortheassetorliability.
Thefollowingtablesummarisesfinancialassetsandliabilitiesmeasuredatfairvalueonarecurringbasisandfinancialassetsthatarenotmeasuredatfairvalueonarecurringbasis(butfairvaluedisclosuresarerequired)
NotesTo Financial Statements for the year ended 31st March 2018
236 Cochin Shipyard Ltd
As at 31.03.2018(` in Lakhs)
Financial Assets NonCurrent
(i)Investments 9.18 LevelIII(ii)Loans 147.77 LevelII
Current(i)Investments 0.16 LevelI(ii)TradeReceivables 58,012.76 LevelII(iii)Cash&Cashequivalents 80,698.75 LevelII(iv)BankBalancesotherthan(iii) 269,840.19 LevelII(v)Loans 38.14 LevelII(vi)Others 26,084.73 LevelII
Total Financial Assets 434,831.68 FinancialLiabilitiesNonCurrent
(i)Borrowings 12,300.00 LevelI(ii)Otherfinancialliabilities 261.22 LevelII
Current(i)TradePayables 27,382.97 LevelII(ii)Otherfinancialliabilities 11,737.44 LevelII
Total Financial Liabilities 51,681.63
Note:
1. Theinvestmentsinequityinstrumentsarenotheldfortrading.Instead,theyareheldformediumorlongtermstrategicpurpose.Upon the application of IndAS 109, theCompany has chosen to designate these investments in equityinstrumentsasatFVTOCIasthedirectorsbelievethatthisprovidesamoremeaningfulpresentationofmediumorlongtermstrategicinvestments,thanreflectingchangesinfairvalueimmediatelyinprofitorloss.
Investmentsincludedinlevel3offairvaluehierarchyhavebeenvaluedusingthecostapproachtoarriveattheirfairvalue.Thecostofunquotedinvestmentsapproximatethefairvaluebecausethereisawiderangeofpossiblefairvaluemeasurementsandthecostrepresentsestimateoffairvaluewithinthatrange.
TherewerenotransfersbetweenLevel1and2intheperiod.
2. Loans,Borrowingsareatthemarketratesandthereforethecarryingvalueisthefairvalue.
3. Thecarryingamountoftradereceivables,tradeandotherpayablesandshorttermloansareconsideredtobethesameastheirfairvalueduetotheirshorttermnature.
Differencebetweencarryingamountsandfairvaluesofbankdeposits,otherfinancialassets,otherfinancialliabilitiesandborrowingssubsequentlymeasuredatamortisedcostisnotsignificantineachoftheyearspresented.
NotesTo Financial Statements for the year ended 31st March 2018
23746th Annual Report
FinancialInstrumentsbycategory(`inlakhs)
31st March 2018
FVTPL FVTOCI Amortised Cost
Financial AssetsInvestments(Non-Current) -Equityinstruments 9.18
Investments(Current) -MutualFunds 0.16
Tradereceivables 58,012.76
Cash&Cashequivalents 350,538.94
OtherFinancialAssets 26,270.64
Total Financial Assets 0.16 9.18 434,822.34
Financial liabilities
Borrowings 12,300.00
Tradepayables 27,382.97
CapitalcreditorsOtherfinancialliabilties 11,998.66
Total Financial Liabilities 51,681.63
NotesTo Financial Statements for the year ended 31st March 2018
238 Cochin Shipyard Ltd
48.FinancialRiskManagementPolicy
Financial Risk Management Objective and Policies:
TheCompany’s principal financial liabilities, other than derivatives, comprise of loans and borrowings, trade and otherpayablesandadvancesfromcustomers.ThemainpurposeofthesefinancialliabilitiesistofinancetheCompany’soperations,projectsunderimplementationandtoprovideguaranteestosupportitsoperations.TheCompany’sprincipalfinancialassetsincludeInvestment,loansandadvances,tradeandotherreceivablesandcashandbankbalancesthatderivedirectlyfromitsoperations.TheCompany isexposedtomarketrisk,creditriskand liquidityrisk.TheCompany’sseniormanagementoverseesthemanagementoftheserisks.AllderivativeactivitiesforriskmanagementpurposesarecarriedoutbyunderthesupervisionoftheForexRiskManagementCommitteebyassigningnecessaryresources.ItistheCompany’spolicythatnotradinginderivativesforspeculativepurposesmaybeundertaken.TheBoardofDirectorsreviewsandagreespoliciesformanagingeachoftheserisks,whicharesummarisedbelow.
