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ANNUAL REPORT
Year ended 31st March, 2017
Annual Report and Accounts 2016-17
CORPORATE INFORMATION
Board of Directors
JAMSHYD N. GODREJ, Chairman & Managing Director
ADI B. GODREJ
NADIR B. GODREJ
VIJAY M. CRISHNA, Executive Director
KAVAS N. PETIGARA
PRADIP P. SHAH
Ms. ANITA RAMACHANDRAN
PHIROZE D. LAM, Executive Director (upto 31st March, 2017)
KYAMAS A. PALIA, Executive Director (Finance) (upto 31st March, 2017)
ANIL G. VERMA, Executive Director & President
Ms. NYRIKA HOLKAR, Executive Director - Corporate Affairs (from 1st April, 2017)
KEKI M. ELAVIA
NAVROZE J. GODREJ (from 6th November, 2017)
Auditors
KALYANIWALLA & MISTRY LLP
Chartered Accountants
Bankers
CENTRAL BANK OF INDIA ICICI BANK LTD.
UNION BANK OF INDIA AXIS BANK LTD.
STATE BANK OF INDIA HDFC BANK LTD.
CITIBANK N.A. KOTAK MAHINDRA BANK LTD.
EXPORT-IMPORT BANK OF INDIA
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Godrej & Boyce Mfg. Co. Ltd.
NOTICE is hereby given that the Eighty-Sixth Annual General Meeting of the Members of GODREJ & BOYCE MANUFACTURING
COMPANY LIMITED will be held on Friday, 24th November, 2017 at 10.00 a.m. at Pirojshanagar, Vikhroli, Mumbai, 400079
to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the Audited Standalone Financial Statements and the Audited Consolidated Financial Statements
of the Company for the financial year ended 31st March, 2017 together with the Report of the Board of Directors and Auditors
thereon.
2. To appoint a Director in place of Mr. A. G. Verma (DIN: 02366334), who retires by rotation and, being eligible, offers himself for
re-appointment.
3. To appoint a Director in place of Mr. A. B. Godrej (DIN: 00065964), who retires by rotation and, being eligible, offers himself for
re-appointment.
4. To appoint M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Firm Registration No. 117366W/W-100018, as Statutory
Auditors of the Company to hold office from the conclusion of this 86 th Annual General Meeting till the conclusion of the 91st
Annual General Meeting to be held in the year 2022 (subject to ratification of their appointment at every Annual General
Meeting if so required under the Companies Act, 2013) and to authorize the Board of Directors to fix their remuneration as may
be mutually agreed with the Statutory Auditors, in addition to reimbursement of Goods and Service Tax and out of pocket
expenses incurred in connection with the audit of accounts of the Company and in this regard, to consider and if thought fit, to
pass the following Resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 139, 142 and other applicable provisions, if any, of the Companies Act,
2013 (“the Act”) and the Companies (Audit and Auditors) Rules, 2014, (“the Rules”), (including any statutory modification(s) or re-
enactment(s) thereof for the time being in force), M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Firm Registration No.
117366W/W-100018, who have offered themselves for appointment and have confirmed their eligibility to be appointed as
Statutory Auditors, in terms of provisions of Section 141 of the Act, and Rule 4 of the Rules, be and are hereby appointed as
Statutory Auditors of the Company in place of M/s. Kalyaniwalla & Mistry LLP (Firm Registration No. 104607W/W100166)
Chartered Accountants to hold office for a period of five years from the conclusion of this Annual General Meeting until the
conclusion of the 91st Annual General Meeting of the Company to be held in the year 2022 (subject to ratification of their
appointment at every Annual General Meeting if so required under the Act) on such remuneration as may be mutually agreed
upon between by the Board of Directors and the Statutory Auditors, in addition to Goods and Service Tax and re-imbursement of
out of pocket expenses, travelling expenses etc. incurred by them in connection with the audit of Accounts of the Company.”
SPECIAL BUSINESS
5. To appoint Ms. Nyrika Holkar (DIN: 07040425) as Executive Director-Corporate Affairs of the Company, and to consider, and if
thought fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:
“RESOLVED THAT in accordance with the provisions of Sections 149, 152, 160, 161 and other applicable provisions, if any, of the
Companies Act, 2013 and the Rules framed thereunder, Ms. Nyrika Holkar (DIN: 07040425) who was appointed as an Additional
Director on the Board of the Company, with effect from 1st April, 2017 and who holds office as such upto the date of this Annual
General Meeting and in respect of whom the Company has received a Notice in writing, alongwith the requisite deposit, from a
Member, proposing her candidature for the office of a Director, be and is hereby appointed and designated as Executive
Director -Corporate Affairs, to hold office for a term of 3 years, commencing from 1 st April, 2017 to 31st March, 2020, liable to
retire by rotation.”
6. To appoint Mr. Navroze J Godrej (DIN: 03049821) as a Non-Executive Director of the Company, and to consider, and if thought
fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:
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Annual Report and Accounts 2016-17
“RESOLVED THAT in accordance with the provisions of Sections 149, 152, 160, 161 and other applicable provisions, if any, of the
Companies Act, 2013 and the Rules framed thereunder, Mr. Navroze J. Godrej (DIN: 03049821) who was appointed as an
Additional Director on the Board of the Company, with effect from 6 th November, 2017, and who holds office as such upto the
date of this Annual General Meeting and in respect of whom the Company has received a Notice in writing, alongwith the
requisite deposit, from a Member, proposing his candidature for the office of a Director, be and is hereby appointed as a Non-
Executive Director of the Company, liable to retire by rotation.”
7. To ratify the remuneration of Cost Auditors and to consider, and if thought fit, to pass with or without modification(s), the
following Resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Section 148 and other applicable provisions, if any, of the Companies Act, 2013
and the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014 (including any
statutory modification(s) or re-enactment thereof, for the time being in force)-
(a) Remuneration of Rs. 17,00,000 (excluding all taxes and reimbursement of out-of-pocket expenses) payable to M/s. P. D. Dani
& Associates, Cost Accountants, appointed by the Board of Directors as the Cost Auditors of the Company to conduct the audit of
the cost records of the Company in respect of Appliances, Vending Machines and Electric Motors businesses, for the financial
year 2017-18, as approved by the Board of Directors, be and is hereby ratified; and
(b) Remuneration of Rs. 23,00,000 (excluding all taxes and reimbursement of out-of-pocket expenses) payable to Mr. A. N.
Raman, Cost Accountant, appointed by the Board of Directors as the Cost Auditor of the Company to conduct the audit of the
cost records of the Company in respect of Construction, Electricals & Electronics, Material Handling Equipment, Aerospace,
Process Equipment, Precision Engineering, Toolings, Interio, and Security Solutions businesses, for the financial year 2017-18, as
approved by the Board of Directors, be and is hereby ratified.
FURTHER RESOLVED THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such
steps as may be necessary, proper or expedient to give effect to this Resolution.”
NOTES:
(a) The relative Explanatory Statement pursuant to Section 102 of the Companies Act, 2013 (the Act), in respect of the business
mentioned under Item No. 4 to 7 as set out in the Notice is annexed hereto.
(b) A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL GENERAL MEETING OF THE COMPANY IS ENTITLED TO APPOINT A
PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND SUCH A PROXY NEED NOT BE A MEMBER OF THE COMPANY. A person
can act as proxy on behalf of Members not exceeding fifty and holding in the aggregate not more than ten percent of the total
share capital of the Company carrying voting rights. A Member holding more than ten percent of the total share capital of the
Company carrying voting rights may appoint a single person as proxy and such person shall not act as proxy for any other person
or Member. Proxies in order to be effective should be deposited at the Registered Office of the Company, not less than 48 hours
before the commencement of the meeting. A proxy so appointed shall not have any right to speak at the meeting. A proxy form
in MGT-11 is annexed to this Report and marked Enclosure 5.
Proxies submitted on behalf of the limited companies, societies, partnership firms, etc., must be supported by appropriate
resolution/authority, as applicable, issued on behalf of the nominating organization.
(c) Brief Resume of Directors proposed to be appointed/re-appointed, as stipulated in Secretarial Standards as issued by the
Institute of Company Secretaries of India is provided after the Explanatory Statement to this Notice.
(d) Relevant documents referred to in the accompanying Notice are available for inspection at the Registered Office of the Company
during office hours on all days except Sundays and public holidays, upto the date of the Annual General Meeting. The aforesaid
documents, will also be available for inspection by Members at the Annual General Meeting.
(e) Corporate Members intending to send their authorized representatives to attend the Annual General Meeting pursuant to
Section 113 of the Companies Act, 2013, are requested to send a certified copy of the board resolution authorizing their
representative to attend and vote on their behalf at the Meeting.
(f) Pursuant to section 101 of the Companies, Act 2013, read with relevant rules made thereunder, Companies can serve Annual
Reports and other communications through electronic mode to those Members whose email addresses are registered with the
Company/ Depositories, unless any Member has requested for a physical copy of the same. Members who have not registered
their email addresses so far are requested to register their email address with their Depository Participant only, for receiving all
communication including Annual Report, Notices, Circulars, etc. from the Company, electronically.
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Godrej & Boyce Mfg. Co. Ltd.
(g) Members may please note that in terms of Section 124 of the Companies Act, 2013, any dividend which has not been paid or
claimed within thirty days from the date of declaration, shall be transferred within seven days from the date of expiry of the said
period of thirty days to the Unpaid Dividend Account with a scheduled bank. Any money transferred to the Unpaid Dividend
Account which remains unpaid or unclaimed for a period of seven years from the date of such transfer, shall be transferred by
the Company to the Investor Education and Protection Fund (IEPF) set up by the Government of India under Section 125 of the
Companies Act, 2013.
J. N. GODREJ
Chairman & Managing Director
DIN: 00076250
Mumbai, 6th November, 2017
Registered Office:
Pirojshanagar, Vikhroli,
Mumbai 400 079.
EXPLANATORY STATEMENT:
The following Explanatory Statement, as required by Section 102 of the Companies Act, 2013, sets out all material facts relating
to the business mentioned under Item Nos. 4 to 7 of the accompanying Notice dated 6th November, 2017.
Item No. 4
Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, the
existing Statutory Auditors of the Company, M/s Kalyaniwalla & Mistry LLP hold their office till the conclusion of this 86th Annual
General Meeting.
On the recommendation of the Audit Committee, at its Meeting held on 31 st October 2017, the Board of Directors considered
and approved the appointment of M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Firm Registration No. 117366W/W-
100018, as the Statutory Auditors to hold office from the conclusion of this 86 th Annual General Meeting until the conclusion of
the 91st Annual General Meeting to be held in the year 2022, at a remuneration as may be agreed upon by the Board and the
Auditors.
A brief profile of M/s Deloitte Haskins & Sells LLP is delineated below:
M/s Deloitte Haskins & Sells LLP (the Firm) was incorporated on 20th November, 2013 bearing Firm Registration No. 117366W/W-
100018. The Registered Office of the Firm is situated at Indiabulls Finance Centre, Tower 3, 27-32 Floors, Senapati Bapat Marg,
Elphinstone Road (West) Mumbai- 400 013. The Firm is well positioned with the experience, scale and multi-disciplinary
capabilities necessary to understand the dynamics and the complexities of the business. The Firm adopts a multi-disciplinary
approach, integrating competencies from audit, tax and other specialized services. The Firm also possesses significant experience
in IND AS / IFRS conversions. The Firm has a significant experience in transitioning large clients with complex and fairly spread-
out businesses which includes challenging and complex scenarios, such as information transfers and the review of accounting
positions. The Firm continuously promotes, enables and enhances the quality of audits performed in accordance with applicable
auditing standards and focuses on consistent execution which includes commitment, excellence, teamwork and analytics. The
Firm conducts Client Service Assessment (CSA) programs for feedback on service and commitment to quality, thus providing a
strategic and holistic snapshot of the relationship with the clients and the ways in which it can be improved.
As per the requirements of the Companies Act, 2013, the Firm has confirmed that the appointment, if made, would be within the
limits specified under Section 141(3)(g) of the Companies Act, 2013, and it is not disqualified to be appointed as Auditors in terms
of provisions of sections 139 and 141 of the Companies Act, 2013 and the Rules made thereunder.
The Board recommends the passing of the Ordinary Resolution as set out in Item No. 4 of this Notice for the approval of the
Members.
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Annual Report and Accounts 2016-17
None of the Directors and/or Key Managerial Personnel and their relatives are, in any way, concerned with or interested in,
financially or otherwise in the said Resolution.
Item No. 5
The Board of Directors, at its Meeting held on 18th March 2017, approved the appointment of Ms. Nyrika Holkar (DIN:
07040425) as an Additional Director designated as Executive Director- Corporate Affairs, on the Board of the Company with
effect from 1st April, 2017, subject to the Members’ approval at the forthcoming Annual General Meeting.
Ms. Nyrika Holkar who is the daughter of Mr. Vijay M. Crishna, Executive Director of the Company has been associated with the
Company as Senior Vice President (Corporate Affairs) since 1st April 2015 until her appointment on the Board of Directors as an
Executive Director- Corporate Affairs from 1st April 2017.
Ms. Nyrika Holkar graduated with an International Baccalaureate Program from the World College of the Adriatic, Italy. She went
on to graduate with distinction and a double major in Philosophy and Economics from Colorado College, Colorado Springs, USA.
She then obtained a degree in law from University College, London, UK and completed the London Bar exam as a Solicitor from
the United Kingdom. She was admitted to the Bar Council of India in August 2010. She worked as an advocate in the Chamber of
Darius Khambata, the Additional Solicitor General and thereafter with AZB & Partners, a leading Corporate Law Firm in India, for
5 years, where she specialized in mergers and acquisitions, private equity and commercial contracts. In 2016, she got a diploma
from Harvard Business School in General Management Program.
In view of Ms. Nyrika Holkar possessing significant experience and expertise, her continuance as Executive Director would be
highly beneficial to the Company. It is therefore considered desirable that the Board should continue to receive the benefit of her
expertise, as a Director of the Company.
A Notice under Section 160 of the Companies Act, 2013, has been received from a Member signifying his intention to propose
the appointment of Ms. Nyrika Holkar as a Director.
The details of Ms. Nyrika Holkar, as required to be given pursuant to the Secretarial Standards, are attached to this Notice.
The Board recommends the passing of the Ordinary Resolution as set out in Item No. 5 of this Notice for the approval of the
Members.
None of the Directors and/or Key Managerial Personnel and their relatives, except Ms. Nyrika Holkar and Mr. V.M. Crishna, are
concerned with or interested, financially or otherwise, in the said Resolution.
Item No. 6
The Board of Directors, had at its Meeting held on 6th November 2017, approved the appointment of Mr. Navroze J. Godrej (DIN:
03049821) as an Additional Director designated as a Non-Executive Director, on the Board of the Company, which is subject to
the Members’ approval at the forthcoming Annual General Meeting.
Mr. Navroze J. Godrej, is the son of Mr. Jamshyd N. Godrej the Chairman & Managing Director, and was earlier associated with
the Company as Manager (Special Projects) from October 2005 until his appointment on the Board as an Executive Director from
1st May, 2010.
Mr. Navroze J. Godrej stepped down from the position of Executive Director as well as from the Board of Directors of the
Company with effect from 1st October, 2016 due to his pre-occupation with various other personal and professional
commitments.
Mr. Navroze J. Godrej holds a Master of Design Degree in Innovation and Design Strategy from the Illinois Institute of Technology,
Institute of Design, Chicago, Illinois, USA. During his stint as Executive Director of the Company, he was responsible for strategy
and innovation. In order to inculcate innovation and design thinking, he set up an Innovation & Design Center (“the IDC”) in the
Company. IDC implements Disruptive Innovation and Human-Centred Design and works with a diverse set of employees from
various businesses to imbibe a culture of innovation at a grassroot level. This creates an environment where strategic design
pervades every aspect of business so as to deliver products and services of the greatest value to the community. Through design
thinking and innovation, Mr. Navroze J. Godrej had been able to create a greater awareness and agility within the organisation.
In an era of fierce competition, it is considered desirable to have a thrust on newer ideas, innovative thinking with a different
dimension and perspective to scale up the business and in view of this matter, it is considered desirable to seek the benefit of the
knowledge and experience of Mr. Navroze J. Godrej, it is therefore proposed to commend to the Members his appointment as a
Non-Executive Director of the Company.
A Notice under Section 160 of the Companies Act, 2013, has been received from a Member signifying his intention to propose
the appointment of Mr. Navroze J. Godrej as Non- Executive Director of the Company.
The details of Mr. Navroze J. Godrej, as required to be given pursuant to the Secretarial Standards, are attached to this Notice.
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Godrej & Boyce Mfg. Co. Ltd.
The Board recommends the passing of the Ordinary Resolution as set out in Item No. 6 of this Notice for the approval of the
Members.
None of the Directors and/or Key Managerial Personnel and their relatives, except Mr. Navroze J. Godrej and Mr. Jamshyd N.
Godrej, are concerned with or interested, financially or otherwise, in the said Resolution.
Item No. 7
In accordance with the provisions of Section 148 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules,
2014, the Board of Directors of the Company on the recommendation of the Audit Committee, approved the appointment of (i)
M/s. P. D. Dani & Associates, Cost Accountants, and (ii) Mr. A.N. Raman, Cost Accountant, as the Cost Auditors of the Company
for the financial year 2017-18, for conducting the audit of the cost records of certain applicable businesses of the Company (as
specified in the Resolution), at a remuneration of Rs. 17,00,000 and Rs. 23,00,000, respectively, (excluding all taxes and
reimbursement of out-of-pocket expenses). The remuneration payable to the Cost Auditors is required to be ratified by the
Members of the Company.
The Board recommends the passing of the Ordinary Resolution as set out in Item No. 7 of this Notice for the approval of the
Members.
None of the Directors and/or, Key Managerial Personnel and their relatives are concerned with or interested, financially or
otherwise, in the said Resolution.
J. N. GODREJ
Chairman & Managing Director
DIN: 00076250
Mumbai, 6th November, 2017
Registered Office:
Pirojshanagar, Vikhroli,
Mumbai 400 079.
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Annual Report and Accounts 2016-17
Pursuant to the Secretarial Standards issued by ‘The Institute of Company Secretaries of India’, the
following information is furnished about the Directors proposed to be appointed/re-appointed:
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Godrej & Boyce Mfg. Co. Ltd.
Expertise in specific functional Business/Legal Experience and Business Experience and Management
area Management Expertise Expertise
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Annual Report and Accounts 2016-17
DIRECTORS' REPORT
TO THE MEMBERS,
The Directors hereby present the Eighty Sixth Annual Report of the Company together with the Audited Financial Statements
for the year ended 31st March, 2017.
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Godrej & Boyce Mfg. Co. Ltd.
The Scheme of Amalgamation of two wholly-owned subsidiary companies, Busbar Systems (India) Limited and Mercury
Manufacturing Company Limited with the Company, with effect from 1 st April, 2016 and also, the Scheme of Amalgamation of
Godrej Investments Private Limited with the Company, with effect from 29th March, 2017, have been given effect to in these
accounts (see Note 50 for details).
Pursuant to Section 129(3) of the Companies Act, 2013 (the Act), read with Rule 2A of the Companies (Accounts) Rules, 2014, the
Company has also prepared consolidated financial statements of the Company and its subsidiaries, joint ventures and associates;
these statements are also the Company’s first Ind AS financial statements and are covered by Ind AS 101, First-time adoption of
Indian Accounting Standards, referred to earlier.
The Company’s Board of Directors is responsible for the preparation of the consolidated financial statements of the Company, its
subsidiaries, associates and joint venture entities (“the Group”), in terms of the requirements of the Companies Act, 2013 and
the Rules thereunder. The respective Board of Directors, of the subsidiary companies included in the Group and of its associates
and joint venture entities, are responsible for the maintenance of adequate accounting records in accordance with the provisions
of the Companies Act, 2013 for safeguarding the assets of the Group and for preventing and detecting frauds and other
irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are
reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were
operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to
fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Company, as
aforesaid.
The Consolidated Financial Statements of the Company and the Auditors’ Report thereon, are enclosed separately with, and form
part of this Report (Enclosure 1). The Consolidated Financial Statements presented by the Company include the financial results
of its subsidiaries, associates and joint ventures.
The Company had filed a Scheme of Amalgamation of two of its Wholly Owned Subsidiaries (WOSs), namely Busbar Systems
(India) Limited, Bengaluru and Mercury Manufacturing Company Limited, Chennai with the Company and their respective
Shareholders (‘the Scheme’) with National Company Law Tribunal, Bengaluru Bench and Chennai Bench respectively. Since the
Final Orders approving the said Scheme were expected to be received from the respective NCLT Benches after 30 th September,
2017, it would not have been possible to consolidate the financials of the above referred two WOSs with that of the Company by
30th September, 2017 and hold the Annual General Meeting before the end of six months from the close of the financial year for
its adoption by the Members of the Company, as stipulated under the provisions of the Companies Act, 2013. Accordingly, the
Company sought an extension of three months for holding the Annual General Meeting of the Company, by filing an application
to that effect with the Office of the Registrar of Companies, Maharashtra, Mumbai (the RoC). Approval from the RoC granting
extension of time to hold the Annual General Meeting by 30th December, 2017 has been received by the Company.
2. DIVIDEND:
During the financial year 2016-17, the Board of Directors declared and paid an Interim Dividend, at the rate of Rs. 700 per equity
share of Rs. 100 each, absorbing an aggregate Rs.57.11 crore inclusive of taxes. The Directors do not recommend payment of any
final dividend for the financial year 2016-17. The total dividend for the financial year 2015-16 was Rs. 3,200 per equity share.
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Annual Report and Accounts 2016-17
The Company is committed to equality of opportunity in all aspects of its business and does not discriminate on the grounds of
nationality, race, colour, religion, caste, gender, gender identity or expression, sexual orientation, disability, age or marital status.
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Godrej & Boyce Mfg. Co. Ltd.
The Company recognizes merit and continuously seeks to enhance the effectiveness of its Board. The Company believes that for
effective corporate governance, it is important that the Board has the appropriate balance of skills, experience and diversity of
perspectives.
Board appointments will be made on merit basis and candidates will be considered against objective criteria with due regard for
the benefits of diversity on the Board. The Board believes that such merit-based appointments will best enable the Company to
serve its stakeholders.
The Board will review this Policy on a regular basis to ensure its effectiveness.
The Companies Act, 2013 provides for a major overhaul in the corporate governance norms for all companies in order to adopt
best practices on corporate governance and to make the corporate governance framework more effective. Pursuant thereto, the
Company was required to formulate Governance Guidelines on Board Effectiveness. As a part of the Board Effectiveness Review,
it was the responsibility of the Board to annually evaluate the individual Directors, the Board Committees and also the entire
Board as a whole. It was the responsibility of the Nomination and Remuneration Committee to organize the evaluation process
and determine the evaluation criteria/ framework for the Board and individual Directors, which would include the Chairman,
Independent Directors, Non-Independent Non-Executive Directors, the Managing Director and the Executive Directors.
The Non-Executive Directors received Sitting Fees and Commission in accordance with the provisions of the Companies Act, 2013.
The Company conducted a formal Board Effectiveness Review as part of its efforts to evaluate, identify improvements and thus
enhance the effectiveness of the Board, its Committees, and individual Directors, in line with the requirements of the provisions
of the Companies Act, 2013. The Nomination and Remuneration Committee took up the design and execution of this process
which enabled providing vital feedback on how the Board currently operates and how it might improve its effectiveness.
Compiled feedback and suggestions on (i) Board processes (including Board composition, strategic orientation and team
dynamics) (ii) individual committees (iii) individual Board members and (iv) chairperson’s feedback report, were shared by the
Nomination and Remuneration Committee with the Board. The criteria for evaluation of the Board Committees covered whether
the Committee has well defined objectives, the right composition and whether it delivers its objectives. The criteria for
evaluation of all the individual Directors included skills, experience and level of preparedness of the Directors, attendance and
extent of contribution to Board discussion and how the Director leverages his/ her expertise and networks to meaningfully
contribute to the Company. The criteria for the Chairman’s evaluation included leadership style, conduct of Board Meetings, etc.
The individual Board Member Feedback Report and overall Board Feedback Report was facilitated by Mrs. Anita Ramachandran,
Chairperson of the Nomination and Remuneration Committee, with the Independent Directors. The Independent Directors were
appreciative about the effective functioning of the Board, but also identified other areas which could show scope for
improvement. The feedback was shared with the Chairman and based on his evaluation, a Chairman’s Feedback Report was also
compiled.
Mr. J.N. Godrej, Chairman and Managing Director, other Whole-Time Directors, Mr. P. E. Fouzdar, Executive Vice President
(Corporate Affairs) and Company Secretary and Mr. P. K. Gandhi, Chief Financial Officer, are the Key Managerial Personnel of the
Company.
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Annual Report and Accounts 2016-17
(b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that
are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2017 and of
the profit of the Company for the year ended on 31st March, 2017;
(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with
the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud
and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by the Company and such internal financial controls
were adequate and operating effectively;
(f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such
systems were adequate and operating effectively;
(g) the annual accounts have been audited by the Company’s Auditors M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants,
and their report is appended thereto.
9. SHARE CAPITAL
During the year under review, the Hon’ble High Court of Judicature at Bombay by its Order dated 20 th June, 2016 sanctioned the
Scheme of Amalgamation of Cartini India Limited (“Cartini”) with the Company.
Accordingly, the Company issued and allotted 15,538 Equity shares at par, credited as fully paid up, to the Members of Cartini,
whose names appear in the Register of Members of Cartini, on the Effective Date, i.e 1st August, 2016, in the ratio of 254 fully
paid equity share of Rs. 100 each of the Company for every 1,000 equity shares of Rs. 10 each held in Cartini.
12. TRANSFER OF UNCLAIMED AMOUNT TO THE INVESTOR EDUCATION AND PROTECTION FUND (“IEPF”):
The Company sends letters to all deposit holders, whose deposits or interest due thereon are unclaimed so as to ensure that they
receive their rightful dues. Efforts are also made to communicate with the deposit holders in cases wherein they have relocated
and failed to intimate the Company of the new address.
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Godrej & Boyce Mfg. Co. Ltd.
During the year, the Company had transferred a sum of Rs. 3,29,228 comprising of Deposits from public and Interest due thereon
to the IEPF, the amount which was due and payable but remained unclaimed and unpaid for a period of seven years as provided
in Section 125 of the Companies Act, 2013.
14. PARTICULARS OF INVESTMENTS MADE, GUARANTEES PROVIDED AND LOANS GIVEN BY THE COMPANY:
The details of loans, guarantees, and investments as required by the provisions of Section 186 of the Companies Act, 2013 and
the Rules made thereunder are set out in the Notes to the Standalone Financial Statements of the Company.
15. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have been no material changes and commitments affecting the financial position of the Company, which have occurred
between 31st March, 2017 and the date of this Report.
16. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There are no significant material orders passed by the regulators/ courts/ tribunals which would impact the going concern status
of the Company and its future operations.
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Annual Report and Accounts 2016-17
19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as
required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is appended as
Annexure I to this Report.
The Company continuously strives to attain world-class standards in its management of Environment, Occupational Health and
Safety by working closely with employees at all levels. The Company also strives to align its operations and activities with the
national mission on environmentally sustainable growth.
15
Godrej & Boyce Mfg. Co. Ltd.
The Godrej Group has developed a long-term vision, for playing an active part in creating a more inclusive and greener India,
called “Godrej Good & Green”; the Group aspires to create a more skilled workforce, a greener India, and innovate for good and
green products. For this purpose, specific goals at the Group level for 2020 have been spelt out, and focused activities are
planned by the Company to address environmental and business issues, and the needs of underserved populations.
Based on the recommendation of the CSR Committee, the Board has approved the CSR Policy of the Company, including the CSR
activities and the projects proposed to be undertaken by the Company, and its governance structure and the same is placed on
the website of the Company.
The details required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in the CSR Report, which
is appended as Annexure II to this Report.
16
Annual Report and Accounts 2016-17
25. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES:
In terms of Section 129 of the Companies Act, 2013, the consolidated financial statements have been prepared by the Company
in accordance with the applicable accounting standards, and form part of this Report. A statement containing the salient features
of the financial statements of the Company’s subsidiaries, joint ventures and associates, in Form AOC-1 as required under Rule 5
of the Companies (Accounts) Rules, 2014 forms part of the notes to the consolidated financial statements, and provides details
on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the
consolidated financial statements.
17
Godrej & Boyce Mfg. Co. Ltd.
The Scheme of Amalgamation of Busbar Systems (India) Limited (“Busbar”) and Mercury Manufacturing Company Limited
(“MMCL”) with the Company (“the Scheme 4”) filed in accordance with the provisions of Sections 230 to 232 of the Companies
Act, 2013, with NCLT Mumbai Bench, NCLT, Bengaluru Bench and NCLT, Chennai Bench came up for its final hearing on 23 rd
August, 2017, on 16th October, 2017 and on 14th September, 2017, respectively, whereat the respective NCLT issued Orders
sanctioning the Scheme 4. In accordance with the directions of the NCLT respective benches, the Company filed certified copies
of the Orders with the MCA on 3rd October, 2017 for MMCL and on 28th October, 2017 for Busbar. Accordingly, the Scheme 4
became effective. With effect from the Appointed Date, i.e. 1st April, 2016, and upon the Scheme 4 becoming effective, the whole
undertaking of Busbar and MMCL, alongwith all the assets and liabilities thereof, stood transferred to the Company to belong to,
and be managed by the Company, and Busbar and MMCL stood dissolved without winding-up.
27. AUDITORS:
In accordance with Section 139 of the Companies Act, 2013 and the rules made thereunder, M/s Kalyaniwalla & Mistry LLP,
Chartered Accountants (Firm Regn. No. 104607W/W100166), Mumbai, were appointed as Statutory Auditors to hold office from
the conclusion of the 83rd Annual General Meeting (“AGM”) till the conclusion of the 86th AGM (i.e. the forthcoming AGM of the
Company).
Hence, pursuant to the provisions of the Companies Act, 2013, the Company is required to appoint new Statutory Auditors.
The Audit Committee at its Meeting held on 31st October, 2017, unanimously approved to recommend to the Board, the
appointment of Deloitte Haskins & Sells LLP, Chartered Accountants, ICAI Registration No. 117366W/W- 100018, Mumbai, as the
new Statutory Auditors to hold office from the conclusion of this 86th AGM on 24th November, 2017, until the conclusion of the
91st AGM to be held in the year 2022, at a remuneration as may be approved by the Board. The Board, at its meeting held on 6 th
November, 2017, approved the recommendation of the Audit Committee.
Deloitte Haskins & Sells LLP, Chartered Accountants have confirmed that their appointment, if made, would be within the limits
specified under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified to be appointed as Statutory
Auditors in terms of the provisions of Section 139(1), Section 141(2) and Section 141(3) of the Companies Act, 2013 and the
provisions of the Companies (Audit and Auditors) Rules, 2014. The Board of Directors recommends to the Members the
appointment of Deloitte Haskins & Sells LLP, Chartered Accountants as Statutory Auditors of the Company.
There are no qualifications, reservations or adverse remarks or disclaimers made by Kalyaniwalla & Mistry LLP, Statutory
Auditors, in their Report.
The Board places on record, its appreciation of the contribution of M/s Kalyaniwalla & Mistry LLP, Chartered Accountants, during
their tenure as the Statutory Auditors of the Company.
18
Annual Report and Accounts 2016-17
The remuneration of the Cost Auditors is required to be ratified by the Members of the Company at the ensuing Annual General
Meeting.
In accordance with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors on the recommendation of the
Audit Committee, has appointed M/s. P D Dani & Associates, Cost Accountants as the Lead Cost Auditors and Mr. A.N. Raman,
Cost Accountant, Cost Auditor of the Company for the financial year ending 31st March, 2018.
J. N. GODREJ
Chairman & Managing Director
DIN: 00076250
Mumbai, 6th November, 2017
Registered Office:
Pirojshanagar, Vikhroli,
Mumbai 400 079.
19
Godrej & Boyce Mfg. Co. Ltd.
A. CONSERVATION OF ENERGY
B. TECHNOLOGY ABSORPTION
20
Annual Report and Accounts 2016-17
6. Development of rack collapse warning system with tilt sensor based embedded device for giving warning of
rack condition during hazards like earthquake.
7. Development of embedded system based on light assisted picking system to enhance picking efficiency of
distribution centres (retail / e-commerce segments).
8. Development of special vacuum pump motor for submarine application and process development of
encapsulation of motor windings with resins.
9. Development of storage and retrieval system for Sheet metal storage & Die/Mould storage for shop floor
applications.
iii.
(iii) During the year under review, the Company spent Rs. 39.06 crore on Research & Development.
The Company’s foreign exchange earnings and outgo for the year amounted to Rs. 1,372.33 crore and Rs. 602.90 crore respectively.
21
Godrej & Boyce Mfg. Co. Ltd.
We, Godrej & Boyce Mfg Co. Ltd (G&B), are happy to present to you our third CSR compliance report. We have continued
to work with integrity, have trust, service to mankind, respect for each other and conserving environment to pursue our
vision of Godrej being in every home and workplace. We strive for enriching the quality of life, every day and everywhere.
We grow with our values system, inculcating it in our CSR and Sustainability initiatives. The CSR projects undertaken are in
line with Godrej Group’s Good & Green goals and the areas of intervention specified in the Schedule VII of the Companies
Act, 2013.
This annual report presents our approach towards new initiatives which is gaining momentum like community
development and work done in employability by following our CSR philosophy, highlighting our commitment to our
stakeholders. This report mentions about CSR committee, its role and responsibilities, taskforces and monitoring and
review by them, project details including budgets and total spends.
At G&B, our CSR policy applies to all activities that are undertaken as part of our Good & Green goals. In Godrej Good &
Green, the focus is on increasing the employability of underprivileged youth through vocational training thus improving
their socio-economic condition, go green by creating a greener India to encourage a sustainable approach towards
business, and innovating environment-friendly and /or solutions benefiting bottom of the pyramid. In the year 2014-15 we
have started community development initiatives around the area of operations in Maharashtra, Punjab and Uttarakhand
as it is critical to build sustainable communities by addressing their needs in the area of livelihood, environment, health &
sanitation and education that is aligned to schedule VII of the Companies Act, 2013.
While this CSR policy is drafted as per the Godrej Groups’ Good and Green policy, it includes the CSR programs that meets
the requirement of the CSR Rules as per the Section 135 of the Companies Act, 2013.
The G&B CSR Policy is available in the Company’s website:
http://www.godrejandboyce.com/godrejandboyce/corpPolicies.aspx?id=16&menuid=929
22
Annual Report and Accounts 2016-17
2.3 Responsibilities
1. Formulate and update G&B CSR Policy, and have it approved by the Board of G&B.
2. Suggest areas of intervention to the Board of G&B.
3. Approve projects that are in line with the CSR Policy.
4. Put monitoring mechanism in place to track the progress of each project.
5. Recommend the CSR budget and expenditures to the Board of G&B, for approval.
6. Meet twice a year to review the progress made.
* includes budget and expenditure of Busbar Systems (India) Limited, a Wholly-Owned Subsidiary which
was amalgamated with G&B.
23
Godrej & Boyce Mfg. Co. Ltd.
Details of the expenditures incurred by G&B during the current financial year 2016-17
(Amount in Rs. Lakhs)
CSR Project Sub activity for CSR Sector in which 1) Local area Institute/ Amount Amount spent Total Cumulative Amt spent direct Audit
Activity the project is 2) State /district 3) organization outlay on projects, expenditure in expenditure or through the proof
covered project or / person (Budget) 1) Direct the up to the implementing available
programme involved Project or expenditure corresponding reporting agency
Programme 2)Overheads, area period
wise
A. Livelihood
i. Disha Vocational Skill Employment 88 cities, 20 states, 30 Pvt VTC 226 235.2 235.2 235.2 138.49L Invoices
training for Rural & enhancing across india & 51 Govt implementng & Bills
Urban youth in vocational skills (Schedule A: List of partners Agency
trades like –Fitter, development States & Cities) (Schedule B 79.30L Direct
Welder, Machinist, & D) expense
RAC, Flt Driver, FST,
Lock ST Stipend
cost of government
apprentices
ii.Rural Women Livelihood Shirwal (Satara), Partners, 30 40.59 40.59 40.59 40.59L 26 L Invoices
develop- Empowerment, enhancement Khalapur (Raigad), Villagers, through & Bills
ment SHG Formation, Eco projects Kudal (Sindhudurg) CSR team implementing
- Bhiwandi (Thane) members agency
Tourismdevelopme Maharashtra, (Schedule C) 14.59 L direct
nt, Agriculture Bhagwanpur expense
scheme (Haridwar),
awaremess, Uttarakhand,
Surveys, Madkai(Goa),
Dahej, Vadodara
(Gujrat)
B. Support Uplifting education, Promoting Shirwal Govt 82 67 67 67 67 L 21 Invoices
education Sanitation & Education (Satara),Khalapur Schools, L through & Bills
cleanliness in rural (Raigad), villagers, implementing
schools, career Kudal(Sindhudurg) partners agency 46
guidance, E- Bhiwandi(Thane) (Schedule C) L direct
learning, Science Maharashtra, expense
lab, Activity based Bhagwanpur
learning, Model (Haridwar),
school Uttarakhand,
Madkai(Goa),
Dahej,
Vadodara(Gujrat)
C. Preventive health Promoting Shirwal(Satara),Kh Hospitals 110 107 107 107 107 L 91 Invoices
Promoting checkups, safe preventive alapur (Raigad), Villagers, L Through & Bills
Health Care drinking water, health care Bhiwandi(Thane), partners implementng
awareness, Waste Kudal(Sindhudurg), (Schedule Agency 18L
water Maharashtra, C&D) direct expense
management, Bhagwanpur,
renovation of Uttarakhand,
washrooms, road Madkai, Goa,
pathway for safety Chennai (Tamil
Nadu)
D. Environ- Tree plantation, ensuring Shirwal(Satara),Kh Water 30 28 28 28 28 L 24 Invoice
ment rain water environmental alapur (Raigad), Organizatio L Through /receipts
harvesting, sustainability, Maharashtra n Trust implementng
environment ecological Resources Agency 4L
awareness balance (WOTR) direct expense
Partners,
villagers,
(Schedule
C&D)
24
Annual Report and Accounts 2016-17
CSR Project Sub activity for CSR Sector in which 1) Local area Institute/ Amount Amount spent Total Cumulative Amt spent direct Audit
Activity the project is 2) State /district 3) organization outlay on projects, expenditure in expenditure or through the proof
covered project or / person (Budget) 1) Direct the up to the implementing available
programme involved Project or expenditure corresponding reporting agency
Programme 2)Overheads, area period
wise
E. CSR Salary, Travel CSR Mumbai, Dedicated 26 26 26 26 26 Invoices
Overhead management CSR /Salary
Resource, slips
Project
Mgmt
Other details of coverage and partners are given in Schedules A,B,C and D attached to this report.
3. Responsibility Statement
Through this report, G&B seeks to communicate its commitment towards CSR to the Ministry of Corporate Affairs. The Board of the Company and the CSR Committee are responsible
for the integrity and the objectivity of all the information provided in this report. In alignment with our Good & Green goals provided in our CSR Policy, all projects reported have been
selected based on careful consideration of the extent to which they create sustainable outcomes in the communities around the area of operations. We have understaken measures to
ensure these projects are implemented in an effective and efficient manner so that they are able to deliver maximum impact. In line with the Companies Act, 2013, we have also
instituted monitoring mechanisms to track the progress of projects and ensure their smooth implementation.
The CSR Committee confirms that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and Policy of the company.
25
Godrej & Boyce Mfg. Co. Ltd.
State presence 20
City presence 88
26
Annual Report and Accounts 2016-17
2 Don BoscoYuva Kendra, Don Bosco yuva Kendra, Nangloi Welding, Fitter, Refrigration& Air Conditioning 6
Central Road, near Holy Cross School, (RAC)
Najafgarh - 110 043
3 Don Bosco Tech- Western Don Bosco Centre for Learning(DBCL), Welding, Fitting, Electricial 6
Province Premier Automobiles Road,
KurlaWest, Mumbai 400070
6 George Telegraph Training 31A, S. P. Mukherjee Road, Kolkata- Refrigration & Air Conditioning (RAC) 6
Institute 700 025
7 LaurusEdutech LaurusEdutech Life skills Pvt Ltd, Refrigration & Air Conditioning (RAC) 1
DP 110, 2nd phase, F19, Ambattur
Industrial Estate, Chennai -600058
27
Godrej & Boyce Mfg. Co. Ltd.
15 LokBharti Skilling Solutions 46, Janpath, New Delhi - 110001 Masonry & plastering, Plumbing, shuttring 2
Pvt. Ltd. carpentry
16 UttanKrishiSanshodhanS Keshavsrushti, Uttan Road, Horticulture 1
antha Bhayandar (W)
17 Indo German Institute Vishakhapattnam Refrigration & Air Conditioning 1
18 Sure tech Education Jamal Manzal, Opp. Cooperative Refrigration & Air Conditioning (RAC) 1
Arts College, Main Road,
Olavakode, Palakkad
21 Bangalore Electronic 309, 1st floor, 10th Cross, Wilson Refrigration& Air Conditioning (RAC) 1
Services Garden, Bangalore 560027
Karnataka
22 MsRamaiah Polytechnic MSRP -MSR Nagar, MSRIT Post, Refrigration& Air Conditioning (RAC) 1
Bangalore- 560054
23 Morning Star Bhopal (New) Refrigration& Air Conditioning (RAC) 1
24 Future Sharp Future retail home office,tower Refrigration& Air Conditioning (RAC) 1
C,247 park, L.B.S Marg, Vikroli
west, Mumbai 400083
28
Annual Report and Accounts 2016-17
29
Godrej & Boyce Mfg. Co. Ltd.
30
Annual Report and Accounts 2016-17
Sr.
No. Partners Address of Head office Partnership Pillars Area of intervention
1 WOTR "Paryavaran" Behind Market Knowledge & project Health & Waste water
Yard, Sarasnagar Rd, Implementation Sanitation Management
Ahmednagar, MH 414001
2 Greenway 805, 2, LodhaSupremus, Project Health & Smokeless Chulha
Grameen Pvt. Ltd. SenapatiBapat Marg, Railway Implementation Sanitation
Colony, Lower Parel, Mumbai,
Maharashtra 400013
3 Bharti Vidyapeeth LBS Road, 13 Sadashiv Peth, Next Knowledge partner Environment Environment
University to Alka Talkies, Pune, Awareness
Maharashtra 411030
4 Agnel Institute of Agnel Technical Education Project Livelihood Welding,Fitting,
technical training Complex,Fr. Implementation Electrical
& AgnelAshram,BandStand,Bandra
entrepreneurship West,Mumbai-400050
5 Urmee (Urban 15-A, Bhale Estate, Behind Project Education Promoting
Rural Pratham Motors, Mumbai-Pune Implementation Education
Management Road, Wakdewadi, Pune-411003
Empowerment &
Establishment)
6 Idea Foundation IDEA, Flat No 10, Fountain Head Project Education Promoting
Apartment, Opp. Karishma Implementation Education
Society, Kothrud, Pune 411038,
Ph. No. 09890119732
31
Godrej & Boyce Mfg. Co. Ltd.
Sr.
No. Partners Address of Head office Partnership Pillars Area of intervention
15 UNDP UNDP India, Office in Mantralaya Financial Support Livelihood Skill development,
Mumbai partner Tourism
Development,
women
empowerment,
agriculture
projects
16 Vasundhara Vasundhara Science Center, At Knowledge partner Education Science education
Post –Nerurpar, Tal.-Kudal, Dist.
Sindhudurg, Maharashtra.
17 Ankidyne #46, 1st Main Road, New Colony, Project Education Science education
Chromepet, Chennai- 600 044. Implementation
32
Annual Report and Accounts 2016-17
[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014]
To,
The Members,
Godrej and Boyce Manufacturing Company Limited
We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good
corporate practices by Godrej & Boyce Manufacturing Company Limited (hereinafter called the Company). Secretarial Audit
was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory
compliances and expressing our opinion thereon.
Based on our verification of Godrej & Boyce Manufacturing Company Limited’s books, papers, minute books, forms and
returns filed and other records maintained by the Company and also the information provided by the Company, its officers,
agents and authorized representatives during the conduct of secretarial audit. We hereby report that in our opinion, the
Company has, during the audit period covering the financial year ended on 31st March, 2017 complied with the statutory
provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to
the extent, in the manner and subject to the reporting made hereinafter:
We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company
for the financial year ended on 31st March, 2017 according to the provisions of:
(i) The Companies Act, 2013 (the Act) and the Rules made thereunder;
(ii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;
(iii) Foreign Exchange Management Act, 1999 and the Rules and Regulations made thereunder to the extent of
Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;
(iv) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of
India Act, 1992 (‘SEBI Act’): -the Company is an unlisted public company and hence compliance limited to the
extent applicable in respect of the Company’s holdings in listed public companies;
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;
(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;
(d) The Securities and Exchange Board of India (Share Based Employee Benefit) Regulations, 2014;
(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;
(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations,
1993 regarding the Companies Act and dealing with client;
(v) The following laws are specifically applicable to the Company as per the representation given by the Company:-
1. Arms Act, 1959 and Indian Arms Rules 1962.
2. Atomic Energy Act, 1962 and Atomic Energy (Safe Disposal of Radioactive Wastes) Rules, 1987.
3. Atomic Energy Act, 1962 and Atomic Energy (Radiation Protection) Rules, 2004.
4. Energy Conservation Act, 2001 and Bureau of Energy Efficiency (Manner and Intervals of Time for Conduct
of Energy Audit) Regulations, 2010.
5. Energy Conservation Act, 2001 read with Energy Consumption Standard for star labelled room A/Cs of the
vapour compression type which are of window A/C and 1:1 high wall split A/C.
6. Energy Conservation Act, 2001 read with Bureau of Energy Efficiency (Particulars and Manner of their
Display on Labels of Household Frost Free Refrigerators) Regulations, 2009.
7. Energy Conservation Act, 2001 read with Bureau of Energy Efficiency (Particulars and Manner of their
Display on Labels of Room Air Conditioners) Regulations, 2009.
8. Energy Conservation Act, 2001 read with Energy Consumption Standard for star labelled household frost
free refrigerator and Notification issued by BEE dated 16 December 2015.
9. Explosives Act, 1884 and Gas Cylinder Rules, 2004.
33
Godrej & Boyce Mfg. Co. Ltd.
10. Explosives Act, 1884 and Static and Mobile Pressure Vessels (Unfired) Rules, 1981.
11. Forest (Conservation) Act 1980 and Forest (Conservation) Rule 2003.
12. Jammu and Kashmir Industrial Establishments (National and Festival) Holidays Act, 1974 and Jammu and
Kashmir Industrial Establishments (National and Festival) Holidays Rules.
13. Petroleum Act, 1934 read with Petroleum Rules 2002.
14. Environment (Protection) Act, 1986 and Bio-Medical Waste (Management and Handling) Rules, 1998.
15. Maharashtra Acquisition of Private Forests Act, 1975.
16. Maharashtra Felling of Trees (Regulation) Act, 1984.
17. Building & Other Construction Workers’ Welfare Cess Act, 1996 Child Labour (Prohibition & Regulation)
Act,1986
18. Building & Other Construction Workers’ (Regulation of Employment & Conditions of Service) Act, 1996.
19. Industrial Employment (Standing Orders) Act, 1946
20. Inter-State Migrant Workmen Regulation of Employment and Conditions of Service Act, 1979.
21. Manufacture, Storage and Import of Hazardous Chemical Rules, 1989.
22. Bio-Medical Waste (Management and Handling) Rules, 1998 / 2003.
23. The Gujarat SEZ Act, 2004 – Dahej.
We have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards issued by The Institute of Company Secretaries of India.
(ii) The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 / Listing Agreements entered into by the
Company with BSE Limited&The National Stock Exchange of India Limited: - NOT APPLICABLE.
During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines,
Standards, etc. mentioned above.
We further report that:
The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive
Directors and Independent Directors. The changes in the composition of Board of Directors that took place during the
period under review were carried out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent as
per the provisions of the Secretarial Standard on meeting of Board of Directors (SS1) and a system exists for seeking and
obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at
the meeting.
All the decisions were carried through with requisite majority and are recorded with dissents (wherever required) as a part
of minutes.
The Statutory auditors, in their audit report, have mentioned about the fraud pertaining to Systems Integration & Turnkey
Automation Projects in collusion with third parties resulting in losses to the Company amounting to Rs. 19 Crores for which
management has taken appropriate remedial measures. The Statutory auditors have mentioned by ‘emphasis of matter’ in
respect of non current investment in Subsidiaries, Associates and Joint Ventures as well as certain accounting treatments
applied in the books of accounts as a result of amalgamation of Cartini India Limited with the Company.
We further report that there are adequate systems and processes in the Company commensurate with the size and
operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.
We further report that during the audit period, the Company has:
i. approved composite scheme of Arrangement and Amalgamation amongst Geometric Ltd. and 3D
PLM Software Solutions Limited and HCL Technologies Limited by circular resolution.
ii. approved Scheme of Amalgamation of its wholly owned subsidiaries i.e. Busbar Systems (India)
Limited and Mercury Manufacturing Company Limited with the Company and its respective shareholders.
iii. approved Scheme of Amalgamation of Godrej Investments Private Limited with the company and its
respective shareholders.
iv. allotted shares to the shareholders of Cartini India Limited upon its amalgamation with the company.
v. altered its Object Clause.
vi. approved admission of its securities in Demat form.
vii. issued advertisement for acceptance of Deposits from the public.
viii. transferred 9,35,00,000 equity shares of face value of Re. 1/- each in Godrej Consumer Products Limited
to Godrej Seeds and Genetics Limited without consideration, which was proposed in the Board Meeting held
34
Annual Report and Accounts 2016-17
on March 21, 2017 and approved by shareholders in Extra Ordinary General Meeting held on March 22, 2017.
ix. transferred 19,39,04,681 equity shares of face value of Re. 1/- each in Godrej Industries Limited to Vora
Soaps Limited without consideration, which was proposed in the Board meeting held on March 21, 2017
and approved by shareholders in Extra Ordinary General Meeting held on March 22, 2017.
x. approved,
1. issuance of corporate guarantee of USD 2.5 Million in favour of Citibank N.A., New York in respect of
extension of loan facilities to Urban Electric Power Inc., USA.
2. issuance of corporate guarantee of USD 1.8 Million in favour of Citibank N.A., New York in respect of
extension of loan facilities to Sheetak Inc., USA.
3. extension of corporate guarantee of USD 1 Million in favour of Citibank N.A., New York in respect of loan
facilities to Sheetak Inc., USA.
4. issuance of corporate guarantee of USD 3 Million in favour of Citibank N.A., New York in respect of
extension of loan facilities to Urban Electric Power Inc., USA.
5. extension of corporate guarantee of USD 1 Million in favour of Citibank N.A., New York in respect of loan
facilities to Sheetak Inc., USA.
‘Annexure A’
To,
The Members
Godrej and Boyce Manufacturing Company Limited
1. Maintenance of Statutory and other secretarial records is the responsibility of the management of the Company. Our
responsibility is to express an opinion on the secretarial records based on our audit.
2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurances about the
correctness of the contents of the records. The verification was done on test basis to ensure that correct facts are reflected
in records. We believe that the processes & practices we followed provide a reasonable basis for our opinion.
3. We have not verified the correctness, adequacy and appropriateness of financial records and books of Accounts of the
Company. We have relied on the report of the Statutory Auditors in respect of the same and the other matters dealt with in
their report as per the guidance of the Institute of Company Secretaries of India.
4. Wherever required, we have obtained the management representation about the compliance of laws, rules and regulations
and happening of events, etc.
5. The Company was following system of obtaining reports from various departments to ensure compliance with applicable
laws and now is in the process of implementing electronic system for compliance management to monitor and ensure
compliance with applicable laws, rules, regulations and guidelines.
6. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility
of the management. Our examination was limited to the verification of procedures on test basis.
7. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficacy or
effectiveness with which the management has conducted the affairs of the Company.
35
Godrej & Boyce Manufacturing Company Limited
Enclosure 1: Consolidated Financial Statements for the year ended 31st March, 2017
(Paragraph 1 of the Directors' Report)
Enclosure 3: Form No. AOC-2 pursuant to Section 134 (3) (h) of the Companies Act, 2013
(Paragraph 10 of the Directors' Report)
36
Godrej & Boyce Manufacturing Company Limited
ENCLOSURE 2
37
ENCLOSURE 2
GODREJ AND BOYCE MFG. CO.LTD
EXTRACT OF ANNUAL RETURN IN FORM MGT-9
REQUIRED TO BE ATTACHED WITH THE DIRECTORS' REPORT AS ON THE FINANCIAL YEAR ENDED
31.03.2017
[Pursuant to Section 92 (3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management & Administration )
Rules, 2014]
i CIN U28993MH1932PLC001828
ii Registration Date 03-03-1932
iii Name of the Company GODREJ AND BOYCE MANUFACTURING COMPANY LIMITED
iv Category/Sub-category of the Company Company Limited by Shares/ Indian Non- Government Company
v Address of the Registered office and contact PIROJSHANAGAR, VIKHROLI, MUMBAI. Tel: 022 67961700/1800
details
vi Whether listed company (Yes/No) No
vii Name , Address & Contact details of NA
Registrar & Transfer Agent, if any.