Market Risk
Marketriskistheriskthatthefairvalueoffuturecashflowsoffinancialassetswillfluctuatebecauseofchangesinmarketprices.Marketriskcomprisesthreetypesofrisk:interestraterisk,currencyriskandotherpricerisk,suchasequitypriceriskandcommodityrisk.FinancialAssetsaffectedbymarketriskincludeloansandborrowings,depositsandderivativefinancialinstruments.
Interest Rate Risk
Interestrateriskistheriskthatthefairvalueorfuturecashflowsofafinancialinstrumentwillfluctuatebecauseofchangesinmarket interestrates.TheCompany’sexposuretotheriskofchanges inmarket interestratesrelatesprimarilytotheCompany’slong-termdebtobligationswithfloatinginterestrates.
Foreign Currency Risk
Foreigncurrencyriskistheriskthatthefairvalueorfuturecashflowsofanexposurewillfluctuatebecauseofchangesinforeignexchangerates.TheCompany’sexposuretotheriskofchangesinforeignexchangeratesrelatesprimarilytotheCompany’soperatingactivities(whenrevenueorexpenseisdenominatedinaforeigncurrency).
Foreigncurrencyriskofthecompanyismanagedthroughaproperlydocumentedriskmanagementpolicyapprovedbytheboard.
Commodity Price Risk
TheCompanyisaffectedbythepricevolatilityofcertaincommodities.Itsoperatingactivitiesrequirethepurchaseofsteel,majormachineries,equipmentsetc.Therefore,theCompanyplansitspurchasescloselytooptimisetheprice.
Credit Risk
Creditriskistheriskthatacounterpartywillnotmeetitsobligationsunderafinancialinstrumentorcustomercontract,leadingtoafinancialloss.TheCompanyisexposedtocreditriskfromitsoperatingactivities(primarilytradereceivablesandadvancestosuppliers)andfromitsfinancingactivities,includingdepositswithbanksandfinancialinstitutions,foreignexchangetransactionsandotherfinancialinstruments.
NotesTo Financial Statements for the year ended 31st March 2018
23946th Annual Report
49.Leasearrangements&Guaranteedamount(`inlakhs)
Particulars As at 31.03.2018
a)Premisestakenonoperatinglease:
TheCompanyhasoperatingleasesforfacilityatInternationalShipRepairFacility(ISRF).TheseleasearrangementswithCochinPortTrust(CoPT)isfor30years,whichisnon-cancellableleases.
Withrespecttonon-cancellableoperatinglease,thefutureminimumleasepaymentasatBalanceSheetdateisasunder:
InthecaseofHCSLhasoperatingleasesforfacilityatNazirgungeandSalkiafacilitiesTheseleasearrangementswithHooghlyDocks&Portswithrespecttonon-cancellableoperatinglease,thefutureminimumleasepaymentasatBalanceSheetdateisasunder:EngineersLtdarefor60years,whichisnon-cancellableleases.
b)Guaranteedamount:
TheamountwhichCSLhasundertakentopaytoCochinPortTrustduringthecontractperiodof30years.
Withrespecttonon-cancellableoperatinglease,thefutureminimumleasepaymentandGuaranteeamountasatBalanceSheetdateisasunder:
Foraperiodnotlaterthanoneyear 646.55
Foraperiodlaterthanoneyearandnotlaterthanfiveyears 3693.80
Foraperiodlaterthanfiveyears 68406.60
NotesTo Financial Statements for the year ended 31st March 2018
240 Cochin Shipyard Ltd
50.SegmentReporting
The Company has identified twomajor operating segments viz, Shipbuilding and Repair of ships/ offshore structures.Segmentwiseanalysishasbeenmadeontheabovebasisandamountsallocatedonareasonablebasis.
(`inlakhs)
Particulars As at 31.03.2018
SegmentAssetsShipbuilding 231887.20Ship Repair 168349.50Others 147232.63Total 547469.33SegmentLiabilityShipbuilding 131092.54Ship Repair 36514.61Others 53752.51Total 221359.66External SalesShipbuilding 173185.70Ship Repair 62326.63Unallocated 3482.41Total 238994.74
(`inlakhs)
Particulars As at 31.03.2018
InterestIncome 15440.04UnallocatedTotal RevenueShipbuilding 173185.70Ship Repair 62326.63Unallocated 18922.45Total 254434.78Accretion(-)/DecretiontoWorkinprogressShipbuilding 1002.26Ship Repair (3512.67)Total (2510.39)SegmentResultShipbuilding 41471.88Ship Repair 13145.75Unallocated 6947.54Total 61565.17
TheCompanyhastwomajorbusinesssegments–“ShipBuilding”and“ShipRepair”.RevenueunderShipbuildingincludesRs.144334.95lakhs(Previousyear:Rs.131504.38lakhs)fromoneCustomers(Previousyear:oneCustomer)havingmorethan10%revenueofthetotalrevenue.AndforShiprepair,revenueincludesRs.40014.22lakhs(Previousyear:Rs.38073.82lakhs)fromonecustomers(Previousyear:oneCustomer)havingmorethan10%revenueofthetotalrevenue.