Sl. No. Name and Description of main NIC Code of the % to total turnover
products/services Product /service of the company
1 Domestic electric appliances such as 27501, 28192 33.87%
refrigerators, washing machines and
airconditioners
2 Furniture 31003 21.64%
3 Reinforced safes, vaults, strongroom doors 25996 8.21%
and other security equipment.
TOTAL 76.08%
Sl. No. Name and Address of the Company CIN/GLN HOLDING/ % OF APPLICABLE
SUBSIDIARY/ SHARES HELD SECTION
ASSOCIATE
1 Godrej Infotech Ltd., U32100MH1997PLC106135 Subsidiary 52.06% 2(87)
Pirojshanagar, Vikhroli, Mumbai 400079
2 India Circus Retail Pvt. Ltd. U52600MH2011PTC223988 Subsidiary 51.95% 2(87)
Godrej Plant 13 Annex, 2nd Floor,
Pirojshanagar, Vikhroli - East, Mumbai-
400079
15 Godrej UEP (Singapore) Pte. Ltd. NA Assoicate of Godrej Singapore Pte. Ltd. Nil 2(6)
11, Lok Yang, Singapore 628632
38
IV. SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)
Category of Shareholders No. of Shares held at the beginning of the year No. of Shares held at the end of the year % Change
during the year
A. Promoters
(1) Indian
a) Individual/HUF 0 3,27,967 3,27,967 49.47 3,25,322 1,506 3,26,828 48.17 -1.30
b) Central Govt. 0 0 0 0 0 0 0 0 0
c) State Govt(s) 0 0 0 0 0 0 0 0 0
d) Bodies Corp. 0 1,77,432 1,77,432 26.77 0 1,77,432 1,77,432 26.15 -0.61
e) Banks/FI 0 0 0 0 0 0 0 0 0
f) Any other… 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0
Sub-total(A)(1): 0 5,05,399 5,05,399 76.24 3,25,322 1,78,938 5,04,260 74.33 -1.91
(2) Foreign
a) NRI - Individuals 0 0 0 0 16,677 0 16,677 2.46 2.46
b) Other - Individuals 0 0 0 0 0 0 0 0
c) Bodies Corp. 0 0 0 0 0 0 0 0
d) Banks/FI 0 0 0 0 0 0 0 0
e) Any other… 0 0 0 0 0 0 0 0
Total Shareholding of
Promoter
(A)= (A)(1)+(A)(2) 0 5,05,399 5,05,399 76.24 3,41,999 1,78,938 5,20,937 76.78 0.54
B. PUBLIC SHAREHOLDING
(1) Institutions
a) Mutual Funds 0 0 0 0 0 0 0 0 0
b) Banks/FI 0 0 0 0 0 0 0 0 0
C) Central Govt 0 0 0 0 0 0 0 0 0
d) State Govt(s) 0 0 0 0 0 0 0 0 0
e) Venture Capital Funds 0 0 0 0 0 0 0 0 0
f) Insurance Companies 0 0 0 0 0 0 0 0 0
g) FIIs 0 0 0 0 0 0 0 0 0
h) Foreign Venture
Capital Funds 0 0 0 0 0 0 0 0 0
i) Others (specify) 0 0 0 0 0 0 0 0 0
Sub-total(B)(1): 0 0 0 0 0 0 0 0 0
Grand Total (A+B+C) 0 6,62,910 6,62,910 100.00 3,41,999 3,36,449 6,78,448 100.00 0
39
(ii) SHARE HOLDING OF PROMOTERS (EQUITY SHARES)
Sl. No. Shareholder's Name Shareholding at the Shareholding at the
begginning of the year end of the year
No. of Shares % of total Shares % of shares No. of Shares % of total % of shares % change in
of the company pledged/ shares pledged/ share holding
encumbered to total of the company encumbered to during the year
shares total shares
1 Mrs. Tanya A. Dubash jointly held with 9,609 1.45% 0 9,609 1.42% 0 -0.03%
Mr. Adi B. Godrej
2 Mrs. Tanya A. Dubash 7 0.00% 0 1043 0.15% 0 0.15%
3 Ms. Nisaba A. Godrej jointly held with 9609 1.45% 0 9609 1.42% 0 -0.03%
Mr. Adi B. Godrej
4 Ms. Nisaba A. Godrej 7 0.00% 0 1043 0.15% 0 0.15%
5 Mr. Pirojsha A. Godrej jointly held with 9,616 1.45% 0 9,616 1.42% 0 -0.03%
Mr. Adi B. Godrej
6 Mr. Pirojsha A. Godrej 0 0.00% 0 1,037 0.15% 0 0.15%
7 Mr. Adi B. Godrej 32,240 4.86% 0 36,746 5.42% 0 0.55%
8 Mrs. Parmeshwar A. Godrej jointly held 4,506 0.68% 0 0 0.00% 0 -0.68%
with Mr. Adi B. Godrej
9 Mr. Nadir B. Godrej jointly held with 53 0.01% 0 53 0.01% 0 0.00%
Ms. Rati N. Godrej
10 Mr. Nadir B. Godrej 65,540 9.89% 0 67,140 9.90% 0 0.01%
11 Ms. Nyrika Holkar jointly held with Mrs. 15,114 2.28% 0 16,668 2.46% 0 0.18%
Smita G. Crishna
12 Ms. Freyan C. Bieri jointly held with 15,113 2.28% 0 16,667 2.46% 0 0.18%
Mrs. Smita G. Crishna
13 Ms. Freyan C. Bieri jointly held with 10 0.00% 0 10 0.00% 0 0.00%
Mrs. Smita G. Crishna/Mr. Vijay Crishna
Sl. No. Name Shareholding Date Increase (+)/ Reason Cumulative Shareholding during the year/
Decrease (-) end of the period
in Shareholding
No. of Shares at the % of total shares of No. of shares % of total shares of
beginning of the year the company the company
7 Ms. Nyrika Holkar jointly held 15,114 2.28% 01 April 2016 2.28%
with Mrs. Smita G. Crishna 26 August 2016 1,554 Issue and Alltoment of Shares on the 16,668 2.46%
Amalgamation of Cartini India Limited with the
Company vide Order of the Hon'ble High Court
of Judicature at Bombay dated 20th June, 2016
8 Ms. Freyan C. Bieri jointly held 15,113 2.28% 01 April 2016 2.28%
with Mrs. Smita G. Crishna 26 August 2016 1,554 Issue and Alltoment of Shares on the 16,667 2.46%
Amalgamation of Cartini India Limited with the
Company vide Order of the Hon'ble High Court
of Judicature at Bombay dated 20th June, 2016
41
10 Mr. Navroze J. Godrej jointly 0 0.00% 31 March 2016 0.00%
held with Mrs. Pheroza J. Godrej 26 August 2016 1,556 Issue and Alltoment of Shares on the 1,556 0.23%
Amalgamation of Cartini India Limited with the
Company vide Order of the Hon'ble High Court
of Judicature at Bombay dated 20th June, 2016
42
(iv) Shareholding Pattern of top ten Shareholders (other than Direcors, Promoters and Holders of GDRs & ADRs):
Sl. No. Shareholding at the beginning of Cumulative Shareholding during the year
the year
For Each of the Top 10 No.of shares % of total No of shares % of total shares of
Shareholders shares of the the company
company
* Out of which 17975 shares are held as a trustee of The Raika Godrej Family Trust for the beneficial interest of Ms. Raika J. Godrej
** Resigned as a Director of the Company with effect from 1st October, 2016
43
V INDEBTEDNESS
Rs. In Crores
Indebtedness of the Company including interest outstanding/accrued but not due for payment
Secured Loans Unsecured Deposits Total
excluding deposits Loans Indebtedness
Particulars of Remuneration
Name of MD/WTD/Manager
Sl. No. Total Amount in Rs.
Jamyshyd N. Phiroze D. Lam Kyamas A. Palia Vijay M. Crishna Navroze J. Godrej* Anil G. Verma In crores
1 Gross salary Godrej
(a) Salary as per provisions contained in section 17(1) of the 4.14 4.09 3.82 3.17 1.95 4.25 21.43
Income Tax, 1961
(b) Value of perquisites u/s 17(2) of the Income Tax Act, 1961 0.16 0.04 0.02 0.10 0.01 0.06 0.39
2 Stock Option
3 Sweat Equity
4 Commission
- as % of profit
- others, specify…
5 Others, please specify
Total (A) 4.30 4.13 3.84 3.27 1.96 4.30 21.81
Ceiling as per the Act 41.30
* Resigned as a Director of the Company with effect from 1st October, 2016
Particulars of Remuneration
Sl. No. Name of Directors Total Amount in
Anita Rs. In crore
Kavas N. Petigara Pradip P. Shah Keki M. Elavia
1 Independent Directors Ramachandran
(a) Fee for attending board/committee meetings 0.16 0.06 0.14 0.17 0.53
44
C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD
(b) Value of perquisites u/s 17(2) of the Income Tax Act, 1961 0.01 0.00 0.01
2 Stock Option
3 Sweat Equity
4 Commission
- as % of profit
- others, specify…
5 Others, please specify
A. COMPANY
Penalty
Punishment
Compounding NIL
B. DIRECTORS
Penalty
Punishment
Compounding NIL
C. OTHER OFFICERS IN DEFAULT
Penalty
Punishment
Compounding NIL
45
Godrej & Boyce Manufacturing Company Limited
ENCLOSURE 3
46
ENCLOSURE 3
[Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014]
Form for Disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in sub section (1) of
section 188 of the Companies Act, 2013 including certain arm’s length transaction under third proviso thereto.
Terminal Benefits
Company’s contribution to Provident Fund, Gratuity or any other Annuity Fund
in accordance with the Rules of the Company, in force from time to time
47
SL. Particulars Details
No.
a) Name (s) of the related party & nature of relationship Mrs. S G Crishna, spouse of Mr. V M Crishna, Whole-time Director and sister of
Mr. J N Godrej, Chairman and Managing Director
d) Salient terms of the contracts or arrangements or Re-designation and revision in remuneration payable with effect from 1st April,
transaction including the value, if any 2015 as Sr. Vice President (Welfare Co-ordination)as under:
Salary of Rs. 2 Lakh per month and Rs. 24 Lakh per annum
Terminal Benefits
Company’s contribution to Provident Fund, Gratuity or any other Annuity Fund
in accordance with the Rules of the Company, in force from time to time
48
SL. Particulars Details
No.
a) Name (s) of the related party & nature of relationship Ms. Nyrika Holkar, daughter of Mr. V M Crishna, Whole-time Director
Salary of Rs. 7.15 Lakh per month and Rs. 85.80 Lakh per annum
Performance Linked Variable Remuneration according to the Scheme of the
Company for each of the financial years, having regard to her performance for
each financial year
Leave Travel Concession for self and family once in a calender year amounting to
Rs. 39,000 per annum
Earned/ Privelege Leave, on full day and allowance, not exceeding 30 days in a
calender year.
Terminal Benefits
Company’s contribution to Provident Fund, Superannuation Fund, Gratuity or
any other Annuity Fund in accordance with the Rules of the Company, in force
from time to time
e) Justification for entering into such contracts or Rendering of professional services
arrangements or transactions’
f) Date of approval by the Board 23rd February, 2015
h) Date on which the special resolution was passed in 30th March, 2015
General meeting as required under first proviso to
section 188
49
2. Details of material contracts or arrangements or transactions at Arm’s length basis.
J. N. Godrej
Chairman and Managing Director
DIN: 00076250
50
Annual Report and Accounts 2016-17
We have audited the accompanying standalone Ind AS Financial Statements of GODREJ & BOYCE MANUFACTURING
COMPANY LIMITED (“the Company”), which comprises the Balance Sheet as at 31st March, 2017, and the Statement of
Profit and Loss (including other comprehensive income), the Statement of Cash Flows and the Statement of Changes in
Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
Auditor's Responsibility
Our responsibility is to express an opinion on these standalone Ind AS Financial Statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are
required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit of the standalone Ind AS Financial Statements in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan
and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the
standalone Ind AS Financial Statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the standalone Ind AS Financial Statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s
preparation of the Ind AS Financial Statements that give a true and fair view in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall
presentation of the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion
on the standalone Ind AS Financial Statements.
Emphasis of Matter
We draw attention to the following matters in the Notes to the financial statements:
a. Refer note 37(b)(i) whereby the Company has transferred 193,904,681 equity shares of face value of Re. 1/- each in
Godrej Industries Limited to Vora Soaps Limited without consideration. The transfer has been authorized by
majority of the Board of Directors and by the shareholders of the Company. The carrying amount of the investments
in the books of the Company was Rs. 257.77 crore. Had the investment been not transferred the profit for the year
would have been higher by 168.56 Crore and retained earnings would have been higher by the same amount.
51
Godrej & Boyce Mfg. Co. Ltd.
b. Refer note 37(b)(ii) whereby the Company has transferred 93,500,000 equity shares of face value of Re. 1/- each in
Godrej Consumer Products Limited to Godrej Seed and Genetics Limited without consideration. The transfer has
been authorized by majority of the Board of Directors and by the shareholders of the Company. The carrying
amount of the investments in the books of the Company was Rs. 223.48 Crore. Had the investment been not
transferred the profit for the year would have been higher by 146.14 Crore and retained earnings would have been
higher by the same amount.
c. Refer note 1(G)(iv) whereby non-current investments in subsidiaries, Associates and Joint Ventures are stated at
cost (unless otherwise stated) as per Ind AS 27; however, for any diminution other than temporary in the value of
investments, the book value is reduced to recognise the decline. In cases where these investments are carried at
their book values, which are higher than their fair values, the diminution in the value of such investments is
considered to be of a temporary nature, in view of the Company's long-term financial involvement in such investee
companies. No provision is, therefore, considered necessary in the accounts for diminution in the value of such
investments.
d. Refer Note 50(i) to the standalone Ind AS financial statements, during the year pursuant to the scheme of
Amalgamation approved by the Bombay High Court, Cartini India Ltd. was amalgamated with the Company and was
accounted for in the books of account according to the pooling of interest method under Accounting Standard (AS)
14. The scheme of amalgamation under Indian Accounting Standard (Ind AS) 103 is to be accounted for in the books
of account at acquisition date fair values. Had the business combination principles been applied and all the
identified assets acquired and the liabilities assumed were measured at their acquisition date fair values and the
consideration transferred measured in accordance with this Ind AS which generally requires acquisition date fair
value, the Capital Reserve amounting to Rs. 18.78 Crore would have been recorded in the books.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone
Ind AS Financial Statements give the information required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs
(financial position) of the Company as at March 31, 2017, and its profit (financial performance including other
comprehensive income), its cash flows and the changes in equity for the year ended on that date.
1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government of
India in terms of sub-section (11) of section 143 of the Act, we give in the “Annexure A”,a statement on the matters
specified in the paragraph 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and
belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears
from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement
of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books
of account.
d) In our opinion, the aforesaid standalone Ind AS Financial Statements comply with the Indian
Accounting Standards prescribed under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March 31, 2017, and taken
on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being
appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the
operating effectiveness of such controls, refer to our separate report in “Annexure B”; and
52
Annual Report and Accounts 2016-17
g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the
Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone
Ind AS financial statements – Refer Note 27 (e) to (h).
ii. The Company has made provision, as required under the applicable law or accounting standard,for
material foreseeable losses, if any, on long term contracts including derivative contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education
Protection Fund by the Company.
iv. The Company has provided requisite disclosures in the financial statements as to holdings as well as
dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016.
However, we are unable to obtain sufficient and appropriate audit evidence to report on whether the
disclosures are in accordance with books of account maintained by the Company and as produced to us
by the Management – Refer Note 44 to the standalone Ind AS financial statements.
ERMIN K. IRANI
PARTNER
Membership Number: 35646
Mumbai, November 6, 2017.
53
Godrej & Boyce Mfg. Co. Ltd.
Statement on Matters specified in paragraphs 3 & 4 of the Companies (Auditor’s Report) Order, 2016:
i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of
fixed assets, other than furniture, fixture and equipment. In case of furniture, fixture and equipment acquired/
purchased after April 1, 1978, the records are maintained showing aggregate quantitative details with their situation
and value, without item-wise break-up.
(b) As explained to us, the fixed assets (other than furniture, fixture and office equipment) have been physically verified
by the Management in accordance with a phased programme of verification, which in our opinion, is reasonable,
considering the size of the Company and the nature of its business. The discrepancies reported on such verification
were not material and have been properly dealt with in the books of account.
(c) According to the information and explanation given to us, the records examined by us and based on the
examination of the registered sale deed / conveyance deed / court order approving scheme of amalgamation
provided to us, we report that, the title deeds of immovable properties are held in the name of the Company except
for the cases tabulated below:
Particulars Gross Block Net Block (Rs. Remarks
(Rs. in Crore) in Crore)
Freehold Land 28.37 28.37 Land pertaining to three subsidiaries amalgamated with the
Company during the year 2015-16, Land pertaining to Busbar
Systems India Ltd. which was amalgamated w.e.f. April 1, 2016
and certain Lands at Khalapur are not in the name of the
Company.
In case of immovable properties of land and buildings that have been taken on lease, the lease agreements are in
the name of the Company except leasehold land pertaining to Cartini India Ltd., an entity amalgamated with the
Company w.e.f. 1st April, 2016 for which the leasehold agreements are in the process of being registered in the
name of the Company.
ii. The Management has conducted physical verification of inventory at reasonable intervals.The discrepancies noticed
on physical verification of inventory as compared to book records were not material in relation to the operations of
the Company and the same have been properly dealt with in the books of account.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or
other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of sub-
clause (a), (b) and (c) of paragraph 3(iii) of the Order are not applicable.
iv. In our opinion and according to the information and explanations given to us and the records examined by us,the
Company has complied with the provisions of Section 185 and 186 in respect of investments made, guarantees and
securities provided to the parties. However, the Company has not advanced any loan to parties covered under
Section 185 and 186.
v. In our opinion, and according to the information and explanations given to us, the Company has complied with the
directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant
provisions of the Act and the rules framed thereunder, with regard to deposits accepted from the public.
vi. We have broadly reviewed the books of account maintained by the Company in respect of manufacture of products
where, pursuant to the Rules made by the Central Government of India for the maintenance of cost records under
sub-section (1) of Section 148 of the Act, and are of the opinion that, prima facie, the prescribed accounts and
records have generally been made and maintained. We have not, however, made a detailed examination of the
records with a view to determine whether they are accurate or complete.
54
Annual Report and Accounts 2016-17
vii.(a) According to the information and explanations given to us and the records examined by us, the Company is
generally regular in depositing undisputed statutory dues including Provident Fund, Employees’ State Insurance,
Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other material
statutory dues with the appropriate authorities. According to the information and explanations given to us, there
are no arrears of outstanding statutory dues in respect of above as on the last day of the financial year for a period
of more than six months from the date they became payable.
(b) According to the information and explanation given to us and the records examined by us, there are no material
dues of Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise and Value added tax outstanding on
account of any dispute, except:
Nature of the Statute Nature of Dues Amount Period to which the Forum where the dispute is pending
(Rs. in crore) amount relates
viii. According to the information and explanations given to us and based on the examination of the records the
Company has not defaulted in repayment of loans or borrowings to financial institutions, banks, government or
dues to debenture holders.
ix The Company did not raise any money by way of initial public offer or further public offer (including debt
instrument). In our opinion and according to the information and explanations given to us and based on the
documents and records examined by us on an overall basis, the term loans obtained by the Company were applied
for the purpose for which the loans were obtained.
x During the course of our examination of the books of account and records of the Company, carried out in
accordance with the generally accepted auditing practices in India, and according to the information and
explanation given and representations made by the Management, no major fraud on or by the Company, has been
noticed or reported during the year, except for the fraud / irregularities observed by the Company by employees in
a line of business for the contracts pertaining to Systems Integration & Turnkey Automation Projects in collusion
with third parties, resulting in losses to the Company amounting to Rs. 19 Crore, for which management has taken
appropriate remedial measures.
xi According to the information and explanations given to us and based on our examination of the records of the
Company, the Company has paid/ provided for managerial remuneration in accordance with the requisite approvals
mandated by the provisions of Section 197 read with Schedule V to the Act.
xii In our opinion and according to the information and explanation given to us, the Company is not a Nidhi Company.
Accordingly, provisions of paragraph 3(xii) of the Order are not applicable.
xiii According to the information and explanation given to us and based on our examination of the records of the
Company, transactions with related parties are in compliance with Section 177 and 188 of the Act, where applicable,
and details of such transactions have been disclosed in the Financial Statements as required by the applicable
accounting standards.
xiv According to the information and explanation given to us and based on our examination of the records of the
Company, the Company has not made any preferential allotment or private placement of shares or fully or partly
convertible debentures during the year.
xv According to the information and explanation given to us and based on our examination of the records of the
Company, the Company has not entered into any non-cash transactions with the directors or persons connected
with him. Hence the provisions of Section 192 of the Act are not applicable.
55
Godrej & Boyce Mfg. Co. Ltd.
xvi The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934 hence the
provisions of paragraph 3 (xvi) of the Order are not applicable.
ERMIN K. IRANI
PARTNER
Membership Number: 35646
Mumbai, November 6, 2017.
Referred to in Para 2 (f) ‘Report on Other Legal and Regulatory Requirements’ in our Independent Auditor’s Report to the
members of the Company on the standalone Ind AS financial statements for the year ended 31st March, 2017.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
(“the Act”)
We have audited the internal financial controls over financial reporting of GODREJ & BOYCE MANUFACTURING COMPANY
LIMITED (“the Company”) as of 31st March, 2017 in conjunction with our audit of the standalone Ind AS financial
statements of the Company for the year ended on that date.
Auditors’ Responsibility
Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on
our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI
and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial
controls, both applicable to an audit of Internal Financial Controls and, both issued by the ICAI. Those Standards and the
Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance about whether adequate internal financial controls over financial reporting was established and maintained and
if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls
system over financial reporting and their operating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial
controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the
auditor’s judgment, including the assessment of the risks of material misstatement of the standalone financial statements,
whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion
on the Company’s internal financial controls system over financial reporting.
56
Annual Report and Accounts 2016-17
Opinion
In our opinion the Company has maintained, in all respects, adequate internal financial controls system over financial
reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017,
based on the internal control over financial reporting criteria established by the Company considering the essential
components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial
Reporting issued by the Institute of Chartered Accountants of India.
ERMIN K. IRANI
PARTNER
Membership Number: 35646
Mumbai, November 6, 2017.
57
Godrej & Boyce Mfg. Co. Ltd.
58
Annual Report and Accounts 2016-17
III. EXPENSES
(1) Cost of Materials consumed 30 3,501.47 3,323.07
(2) Excise duty 674.59 633.11
(3) Purchases of Stock-in-Trade 31 2,182.55 1,963.75
(4) Changes in Inventories of Finished Goods, Work-in-Process
and Stock-in-Trade 32 (132.31) (2.85)
(5) Property Development and Construction Expenses 34 54.98 22.20
(6) Employee Benefits Expense 33 1,112.66 1,038.12
(7) Finance Costs 35 175.84 177.18
(8) Depreciation and Amortization Expense 2 178.62 157.64
(9) Other Expenses 36 1,924.40 1,859.42
(10) Less: Expenditure transferred to Capital Accounts (55.16) (41.40)
TOTAL EXPENSES 9,617.64 9,130.24
59
Godrej & Boyce Mfg. Co. Ltd.
First Interim Equity Dividend declared and paid during the year - - - - - (46.40) - (46.40)
Second Interim Equity Dividend declared and paid during the year - - - - - (165.73) - (165.73)
Dividend Distribution Tax (DDT) on Interim Dividend - - - - - (29.71) - (29.71)
Adjustment pursuant to business combination [Note 17(a)(iii))] (6.37) - - (1.46) - (19.28) - (27.11)
Final Equity Dividend for the year 2014-15 paid in 2015-16 - - - - - (106.07) - (106.07)
Dividend Distribution Tax (DDT) on Final Equity Dividend - - - - - (21.21) - (21.21)
-
Balance as at 31/03/2016 68.03 20.08 (23.36) 636.43 - 2,788.76 (6.09) 3,483.85
Adjustment pursuant to business combination [Note 17(a)(iii))] 4.67 - 3.60 9.42 - (107.38) 164.16 74.47
Profit / (Loss) after tax for the year - - - - - 25.17 - 25.17
Transfer to Debenture Redemption Reserve - - - - 20.83 (20.83) - -
Transfer from Investment Subsidy Reserve - - - - - 0.69 - 0.69
Interim Equity Dividend declared and paid during the year - - - - - (47.49) - (47.49)
Dividend Distribution Tax (DDT) on Interim Dividend - - - - - (9.62) - (9.62)
Remeasurement of defined employee benefit plans - - - - - - (6.51) (6.51)
Fair valuation of investments in equity instruments - - - - - - 4,232.80 4,232.80
Deferred tax credit on items of OCI - - - - - - 2.00 2.00
Total comprehensive income for the year 2016-17 4.67 - 3.60 9.42 20.83 (159.46) 4,392.45 4,271.51
Balance as at 31/03/2017 17 72.70 20.08 (19.76) 645.85 20.83 2,629.30 4,386.36 7,755.36
As per our Report of even date For and on behalf of the Board of Directors
For KALYANIWALLA & MISTRY LLP
CHARTERED ACCOUNTANTS
Firm Registration Number 104607W / W100166
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Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
A. CASH FLOWS FROM OPERATING ACTIVITIES
PROFIT BEFORE TAX 132.15 406.08
ADJUSTMENTS TO RECONCILE PROFIT BEFORE TAX TO NET CASH USED IN:
Depreciation and Amortization Expense 178.62 157.64
Provisions for Doubtful Debts/Advances/Deposits 20.88 14.48
Profit on Sale of Investments (Net): Non-current (114.73) (77.48)
Profit on Sale/Assignment of Fixed Assets (Net): Other Fixed Assets 1.39 (0.38)
Unrealized Foreign Currency (Gain)/Loss (21.37) (1.67)
Interest Income (9.10) (17.55)
Dividend Income (68.49) (144.11)
Finance Costs 175.84 177.18
Fair Valuation of Investments 154.76
Transfer of investments in subsidiaries to group companies - -
Reclassification of acturial loss to Other Comprehensive Income (6.51) (4.94)
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 443.44 509.25
MOVEMENT IN CURRENT ASSETS AND LIABILITIES:
Inventories (267.68) (103.32)
Trade and other Receivables (312.53) (66.88)
Trade and other Payables 597.62 119.22
CASH GENERATED FROM/(USED IN) OPERATIONS 460.85 458.27
Direct Taxes paid (44.42) (40.30)
NET CASH FROM/(USED IN) OPERATING ACTIVITIES 416.43 417.97
B. CASH FLOWS FROM INVESTING ACTIVITIES
Fixed Assets acquired (Net) (636.46) (440.03)
(Purchase)/Sale of Investment in Subsidiaries and Associates 582.23 (97.44)
Net increase in bank deposits (having original maturities of more than 3 months) (17.95) (11.27)
Proceeds (residual bank balance) received from a wholly-owned subsidiary on its liquidation 0.82 -
Interest Income 9.10 16.16
Dividend Income 68.49 144.11
NET CASH FROM/(USED IN) INVESTING ACTIVITIES 6.23 (388.47)
C. CASH FLOWS FROM FINANCING ACTIVITIES
Net increase/(decrease) in short-term Bank Borrowings 57.87 (199.36)
Other Borrowings: Fresh Loans and Deposits taken 2,023.26 1,589.86
Loans and Deposits repaid (2,271.69) (1,363.14)
Issue of Debentures - 497.91
Interest paid (177.77) (177.45)
Dividend paid, including Dividend Distribution Tax (47.49) (369.12)
NET CASH FROM/(USED) IN FINANCING ACTIVITIES (415.82) (21.30)
Cash and Cash Equivalents at the beginning of the year 20.36 12.16
Cash and Cash Equivalents at the end of the year 27.20 20.36
Add: Other Bank Balances (not considered as cash and cash equivalents):
Fixed Deposits with Banks 57.00 42.00
Other Earmarked Accounts 22.71 19.76
CLOSING CASH AND BANK BALANCES (NOTE 12) 106.91 82.12
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Godrej & Boyce Mfg. Co. Ltd.
NOTES:
1. The Statement of Cash Flow has been prepared under the "Indirect Method" as set out in the Indian Accounting Standard (Ind AS-7) on
"Statement of Cash Flows," and presents cash flows by operating, investing and financing activities.
2. Figures for the previous year have been regrouped/restated wherever necessary to conform to this year's classification.
3. Figures in brackets are outflows/deductions.
4. Cash and cash equivalents for the purposes of this Statement comprise of cash in hand, cash at bank and fixed deposits with
maturity of three months or less.
5. For expenditure on CSR activities, please refer to Note 41.
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Annual Report and Accounts 2016-17
A. General Information
Godrej & Boyce Manufacturing Company Limited (the Company) incorporated on 3rd March, 1932 is a major company of the
Godrej Group. The Company has diverse business divisions offering a wide range of consumer, office, and industrial products and
related services of the highest quality to customers in India and abroad. The Company is domiciled in India and its registered office
is at, Pirojshanagar, Vikhroli, Mumbai 400 079.
B. Basis of accounting
These financial statements as at, and for the year ended, 31st March, 2017 have been prepared in accordance with Indian
Accounting standards (“Ind AS”) issued under the Companies (Indian Accounting Standards) Rules, 2015 as amended by
Companies (Indian Accounting Standards) (Amendment) Rules, 2016.
For all periods up to and including the year ended 31st March, 2016, the Company prepared its financial statements in accordance
with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the
Companies (Accounts) Rules, 2014 (Indian GAAP). These financial statements are the Company’s first Ind AS financial statements
and are covered by Ind AS 101, First-time adoption of Indian Accounting Standards. The transition to Ind AS has been carried out
from the accounting principles generally accepted in India (“Indian GAAP”) which is considered as the “Previous GAAP” for
purposes of Ind AS 101. An explanation of how the transition to Ind AS has affected the Company’s equity and its net profit is
provided in Note 46.
The accounts have been prepared on accrual and going concern basis.
The financial statements of the Company for the year ended 31st March, 2017 were approved for issue in accordance with
the Resolution passed by the Board of Directors at their meeting held on 6th November, 2017
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Godrej & Boyce Mfg. Co. Ltd.
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Annual Report and Accounts 2016-17
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Godrej & Boyce Mfg. Co. Ltd.
rates specified in Schedule II to the Act; these rates are considered as the minimum rates. If management's estimate
of the useful life of the fixed asset is shorter than that envisaged in Schedule II, depreciation is provided at a
higher rate based on management’s estimate of the useful life. Accordingly, in respect of the commercial
construction projects, on some items of equipment at the project sites, depreciation is provided at a higher rate
based on useful life of the assets estimated at 5 years, compared to 15 years specified in Schedule II.
Moreover, in respect of special-purpose machinery used in the contract-manufacturing of precision components and
systems, depreciation is charged over the period of such manufacturing contracts. In respect of
additions to/deductions from the assets, the depreciation on such assets is calculated on a pro rata basis
from/upto the month of such addition/deduction. Assets costing less than Rs. 5,000 are fully depreciated in the
year of purchase/acquisition. Leasehold Land and Buildings are amortised over the period of the lease. The cost
of fixed assets not ready for their intended use at the balance sheet date is disclosed under capital work-in-progress.
Intangible assets comprising of Technical Know-how and Trade Marks are amortised on straight-line basis at
the rate of 16.67%; capitalised Computer Software costs relating to the ERP system, are amortised on straight
line basis at the rate of 20%.
ii. Investment properties
a. The Company has elected to continue with the carrying value for all of its investment property as recognised in its Indian
GAAP financial statements as deemed cost at the transition date, viz., 1st April, 2015.
b. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition,
investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.
c. The cost includes the cost of replacing parts and borrowing costs for long-term construction projects if the recognition
criteria are met. When significant parts of the investment property are required to be replaced at intervals, the Company
depreciates them separately based on their specific useful lives. All other repair and maintenance costs are recognized in
profit or loss as incurred.
d. The Company follows the straight line method for charging depreciation on investment property over estimated useful
lives prescribed in Schedule II to the Companies Act, 2013.
e. Though the Company measures investment property using cost based measurement, the fair value of investment property
is disclosed in the notes.
f. Investment properties are derecognised either when they have been disposed of or when they are permanently withdrawn
from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds
and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.
iii. Intangible assets and goodwill
a. Recognition and measurement
Intangible assets, including patents and trademarks, which are acquired by the Company and have finite useful lives are
measured at cost less accumulated amortisation and any accumulated impairment losses.
b. Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to
which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in
profit or loss as incurred.
c. Amortisation
Intangible assets are amortised over their estimated useful life on straight line method.
iv. Investment in Subsidiaries, Joint Ventures and Associates
Non-current investments in subsidiaries, associates and joint ventures are stated at cost (unless otherwise stated);
however, for any diminution other than temporary in the value of investments, the book value is reduced
to recognise the decline. In cases where these investments are carried at their book values, which are higher than
their fair values, the diminution in the value of such investments is considered to be of a temporary nature, in view
of the Company's long-term financial involvement in such investee companies.
v. Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument of another entity.
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Annual Report and Accounts 2016-17
a. Financial assets
(i) Classification:
The Company shall classify financial assets as subsequently measured at amortised cost, fair value through other
comprehensive income or fair value through profit or loss on the basis of its business model for managing the
financial assets and the contractual cash flow characteristics of the financial asset.
(ii) Initial recognition and measurement:
Equity investments
(a) All equity investments in scope of Ind-AS 109 are measured at fair value. Equity instruments which are held for
trading are classified as at FVTPL. For all other equity instruments, the Company classifies the same at FVOCI. The
classification is made on initial recognition and is irrevocable.
(b) All fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of
the amounts from OCI to profit and loss, even on sale of investment. However, the Company may transfer the
cumulative gain or loss within equity.
(c) Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in
the profit and loss.
b. Financial liabilities
(i) Classification
The Company classifies all financial liabilities as subsequently measured at amortised cost, except for financial
liabilities at fair value through profit or loss. Such liabilities, shall be subsequently measured at fair value.
(ii) Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans
and borrowings, payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net
of directly attributable and incremental transaction cost.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are
an integral part of the Effective Interest Rate (EIR). The EIR amortisation is included as finance costs in the statement
of profit and loss.
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts,
financial guarantee contracts and derivative financial instruments.
(iii) Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified, such an exchange or modification is treated as the
derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying
amounts is recognised in the statement of profit or loss.
(c) Derivative financial instruments
The Company uses derivative financial instruments, such as forward currency contracts to hedge its foreign currency
risks . Such derivative financial instruments are initially recognised at fair value on the date on which a derivative
contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets
when the fair value is positive and as financial liabilities when the fair value is negative.
vi. Inventories
Trade Inventories:
Raw Materials, Loose Tools, Stores, Spares, etc. are valued at lower of weighted average cost and estimated net
realisable value.
Work-in-Process (other than Construction Projects) is valued at lower of estimated cost (consisting of direct
material and direct labour costs plus appropriate factory overheads) and estimated net realisable value.
Finished Goods are valued at lower of average cost and estimated net realisable value; cost includes purchase,
conversion, appropriate factory overheads, any taxes or duties and other costs incurred for bringing the
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Godrej & Boyce Mfg. Co. Ltd.
inventories to their present location and condition. Spares and Components for after-sales service are valued at
lower of average cost and estimated net realisable value.
Obsolete and damaged inventories, and other anticipated losses are adequately provided for, wherever considered
necessary.
Construction Projects:
In respect of the commercial construction projects promoted / developed on the company’s land, construction work-in-
progress is valued at estimated cost consisting of the cost of land (forming part of the project), development, construction
and other related costs.
vii. Cash and cash equivalents
Cash and cash equivalent in the balance sheet comprise cash on hand, bank balances and short-term deposits with an
original maturity of three months or less, which are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined
above.
viii. Borrowing costs
Borrowing costs that are directly attributable to the acquisition or construction of an asset that necessarily takes a
substantial period of time to get ready for its intended use are capitalised as part of the cost of that asset till the date it is
ready for its intended use or sale. Other borrowing costs are recognised as an expense in the period in which they are
incurred.
ix. Provisions and Contingent Liabilities and Contingent Assets
A provision is recognised only when there is a present obligation as a result of a past event that probably requires
an outflow of resources to settle the obligation and in respect of which a reliable estimate can be made. Provision is
not discounted to its present value and is determined based on the best estimate required to settle the obligation at
the balance sheet date. A disclosure for a contingent liability is made when there is a possible obligation or a
present obligation that may, but probably will not, require an outflow of resources. When there is a possible
obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or
disclosure is made.
Provisions and Contingent Liabilities and Contingent Assets are reviewed at each balance sheet date. Contingent
Assets and related income are recognised when it becomes reasonably certain that inflow of economic benefit will arise.
A provision for onerous contracts is measured at the present value of the lower of the expected cost of terminating the
contract and the expected net cost of continuing with the contract. Before a provision is established, the Company
recognises any impairment loss on the assets associated with that contract.
x. Revenue Recognition
(a) Sale of goods
The Company recognizes revenues on the sale of products, net of discounts, sales incentives and rebates granted.
Sales are recognised when significant risks and rewards of ownership in the goods are transferred to the buyer.
Revenues are recognized when collectability of the resulting receivable is reasonably assured.
Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of
returns and allowances, trade discounts and volume rebates.
(b) Lease Rentals:
The group has determined that the payments to the lessor are structured to increase in line with expected general
inflation to compensate for the lessor’s expected inflationary cost increases. Accordingly rental income arising from
operating leases on investment properties is accounted for on an accrual basis as per the terms of the lease contract
and is included in revenue in the statement of profit or loss due to its operating nature.
(c) Revenue from construction contracts for industrial products / equipment.
Industrial products/equipment are constructed based on specifically negotiated contracts with customers. Contract
revenue includes the initial amount agreed in the contract plus any variations in contract work, claims and incentive
payments, to the extent that it is probable that they will result in revenue and can be measured reliably.
If the outcome of a construction contract can be estimated reliably, then contract revenue is recognised in profit or
loss in proportion to the stage of completion of the contract. The stage of completion is based on percentage of
actual cost incurred up to the reporting date to the total estimated cost of the contract. Otherwise, contract revenue
is recognised only to the extent of contract costs incurred that are likely to be recoverable.
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Annual Report and Accounts 2016-17
Contract expenses are recognised as incurred unless they create an asset related to future contract activity. An
expected loss on a contract is recognised immediately in profit or loss.
(d) Revenue from rendering of services
Revenue from service transactions is recognised as per agreements/arrangements with the customer when the
related services are rendered/provided. If the services under a single arrangement are rendered in different
reporting periods, then the consideration is allocated on a relative fair value basis.
(e) Sale from multiple element arrangement
Sales of goods and services sometimes involve the provision of multiple elements. In these cases, the Company
determines whether the contract or arrangement contains more than one unit of accounting. If certain criteria are
met, foremost if the delivered element(s) has (have) value to the customer on a stand-alone basis, the arrangement
is separated and the appropriate revenue recognition convention is then applied to each separate unit of accounting.
Generally, the total arrangement consideration is allocated to the separate units of accounting based on their relative
fair values. If the criteria for the separation of units of accounting are not met, revenue is deferred until such criteria
are met or until the period in which the last undelivered element is delivered.
(f) Revenue from Real Estate Transaction:
i. The “Percentage of Completion Method” of accounting is followed where revenue from sale of properties is
recognized in Statement of Profit & Loss in proportion to the actual cost incurred as against the total estimated cost
of projects under execution with the Company on transfer of significant risk and rewards to the buyer. Up to March
31, 2012 revenue was recognised only if the actual project cost incurred is 20% or more of the total estimated project
cost.
ii. Effective April 1, 2012, in accordance with the “Guidance Note on Accounting for Real Estate Transactions (Revised
2012)” (Guidance Note), all projects commencing on or after the said date or projects which have already
commenced, but where the revenue is recognised for the first time on or after the above date, Construction revenue
on such projects have been recognised on percentage of completion method provided the following thresholds have
been met: (a) All critical approvals necessary for the commencement have been obtained; (b) The expenditure
incurred on construction and development costs is not less than 25 percent of the total estimated construction and
development costs; (c) At least 25 percent of the saleable project area is secured by contracts or agreements with
buyers; and (d) At least 10 percent of the agreement value is realized at the reporting date in respect of such
contracts and it is reasonable to expect that the parties to such contracts will comply with the payment terms as
defined in the contracts.
iii. Effective April 1, 2016, construction revenue for all projects commencing on or after the said date or projects
which have already commenced, but where the revenue is recognised for the first time on or after the above date,
have been recognised in accordance with the “Guidance Note on Accounting for Real Estate Transactions (for entities
to whom Ind AS is applicable)”. Principle enunciated in said guidance note is substantially similar to the guidance
note on accounting for real estate transaction issued by the Institute of Chartered Accountants of India (ICAI) in 2012.
iv. Income from operation of commercial complexes is recognised over the tenure of the lease / service agreement.
(g) Loyalty programme
Sales is allocated between the loyalty programme and the other components of the transaction. The amount
allocated to the loyalty programme is deferred, and is recognised as revenue when the Company has fulfilled its
obligations to supply the discounted products under the terms of the programme or when it is no longer probable
that the points under the programme will be redeemed.
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Godrej & Boyce Mfg. Co. Ltd.
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Annual Report and Accounts 2016-17
a. Current tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any
adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates enacted or
substantively enacted at the reporting date. Current tax also includes any tax arising from dividends.
Current tax assets and liabilities are offset only if, the Company:
(i) has a legally enforceable right to set off the recognised amounts; and
(ii) intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
b. Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:
(i) temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss;
(ii) temporary differences related to investments in subsidiaries and associates to the extent that the Group is able to
control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the
foreseeable future; and
(iii) taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to
the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax
assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised; such reductions are reversed when the probability of future taxable profits
improves.
Unrecognized deferred tax assets are reassessed at each reporting date and recognised to the extent that it has
become probable that future taxable profits will be available against which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they
reverse, using tax rates enacted or substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the
Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset only if:
a) the entity has a legally enforceable right to set off current tax assets against current tax liabilities; and
b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on
the same taxable entity.
Deferred tax asset / liabilities in respect of on temporary differences which originate and reverse during the tax holiday
period are not recognised. Deferred tax assets / liabilities in respect of temporary differences that originate during the tax
holiday period but reverse after the tax holiday period are recognised. Deferred tax assets on unabsorbed tax losses and tax
depreciation are recognised only to the extent that there is virtual certainty supported by convincing evidence of their
realisation and on other items when there is reasonable certainty of realisation. The tax effect is calculated on the
accumulated timing differences at the year-end based on the tax rates and laws enacted or substantially enacted on the
balance sheet date.
Minimum Alternate Tax (MAT) Credit Entitlement is recognised as an asset only when and to the extent there is
convincing evidence that the Company will pay normal income tax during the specified period in which such credit
can be carried forward for set-off. The carrying amount of MAT Credit Entitlement is reviewed at each balance sheet date.
xv. Leases (where the Company is the lessor)
In its Estate Leasing operations, the assets subject to operating leases are included in investment property. Lease
income is recognised in the Statement of Profit and Loss on a straight-line basis over the lease term. Costs, including
depreciation, are recognized as an expense in the Statement of Profit and Loss. Initial direct costs such as legal costs,
brokerage costs, etc. are recognised immediately in the Statement of Profit and Loss.
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Godrej & Boyce Mfg. Co. Ltd.
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Annual Report and Accounts 2016-17
COST OF ASSETS
Gross Block as at 1/4/2016 285.95 46.46 447.80 15.48 721.50 47.94 13.99 48.38 1,627.51
Adjustment pursuant to the Scheme of
Amalgamation of Cartini India Ltd. with - 1.18 32.65 - 39.11 1.07 - 0.50 74.51
the Company
Capital Work-in-Progress as at
- - 241.49 - 79.28 2.40 - 3.08 326.25
1/4/2016
Adjustment pursuant to the Scheme of
Amalgamation of Cartini India Ltd. with - - 3.88 - 0.66 - - - 4.55
the Company
Capital Expenditure during the year 14.75 41.85 315.43 2.40 166.61 7.33 0.12 13.85 562.33
Capital Work-in-Progress as at
- - (329.82) - (72.39) (2.17) (0.02) (6.69) (411.09)
31/3/2017
Additions 14.75 41.85 230.98 2.40 174.16 7.56 0.10 10.24 482.04
Deductions - - (4.54) - (4.44) (0.26) (0.08) (0.66) (9.98)
Gross Block as at 31/3/2017 300.70 89.49 706.89 17.88 930.33 56.31 14.01 58.46 2,174.08
DEPRECIATION
Total Depreciation upto 31/3/2016 - 0.58 12.77 1.86 110.69 8.50 1.00 10.80 146.19
Depreciation for the year - 0.90 18.47 2.25 125.16 9.00 1.00 11.98 168.76
Depreciation on Deductions - - 0.19 - (2.06) (0.10) (0.07) (0.28) (2.32)
Total Depreciation upto 31/3/2017 - 1.48 31.43 4.11 233.78 17.40 1.93 22.50 312.63
COST OF ASSETS
Gross Block as at 1/4/2016 - 6.60 0.96 0.13 7.69
Additions - 0.08 - - 0.08
Deductions - - - - -
Gross Block as at 31/3/2017 - 6.68 0.96 0.13 7.77
AMORTIZATION
Total upto 31/3/2016 - 2.12 0.43 0.04 2.59
Charge for the year - 2.31 0.43 0.04 2.78
Deductions - - - - -
Total Amortization upto 31/3/2017 - 4.43 0.86 0.08 5.37
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Godrej & Boyce Mfg. Co. Ltd.
ACCUMULATED DEPRECIATION
ACCUMULATED DEPRECIATION/AMORTIZATION
Charge for the year 2.12 0.43 0.04 2.59
Deductions - - - -
Total Depreciation /Amortization upto 31/3/2016 2.12 0.43 0.04 2.59
Note: The Company has availed the deemed cost exemption in relation to the property, plant and equipment on the date of transition
and hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer notes
below for the gross block value and the accumulated depreciation on April 1, 2015 under the previous GAAP.
Freehold Leasehold Freehold Leasehold Plant & Furniture & Vehicles/ Office
Land Land Buildings Buildings Equipment Fixtures Vessels Equipment
Particulars Total
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Annual Report and Accounts 2016-17
ACCUMULATED DEPRECIATION
Total Depreciation upto 1/4/2015 -
Depreciation for the year 8.39
Depreciation on Deductions -
Total Depreciation upto 31/3/2016 8.39
Depreciation for the year 7.08
Depreciation on Deductions (0.58)
Total Depreciation upto 31/3/2017 14.89
Note: The Company has availed the deemed cost exemption in relation to the investment property on the date of transition and
hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer notes above for
the gross block value and the accumulated depreciation on April 1, 2015 under the previous GAAP.
(Rupees in crore)
2016-17 2015-16
Rental Income derived from investment properties 217.09 238.84
Direct operating expenses (including repairs and maintenance)
generating rental income 43.41 44.80
Profit arising from investment properties 173.68 194.04
As at 31 March 2017 and 31 March 2016, the fair values of the properties are Rs. 2,126 crore and Rs. 1,964 crore respectively.
These valuations are based on discounted cash flow method
Reconciliation of fair value: (Rupees in crore)
Opening balance as at 01/04/2015 1,882.00
Fair value differences 82.00
Purchases -
Opening balance as at 31/03/2016 1,964.00
Fair value differences 162.00
Purchases -
Closing balance as at 31/03/2017 2,126.00
The Company has applied the method of Discounted Cash Flow projections based on reliable estimates of future cash flows.
Description of valuation technique and key inputs to valuation on investment properties:
Valuation Significant unobservable inputs Range (weighted average)
Discounted Cash Flow Rent growth p.a. 5%
Long term vacancy 0%
Discount rate 15%
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Godrej & Boyce Mfg. Co. Ltd.
Notes:
(a) In respect of the Company’s freehold land situated at Thane (transferred on Amalgamation of the erstwhile
Lawkim Ltd. with the Company):
(i) Land admeasuring approximately one acre was the subject matter of dispute. The Company has filed an appeal in
the Hon'ble High Court of Judicature at Bombay, against the Order dated 23rd December, 2004 passed by the Third
Additional District Judge, Thane. The Company has also registered notice of lis pendens dated 17th May,2005 with the
Registrar of Sub-Assurance.
(ii) A part of the land was acquired by the Thane Municipal Corporation and the Company has an option for the
Transferable Development Rights (TDR) as compensation for the said acquisition. Pending the receipt of such
compensation by the Company in the form of TDR, no adjustment has been made in the books in this regard.
(b) Freehold Land includes (i) leasehold rights in perpetuity and (ii) transferable development rights (TDRs). Freehold
Buildings include investments representing shares in ownership of flats.
(c) Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. 29.61 crore
(as at 31-03-2016: Rs. 48.43 crore).
(d) The additions to Freehold Land, includes Rs. 17.84 crore, pertaining to carrying value of Land of the three wholly-owned
subsidiaries merged with the Company, with effect from, 1st April, 2015. [Refer Note 50 (v)]
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
3. INVESTMENTS IN SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
(at cost unless otherwise specified)
GRAND SUMMARY
TRADE INVESTMENTS
(a) Subsidiary companies
Equity Shares 70.57 1,183.51 1,112.15
Preference Shares/Preferred Stock 45.59 40.59 15.90
116.16 1,224.10 1,128.05
(b) Associate companies
Equity Shares - 256.33 255.00
Common Stock 33.59 33.59 17.84
Contribution towards Capital of an LLP 2.67 2.12 1.88
36.26 292.04 274.72
(c) Joint Venture company
Equity Shares 0.75 0.75 0.75
153.17 1,516.89 1,403.52
(a) QUOTED
(At Amortised Cost)
(1) Investments in Equity Shares in direct Subsidiary
Companies (with the Company's direct holdings in
excess of 50% of the equity share capital)
(i) Nil (as at 31-03-2016: 19,39,04,681) Equity Shares of Re. 1 each in
Godrej Industries Ltd. (GIL) – at Book Value (See Note 1. below) - 257.77 257.77
- 257.77 257.77
76
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
(b) UNQUOTED
(At Amortised Cost)
(1) Investments in Equity Shares in direct Subsidiary Companies
(i) 5,050 Equity Shares of Rs.100 each in Godrej Infotech Ltd. 1.05 1.05 1.05
(ii) Nil (as at 31-03-2016: 3,09,410) Equity Shares of RM 10 each in
Godrej (Malaysia)Sdn. Bhd. [G(M)] [after deducting Rs. 5.22 crore
in respect of the value of shares in Mercury Manufacturing
Company Ltd. received from the liquidator of G(M) - 0.81 6.04
(iii) Nil (as at 31-03-2015: 50,000) Equity Shares of Rs. 10 each in
East View Estates Pvt. Ltd. (see Note 2. below) - - 0.94
(iv) Nil (as at 31-03-2015: 10,000) Equity Shares of Rs. 10 each in
Firstrock Infrastructure Pvt. Ltd. (see Note 2. below) - - 6.94
(v) Nil (as at 31-03-2015: 10) Equity Shares of Rs. 10 each in
Miracletouch Developers Pvt. Ltd. (see Note 2. below) - - 7.83
(vi) 2,00,000 Equity Shares of Rs. 10 each in India Circus Retail
Private Ltd. (purchased at face value during the year 2015-16) 0.20 0.20 -
(vii) 48,723 Equity Shares of S$ 10 each in Godrej (Singapore) Pte. Ltd. 24.83 24.83 24.83
(viii) 98,170 (as at 31-03-2015: 54700) Equity Shares of € 46 each in
Veromatic International BV., the Netherlands (43,470 shares
subscribed during the year 2015-16) [excluding diminution (other
than temporary) in the value of investment amounting
to Rs. 43.02 crore recognized in the year 2011-12] 42.63 42.63 28.12
(ix) 3,00,000 Shares ("common stock with no par value") of Godrej
Americas Inc. USA. 1.86 1.86 1.86
70.57 71.38 77.61
77
Godrej & Boyce Mfg. Co. Ltd.
Notes:
1. Pursuant to a resolution passed at an extraordinary general meeting, of the Company: (a) the entire holding of 19,39,04,681
shares in Godrej Industries Ltd.(GIL), was transferred to Vora Soaps Ltd. - a promoter group company - without consideration; and (b)
9,35,00,000 shares held by the Company in Godrej Consumer Products Ltd. (GCPL) were transferred to Godrej Seeds and Genetics
Ltd. - a promoter group company - without consideration.
Consequently, the Company is no longer the holding company of GIL, GCPL and their respective subsidiaries. Hence, investments in
GCPL and Godrej Properties Ltd. (a subsidiary of Godrej Industries Ltd.) at the end of the year are classified as Other Equity
instruments.