NotesTo Financial Statements for the year ended 31st March 2018
24146th Annual Report
51.CapitalManagement
Thecompany'sobjectivewhenmanagingcapitalaretosafeguardtheirabilitytocontinueasagoingconcernsothattheycancontinuetoprovidereturnsforshareholdersandmaintainanoptimalcapitalstructuretoreducethecostofcapital.
Forthepurposeofcapitalmanagement,capitalincludesissuedequitycapitalandallotherequityreservesattributabletotheequityholdersoftheparent.Thecompanyisnotsubjecttoanyexternallyimposedcapitalrequirements.
Tomaintainoradjustthecapitalstructure,thecompanymayadjustthedividendpaymenttoshareholders,returnoncapitaltoshareholdersorissuenewshares.Thecompanymonitorscapitalusingagearingratio,whichisnetdebtdividedbytotalequity.TheCompanyincludeswithinnetdebt,interestbearingloansandborrowings(includingbonds).
(`inlakhs)
Particulars As at 31.03.2018
Longtermborrowings 12300.00NetDebt 12300.00EquityShareCapital 13593.60Otherequity 311953.71TotalEquity 325547.31GearingRatio 3.78%
Nochangesweremadeintheobjectives,policiesorprocessesformanagingcapitalduringtheyearsendedMarch31,2018.
52.DetailsofSubsidiaries
Sl No Name Relationship Nature of activity
Principal place of business
As at 31st March 2018
Proportionate ownership
in %
1 HooghlyCochinShipyardLimited Subsidiary Constructionofvesselsofvarioustypesandrepairs
thereof India 74%
NotesTo Financial Statements for the year ended 31st March 2018
242 Cochin Shipyard Ltd
53.Summarisedfinancialinformationofsubsidiarycompanyisasfollows:
The amounts disclosed for subsidiary are before inter-company eliminations(`inlakhs)
Summarised Balancesheet 2017-18
Non-currentassets 623.68
Current assets 1556.86
Total Assets 2180.54
Currentliabilities 17.61
Total Liabilities 17.61
Net Assets 2162.93
Accumulated NCI 562.36
Summarised Statement of Profit & Loss 2017-18
Revenue 0.00
Profit/(Loss)fortheyear (37.07)
OtherComprehensiveIncome 0.00
Total Comprehensive Income (37.07)
Profit/(Loss) attributable to NCI (9.64)
Summarised Cashflows 2017-18
Cashflowsfromoperatingactivites (110.47)
Cashflowsfrominvestingactivities (12.84)
Cashflowsfromfinancingactivities 1628.00
Netincrease/decreaseincashandcashequivalents 1504.69
NotesTo Financial Statements for the year ended 31st March 2018
24346th Annual Report
54.INFORMATIONREQUIREDBYSCHEDULEIIIOFTHECOMPANIESACT2013,WITHRESPECTTOCONDOLIDATEDFINANCIALSTATEMENTS
Networth Profitor(Loss) OtherComprehensiveIncome
Total Comprehensive Income
Name of the entity in the
group
Ownership in % As at March 31,
2018
Propor-tionate Share
As % of Consoli-
dated NetWorth
Share in Profit/ (Loss)
As % of Consol-idated Profit/ (Loss)
Share in Other
Compre-hensive Income
As % of Con-solidated
Other Com-prehensive
Income
Share in Total Com-prehensive
Income
As % of Consolidated
Total Com-rpehensive
income
CochinShipyardLimited 100.00% 325586.69 99.84% 39675.01 100.12% -134.08 100.00% 39540.93 100.12%
SubsidaryHooghlyCochinShipyardLimited 74 1600.57 0.49% -27.43 -0.07% 0 0 (27.43) -0.07%
Non-controllinginterest 562.36 0.17% -9.64 -0.02% 0 0 (9.64) -0.02%
Consolidationadjustments (1639.95) -0.50% -11.95 -0.03% 0 0 (11.95) -0.03%
GrandTotal 326109.67 100.00% 39625.99 100.00% -134.08 100.00% 39491.91 100.00%
55a. Inthecaseofcontracts/sub-contracts,whereverfinalbillsarenotsubmittedbythecontractorsfortheworkdoneasatthecloseoftheyear,liabilityisestimatedandprovidedbasedontheworkdone.