2. The three wholly-owned subsidiaries (items iii, iv, and v) have been amalgamated with the Company with effect from 1st April,
2015, and the book value of the investments therein have been adjusted against Capital Reserve [Note 50 (v)].
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
78
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
C. DISCLOSURE
4. OTHER INVESTMENTS
(a) QUOTED
Investments in Equity Shares (Fully Paid up unless stated otherwise)
(At Fair Value Through Other Comprehensive Income):
(i) 2,50,03,815 (as at 31-03-2016: 11,85,03,815) Equity Shares of
Re. 1 each in Godrej Consumer Products Ltd.
(9,35,00,000 shares transferred to a promoter group company
during the year 2016-17) (6,60,000 shares sold during the year
2015-16) 4,179.14 - -
(ii) 1,06,50,688 Equity Shares of Rs. 5 each in Godrej
Properties Ltd.(12,55,000 shares purchased during
the year 2015-16) 410.64 - -
(iii) 46,86,976 Equity Shares of Rs. 2 each in HCL Technologies Ltd.
(28,31,393 shares received on demerger of Business Undertaking
of erstwhile Geometric Ltd. with HCL Technologies Ltd., in exchange
of 1,21,75,000 shares held in erstwhile Geometric Ltd. by the
Company. Moreover, 18,55,583 shares received in exchange of
79,79,008 shares held by Godrej Investments Pvt. Ltd., which merged
with the Company from the appointed date of 29th March, 2017.) 409.99 - -
(iv) 12,000 Equity Shares of Rs. 10 each in Central Bank of India 0.13 0.09 0.13
(v) 52,590 Equity Shares of Rs. 2 each in Housing Development
Finance Corporation Ltd. 7.90 5.81 6.92
(vi) 68,65,666 Common Shares of par value USD 0.001 in Verseon
Corporation USA (purchased during the year 2015-16 at a total
cost of Rs.100.57 crores) 85.88 98.91 -
Total Quoted Non-current Non-Trade Other Investments 5,093.68 104.81 7.05
(b) UNQUOTED
(1) Investments in Equity Shares
(i) 50 Equity Shares of Rs. 50 each in Godrej & Boyce Employees’
Co-operative Consumer Society Ltd.* - - -
(ii) 1,000 Equity Shares of Rs. 10 each in Super Bazar Cooperative
Stores Ltd.* - - -
79
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
C. DISCLOSURE
(a) Aggregate amount of Quoted Investments and market value thereof 5,093.68 104.81 7.05
(b) Aggregate amount of Unquoted Investments 146.07 9.02 2.25
5,239.75 113.83 9.30
(c) Aggregate amount of Impairment in the value of Investments - - -
Non-current investments in Subsidiaries, Associates and Joint Ventures are stated
at cost (unless otherwise stated) as per Ind AS 27; however, for any diminution,
other than temporary in the value of investments, the book value is reduced to
recognise the decline. In cases where these investments are carried at their book
values, which are higher than their fair values, the diminution in the value of such
investments is considered to be of a temporary nature, in view of the Company's
long-term financial involvement in such investee companies.
5. TRADE RECEIVABLES
Unsecured and considered good 7.44 12.50 69.66
Unsecured and considered doubtful 138.46 117.58 103.10
Less: Allowances for doubtful receivables (138.46) (117.58) (103.10)
- - -
Total 7.44 12.50 69.66
80
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
81
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
(b) Work-in-Process
(i) Consumer Durables 126.00 121.09 125.62
(ii) Industrial Products 258.96 291.42 347.53
384.96 412.51 473.15
(c) Finished Goods
(i) Manufactured:
(1) Consumer Durables 584.20 465.13 414.05
(2) Industrial Products 35.22 20.01 30.17
619.42 485.14 444.22
(ii) Traded
(1) Consumer Durables 319.97 288.78 288.17
(2) Industrial Products 14.78 9.53 9.90
(3) Others 0.24 0.44 0.34
334.99 298.75 298.41
Total 954.41 783.89 742.63
82
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
12. CASH AND BANK BALANCES
(A) Cash and Cash Equivalents
(i) Balances with Banks on Current Accounts 25.81 18.77 10.33
(ii) Cash on Hand 1.39 1.59 1.83
Total Cash and Cash Equivalents 27.20 20.36 12.16
83
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
16. EQUITY SHARE CAPITAL As at As at As at
(a) Authorised: 31-03-2017 31-03-2016 01-04-2015
(i) 1,100,000 Equity Shares of Rs. 100 each 11.00 11.00 11.00
(ii) 900,000 Cumulative Redeemable Preference Shares of Rs. 100 each 9.00 9.00 9.00
20.00 20.00 20.00
(b) Issued, Subscribed and Paid Up:
678,448 (as at 31/3/2016: 662,910) Equity Shares of Rs. 100 each fully paid up 6.78 6.63 6.63
(1) The Company does not have any holding company.
(2) Details of equity shareholders holding more than 5% shares in the Company are given below:
(3) Terms/rights attached to equity shares: The Company has only one class of equity shares having a par value of Rs.100 per share. Each
holder of equity shares is entitled to one vote per share. Accordingly, all equity shares rank equally with regard to dividends and share in
the Company's residual assets. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the
ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity
shares will be entitled to receive the residual assets of the Company, remaining after distribution of all preferential amounts, in
proportion to the number of equity shares held.
(4) During the year under review, the Company's Equity Share Capital has increased from Rs. 6.63 Crore to Rs. 6.78 Crore. Pursuant to the
sanction of the Scheme of Amalgamation of Cartini India Ltd. (CIL) with the Company, by the Hon'ble High Court Judicature at Bombay,
15,538 equity shares of the Company have been allotted during the year as fully paid up, to the equity shareholders of CIL, without
payment being received in cash. During the period of five years immediately preceeding the previous reporting date, there has been
no change in the Company's share capital.
(5) The National Company Law Tribunal has by its Order dated 23rd August, 2017, approved the Scheme of Amalgamation of Godrej
Investments Pvt. Ltd. (GIPL) with the Company, with the appointed date of 29th March, 2017. Accordingly, 1,77,429 equity shares of
Rs. 100 each of the Company will be issued to the shareholders of GIPL.
(Rupees in crore)
As at As at
17. OTHER EQUITY 31-03-2017 31-03-2016
(1) The Directors do not propose any Final Dividend for the year.
(2) Capital Reserve: During amalgamation, the excess of net assets taken, over the cost of consideration paid by the Company
are treated as capital reserve.
(3) Securities Premium Reserve: The amount received in excess of the face value of equity shares, is recognised as Securities
Premium Reserve. The reserve can be utilised in accordance with the provisions of the Companies Act, 2013.
(4) General Reserve: The Company transferred a portion of the net profits before declaring dividend, to general reserve, pursuant
to the provisions of the Companies Act, 1956. Transfer to general reserve is not mandatory under the Companies Act, 2013.
(5) Debenture Redemption Reserve: Reserve has been created at 25% of the value of debentures, apportioned over the tenure of the debentures.
(6) Retained Earnings: Retained earnings are the profits earned till date, less transfers to general reserve, debenture redemption
reserve and distribution of dividend and provision for tax thereon.
84
Annual Report and Accounts 2016-17
(Rupees in crore)
As at 31/03/2017 As at 31/03/2016 As at 01/04/2015
(c) Unsecured
(i) Interest-free Loans under the Sales Tax Deferral
Scheme of Maharashtra State Government 40.01 7.20 47.38 4.60 51.99 2.11
(ii) Fixed Deposits 587.39 155.89 578.25 144.52 303.72 278.00
627.40 163.09 625.63 149.12 355.71 280.11
(i) Privately-placed NCDs issued by the Company are secured by a first ranking charge by way of a registered mortgage on the specified
immovable properties of the Company situated at Mumbai. These NCDs are redeemable at par on 22-04-2019 (series I)
and 22-04-2021 (Series II). Interest on these NCDs is payable quarterly. As per the Companies (Share Capital and Debentures)
Rules, 2014, para 18(7), the Company is required to create a Debenture Redemption Reserve of 25% of the value of debentures;
it is also required to invest 15% of the amount of its debentures maturing during the next financial year. The Company has
created a debenture redemption reserve of Rs. 20.83 crore.
(ii) Term Loan from The Zoroastrian Co-operative Bank Ltd. is secured by way of hypothecation of specified machinery and equipment.
It carries a floating interest rate of 10.50% p.a. (10.50% p.a. as at 31-03-2016; 10.50% p.a. as at 31-03-2015), which is 2% p.a. below
Bank's Minimum Lending Rate of 12.50% p.a., subject to a minimum of 9.00% p.a. and a maximum of 12.50% p.a., and is repayable in
8 quarterly installments (7 installments of Rs. 0.63 crore each and last installment of Rs. 0.66 crore starting from 30-06-2017 and
ending on 24-03-2019).
(iii) Term Loan from HDFC Ltd. is secured by first equitable mortgage of specified immovable properties situated at Mumbai.
It carries a floating interest rate of 12.75% p.a. (12.90% p.a. as at 31-03-2016; 13.10% p.a. as at 31-03-2015), which is 4.75% p.a.
below HDFC-CPLR of 17.65% p.a. This loan is fully repaid on 31-03-2017.
(iv) Interest-free Loans under the Sales Tax Deferral Schemes of Maharashtra State Government is payable in annual
instalments as may be prescribed in the Schemes, beginning from 21-04-2017 and continuing upto '21-04-2023.
(v) Fixed Deposits from employees and public carry interest rates ranging from 8.50% p.a. to 9.75% p.a. payable monthly or
half-yearly, and have a maturity period of 3 years from the respective dates of deposit.
(vi) Current maturities of Long-term Borrowings are disclosed under the head "Other Current Financial Liabilities" (Note 24)
(Rupees in crore)
As at As at As at
31/03/2017 31/03/2016 01/04/2015
85
Godrej & Boyce Mfg. Co. Ltd.
(i) Sundry Deposits and Advances include: (a) Rs. 24.80 crore (as at 31-3-2016: Rs. 24.80) received towards hand-over of possession of land to a
public utility, and (b) Rs. 0.75 crore (as at 31-3-2016: Rs. 0.75 crore) received towards Compensation against Land acquired. These amounts have
not been adjusted in the accounts in view of pending suit/proceedings.
(Rupees in crore)
Current Provisions Non-current Provisions
As at As at As at As at As at As at
31/03/2017 31/03/2016 01/04/2015 31/03/2017 31/03/2016 01/04/2015
20. NON-CURRENT PROVISIONS
(a) Provision for Free Service under Product Warranties 24.10 23.99 18.92 31.71 20.39 19.25
(b) Provision for Employee Benefits 7.32 8.19 7.65 35.21 30.82 27.41
Total 31.42 32.18 26.57 66.92 51.21 46.66
86
Annual Report and Accounts 2016-17
The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current
tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
Significant management judgment is required in determining provision for income tax, deferred income tax assets and liabilities
and recoverability of deferred income tax assets. The recoverability of deferred income tax assets is based on estimates of taxable
income in which the relevant entity operates and the period over which deferred income tax assets will be recovered.
As on 31-03-2017, the tax liability with respect to the dividends proposed is Rs. Nil (as at 31-03-2016 : Rs. Nil, as at 1-04-2015: Rs. 32.76 crores)
87
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
22. CURRENT BORROWINGS
(a) Secured
(i) Working Capital Facilities from Banks (Net) 288.55 237.53 436.14
(ii) Export Credits from Export-Import Bank of India under a revolving credit limit 267.00 349.00 316.00
555.55 586.53 752.14
(b) Unsecured
(i) Deposits/Short-term Loans from Companies 104.50 150.05 195.22
(ii) Deposits from Shareholders 72.90 90.65 37.15
(iii) Short-term Loans from Banks 150.00 120.00 295.00
(iv) Other Borrowings 175.53 210.13 164.78
(v) Acceptances 124.82 116.48 -
627.75 687.31 692.15
Total 1,183.30 1,273.84 1,444.29
(i) Working Capital Facilities from Banks are secured by a first pari passu charge by way of
hypothecation of inventories and book debts. They carry interest rates ranging from 9.00% p.a. to
10.25% p.a. and are generally renewable each year.
(ii) Export Credits from Export-Import Bank of India are secured by first equitable mortgage of
specified immovable properties situated at Mumbai. They carry an interest rate of 8.75% p.a
(excluding interest subvention of 3% and are payable/ renewable after 180 days.
(iii) Deposits/Short-term Loans from Companies carry an interest rate of 8.50% p.a. to 9.00% p.a.
payable monthly and quarterly, and have a maturity period of 3 months or 6 months from the
respective dates of deposit; and include deposits from an associate Godrej Investments Pvt. Ltd.: Rs.
75.69 crore (as at 31-3-2016: Rs.109.36 crore; as at 31-3-2015: Rs.44.59 crore).
(iv) Deposits from Shareholders have a maturity period of 3 months from the respective dates of
deposit, and carry an interest rate of 8.75% p.a. payable at the month-end and at maturity.
(v) In respect of Negotiable Commercial Paper, the maximum balance outstanding during the year
was Rs. 600 crore (Previous Year: Rs. 325 crore).
(vi) Short-term Loans from Banks carry an interest rate of 7.85% to 9.35% p.a. and are
payable/renewable after 1 month/12 months.
(vii) Other Borrowings are Buyers Credit from Banks, due and payable in foreign currency, and carry
interest rates ranging from 1.35% to 1.51% p.a.
88
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
89
Godrej & Boyce Mfg. Co. Ltd.
90
Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
91
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
92
Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
93
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
Amount spent during the year on: Already Paid Yet to be Paid Total
(i) Construction/Acquisition of any asset - - -
(ii) On purposes other than (i) above 5.07 - 5.07
5.07 - 5.07
94
Annual Report and Accounts 2016-17
95
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
96
Annual Report and Accounts 2016-17
(Rupees in crore)
Reconciliation of equity as at 1st April, 2015 Additions
As per Effects of pursuant to
Footnote Indian transition business As per
ref. GAAP to Ind AS combinations Ind AS
ASSETS
(1) NON-CURRENT ASSETS
(a) Property, Plant and Equipment 1 1,608.15 (269.29) 8.23 1,347.09
(b) Capital Work-in-progress 162.29 - - 162.29
(c) Investment Property 1 - 270.54 - 270.54
(d) Goodwill - - - -
(e) Other Intangible assets 6.93 - - 6.93
(f) Intangible assets under development - - - -
(g) Financial Assets
(i) Investments in Subsidiaries, Associates and Joint Venture 1,025.57 196.11 181.84 1,403.52
(ii) Others Investments 2 1.34 7.96 - 9.30
(iii) Trade Receivables 69.66 - - 69.66
(iv) Loans 52.13 (0.65) - 51.48
(v) Other Financial Assets 3 258.77 - - 258.77
(h) Deferred Tax Assets (net) 77.24 14.60 (0.30) 91.54
(i) Other Non-Current assets 105.60 (0.00) 0.65 106.25
Total Non-Current Assets 3,367.68 219.27 190.42 3,777.37
97
Godrej & Boyce Mfg. Co. Ltd.
98
Annual Report and Accounts 2016-17
99
Godrej & Boyce Mfg. Co. Ltd.
100
Annual Report and Accounts 2016-17
Reconciliation of profit or loss for the year ended 31st March, 2016 (Rupees in crore)
Additions
As per Effects of pursuant to
Footnote Indian transition business As per
ref. GAAP to Ind AS combinations Ind AS
I. REVENUE FROM OPERATIONS 9,422.28 (186.92) 61.22 9,296.58
II. OTHER INCOME 3 160.86 0.17 1.23 162.26
TOTAL INCOME 9,583.14 (186.75) 62.45 9,458.84
III. EXPENSES
(1) Cost of materials consumed 3,337.57 (49.44) 34.94 3,323.07
(2) Excise duty 633.11 - - 633.11
(3) Purchases of Stock-in-Trade 1,963.75 - - 1,963.75
(4) Changes in inventories of Finished Goods,
Work-in-Process and Stock-in-Trade 4 52.49 (52.58) (2.76) (2.85)
(5) Property Development and Construction Expenses 6 92.62 (70.42) - 22.20
(6) Employee Benefits Expenses 10 1,034.06 (4.82) 8.88 1,038.12
(7) Finance costs 7 193.00 (16.13) 0.31 177.18
(8) Depreciation and Amortization Expenses 147.57 8.74 1.33 157.64
(9) Other Expenses 7 1,894.45 (46.69) 11.66 1,859.42
(10) Less: Expenditure transferred to Capital Accounts (41.40) - - (41.40)
TOTAL EXPENSES 9,307.22 (231.34) 54.36 9,130.24
IV. PROFIT BEFORE EXCEPTIONAL ITEMS AND TAX 275.92 44.59 8.09 328.60
V. EXCEPTIONAL ITEMS 77.48 - - 77.48
VI. PROFIT BEFORE TAX 353.40 44.59 8.09 406.08
VII. TAX EXPENSES
1. Current Tax 48.00 - 2.74 50.74
2. Prior years' tax adjustments 0.54 - - 0.54
3. Deferred Tax 11 (25.00) 23.74 (7.01) (8.27)
23.54 23.74 (4.27) 43.01
VIII. PROFIT AFTER TAX FOR THE YEAR 329.86 20.85 12.36 363.07
Note: During the year 2016-17, Mercury Manufacturing Company Ltd., Busbar Systems (India) Ltd., the Company's wholly-owned
subsidiaries, were merged with the Company, with the appointed date of 1st April, 2016. Also, Godrej Investments Pvt. Ltd.
was merged with the Company with the appointed date of 30th March, 2017.
As per Ind AS 103, Business Combinations, Appendix C, the financial information in the financial statements in respect of
prior periods has been restated as if the business combination had occurred from the beginning of the earliest period
presented in the financial statements. Accordingly, the financials for the years 2014-15 and 2015-16 have been restated,
to include the above merger.
101
Godrej & Boyce Mfg. Co. Ltd.
Particulars Footnote As on As on
ref. 31-03-2016 01/04/2015
(Net of deferred tax) (Net of deferred tax)
102
Annual Report and Accounts 2016-17
103
Godrej & Boyce Mfg. Co. Ltd.
A. Transition to Ind AS
These are the Company’s first financial statements prepared in accordance with Ind AS. For all periods upto and including the year
ended 31st March, 2016, the Company prepared its financial statements in accordance with the accounting standards notified
under Section 133 of the Companies Act 2013, read together with the relevant rules thereunder ('Previous GAAP').
The adoption of Ind AS, has been carried out in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards.
Ind AS 101 requires that all Ind AS standards and interpretations that are issued and effective for the first Ind AS financial
statements be applied retrospectively and consistently for all financial years presented. Accordingly, the Company has prepared
financial statements which comply with Ind AS for the year ended 31-03-2017, together with the comparitive information as at and
for the year ended 31-03-2016 and the opening Ind AS balance sheet as at 1-4-2015, the date of transition to Ind AS.
104
Annual Report and Accounts 2016-17
Financial liabilities
Non-current
Borrowings
Secured Redeemable Non-Convertible
Debentures (NCDs) - - 498.40 498.40 - 514.65 - 514.65
Secured Term Loans from Banks
and Financial Institutions - - 2.50 2.50 - - - -
Unsecured Borrowings - 627.40 627.40 - 508.88 - 508.88
Other financial liabilities - - 294.87 294.87 - - - -
Current
Borrowings - - 1,183.30 1,183.30 - 163.09 - 163.09
Trade and other payables - - 1,111.60 1,111.60 - - - -
Other financial liabilities:
Current maturities of long-term borrowings - - 165.61 165.61 - - - -
Derivative Liability 11.36 - - 11.36 - 11.36 - 11.36
Others - - 569.52 569.52 - - - -
11.36 - 4,453.20 4,464.56 - 1,197.98 - 1,197.98
105
Godrej & Boyce Mfg. Co. Ltd.
Financial liabilities
Non-current
Borrowings
Secured Redeemable Non-Convertible
Debentures (NCDs) - 497.90 497.90 - 508.06 508.06
Secured Term Loans from Banks
and Financial Institutions - - 5.05 5.05 - - - -
Unsecured Borrowings - 625.63 625.63 - 470.71 - 470.71
Other Financial Liabilities 256.68 256.68 - - - -
Current
Borrowings - - 1,273.84 1,273.84 - - - -
Trade payables - - 884.10 884.10 - - - -
Other Financial Liabilities:
Current maturities of long-term borrowings 152.64 152.64 - - - -
Derivative Liability 2.71 - 2.71 - 2.71 - 2.71
Others - - 589.85 589.85 - - - -
2.71 - 4,285.69 4,288.40 - 981.48 - 981.48
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Financial liabilities
Non-current
Borrowings
Secured Term Loans from Banks
and Financial Institutions - - 7.92 7.92 - - - -
Unsecured Borrowings - 355.71 355.71 - 246.87 246.87
Other Financial Liabilities - - 210.51 210.51 - - - -
Current
Borrowings - - 1,444.29 1,444.29 - - - -
Trade and other payables - - 951.31 951.31 - - - -
Other Financial Liabilities:
Current maturities of long-term borrowings - - 283.01 283.01 - - - -
Derivative Liability 1.23 - 1.23 - 1.23 - 1.23
Others - - 476.81 476.81 - - - -
1.23 - 3,729.56 3,730.79 - 248.10 - 248.10
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Godrej & Boyce Mfg. Co. Ltd.
Paticulars (Rupees in
crore)
Opening Balance (01-04-2015) 2.25
Net change in fair value (unrealised) 6.77
Purchases 18.00
Closing Balance (31-03-2016) 27.02
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(Rupees in crore)
Contractual cash flows
As at 31/03/2017 Carrying Total Less than 6-12 1-2 years 2-5 years More than
amount 6 months months 5 years
Current
Secured Borrowings 555.55 555.55 555.55 - - - -
Unsecured Borrowings 477.75 477.75 477.75 - - - -
Short term loans from banks 150.00 150.00 150.00 - - - -
Trade Payables 1,111.60 1,111.60 1,111.60 - - - -
Other Current Financial Liabilities 610.31 610.31 610.31 - - - -
Derivative Liability 11.36 11.36 11.36
Acceptances 124.82 124.82 124.82 - - - -
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Godrej & Boyce Mfg. Co. Ltd.
Current
Secured Borrowings 586.53 586.53 586.53 - - - -
Unsecured Borrowings 567.31 567.31 567.31 - - - -
Short term loans from banks 120.00 120.00 120.00 - - - -
Trade Payables 884.10 884.10 884.10 - - - -
Other Current Financial Liabilities 742.49 742.49 742.49 - - - -
Derivative Liability 2.71 2.71 2.71
(Rupees in crore)
Contractual cash flows
As at 1/4/2015 Carrying Total Less than 6-12 1-2 years 2-5 years More than
amount 6 months months 5 years
Current
Secured Borrowings 752.14 752.14 752.14 - - - -
Unsecured Borrowings 397.15 397.15 397.15 - - - -
Short term loans from banks 295.00 295.00 295.00 - - - -
Trade Payables 951.31 951.31 951.31 - - - -
Other Current Financial Liabilities 759.82 759.82 759.82 - - - -
Derivative Liability 1.23 1.23 1.23
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Annual Report and Accounts 2016-17
A. Currency risk
The Company is exposed to currency risk on account of its borrowings and other payables/receivables in foreign currency. The functional
currency of the Company is Indian Rupee. The Company uses forward exchange contracts to hedge its currency risk, mostly with a
maturity of less than one year from the reporting date.
The Company does not use derivative financial instruments for trading or speculative purposes.
Financial assets As at As at As at As at As at As at
31/03/2017 31/03/2016 31/03/2015 31/03/2017 31/03/2016 31/03/2015
Trade and other receivables USD 2,64,16,442 1,95,50,752 1,58,03,268 171.31 129.63 98.85
EURO 9,45,630 5,31,204 15,90,286 6.55 4.01 10.69
GBP 3,46,729 6,82,509 6,21,117 2.80 6.52 5.75
OTHERS 9,76,339 9,07,833 2,22,441 19.59 20.08 4.63
200.25 160.24 119.92
Hedged Exposures USD 1,06,43,134 97,74,043 21,33,347 69.02 64.81 13.34
131.23 95.43 106.58
The following significant exchange rates have been applied during the year.
Year-end spot rate
(Rupees) 31-03-2017 31-03-2016 31-03-2015
USD 1 64.85 66.31 62.55
EUR1 69.29 75.45 67.24
GBP1 80.90 95.52 92.52
Sensitivity analysis
A reasonably possible strengthening (weakening) of the Indian Rupee against US dollars at 31st March would have affected the
measurement of financial instruments denominated in US dollars and affected equity and profit or loss by the amounts shown below. This
analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and
purchases.
as at 31/03/2017 as at 31/03/2016 as at 1/4/2015
Profit or (loss) Profit or (loss) Profit or (loss)
Effect in Rs. Crore Strengthening Weakening Strengthening Weakening Strengthening Weakening
USD - 3% movement (1.52) 1.51 (1.76) 1.76 1.37 (1.37)
EUR - 3% movement 0.16 (0.16) (0.19) 0.19 0.02 (0.02)
GBP - 3% movement (0.06) 0.06 (0.18) 0.18 (0.14) 0.14
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Nominal amount As at As at As at
31-03-2017 31-03-2016 31-03-2015
Fixed-rate instruments
Financial liabilities: Long-term 1,125.80 1,123.53 355.71
Financial liabilities: Short-term 1,180.78 1,270.32 1,441.39
2,306.58 2,393.85 1,797.10
Variable-rate instruments
Financial liabilities: Long-term 2.50 5.05 7.92
Financial liabilities: Short-term 2.52 3.52 2.90
5.02 8.57 10.82
Total 2,311.60 2,402.42 1,807.92
As at 31/03/2016
Variable-rate instruments (0.09) 0.09
Cash flow sensitivity (net) (0.09) 0.09
As at 01/04/2015
Variable-rate instruments (0.11) 0.11
Cash flow sensitivity (net) (0.11) 0.11
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Annual Report and Accounts 2016-17
C. CREDIT RISK
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Company's receivables from customers and investments in debt
securities.
The carrying amount of financial assets represents the maximum credit exposure.
Impairment
The ageing of trade and other receivables that were not impaired was as follows.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
Neither past due nor impaired 1,213.41 923.50 1,115.45
More than 6 months and less than 1 year 208.28 207.29 165.80
More than 1 year and less than 3 years 396.51 400.89 412.62
More than 3 years 179.92 181.84 110.88
1,998.12 1,713.52 1,804.75
Management believes that the unimpaired amounts that are past due by more than 6 months are still collectible in full, based
on historical payment behaviour and extensive analysis of customer credit risk, on a case to case basis, with reference to the
customer's credit quality and prevailing market conditions. Based on past experience, the Company does not expect any
material loss on its receivables and hence no provision is deemed necessary on account of Expected Credit Loss (ECL).
The movement in the allowance for impairment in respect of trade and other receivables during the year was as follows:
Loans and advances are monitored by the Company on a regular basis and these are niether past due nor impaired.
(Rupees in crore)
Collective impairments
Balance as at 01/04/2015 103.10
Impairment loss recognised 13.99
Balance as at 31/03/2016 117.09
Impairment loss recognised 20.88
Balance as at 31/03/2017 137.97
Amounts written off as at 31/03/2016 17.90
Amounts written off as at 31/03/2017 20.97
Cash and cash equivalents
The Company maintains its cash and cash equivalents with credit worthy banks and financial institustions and reviews it on
ongoing basis. The credit worthiness of such banks and financial institutions is evaluated by the management on an ongoing
basis and is considered to be good.
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Godrej & Boyce Mfg. Co. Ltd.
The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. Management monitors the return on capital as well as the level of dividends to
ordinary shareholders.
The Board of Directors seeks to maintain a balance between the higher returns that might be possible with higher levels of
borrowings and the advantages and security afforded by a sound capital position.
The Company monitors capital using a ratio of ‘adjusted net debt’ to ‘equity’. For this purpose, adjusted net debt is defined as
total liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. The Company's adjusted net
debt to equity ratio for 3 years is given below:
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
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Annual Report and Accounts 2016-17
REVENUE
Domestic Sales 6,719.34 2,127.88 378.16 - 9,225.38 6,135.90 1,870.89 599.22 - 8,606.01
Export Sales 117.64 436.56 - 554.20 136.28 415.42 - 551.70
SALE OF PRODUCTS AND SERVICES (Gross) 6,836.98 2,564.44 378.16 9,779.58 6,272.18 2,286.31 599.22 9,157.71
Inter-Segment Transfers 20.46 75.13 - 95.59 192.63 21.85 105.48 319.96
Other Operating Revenue/Other Income 60.14 72.63 11.34 144.11 68.47 70.32 18.23 157.02
SEGMENT REVENUE 6,917.58 2,712.20 389.50 - 10,019.28 6,533.28 2,378.48 722.93 - 9,634.69
Less: Inter-Segment Revenue (95.59) (319.96)
9,923.69 9,314.73
Add: Income from Dividends 68.48 144.11
TOTAL REVENUE 9,992.17 9,458.84
CAPITAL EXPENDITURE
TOTAL CAPITAL EXPENDITURE (as per Balance Sheet) 154.54 185.39 13.99 208.41 562.33 175.40 204.27 25.59 50.22 455.48
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Godrej & Boyce Mfg. Co. Ltd.
(b) The amalgamation was accounted for as specified in the Scheme. The details of adjustments made in the accounts
pursuant to the Scheme are set out below:
st
Value of Net Assets of Cartini India Ltd. taken over as at 1
April, 2016 (See Notes below):
Rupees
Property, Plant and Equipment (Gross Block) 84,55,54,066
Less: Accumulated Depreciation 10,04,42,804
Property, Plant and Equipment (Net Block) 74,51,11,262
Add: Capital Work-in-Progress 4,54,57,533
Total Property, Plant and Equipment 79,05,68,795
Non-current Investments 10,49,41,990
Other Non-current Assets 57,33,829
Inventories 20,37,26,850
Trade Receivables 8,99,09,732
Cash and Bank Balances 56,72,068
Short-term loans and advances 2,36,82,995
Other Current Assets 3,989
Total Assets (A) 1,22,42,40,248
Less: Liabilities:
Deferred Tax Liability (Net) 4,71,69,134
Other Non-current Liabilities 3,35,710
Trade Payables 13,95,85,045
Other Current Liabilities 4,27,09,703
Short-term Provisions 24,41,492
Total Liabilities (B) 23,22,41,084
Total Value of Net Assets taken over *(A) – (B)+ 99,19,99,164
Less: 15,538 equity shares of Rs.100 each of the Company issued at par, credited as fully paid
up, to the shareholders of Cartini 15,53,800
99,04,45,364
As per the Order of the Court, the balance adjusted against:
Capital Redemption Reserve 4,84,55,300
General Reserve 7,96,00,000
Retained Earnings 86,33,31,934
Capital Reserve (9,41,870)
99,04,45,364
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
Cartini as at the closing balance sheet as at 31st March, 2016.
As per para 18 of Ind AS, 103, Business Combinations, the acquirer shall measure the identifiable assets acquired and the
liabilities assumed at their acquisition-date fair values. However, the above acquisition was recorded at book value,
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Annual Report and Accounts 2016-17
under a Court scheme. As per valuation report issued by valuers, V. S. Dastur and Co., Chartered Accountants, the fair value
of Cartini shares amounted to Rs. 16,213 per share, totalling to Rs. 99,21,22,109, for 61,193 shares of Cartini.
Had the acquisition been at fair value, the resultant Capital Reserve would have amounted to Rs. 18,77,88,625.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of Cartini as at the close of business
on the date preceding the aforesaid date, whether or not provided in the books of Cartini, and all liabilities
which arise or accrue on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and
obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of Cartini.
(f) Since the aforesaid Scheme, which is effective from 1st April, 2016, has been given effect to in these accounts,
the figures for the current year to that extent are not comparable with those of the previous year.
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
GIPL as at the closing balance sheet as at 29th March, 2017.
(d) With effect from 29th March, 2017, all debts, liabilities, duties and obligations of GIPL as at the close of business on the
date preceding the aforesaid date, whether or not provided in the books of GIPL, and all liabilities which arise or accrue
on or after 29th March, 2017 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of GIPL.
(f) Upon the Scheme coming into effect, and in consideration for the amalgamation of GIPL with the Company, the Company
will issue and allot 1,77,429 equity shares at par, credited as fully paid up, to the shareholders of GIPL, whose names
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Godrej & Boyce Mfg. Co. Ltd.
appear in the Register of Members of GIPL, on the Effective Date, ie. 18th September, 2017, in the ratio of 1 fully paid
equity share of Rs. 100 each of the Company for each share of Rs. 100 each held by GIPL in the Company.
(iii) Amalgamation of wholly-owned subsidiary Busbar Systems (India) Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of Busbar Systems (India) Ltd. (Busbar) with the Company with effect from
1st April 2016, was sanctioned by the National Company Law Tribunal (“NCLT”), Mumbai Bench, on 23rd August, 2017
and by the National Company Law Tribunal (“NCLT”), Bangalore Bench, on 16th October, 2017 and certified copies
of the Order of the NCLT sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on
28th October, 2017 and with the Registrar of Companies, Bangalore on 26th October, 2017. Accordingly, the
Scheme has been given effect to in the accounts for the year, and the entire undertaking of erstwhile Busbar stands
transferred to and vested in the Company as a going concern and Busbar, without any further act, stands dissolved
without winding up. Busbar was mainly engaged in the business of manufacturing busbars. The amalgamation
was accounted for as specified in the Scheme.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
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Annual Report and Accounts 2016-17
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
Busbar as at the closing balance sheet as at 31st March, 2016.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of Busbar as at the close of business on the
date preceding the aforesaid date, whether or not provided in the books of Busbar, and all liabilities which arise or accrue
on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of Busbar.
(f) The amalgamation of the wholly-owned subsidiary does not entail issue of shares.
(iv) Amalgamation of wholly-owned subsidiary Mercury Manufacturing Company Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of Mercury Manufacturing Company Ltd. (MMCL) with the Company
with effect from 1st April 2016, was sanctioned by the National Company Law Tribunal (“NCLT”), Mumbai Bench,
on 23rd August, 2017 and by the National Company Law Tribunal (“NCLT”), Chennai Bench, on 14th September, 2017
and certified copies of the Order of the NCLT sanctioning the Scheme were filed with the Registrar of Companies,
Maharashtra and Chennai on 3rd October, 2017.
Accordingly, the Scheme has been given effect to in the accounts for the year, and the entire undertaking of erstwhile
MMCL stands transferred to and vested in the Company as a going concern and MMCL, without any further act,
stands dissolved without winding up. MMCL was mainly engaged in the business of manufacture and export of steel
furniture. The amalgamation was accounted for as specified in the Scheme.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
Rupees
Value of Net Assets of Mercury Manufacturing Company Ltd. taken over as at 1st
April, 2016 (See Notes below):
Property, Plant and Equipment (Gross Block) 7,43,01,925
Less: Accumulated Depreciation 82,08,674
Total Property, Plant and Equipment (Net Block) 6,60,93,251
Other Financial Assets (Non-Current) 1,26,851
Other Assets (Non-Current) 25,22,774
Total Non-Current Assets 6,87,42,876
Inventories 4,35,72,759
Trade Receivables 7,41,94,112
Cash and Bank Balances 4,61,40,158
Other Financial Assets (Current) 4,63,683
Other Assets (Current) 41,00,462
Total Assets (A) 23,72,14,050
Less: Liabilities:
Non-Current Liabilities
Deferred Tax Liability (Net) 51,32,309
Provisions 25,47,488
Current Liabilities
Financial Liabilities
Borrowings 2,32,59,748
Trade Payables 2,64,13,886
Other Financial Liabilities 60,31,857
Other Current Liabilities 31,22,508
Provisions 3,62,560
Current Tax Liabilities (Net) 15,92,978
Total Liabilities (B) 6,84,63,334
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Godrej & Boyce Mfg. Co. Ltd.
Rs.
Total Value of Net Assets taken over *(A) – (B)+ 16,87,50,716
Adjusted against:
Capital Redemption Reserve 1,45,00,000
General Reserve 2,40,00,000
Retained Earnings 9,41,55,969
Other Comprehensive Income (14,05,253) 13,12,50,716
3,75,00,000
Less: Book Value of equity shares held by the Company in MMCL written off 12,51,65,103
Balance adjusted against Retained Earnings (8,76,65,103)
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
MMCL as at the closing balance sheet as at 31st March, 2016.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of MMCL as at the close of business
on the date preceding the aforesaid date, whether or not provided in the books of MMCL, and all liabilities which arise
or accrue on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of MMCL.
(f) The amalgamation of the wholly-owned subsidiary does not entail issue of shares.
(v) Amalgamation of wholly-owned subsidiary companies, East View Estates Pvt. Ltd., First Rock Infrastructure Pvt. Ltd.
and Miracletouch Developers Pvt. Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of East View Estates Pvt. Ltd., First Rock Infrastructure Pvt. Ltd. and
Miracletouch Developers Pvt. Ltd. ("three subsidiaries") with the Company with effect from 1st April 2015,
was sanctioned by the Hon'ble High Court of Judicature at Bombay (“the Court”) on 8th July, 2016 and certified copies
of the Order of the Court sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on 8th July,
2016. Accordingly, the Scheme has been given effect to in the accounts for the year, and the entire undertaking of the
erstwhile three subsidiaries stands transferred to and vested in the Company as a going concern and the three
subsidiaries, without any further act, stands dissolved without winding up. The three subsidiaries were mainly engaged
in the business of land development.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
Rupees
Value of Net Assets of the three subsidiaries taken over as East View Estates First Rock Miracletouch Total
at 1st April, 2015 (See Notes below): Pvt. Ltd. Infrastructure Developers Pvt. Ltd.
Pvt. Ltd.
Fixed Assets (Freehold Land) 3,43,49,155 8,20,30,163 6,19,78,315 17,83,57,633
Long-term loans and advances 61,565 61,565
Cash and Cash equivalents 3,25,412 27,668 17,889 3,70,969
Short-term loans and advances 20,331 1,09,289 1,29,620
Total Assets (A) 3,47,36,132 8,20,78,162 6,21,05,493 17,89,19,787
Less: Liabilities:
Short-term borrowings 4,60,42,437 12,36,42,674 9,13,54,069 26,10,39,180
Trade Payables 8,764 132 8,896
Other Current Liabilities 11,236 11,368 22,604
Total Liabilities (B) 4,60,51,201 12,36,53,910 9,13,65,569 26,10,70,680
Total Value of Net Assets taken over *(A) – (B)+ (1,13,15,069) (4,15,75,748) (2,92,60,076) (8,21,50,893)
Less: Book Value of Investments written off (93,85,245) (6,94,07,440) (7,83,84,250) (15,71,76,935)
Balance adjusted against Capital Reserve (2,07,00,314) (11,09,83,188) (10,76,44,326) (23,93,27,828)
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Annual Report and Accounts 2016-17
Notes:
(c) For recording Fixed Assets in the books of the Company at Fair Values:
Freehold Land has been recorded at the carrying value of Rs. 17.84 crore in the books of the three subsidiaries as at
31st March, 2015.
All assets and liabilities, other than the Fixed Assets items mentioned above, have been recorded in the books of the
Company at the values appearing in the books of the three subsidiaries as at the closing balance sheet as at
31st March, 2015. Since these subsidiaries were 100% owned by the Company, there was no issue of shares,
instead, the carrying values of these investments in the book of the Company have been adjusted (as shown above)
against Capital Reserve.
(d) With effect from 1st April, 2015, all debts, liabilities, duties and obligations of the three subsidiaries as at the close of
business on the date preceding the aforesaid date, whether or not provided in the books of the three subsidiaries, and
all liabilities which arise or accrue on or after 1st April, 2015 shall be deemed to be the debts, liabilities, duties and
obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to the
Scheme, in the name of the Company, such asset and liabilities continue to be in the name of the three subsidiaries.
51. MEMBERS' VOLUNTARY LIQUIDATION PROCEEDINGS OF GODREJ (MALAYSIA) SDN. BHD [G(M)]:
During the financial year 2014-15, as part of the Members' Voluntary Liquidation proceedings of Godrej Malaysia (GM), 12,50,000
shares of Rs.10 each held by G(M) in Mercury Manufacturing Company Ltd. (MMCL) have been acquired by the Company
as distribution in specie. Distribution of assets of G(M) back to the Company as a shareholder in MMCL, would be capital in
nature and be a part of its entitlement as a shareholder. The transfer of the said shares of MMCL was registered on
18th March 2016. Pursuant to the said transfer, MMCL has become a wholly-owned subsidiary of the Company with effect
from 18th March, 2016. The value of other net assets (residual bank balance) amounting to Rs. 0.75 crore was transferred to
the Company on the completion of the liquidation proceedings in Malaysia. The balance amount of Rs. 0.07 crore was
adjusted against Capital Reserve.
B. Jointly-held subsidiaries (where the Company and its subsidiary Godrej Industries Ltd together hold more than
one-half of the equity share capital):
1. Godrej Consumer Products Ltd. (GCPL) (ceased to be a subsidiary with effect from 30th March, 2017)
2. Godrej One Premises Management Pvt. Limited (ceased to be a subsidiary with effect from 30th March, 2017)
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Godrej & Boyce Mfg. Co. Ltd.
The following companies are step-down subsidiaries (where the Company's subsidiaries listed in A and B above,
directly and/or indirectly through one or more subsidiaries, hold more than one-half of equity share capital):
(I) which remain subsidiaries as at 31.03.2017
C. Subsidiaries of Godrej Infotech Ltd.:
1. Godrej Infotech Americas Inc. (a wholly-owned subsidiary incorporated in North Carolina, USA)
2. Godrej Infotech (Singapore) Pte. Ltd. (a wholly-owned subsidiary incorporated in Singapore)
3. LVD Godrej Infotech NV (incorporated in Belgium)
D. Subsidiaries of Godrej (Singapore) Pte. Ltd.:
1. JT Dragon Pte. Ltd. (Incorporated in Singapore)
2. Godrej (Vietnam) Co. Ltd. (Incorporated in Vietnam) (a wholly owned subsidiary of JT Dragon Pte. Ltd.)
E. Joint Ventures:
1. Godrej Consoveyo Logistics Automation Ltd. (formerly Godrej Efacec Automation & Robotics Ltd.)
2. Godrej & Khimji (Middle East) LLC (incorporated in Sultanate of Oman) [a Joint Venture of Godrej (Singapore) Pte. Ltd.]
3. Godrej UEP (Singapore) Pte. Ltd. (Joint venture between Godrej (Singapore) Pte. Ltd. and Urban Electric Power Inc.)
(II) which have ceased to be subsidiaries as at 31.03.2017
F. Subsidiaries of Godrej Industries Ltd.: (ceased to be a subsidiary with effect from 30th March, 2017)
1. Godrej Agrovet Ltd. (GAVL)
2. Godrej Properties Ltd. (GPL)
3. Ensemble Holdings & Finance Ltd.
4. Godrej International Ltd. (incorporated in the Isle of Man)
5. Natures Basket Ltd.
6. Godrej International Trading & Investments Pte Ltd. (incorporated in Singapore)
7. Godrej International Ltd. (incorporated in Labuan, Malaysia)
G. Subsidiaries of GAVL: (ceased to be a subsidiary with effect from 27th March, 2017)
1. Godvet Agrochem Ltd.
2. Astec LifeSciences Ltd. and its subsidiaries
i. Behram Chemicals Pvt. Limited
ii. Astec Europe Sprl
iii. Comercializadora Agricola Agroastrachem Cia Ltda
3. Creamline Dairy Products Ltd. and its subsidiary
i. Nagavalli Milkline Pvt. Ltd.
4. Godrej Seeds and Genetics Ltd. (upto 18th March, 2017)
H. Subsidiaries of GPL: (ceased to be a subsidiary with effect from 30th March, 2017; as GIL ceased to
be a subsidiary on that date)
1. Godrej Fund Management Pte Ltd.
2. Godrej Real Estate Pvt. Ltd.
3. Godrej Buildcon Pvt. Ltd.
4. Godrej Projects Development Pvt. Ltd. (GPDPL)
5. City Star Infraprojects Ltd. (w.e.f. 12th January, 2017)
6. Godrej Garden City Properties Pvt. Ltd.
7. Godrej Real View Developers Pvt. Ltd. (w.e.f.1st September,2016 and upto 28th March, 2017)
8. Godrej Green Homes Ltd.
9. Godrej Home Developers Pvt. Ltd.
10. Godrej Hillside Properties Pvt. Ltd.
11. Godrej Prakriti Facilities Pvt. Limited ( a subsidiary of Happy Highrises Ltd.w.e.f 9th June, 2015)
12. Godrej Investment Advisers Pvt. Limited ( a subsidiary w.e.f 29th October 2015)
13. Godrej Highrises Properties Pvt. Limited ( a subsidiary w.e.f 26th June, 2015)
14. Godrej Genesis Facilities Management Pvt. Limited ( a subsidiary of Happy Highrises Ltd w.e.f 19th February, 2016)
15. Godrej Residency Private Limited (w.e.f. 16th March, 2017)
16. Godrej Skyline Developers Private Limited (w.e.f. 22nd November, 2016)
17. Godrej Vikhroli Properties India Limited (Godrej Vikhroli Properties LLP converted into a Public Limited Company)
18. Prakritiplaza Facilities Management Private Limited (w.e.f. 28th July, 2016)
19. Godrej Century LLP (w.e.f. 14th March, 2017)
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123
Godrej & Boyce Mfg. Co. Ltd.
31. Laboratoria Cuenca S.A. (incorporated in Argentina) (a subsidiary of Godrej Netherlands Argentina BV)
32. Deciral S.A. (incorporated in Uruguay) (a subsidiary of Laboratoria Cuenca S.A.)
33. Issue Group Brazil Ltd. (incorporated in Brazil) (a subsidiary of Godrej Netherlands Argentina BV)
34. Consell S.A . (incorporated in Argentina) (a subsidiary of Laboratoria Cuenca S.A.)
35. Subinite Pty Ltd. (incorporated in South Africa) (a subsidiary of Godrej West Africa Holdings Ltd.)
36. Lorna Nigeria Ltd (incorporated in Nigeria) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
37. Weave IP Holding Mauritius Pvt. Ltd. (incorporated in Mauritius) (a subsidiary of Godrej West Africa Holdings Ltd.)
38. Weave Trading Mauritius Pvt. Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
39. Hair Trading (Offshore) S. A. L. (incorporated in Lebanon) (a subsidiary of Weave Trading Mauritius Pvt Ltd.)
40. Weave Mozambique Limitada (incorporated in Mozambique) (a subsidiary of Godrej West Africa Holdings Ltd.)
41. Godrej East Africa Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products Ltd.)
42. Style Industries Ltd. (incorporated in Kenya) (a subsidiary of DGH Phase Two Mauritius Pvt. Ltd.)
43. DGH Phase Two Mauritius (incorporated in Mauritius) (a subsidiary Godrej East Africa Holdings Ltd.)
44. Godrej Tanzania Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products Ltd.)
45. DGH Tanzania Ltd (incorporated in Tanzania) (a subsidiary of Godrej Tanzania Holdings Ltd.)
46. Sigma Hair Ind Ltd. (incorporated in Tanzania) (a subsidiary of DGH Tanzania Ltd.)
47. Weave Ghana Ltd. (incorporated in Ghana) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
48. Godrej Consumer Products US Holding Limited (Incorporated in Mauritius) (w.e.f. 29th March, 2016)
49. Darling Trading Company Mauritius Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa
Holdings Ltd.)
50. Godrej Africa Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
51. Godrej Indonesia IP Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products
Holding (Mauritius) Ltd.)
52. Frika Weave Pty Ltd. (incorporated in South Africa) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
53. Belaza Mozambiq LDA (w.e.f 30th April, 2015)
54. Charm Industries Ltd. (w.e.f. 14th August, 2015)
55. Canon Chemicals Ltd.
56. Godrej Hair Weave Nigeria Ltd.
57. Godrej International Trading Company (Sharjah)
58. DGH Angola (name changed from Godrej Megasari Holdings)
59. Godrej Hair Care Nigeria Limited (w.e.f 12th January, 2016)
60. Godrej Household Insecticide Nigeria Ltd. (w.e.f 12th January, 2016)
61. Hair Credentials Zambia Limited (w.e.f 23rd December 2015)
62. Godrej SON Holdings Inc. (Incorporated in USA) (w.e.f. 24th March, 2016)
63. Old Pro International Inc (USD)
64. Strength of Nature LLC (USA)
65. Strength of Nature South Africa Proprietary Limited
66. Style Industries Uganda Limited
67. Weave Senegal Ltd
68. DGH Uganda
69. Godrej Consumer Products International FZCO
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Annual Report and Accounts 2016-17
(ii) Associates over which the Company's Chairman and Managing Director is able to exercise significant influence: Nil
125
Godrej & Boyce Mfg. Co. Ltd.
(b) Others:
1. Mr. P. E. Fouzdar, Executive Vice President and Company Secretary
2. Mr. P. K. Gandhi, Chief Financial Officer
(vii) Post Employment Benefit Trust with whom the Company has transactions:
1. Godrej and Boyce Manufacturing Co. Ltd. Employees' Provident Fund
2. Godrej and Boyce Manufacturing Co. Ltd. Employees' Gratuity Fund
3. Godrej and Boyce Manufacturing Co. Ltd. Managerial Superannuation Fund
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Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
(ii) Transactions carried out with Mr. J. N. Godrej, Chairman & Managing Director
(a) Dividends paid 2.29 15.70
(b) Unsecured Deposits outstanding 15.00 15.00
(c) Interest paid on Deposits taken 1.37 0.37
(iii) Transactions carried out with Mr. V. M. Crishna, Executive Director:
(a) Dividends paid * 0.00 0.01
(b) Unsecured Deposits outstanding 7.00 7.00
(c) Interest paid on Deposits taken 0.64 0.02
(iv) Remuneration paid/payable to Key Managerial Personnel:
(a) Whole-time Directors 21.81 20.10
(b) Other Key Managerial Personnel 3.26 3.08
(v) Transactions carried out with the relatives of Whole-time Directors:
(a) Mrs. P. J. Godrej:
Remuneration 0.27 0.27
Dividend paid 0.00 0.02
(b) Ms. R. J. Godrej (beneficiary of The Raika Godrej Family Trust):
Dividend paid to Mr. J. N. Godrej and others as Trustees of
The Raika Godrej Family Trust 1.25 7.88
Unsecured Deposits outstanding 14.00 -
(c) Mrs. S. G. Crishna:
Remuneration 0.27 0.27
Dividend paid 2.47 16.96
(d) Mrs. F. C. Bieri:
Dividend paid 1.17 7.26
(e) Ms. N. V. Crishna:
Remuneration 1.86 1.39
Dividend paid 1.17 7.26
(f) Mr. N. J. Godrej: (ceased to be a director from 1st October, 2016)
Dividend paid 1.15 7.88
127
Godrej & Boyce Mfg. Co. Ltd.
(c) The JV does not have any contracts remaining to be executed on Capital Account or any contingent liabilities at close.
The future minimum lease rentals receivable under non-cancellable operating leases within a period of one year are
estimated at Rs. 83.25 crore (as at 31-3-2016: Rs. 29.23 crore and as at 31-3-2015: Rs. 24.92 crore), those due later
than one year but not later than five years at Rs. 72.54 crore (as at 31-3-2016: Rs. 66.37 crore and as at 31-3-2015:
Rs. 94.60 crore), and those due later than five years at Rs. Nil (as at 31-3-2016: Rs. Nil and as at 31-3-2015: Rs. Nil).
128
Godrej & Boyce Manufacturing Company Limited
ENCLOSURE 1
129
Godrej & Boyce Mfg. Co. Ltd.
CORPORATE INFORMATION
Board of Directors
JAMSHYD N. GODREJ, Chairman & Managing Director
ADI B. GODREJ
NADIR B. GODREJ
VIJAY M. CRISHNA, Executive Director
KAVAS N. PETIGARA
PRADIP P. SHAH
Ms. ANITA RAMACHANDRAN
PHIROZE D. LAM, Executive Director (upto 31st March, 2017)
KYAMAS A. PALIA, Executive Director (Finance) (upto 31st March, 2017)
ANIL G. VERMA, Executive Director & President
Ms. NYRIKA HOLKAR, Executive Director - Corporate Affairs (from 1st April, 2017)
KEKI M. ELAVIA
NAVROZE J. GODREJ (from 6th November, 2017)
Auditors
KALYANIWALLA & MISTRY LLP
Chartered Accountants
Bankers
CENTRAL BANK OF INDIA ICICI BANK LTD.
UNION BANK OF INDIA AXIS BANK LTD.
STATE BANK OF INDIA HDFC BANK LTD.
CITIBANK N.A. KOTAK MAHINDRA BANK LTD.