55b. BalanceshownunderTradeReceivables,TradePayables,loans,depositsandclaimsaresubjecttoconfirmationandconsequentreconciliation,ifany
56. TheCompanyhasmadeadequateprovisiontowardsmaterialforeseeable losseswhereverrequired, inrespectoflongtermcontracts.TheCompanydonothaveanylongtermderivativecontractsforwhichtherewereanymaterialforeseeablelosses.
57. Figuresinbracketsdenotenegativefigures.
58. Previousyearfigureshavebeen regrouped and classifiedwherevernecessary to conform to the currentyearpresentation.
ForandonbehalfofBoardofDirectors
V KALA SURESH BABU N V D PAUL RANJAN MADHU S NAIRCompanySecretary Director(Operations) Director(Finance)&ChiefFinancialOfficer ChairmanandManagingDirector DIN-07482491 DIN-06869452 DIN-07376798Kochi,datedMay24,2018Asperourreportattached
For M/s Krishnamoorthy & Krishnamoorthy,CharteredAccountants(FirmRegistrationNo.001488S)
C R RemaPartner(MembershipNumber029182)Kochi,dated24May2018
244 Cochin Shipyard Ltd
Statement pursuant to first proviso to sub-section (3) of section 129 of the Companies Act, 2013, read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed form AOC-1 relating to subsidiaries or associate companies or joint ventures
Part A - Subsidiary1. Nameofthesubsidiary HooghlyCochinShipyardLimited2. Thedatesincewhensubsidiarywasincorporated* October23,20173. Reportingperiodforthesubsidiaryconcerned April01,2017toMarch31,20184. Reportingcurrency INR
5. ExchangerateasonthelastdateoftherelevantFinancialyearinthecaseofforeignsubsidiaries NotApplicable
6. Share capital ` 2,200.00Lakhs(2,20,00,000equitysharesof ` 10each)
7. Reservesandsurplus `(37.07lakhs)8. Total assets ` 2,180.54Lakhs9. TotalLiabilities ` 2,180.54Lakhs10. Investments ` 1,490.00Lakhs11. Turnover ` 18.57Lakhs12. Profitbeforetaxation ` (49.92)Lakhs13. Provisionfortaxation ` (12.85)Lakhs14. Profitaftertaxation ` (37.07)Lakhs15. ProposedDividend Nil16. Percentageofshareholding 74%
Part B - Joint Venture1. NameofJointVenture HooghlyCochinShipyardLimited2. LatestauditedBalanceSheetDate March31,20183. DateonwhichtheJointVenturewasincorporated* October23,2017
4. Percentage of shares of Joint Venture held by thecompanyontheyearend 74%
5. No.ofsharesofJointVentureheldbythecompanyontheyearend 1,62,80,000
6. AmountofInvestmentinJointVenture ` 1,628.00Lakhs7. Descriptionofhowthereissignificantinfluence MajorshareholderofHooghlyCochinShipyardLimited8. Reasonwhythejointventureisnotconsolidated N.A.
9. Net worth attributable to shareholding as per latestauditedBalanceSheet ` 1,600.56Lakhs
10.ProfitorLossfortheyeari.ConsideredinConsolidation ` (37.07)lakhsii.NotConsideredinConsolidation -
Notes:
1.HooghlyCochinShipyardLimitedisyettocommenceitsoperations.
* HooghlyCochinShipyardLimitedhadbeen incorporatedas aJointVentureCompanybetweenCochinShipyardLimitedandHooghlyDock&PortEngineersLimited,inwhichCochinShipyardLimitedistheHoldingCompanywith74%ofthetotalshareholding.
Form AOC-1
notes
notes
notes
notes
COCHIN SHIPYARD LIMITEDAdministrative Building, Cochin Shipyard Premises, Perumanoor, Kochi, Kerala, India - 682015.Ph: +91 484-2501200. Fax: + 91 484-2370897website: www.cochinshipyard.com
Con
cept
& D
esig
n: w
ww
.cor
pcom
mst
udio
.in