EXPORT-IMPORT BANK OF INDIA
Registered Office and Head Office
Pirojshanagar, Vikhroli, Mumbai 400 079
Telephone: (022) 6796 5656, 6796 5959; Fax: (022) 6796 1518
E-mail: info@godrej.com | Website: http://www.godrej.com
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Annual Report and Accounts 2016-17
We have audited the accompanying Consolidated Ind AS Financial Statements of GODREJ & BOYCE MANUFACTURING COMPANY
LIMITED (hereinafter referred to as “the Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together
referred to as “the Group”) its associates and jointly controlled entities, comprising of the Consolidated Balance Sheet as at March 31,
2017, and the Consolidated Statement of Profit and Loss (including other comprehensive income), the Consolidated Statement of
Cash Flows and the Consolidated Statement of Changes in Equity for the year then ended, and a summary of significant accounting
policies and other explanatory information (hereinafter referred to as “the Consolidated Ind AS Financial Statements”).
Auditors' Responsibility
Our responsibility is to express an opinion on these consolidated Ind AS financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be
included in the audit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit of the Consolidated Ind AS Financial Statements in accordance with the Standards on Auditing specified
under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the consolidated Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated Ind AS
Financial Statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatement of the consolidated Ind AS Financial Statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal financial control relevant to the Holding Company’s preparation of the consolidated Ind AS Financial
Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by
the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated Ind AS financial
statements.
We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports
referred to in sub-paragraph (a) to (b) of the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our
audit opinion on the consolidated Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated Ind AS
Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India including the Ind AS, of the state of affairs (consolidated financial position)
of the Company as at March 31, 2017, and its profit (consolidated financial performance including other comprehensive income), its
consolidated cash flows and the consolidated changes in equity for the year ended on that date.
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Godrej & Boyce Mfg. Co. Ltd.
Emphasis of matter
We draw attention to the following matters in the Notes to the financial statements:
a) Refer note 38(b)(i) whereby the Holding Company has transferred 193,904,681 equity shares of face value of Re. 1/- each in
Godrej Industries Limited to Vora Soaps Limited without consideration. The transfer has been authorized by majority of the
Board of Directors and by the shareholders of the Holding Company. The carrying amount of the investments in the books of the
Company was Rs. 257.77 crore. Had the investment been not transferred the profit for the year would have been higher by
257.77 Crore and retained earnings would have been higher by the same amount.
b) Refer note 38(b)(ii) whereby the Holding Company has transferred 93,500,000 equity shares of face value of Re. 1/- each in
Godrej Consumer Products Limited to Godrej Seed and Genetics Limited without consideration. The transfer has been authorized
by majority of the Board of Directors and by the shareholders of the Holding Company. The carrying amount of the investments
in the books of the Holding Company was Rs. 223.48 Crore. Had the investment been not transferred the profit for the year
would have been higher by 223.48 Crore and retained earnings would have been higher by the same amount.
c) Refer note 1(I)(vi) whereby non-current investments in Subsidiaries, Associates and Joint Ventures are stated at cost (unless
otherwise stated) as per Ind AS 27; however, for any diminution other than temporary in the value of investments, the book
value is reduced to recognise the decline. In cases where these investments are carried at their book values, which are higher
than their fair values, the diminution in the value of such investments is considered to be of a temporary nature, in view of the
Company's long-term financial involvement in such investee companies. No provision is, therefore, considered necessary in the
accounts for diminution in the value of such investments.
d) Refer Note 52(i) to the consolidated Ind AS financial statements, during the year pursuant to the scheme of Amalgamation
approved by the Bombay High Court, Cartini India Ltd. was amalgamated with the Holding Company and was accounted for in
the books of account according to the pooling of interest method under Accounting Standard (AS) 14. The scheme of
amalgamation under Indian Accounting Standard (Ind AS) 103 is to be accounted for in the books of account at acquisition date
fair values. Had the business combination principles been applied and all the identified assets acquired and the liabilities
assumed were measured at their acquisition date fair values and the consideration transferred measured in accordance with this
Ind AS which generally requires acquisition date fair value, the Capital Reserve amounting to Rs. 18.78 Crore would have been
recorded in the books.
Our opinion is not modified in respect of these matters.
Other matters
a) We did not audit the financial statements / financial information of seven subsidiaries, whose consolidated Ind AS financial
statements reflect total assets of Rs. 147.13 crore as at March 31, 2017, total revenues of Rs. 133.28 crore and net cash flows
amounting to Rs. 9.95 crore for the year ended on that date and for an associate whose share of profit is included amounting to
Rs. 0.37 crore, as considered in the consolidated Ind AS financial statements, in so far as it relates to the amounts and disclosures
included in respect of these subsidiaries; and our report in terms of sub-sections (3) and (11) of section 143 of the Act, in so far as
it relates to the aforesaid subsidiaries, is based solely on the reports of the other auditors.
b) The consolidated Ind AS financial statements also include the Group’s share of net loss of Rs. 6.19 crore for the year ended March
31, 2017, as considered in the consolidated Ind AS financial statements, in respect of two associates and a subsidiary having
insignificant balances, whose financial statements have not been audited by us. These financial statements are unaudited and
have been furnished to us by the Management and our opinion on the consolidated financial statements, in so far as it relates to
the amounts and disclosures included in respect of this associate and our report in terms of sub-sections (3) and (11) of section
143 of the Act in so far as it relates to the aforesaid associate, is based solely on such unaudited financial statements. In our
opinion and according to the information and explanations given to us by the Management, these financial statements are not
material to the Group.
Our opinion on the consolidated Ind AS financial statements and our report on Other Legal and Regulatory Requirements below, is not
modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the
financial statements certified by the Management.
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Annual Report and Accounts 2016-17
ERMIN K. IRANI
PARTNER
Membership Number: 35646
Mumbai, November 6, 2017.
133
Godrej & Boyce Mfg. Co. Ltd.
Referred to in Para 2(f) ‘Report on Other Legal and Regulatory Requirements’ in our Independent Auditor’s Report to the members of
the Company on the Consolidated Ind AS Financial Statements for the year ended March 31, 2017.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial reporting of GODREJ & BOYCE MANUFACTURING COMPANY LIMITED
(hereinafter referred to as “the Holding Company”) and its subsidiary companies, its associate companies and jointly controlled
entities, incorporated in India, as of March 31, 2017, in conjunction with our audit of the Consolidated Ind AS Financial Statements of
the Company for the year ended on that date.
The respective Board of Directors of the Holding Company, its subsidiary companies, its associate companies and jointly controlled
entities, incorporated in India, are responsible for establishing and maintaining internal financial controls based on the internal
control over financial reporting criteria established by the Holding Company and its subsidiaries, its associate companies and jointly
controlled entities incorporated in India considering the essential components of internal control stated in the Guidance Note on
Audit of Internal Financial Controls Over Financial Reporting (“the Guidance Note”) issued by the Institute of Chartered Accountants
of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that
were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective
company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness
of the accounting records and the timely preparation of reliable financial information, as required under the Companies Act, 2013
(“the Act” or “the Companies Act”).
Auditors’ Responsibility
Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Holding Company, its
subsidiaries, its associate companies and jointly controlled entities incorporated in India based on our audit. We conducted our audit
in accordance with the Guidance Note and the Standards on Auditing issued by ICAI and deemed to be prescribed under Section
143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those
Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and
if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over
financial reporting and their operating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over
financial reporting, assessing the risk that a material weakness exists and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the Consolidated Ind AS Financial Statements, whether due to fraud or error.
We believe that the audit evidence we have obtained and the audit evidence obtained by other auditors in terms of their reports
referred to in the Other Matter paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the internal
financial controls system over financial reporting of the Holding Company, its subsidiaries, its associate companies and jointly
controlled entities incorporated in India.
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Annual Report and Accounts 2016-17
Opinion
In our opinion the Holding Company, its subsidiary companies and jointly controlled entities, incorporated in India has maintained, in
all respects, adequate internal financial controls system over financial reporting and such internal financial controls over financial
reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established
by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial
Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.
Other Matters
Our aforesaid reports under Section 143(3)(i) of the Act on the adequacy and operatingeffectiveness of the internal financial controls
over financial reporting insofar as it relates to ten subsidiary companies, two associate companies and two jointly controlled
companies, which are companies incorporated in India, is based on the corresponding reports of the auditors of such companies
incorporated in India.
ERMIN K. IRANI
PARTNER
Membership Number: 35646
Mumbai, November 6, 2017.
135
Godrej & Boyce Mfg. Co. Ltd.
LIABILITIES
(2) NON-CURRENT LIABILITIES
(a) Financial Liabilities
(i) Borrowings 18 1,134.72 5,156.67 4,022.60
(ii) Other Financial Liabilities 19 295.35 362.37 222.06
1,430.07 5,519.04 4,244.66
(b) Provisions 20 70.84 104.34 90.45
(c) Deferred Tax Liabilities (Net) 21 0.15 378.04 313.79
(d) Other Non-Current Liabilities 22 - 14.91 7.73
70.99 1,501.06 6,016.33 4,656.63
(3) CURRENT LIABILITIES
(a) Financial Liabilities
(i) Borrowings 23 1,188.82 6,648.31 5,613.09
(ii) Trade Payables 24 1,116.83 2,993.01 2,803.51
(iii) Other Financial Liabilities 25 793.87 2,512.45 3,002.10
3,099.52 12,153.77 11,418.70
(b) Other Current Liabilities 26 788.46 1,639.38 1,418.98
(c) Provisions 27 31.81 125.25 102.66
(d) Current Tax Liabilities (Net) - 41.17 46.15
3,919.79 13,959.57 12,986.49
Total Equity and Liabilities 13,220.29 29,154.47 26,277.19
Statement of Significant Accounting Policies and
Notes to the Financial Statements 1-61
The accompanying notes are an integral part of the financial statements
As per our Report of even date
For KALYANIWALLA & MISTRY LLP For and on behalf of the Board of Directors
CHARTERED ACCOUNTANTS
Firm Registration No.: 104607W / W100166
136
Annual Report and Accounts 2016-17
137
Godrej & Boyce Mfg. Co. Ltd.
(a) Equity share capital For the year ended For the year ended Rupees in Crore
31-03-2017 31-03-2016
Balance at the beginning of the year 6.63 6.63
Changes in equity share capital during the year 0.15 -
Balance at the end of the year 6.78 6.63
Compensation Expense
Translation difference
Revaluation Reserve
Redemption Reserve
Options outstanding
Capital Redemption
Remeasurements of
Investment Subsidy
Securities Premium
Revaluation surplus
Translation Reserve
Capital Reserve on
Foreign Operations
Retained earnings
Hedging Reserves
Foreign Currency
Foreign Currency
General Reserve
Capital Reserve
Employee Stock
Special Reserve
Non-controlling
Treasury Stock
Debenture
Reserves
Reserve
Reserve
Reserve
interest
Plans
Particulars
Balance as at 01/04/2015 0.15 1,518.24 447.01 3,031.78 22.23 12.67 - 81.39 (23.36) 3.84 6.30 33.18 (103.79) 22.86 (4.27) 5.89 3,573.32 - - - 8,627.44
-
Profit for the year - - - 169.18 - - - - - - - - - - - - - - - 169.18
Fair valuation of investments -
Other comprehensive income for the year - - - - - - - - - - - - - - - - - (12.42) (2.78) (83.00) (98.20)
Total comprehensive income for the year - - - 169.18 - - - - - - - - - - - - - (12.42) (2.78) (83.00) 70.98
138
Annual Report and Accounts 2016-17
Deferred gains/(losses) on
net defined benefit Plans
Employee Stock Options
Debenture Redemption
Non-controlling interest
Remeasurements of the
Compensation Expense
Business Combinations
Currency Translation
Capital Redemption
Investment Subsidy
Securities Premium
Revaluation surplus
Translation Reserve
Capital Reserve on
Retained earnings
Hedging Reserves
Foreign Currency
General Reserve
cashflow hedges
Capital Reserve
Special Reserve
Treasury Stock
outstanding
difference
Reserves
Reserve
Reserve
Reserve
Reserve
Particulars
139
Godrej & Boyce Mfg. Co. Ltd.
Cash and Cash Equivalents at the beginning of the year 795.75 773.89
Cash and Cash Equivalents at the end of the year 77.23 795.75
Add: Other Bank Balances (not considered as cash and cash equivalents):
Fixed Deposits with Banks 64.31 238.13
Other Bank Balances (including share in jointly controlled entities) 23.31 47.46
CLOSING CASH AND BANK BALANCES (NOTE 12) 164.85 1,081.34
D. COMPONENTS OF CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
Cash in hand 6.54 12.64
Balances with Banks in Current Accounts 70.69 783.11
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Annual Report and Accounts 2016-17
NOTES:
1. The Statement of Cash Flow has been prepared under the "Indirect Method" as set out in the Indian Accounting Standard 7 (Ind AS-7)
on "Statement of Cash Flows," and presents cash flows by operating, investing and financing activities.
2. Figures for the previous year have been regrouped/restated wherever necessary to conform to this year's classification.
3. Figures in brackets are outflows/deductions.
4. Cash and cash equivalents for the purposes of this Statement comprise of cash in hand, cash at bank and fixed deposits with
maturity of three months or less.
5. For expenditure on CSR activities, please refer to Note 40.
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Godrej & Boyce Mfg. Co. Ltd.
A. General Information
Godrej & Boyce Manufacturing Company Limited (the Company) incorporated on 3rd March, 1932 is a major company of the
Godrej Group. The Company has diverse business divisions offering a wide range of consumer, office, and industrial products and
related services of the highest quality to customers in India and abroad. The Company is domiciled in India and has its registered
office is at, Pirojshanagar, Vikhroli, Mumbai 400 079.
B. Basis of accounting
These consolidated financial statements as at and for the year ended 31st March, 2017 have been prepared in accordance with
Indian Accounting standards (“Ind AS”) issued under the Companies (Indian Accounting Standards) Rules, 2015 as amended by
the Companies (Indian Accounting Standards) (Amendment) Rules, 2016.
For all periods up to and including the year ended 31st March 2016, the Company prepared its consolidated financial statements
in accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph
7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). These consolidated financial statements are the Company’s first Ind AS
financial statements and are covered by Ind AS 101, First-time adoption of Indian Accounting Standards. The transition to Ind AS
has been carried out from the accounting principles generally accepted in India (“Indian GAAP”) which is considered as the
“Previous GAAP” for purposes of Ind AS 101. An explanation of how the transition to Ind AS has affected the Company’s equity
and its net profit is provided in Note 43.
The consolidated financial statements have been prepared on accrual and going concern basis.
The consolidated financial statements of the Company for the year ended 31st March, 2017 were approved for issue in
accordance with the Resolution passed by the Board of Directors, at their meeting held on 6th November, 2017.
C. Operating Cycle
The normal operating cycle in respect of operation relating to under construction real estate project depends on signing of
agreement, size of the project, phasing of the project, type of development, project complexities, approvals needed and
realisation of project into cash and cash equivalents and range from 3 to 7 years. Accordingly, project related assets and
liabilities have been classified into current and non-current based on operating cycle of respective projects. All other assets
and liabilities have been classified into current and non-current based on a period of twelve months.
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Annual Report and Accounts 2016-17
If management's estimate of the useful life of the fixed asset is shorter than that envisaged in Schedule II, depreciation is
provided at a higher rate based on management’s estimate of the useful life. Accordingly, in respect of the commercial
construction projects, on some items of equipment at the project sites, depreciation is provided at a higher rate based on
useful life of the assets estimated at 5 years, compared to 15 years specified in Schedule II. In respect of additions
to/deductions from the assets, the depreciation on such assets is calculated on a pro rata basis from/upto the month of such
addition/deduction. Assets costing less than Rs. 5,000 are fully depreciated in the year of purchase/acquisition. Leasehold
Land and Buildings are amortised over the period of the lease. The cost of fixed assets not ready for their intended use at the
balance sheet date is disclosed under capital work-in-progress. Intangible assets comprising of Technical Know-how and
Trade Marks are amortised on straight-line basis at the rate of 16.67%; capitalised Computer Software costs relating to the
ERP system, are amortised on straight line basis at the rate of 20%.
(ii) Recognition and measurement of defined benefit obligations
The obligation arising from defined benefit plan is determined on the basis of actuarial assumptions. Key actuarial
assumptions include discount rate, trends in salary escalation, vested future benefits and life expectancy. The discount rate
is determined by reference to market yields at the end of the reporting period on government bonds. The period to maturity
of the underlying bonds correspond to the probable maturity of the post-employment benefit obligations.
(iii) Recognition of deferred tax assets
A deferred tax asset is recognised for all the deductible temporary differences to the extent that it is probable that taxable
profit will be available against which the deductible temporary difference can be utilised. The management assumes that
taxable profits will be available while recognising deferred tax assets.
(iv) Recognition and measurement of other provisions
The recognition and measurement of other provisions are based on the assessment of the probability of an outflow of
resources, and on past experience and circumstances known at the balance sheet date. The actual outflow of resources at a
future date may therefore vary from the figure included in other provisions.
(v) Discounting of long-term financial liabilities
All financial liabilities are required to be measured at fair value on initial recognition. In case of financial liabilities which are
required to subsequently be measured at amortised cost, interest is accrued using the effective interest method.
(vi) Determining whether an arrangement contains a lease
At inception of an arrangement, the Company determines whether the arrangement is or contains a lease. At inception or
on reassessment of an arrangement that contains a lease, the Company separates payments and other consideration
required by the arrangement into those for the lease and those for other elements on the basis of their relative fair values. If
the Company concludes for a finance lease that it is impracticable to separate the payments reliably, then an asset and a
liability are recognised at an amount equal to the fair value of the underlying asset; subsequently, the liability is reduced as
payments are made and an imputed finance cost on the liability is recognised using the Company ’s incremental borrowing
rate. And in case of operating lease, all payments under the arrangement are treated as lease payments.
(vii) Rebates and sales incentives
Rebates are generally provided to distributors or customers as an incentive to sell the Company’s products. Rebates are
based on purchases made during the period by distributor / customer. The Company determines the estimates of rebate
accruals primarily based on the contracts entered into with their distributors / customers and the information received for
sales made by them.
(viii) Fair value of financial instruments
Derivatives are carried at fair value. Derivatives includes Foreign Currency Forward Contracts and Interest Rate Swaps. Fair
valued of Foreign Currency Forward Contracts are determined using the fair value reports provided by the respective
merchant bankers. Fair value of Interest Rate Swaps are determined with respect to current market rate of interest.
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Godrej & Boyce Mfg. Co. Ltd.
balance sheet for liabilities arising from financing activities, to meet the disclosure requirement.
The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of
cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. It clarifies
that the fair value of cash-settled awards is determined on the basis consistent with that used for equity-settled
awards. The amendment clarifies that if the terms and conditions of a cash-settled share-based payment transactions
are modified with the result that it becomes an equity-settled share-based payment transaction, the transaction is
accounted for as such from the date of the modification. Further, the amendment requires the award that include
a net settlement feature in respect of withholding taxes to be treated as equity-settled in its entirety. The cash
payment to the tax authority is treated as if it was a part of an equity settlement.
The Company is currently evaluating the effect of the above amendments.
H. Basis of Consolidation
(i) Subsidiaries
Subsidiaries are all entities (including special purpose entities) that are controlled by the Company. Control exists when the
Group is exposed to, or has the ability to affect those returns through power over the entity. In assessing control, potential
voting rights are considered only if the rights are substantive. The financial statements of subsidiaries are included in these
consolidated financial statements from the date that control commences until the date that control ceases.
The consolidated financial statements have been prepared using uniform accounting policies for like transactions and other
events in similar circumstances. The accounting policies adopted in the preparation of financial statements are consistent
with those of previous year. The financial statements of the Company and its subsidiaries have been combined on a line-by-
line basis by adding together the book values of like items of assets, liabilities, income and expenses, after eliminating intra-
group balances, intra-group transactions and the unrealised profits/ losses, unless cost/revenue cannot be recovered.
The excess of cost to the Group of its investment in subsidiaries, on the acquisition dates over and above the Group’s share
of equity in the subsidiaries, is recognised as ‘Goodwill on Consolidation’ being an asset in the consolidated financial
statements. The said Goodwill is not amortised, however, it is tested for impairment at each Balance Sheet date and the
impairment loss, if any, is provided for. On the other hand, where the share of equity in subsidiaries as on the date of
investment is in excess of cost of investments of the Group, it is recognised as ‘Capital Reserve’ and shown under the head
‘Reserves and Surplus’ in the consolidated financial statements.
Non-controlling interests in the net assets of consolidated subsidiaries is identified and presented in the consolidated
Balance Sheet separately within equity.
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Joint arrangements are those arrangements over which the Group has joint control, established by contractual agreement
and requiring unanimous consent for strategic financial and operating decisions. Investments in associates and jointly
controlled entities are accounted for using the equity method (equity accounted investees) and are initially recognized at
cost. The carrying value of the Group’s investment includes goodwill identified on acquisition, net of any accumulated
impairment losses. The Group does not consolidate entities where the non-controlling interest (“NCI”) holders have certain
significant participating rights that provide for effective involvement in significant decisions in the ordinary course of
business of such entities. Investments in such entities are accounted by the equity method of accounting. When the Group’s
share of losses exceeds its interest in an equity accounted investee, the carrying amount of that interest (including any long-
term investments) is reduced to zero and the recognition of further losses is discontinued except to the extent that the
Group has an obligation or has made payments on behalf of the investee. If the associate or joint venture subsequently
reports profits, the entity resumes recognizing its share of those profits only after its share of the profits equals the share of
losses not recognized.
After application of the equity method, the Group determines whether it is necessary to recognize an impairment loss on its
investment in its associate or joint venture. At each reporting date, the Group determines whether there is objective
evidence that the investment in the associate or joint venture is impaired. If there is such evidence, the Group calculates the
amount of impairment as the difference between the recoverable amount of the associate or joint venture and its carrying
value, and then recognizes the loss as ‘Share of profit of an associate and a joint venture’ in the statement of profit or loss.
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Transaction costs are expensed as incurred, other than those incurred in relation to the issue of debt or equity securities.
Any contingent consideration payable is measured at fair value at the acquisition date. Subsequent changes in the fair value
of contingent consideration are recognised in the Statement of Profit and Loss.
In accordance with Ind AS 101 provisions related to first time adoption, the Group has elected to apply Ind AS accounting for
business combinations prospectively from 1st April, 2015. As such, Previous GAAP balances relating to business
combinations entered into before that date, including goodwill, have been carried forward as at the date of transition to Ind
AS.
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Intangible assets comprising of Technical Know-how and Trade Marks are amortised on straight-line basis at
the rate of 16.67%; capitalised Computer Software costs relating to the ERP system, are amortised on straight
line basis at the rate of 20%.
ii. Investment properties
a. The Company has elected to continue with the carrying value for all of its investment property as recognised in its Indian
GAAP financial statements as deemed cost at the transition date, viz., 1st April, 2015.
b. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition,
investment properties are stated at cost less accumulated depreciation and accumulated impairment loss, if any.
c. The cost includes the cost of replacing parts and borrowing costs for long-term construction projects if the recognition
criteria are met. When significant parts of the investment property are required to be replaced at intervals, the Company
depreciates them separately based on their specific useful lives. All other repair and maintenance costs are recognized in
profit or loss as incurred.
d. The Company follows the straight line method for charging depreciation on investment property over estimated useful
lives prescribed in Schedule II to the Companies Act, 2013.
e. Though the Company measures investment property using cost based measurement, the fair value of investment property
is disclosed in the notes.
f. Investment properties are derecognised either when they have been disposed of or when they are permanently
withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net
disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.
iii. Intangible assets and goodwill
a. Recognition and measurement
Intangible assets, including patents and trademarks, which are acquired by the Company and have finite useful lives are
measured at cost less accumulated amortisation and any accumulated impairment losses.
b. Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to
which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised in
profit or loss as incurred.
c. Amortisation
Intangible assets are amortised over their estimated useful life on straight line method.
iv. Biological assets
Biological assets are measured at fair value less costs to sell, with any change therein recognized in the consolidated
statement of profit or loss.
v. Impairment of Non-Financial Assets
The carrying values of assets / cash generating units at each balance sheet date are reviewed for impairment if any
indication of impairment exists.
If the carrying amount of the assets exceed the estimated recoverable amount, impairment is recognized for such excess
amount. The impairment loss is recognized as an expense in the Consolidated Statement of Profit and Loss, unless the asset
is carried at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation decrease to
the extent a revaluation reserve is available for that asset.
Goodwill on business combinations is included in intangible assets. Goodwill is not amortized but it is tested for impairment
annually or more frequently if events or changes in circumstances indicate that it might be impaired. The recoverable
amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash
flows to their present value based on an appropriate discount factor.
When there is indication that an impairment loss recognized for an asset (other than a revalued asset) in earlier accounting
periods which no longer exists or may have decreased, such reversal of impairment loss is recognized in the Consolidated
Statement of Profit and Loss, to the extent the amount was previously charged to the Consolidated Statement of Profit and
Loss. In case of revalued assets, such reversal is not recognized.
vi. Investment in Joint Ventures and Associates
Investments in associates and joint ventures are stated at cost (unless otherwise stated);
however, for any diminution other than temporary in the value of investments, the book value is reduced
to recognise the decline. In cases where these investments are carried at their book values, which are higher than
their fair values, the diminution in the value of such investments is considered to be of a temporary nature, in view
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Godrej & Boyce Mfg. Co. Ltd.
of the Company's long-term financial involvement in such investee companies. On disposal of investments in
Associates and Jointly controlled entities, the difference between net disposal proceeds and the carrying amounts
are recognized in the Statement of Profit and Loss.
vii. Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument of another entity.
a. Financial assets
(i) Classification:
The Company shall classify financial assets as subsequently measured at amortised cost, fair value through other
comprehensive income or fair value through profit or loss on the basis of its business model for managing the
financial assets and the contractual cash flow characteristics of the financial asset.
(ii) Initial recognition and measurement:
Equity investments
(a) All equity investments in scope of Ind-AS 109 are measured at fair value. Equity instruments which are held for
trading are classified as at FVTPL. For all other equity instruments, the Company classifies the same at FVOCI. The
classification is made on initial recognition and is irrevocable.
(b) All fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of
the amounts from OCI to profit and loss, even on sale of investment. However, the Company may transfer the
cumulative gain or loss within equity.
(c) Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in
the profit and loss.
b. Financial liabilities
(i) Classification
The Company classifies all financial liabilities as subsequently measured at amortised cost, except for financial
liabilities at fair value through profit or loss. Such liabilities, shall be subsequently measured at fair value.
(ii) Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans
and borrowings, payables, as appropriate.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net
of directly attributable and incremental transaction cost.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are
an integral part of the Effective Interest Rate (EIR). The EIR amortisation is included as finance costs in the statement
of profit and loss.
The Company’s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts,
financial guarantee contracts and derivative financial instruments.
(iii) Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the
terms of an existing liability are substantially modified, such an exchange or modification is treated as the
derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying
amounts is recognised in the statement of profit or loss.
(c) Derivative financial instruments
The Company uses derivative financial instruments, such as forward currency contracts to hedge its foreign currency
risks . Such derivative financial instruments are initially recognised at fair value on the date on which a derivative
contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets
when the fair value is positive and as financial liabilities when the fair value is negative.
(d) Financial guarantee contracts
Financial guarantee contracts issued by the Group are those contracts that require a payment to be made to
reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in
accordance with the terms of a debt instrument. Financial guarantee contracts are recognised initially as a liability at
fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently,
the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements
of Ind-AS 109 and the amount recognised less cumulative amortisation.
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Contract expenses are recognised as incurred unless they create an asset related to future contract activity. An
expected loss on a contract is recognised immediately in profit or loss.
(d) Revenue from rendering of services
Revenue from service transactions is recognised as per agreements/arrangements with the customer when the
related services are rendered/provided. If the services under a single arrangement are rendered in different
reporting periods, then the consideration is allocated on a relative fair value basis between the different services.
(e) Sale from multiple element arrangement
Sales of goods and services sometimes involve the provision of multiple elements. In these cases, the Company
determines whether the contract or arrangement contains more than one unit of accounting. If certain criteria are
met, foremost if the delivered element(s) has (have) value to the customer on a stand-alone basis, the arrangement
is separated and the appropriate revenue recognition convention is then applied to each separate unit of accounting.
Generally, the total arrangement consideration is allocated to the separate units of accounting based on their
relative fair values. If the criteria for the separation of units of accounting are not met, revenue is deferred until such
criteria are met or until the period in which the last undelivered element is delivered.
(f) Revenue from Real Estate Transaction:
i. The “Percentage of Completion Method” of accounting is followed where revenue from sale of properties is
recognized in Statement of Profit & Loss in proportion to the actual cost incurred as against the total estimated cost
of projects under execution with the Company on transfer of significant risk and rewards to the buyer. Up to March
31, 2012 revenue was recognised only if the actual project cost incurred is 20% or more of the total estimated project
cost.
ii. Effective April 1, 2012, in accordance with the “Guidance Note on Accounting for Real Estate Transactions (Revised
2012)” (Guidance Note), all projects commencing on or after the said date or projects which have already
commenced, but where the revenue is recognised for the first time on or after the above date, Construction revenue
on such projects have been recognised on percentage of completion method provided the following thresholds have
been met: (a) All critical approvals necessary for the commencement have been obtained; (b) The expenditure
incurred on construction and development costs is not less than 25 percent of the total estimated construction and
development costs; (c) At least 25 percent of the saleable project area is secured by contracts or agreements with
buyers; and (d) At least 10 percent of the agreement value is realized at the reporting date in respect of such
contracts and it is reasonable to expect that the parties to such contracts will comply with the payment terms as
defined in the contracts.
iii. Effective April 1, 2016, construction revenue for all projects commencing on or after the said date or projects
which have already commenced, but where the revenue is recognised for the first time on or after the above date,
have been recognised in accordance with the “Guidance Note on Accounting for Real Estate Transactions (for entities
to whom Ind AS is applicable)”. Principle enunciated in said guidance note is substantially similar to the guidance
note on accounting for real estate transaction issued by the Institute of Chartered Accountants of India (ICAI) in
2012.
iv. Income from operation of commercial complexes is recognised over the tenure of the lease / service agreement.
(g) Loyalty programme
Sales is allocated between the loyalty programme and the other components of the transaction. The amount
allocated to the loyalty programme is deferred, and is recognised as revenue when the Company has fulfilled its
obligations to supply the discounted products under the terms of the programme or when it is no longer probable
that the points under the programme will be redeemed.
(h) Other Operating Revenue and Other Income
Income from processing operations is recognised on completion of production / dispatch of the goods, as per the
terms of contract.
Dividend income, including share of profit in LLP, is recognised when the right to receive the same is established , it is
probable that the economic benefits associated with the dividend will flow to the Group, and the amount of dividend
can be measured reliably.
For all financial instruments measured at amortised cost, interest income is recorded using the effective interest rate
(EIR), which is the rate that discounts the estimated future cash payments or receipts through the expected life of
the financial instruments or a shorter period, where appropriate, to the net carrying amount of the financial assets.
Interest income is included in other income in the Statement of Profit and Loss.
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(i) temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss;
(ii) temporary differences related to investments in subsidiaries and associates to the extent that the Group is able to
control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the
foreseeable future; and
(iii) taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to
the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax
assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised; such reductions are reversed when the probability of future taxable profits
improves.
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Unrecognized deferred tax assets are reassessed at each reporting date and recognised to the extent that it has
become probable that future taxable profits will be available against which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they
reverse, using tax rates enacted or substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the
Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset only if:
a) the entity has a legally enforceable right to set off current tax assets against current tax liabilities; and
b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on
the same taxable entity.
Deferred tax asset / liabilities in respect of on temporary differences which originate and reverse during the tax holiday
period are not recognised. Deferred tax assets / liabilities in respect of temporary differences that originate during the tax
holiday period but reverse after the tax holiday period are recognised. Deferred tax assets on unabsorbed tax losses and tax
depreciation are recognised only to the extent that there is virtual certainty supported by convincing evidence of their
realisation and on other items when there is reasonable certainty of realisation. The tax effect is calculated on the
accumulated timing differences at the year-end based on the tax rates and laws enacted or substantially enacted on the
balance sheet date.
Minimum Alternate Tax (MAT) Credit Entitlement is recognised as an asset only when and to the extent there is
convincing evidence that the Company will pay normal income tax during the specified period in which such credit
can be carried forward for set-off. The carrying amount of MAT Credit Entitlement is reviewed at each balance sheet date.
xxi. Leases (where the Company is the lessor)
In determining whether an arrangement is, or contains a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a lease date if fulfillment of the arrangement is dependent on the
use of a specific asset or assets and the arrangement conveys a right to use the asset, even if that right is not explicitly
specified in the arrangement.
(a) Finance Lease
Agreements are classified as finance leases, if substantially all the risks and rewards incidental to ownership of the leased
asset is transferred to the lessee.
Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of
the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant
periodic rate of interest on the remaining balance of the liability.
(b) Operating Leases
Leases of assets under which all the risks and rewards of ownership are effectively retained by the lessor are classified as
operating leases. Lease payments under operating leases are recognized as an expense on a straight line basis over the lease
term, unless such payments are structured to increase in line with expected general inflation to compensate for the lessor’s
expected inflationary cost increase.
( c) Lease Assets
Assets held by the Group under leases that transfer to the Group substantially all of the risks and rewards of ownership are
classified as finance leases. The leased assets are measured initially at an amount equal to the lower of their fair value and
the present value of the minimum lease payments. Subsequent to initial recognition, the assets are accounted for in
accordance with the accounting policy applicable to that asset.
Assets held under other leases are classified as operating leases and are not recognised in the Group’s statement of financial
position.
(d) Estate Lease
In its Estate Leasing operations, the assets subject to operating leases are included in investment property. Lease
income is recognised in the Consolidated Statement of Profit and Loss on a straight-line basis over the lease term.
Costs, including depreciation, are recognized as an expense in the Consolidated Statement of Profit and Loss. Initial
direct costs such as legal costs, brokerage costs, etc. are recognised immediately in the Consolidated Statement of
Profit and Loss.
xxii. Product warranty expense under service warranty obligation
In respect of products sold by the Company, which carry a specified warranty, future costs that will be incurred by the
Company in carrying out its contractual warranty obligations are estimated and accounted for on accrual basis.
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(b) Derecognition of financial assets and financial liabilities: The Company has opted to apply the exemption available under Ind
AS 101 to apply the derecognition criteria of Ind AS 109 prospectively for the transactions occurring on or after the date of
transition to Ind AS.
(c) Business Combination exemption: The Group has applied the exemption as provided in Ind AS 101, on non-application of Ind
AS 103, "Business Combinations" to business combinations consummated prior to the date of transition (1st April, 2015).
Pursuant to this exemption, goodwill arising from business combination has been stated at the carrying amount under
Previous GAAP.
(d) Share based payment exemption: The Group has elected to apply the share based payment exemption available under Ind
AS 101 on application of Ind AS 102, "Share based payment" to grants which remain unvested on 1st April, 2015.
(e) The following requirement of Ind AS 110, are applied prospectively from the date of transition to Ind AS (provided that Ind
AS 103 is not applied retrospectively to past business combinations):
- To attribute total comprehensive to non-controlling interests irrespective of whether this results in a deficit balance.
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Godrej & Boyce Mfg. Co. Ltd.
Tree Development
Freehold Buildings
Office Equipment
& Improvements
Research Centre
Leasehold Land
Freehold Land
Vehicles/
Vessels
Cost
Particulars
COST OF ASSETS
Gross Block as at 1/4/2016 622.60 151.80 1,611.14 173.27 1,965.37 102.65 107.39 145.26 0.42 0.46 0.80 4,881.16
Adjustments pursuant to loss of
(336.65) (105.34) (1,159.96) (147.42) (1,288.40) (87.82) (64.84) (97.72) (0.42) (0.46) (0.80) (3,289.83)
control of subsidiaries
Additions 14.75 43.03 259.34 2.70 215.21 0.69 8.84 10.86 - - - 555.41
Deductions - - (4.54) - (4.57) (0.30) (0.22) (0.70) - - - (10.34)
Other Adjustments - - - (0.05) (0.18) (0.01) (0.02) 0.00 - - - (0.26)
Gross Block as at 31/3/2017 300.70 89.49 705.98 28.50 887.43 15.21 51.15 57.70 - - - 2,136.15
DEPRECIATION
Total Depreciation upto
- 1.73 44.36 11.88 151.62 14.55 8.91 31.71 0.01 0.03 0.40 265.21
31/3/2016
Adjustments pursuant to loss of
- (1.15) (31.81) (8.18) (93.01) (14.85) (6.69) (22.16) (0.01) (0.03) (0.40) (178.29)
control of subsidiaries
Depreciation for the year - 0.90 18.47 2.95 126.00 1.35 9.32 12.12 - - - 171.11
Depreciation on Deductions - - 0.19 - (2.05) (0.27) (0.07) (0.32) - - - (2.52)
Other Adjustments - - - (0.04) (0.13) 0.00 (0.02) (0.00) - - - (0.19)
Total Depreciation upto
- 1.48 31.21 6.61 182.42 0.78 11.45 21.34 - - - 255.29
31/3/2017
Depreciation pursuant to loss of
8.10 40.09 4.89 125.14 18.31 10.60 29.43 0.10 0.05 0.40 237.11
control of subsidiaries
Registration
Know-how
Computer
Technical
Goodwill
Particulars
Software
Product
COST OF ASSETS
Gross Block as at 1/4/2016 12.60 1.33 78.39 4.51 923.42 38.22 2.71 1,048.58
Adjustments pursuant to loss of
(12.60) - (71.60) (1.85) (923.28) (38.22) (2.71) - (1,037.66)
control of subsidiaries
Additions - - 0.15 - - - - 0.15
Deductions - - 0.02 - - - - 0.02
Other Adjustments - - - - - - - -
Gross Block as at 31/3/2017 - 1.33 6.94 2.67 0.14 - - 11.08
AMORTIZATION
Total upto 31/3/2016 2.39 0.04 13.06 2.42 14.71 - 1.15 31.39
Adjustments pursuant to loss of
(2.39) - (10.89) (0.26) (14.66) - (1.15) - (26.96)
control of subsidiaries
Charge for the year - 0.04 2.41 0.43 0.04 - - 2.93
Deductions during the year - - 0.01 0.00 - - - 0.01
Other Adjustments - - - - - - - -
Total Amortization
(0.00) 0.08 4.59 2.60 0.09 - - 7.36
upto 31/3/2017
Depreciation pursuant to loss of
12.78 1.45 31.14 45.37
control of subsidiaries
Net Block as at 31/3/2017 0.00 1.25 2.35 0.07 0.05 - - 3.72
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Annual Report and Accounts 2016-17
Office Equipment
Research Centre
Leasehold Land
Improvements
Freehold Land
Live Biological
Development
Furniture &
Buildings &
Equipment
Particulars
Leasehold
Vehicles/
Buildings
Freehold
Fixtures
Plant &
Vessels
Assets
Total
Tree
Cost
COST OF ASSETS
Deemed Cost as at 1/4/2015 319.89 96.59 868.84 48.70 1,551.80 75.30 65.41 80.41 0.38 0.44 0.80 3,108.56
Additions 56.89 52.98 666.86 125.88 422.18 31.30 58.30 75.33 0.15 0.12 - 1,489.99
Acquistion through business
250.21 2.50 61.74 - 72.25 2.90 1.39 1.94 - - - 392.93
combination
Deductions (0.56) - 13.09 (1.10) (74.34) (6.52) (15.48) (10.33) (0.11) (0.10) - (95.45)
Other Adjustments (3.83) (0.27) 0.61 (0.21) (6.52) (0.33) (2.23) (2.09) - - - (14.87)
Gross Block as at 31/3/2016 622.60 151.80 1,611.14 173.27 1,965.37 102.65 107.39 145.26 0.42 0.46 0.80 4,881.16
DEPRECIATION
Total Depreciation upto
- - - - - - - - - - - -
1/4/2015
Depreciation for the year - 1.74 44.61 12.13 208.03 16.40 17.22 34.57 0.01 0.04 0.40 335.15
Depreciation on Deductions - - (0.20) (0.08) (54.44) (1.82) (7.00) (1.86) - (0.01) - (65.40)
Other Adjustments - (0.01) (0.05) (0.17) (1.97) (0.03) (1.31) (1.00) - - - (4.54)
Total Depreciation upto
- 1.73 44.36 11.88 151.62 14.55 8.91 31.71 0.01 0.03 0.40 265.20
31/3/2016
Registration
Trademarks
Know-how
Computer
Technical
Land Use
Software
Goodwill
Building
Particulars
Product
Rights
Brand
Total
COST OF ASSETS
Gross Block as at 1/4/2015 12.60 1.33 56.49 4.89 926.31 - - 989.02
Additions - - 25.21 - 0.32 - 0.26 25.79
Acquistion through business
- - 1.61 - - 38.22 2.45 42.28
combination
Deductions - - (2.86) (0.04) (1.54) - - (4.44)
Other Adjustments - - (2.06) (0.34) (1.67) - - (4.07)
Gross Block as at 31/3/2016 12.60 1.33 78.39 4.51 923.42 38.22 2.71 1,048.58
AMORTIZATION
Total upto 31/3/2015 - - - - - - -
Charge for the year 2.47 0.04 16.16 2.47 17.70 - 1.15 37.52
Deductions during the year - - (1.94) - (1.53) - - (3.47)
Other Adjustments (0.08) - (1.16) (0.05) (1.46) - - (2.67)
Total Amortization upto 31/3/2016 2.39 0.04 13.06 2.42 14.71 - 1.15 31.38
Net Block as at 31/3/2016 10.21 1.29 65.33 2.09 908.71 38.22 1.56 1,017.20
Improvements
Freehold Land
Live Biological
Development
Furniture &
Buildings &
Equipment
Equipment
Leasehold
Tangible Assets
Buildings
Freehold
Fixtures
Plant &
Assets
Office
Total
Tree
Cost
Technical
Land Use
Software
Building
Product
Intangible Assets
Rights
Brand
Total
157
Godrej & Boyce Mfg. Co. Ltd.
ACCUMULATED DEPRECIATION
Depreciation for the year 10.62
Depreciation on Deductions -
Adjustments on consolidation -
Total Depreciation upto 31/3/2016 10.62
Adjustments pursuant to loss of control of subsidiaries (2.01)
Depreciation for the year 7.08
Depreciation on Deductions (0.58)
Total Depreciation upto 31/3/2017 15.11
Depreciation pursuant to loss of control of subsidiaries 2.15
Note: The Group has availed the deemed cost exemption in relation to the investment property on the date of transition
and hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer
notes above for the gross block value and the accumulated depreciation on 1st April, 2015 under the previous GAAP.
(Rupees in crore)
2016-17 2015-16
Rental Income derived from investment properties 217.09 246.47
Direct operating expenses (including repairs and maintenance) generating
rental income 43.41 48.83
Profit arising from investment properties 173.68 197.64
As at 31st March, 2017 and 31st March, 2016, the fair values of the properties are Rs. 1,971 crore.
These valuations are based on discounted cash flow method
158
Annual Report and Accounts 2016-17
The Company has applied the method of Discounted Cash Flow projections based on reliable estimates of future cash flows.
Description of valuation technique and key inputs to valuation on investment properties:
Valuation technique Significant unobservable inputs Range (weighted average)
Discounted Cash Flow Rent growth p.a. 5%
Long term vacancy rate 0%
Discount rate 15%
A Sub-Subsidiary Company has trading operations in oil palm plantations whereby the group purchases the saplings and sell the
saplings once it has achieved the desired growth. During the year 2015-16, the group purchased 4,92,200 number of saplings,
out of which 4,92,200 were still under cultivation
159
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in Crore)
Particulars Profit or Loss as at 31/03/2016
160
Annual Report and Accounts 2016-17
Notes:
(a) The Group has availed the deemed cost exemption in relation to the Property, Plant and Equipment on the date of transition and
hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer note 2.A for the
gross block value and the accumulated depreciation on 1st April, 2015 under the previous GAAP.
(b) In respect of the Parent Company’s freehold land situated at Thane (transferred on Amalgamation of the erstwhile Lawkim Ltd.):
(i) Land admeasuring approximately one acre was the subject matter of dispute. The Company has filed an appeal in the Hon’ble
High Court of Judicature at Bombay, against the Order dated 23rd December, 2004 passed by the Third Additional District Judge,
Thane. The Company has also registered notice of lis pendens dated 17th May, 2005 with the Registrar of Sub-Assurance.
(ii) A part of the land was acquired by the Thane Municipal Corporation and the Company has an option for the Transferable
Development Rights (TDR) as compensation for the said acquisition. Pending the receipt of such compensation by the Company
in the form of TDR, no adjustment has been made in the books in this regard.
(c) Freehold Land includes (i) leasehold rights in perpetuity and (ii) transferable development rights (TDRs). Freehold Buildings include
investments representing shares in ownership of flats.
(d) Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. 29.61 crore
(as at 31-03-2016: Rs. 98.27 crore).
(e) The additions to Freehold Land, includes Rs. 17.84 crore, pertaining to carrying value of Land of the three wholly-owned subsidiaries
merged with the Company, with effect from, 1st April, 2015. [Refer Note 52(v)]
(f) Information with respect to subsidiary companies:
(i). Refer Note 28 for disclosure of contractual commitments for the acquisition of Property, Plant and Equipments.
(ii). Addition to Fixed Assets includes Rs. 9.07 crore for the year ended 31st March, 2017 (previous year Rs. 43.01 crore) on
account of Exchange Difference arising on conversion of Long Term Foreign Currency Monetary Items relating to acquisition of
depreciable assets.
(iii). Plant & Equipments and Buildings at Vikhroli location amounting to Rs 0.55 as on 31st March, 2017 (Rs. 3.58 crore as on 31st
March, 2016 and Rs. 3.93 crore as on April 01, 2015) are classified as Assets held for Sale.
(iv). Legal formalities relating to the transfer of title of immovable assets situated at Chennai (acquired as a part of the take over of
Agrovet business from Godrej Industries Limited), Hyderabad (as part of the merger of Godrej Plant Biotech Limited), Dhule (as
part of the merger of Goldmohur Foods & Feeds Ltd), Hanuman Jn. (as part of the merger of Golden Feed Products Ltd),
Chintampalli (as part of the merger of Godrej Gokarna Oilpalm Limited), Ariyalur & Varanavasi (as part of the merger of Cauvery
Oil Palm Limited) and at Kolkata are being complied with. Stamp duty payable thereon is not presently determinable.
(v). To give effect to the Order of the Honorable High Court of Judicature at Bombay passed during 2011-12 regarding the Scheme
of Amalgamation of Godrej Gokarna Oil Palm Limited and Godrej Oil Palm Limited, the amortisation of Grant of Licenses are
charged against the balance in the General Reserve Account.
161
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
3A. INVESTMENTS IN ASSOCIATES 31-03-2017 31-03-2016 01-04-2015
(i) Nil (as at31-03-2016: 2,01,54,008) Equity Shares of Rs. 2 each in Geometric Ltd., valued at
deemed cost as per Ind AS 101, the previous GAAP carrying amount of Rs. 7.27 crore as on 1st
April, 2015 has been recognized at fair value of Rs. 203.38 crore, resulting in an adjustment to the
extent of Rs. 196.11 crore. 79,79,008 shares at a carrying amount of Rs. 51.62 crores were
received pursuant to a business combination. [Refer Note 52 (ii) - Amalgamation of Godrej
Investments Pvt. Ltd. with the Company] . During the year, these shares were exchanged for
shares in HCL Technologies Ltd. and 3DPLM Software Solutions Ltd. on demerger of the Business
Undertaking of erstwhile Geometric Ltd with HCL Technologies Ltd. and amalgamation of
Remaining Undertaking of esrtwhile Geometric Ltd. with 3DPLM Software Solutions Ltd. - 318.31 308.19
Total Quoted Non-current Trade Investments - 318.31 308.19
(b) UNQUOTED
(1) Investments in Equity Shares in Associate Companies
(i) 455000 Fully Paid Equity Shares of Rs.10 each in Polchem Hygiene
Laboratories Private Limited [Note 3A (5) below] - - 5.85
(ii) 24 Fully Paid Equity Shares of AED 1500 each in
Al Rahaba International Trading Limited Liability Company - 3.16 4.07
(iii) 389269 Fully Paid Equity Shares of Rs.10 each in Personalitree Academy Ltd. - 1.10 1.10
Less: Provision for Diminution in Value (Refer Note 1 below) - (1.10) (1.10)
- - -
(iv) 5546 [Fully Paid Equity] Shares of Rs.10 each in Bhabhani Blunt Hairdressing Pvt Ltd - 22.42 22.31
(v) 5,78,200 Fully Paid Shares of RO 1 each in Godrej & Khimji (Middle East) LLC. Oman 17.52 15.04 15.74
(vi) 38 Ordinary Shares of USD 1 each in Parazelsus, Orient Ltd. USA. * - - -
(vii) 16,21,539 common units at Rs. 3.25 each in Urban Electric Power Inc. USA 18.82 24.98 14.63
36.34 65.60 62.60
162
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
163
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
(2) Investment in Preference Shares - Unquoted (at fair value through profit and loss)
(i) 2,01,54,008 7% Redeemable Preference Shares of Rs. 68 each in
3DPLM Software Solutions Ltd. (1,21,75,000 shares received on
amalgamation of Remaining Undertaking of erstwhile Geometric Ltd.
with 3DPLM Software Solutions Ltd., in exchange of 1,21, 75,000 shares
held in erstwhile Geometric Ltd by the Company. Moreover,
79,79,008 shares received in exchange of 79,79,008 shares held by
Godrej Investments Pvt. Ltd., which merged with the Company from the
appointed date of 29th March, 2017.) 137.05 - -
(ii) 25 shares of Rs.100 in Tahir Properties Ltd. (Class - A) (partly paid)[Refer Note 2 below] - - -
137.05 - -
(3) Investment in Debentures (at fair value through profit and loss)
(i) 4364039 Debentures of Rs. 100 each in Godrej Landmark Redevelopers Pvt. Ltd. - 43.64 79.36
(ii) 2989095 Debentures of Rs.10 each Godrej Realty Pvt. Ltd - 2.99 2.99
(iii) 307833 Debentures of Rs. 1000 each in Wonder City Buildcon Pvt. Ltd - 30.59 30.48
(iv) 353618 Debentures of Rs. 1000 each in Wonder Space Properties Pvt. Ltd. - 35.40 34.84
(v) 413949 Debentures of Rs. 1000 each in Godrej Home COnstructions Pvt. Ltd. - 41.23 0.00
(vi) 843837 Debentures of Rs. 1000 each in Godrej Redevelopers(Mumbai) Pvt. Ltd. - 85.33 60.49
Total Quoted Non-current Non-Trade Investments - 239.18 208.16
(4) Investment in Partnership Firms (at fair value through profit and loss)
View Group LP (Less: Provision for Impairment in the value of investment) (Note 4 below) - -
(5) Other Investment (at fair value through profit and loss)
(i) Indian Fund for Sustainable Energy (Infuse Capital) - 2.91 0.96
(ii) Omnivore India Capital Trust 25.93 12.49
- 28.84 13.45
Grand Total 5,239.75 317.49 387.34
*(Amount less than Rs.50,000)
(a) Aggregate Amount of Quoted Investments and Market value thereof 5,093.68 38.87 15.28
(b) Aggregate Amount of Unquoted Investments 146.07 278.62 372.06
(c) Aggregate Amount of Impairments in value of Investments - - -
Notes:
1. The said shares are of a subsidiary and have been refused for registration by the investee company.
2. Uncalled Liability on partly paid shares
- Tahir Properties Ltd. - Equity - Rs. 80 per share (previous year - Rs. 80 per share).
3. As on 1st April, 2015, the outstanding principal amount of Optionally Convertible Notes (OCN) amounting to Rs. 3.98 crore along with accrued
interest thereon amounting to Rs. 6.64 crore have been converted into Class B Preferred Shares. The entire investment in Verseon Corporation is
measured at fair value.
In the year ended 31st March, 2016, the Company's holding of 2,631,578 Class A Preferred Shares and 715,668 Class B Preferred Shares were
converted into 6,694,492 New Common Shares in Verseon Corporation. The Company invested in warrants in respect of 85,587 Class B Preferred
shares which were been converted into 171,174 New Common Shares in Verseon Corporation.
Verseon Corporation was listed on Alternate Investment Market on London Stock Exchange in May 2015.
4. View Group LP has been dissolved on 14th December, 2012, however, the Company has still not received an approval from RBI for writing off the
investment.
164
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
5. LOANS
Secured, Considered Good
(a) Loans and Advances (Considered Doubtful) - 10.33 10.33
Less: Provision for Doubtful Loans - (10.33) (10.33)
(b) Security Deposit 97.08 99.47
- 97.08 99.47
Unsecured, Considered Good
(a) Loans to Employees - 0.99 0.95
(b) Other Advances 6.12 22.76 8.99
(c) Claims Recoverable - - -
(d) Other Deposits 29.39 88.46 87.48
35.51 112.21 97.42
Total 35.51 209.29 196.89
Notes:
1. Secured Deposits - Projects, are Secured against Terms of Development Agreement.
2. A subsidiary had advanced an amount of Rs. 10.33 crore to certain individuals who also pledged certain equity shares as security
against the said advance. The subsidiary has enforced its security and lodged the shares for transfer in its name. The said transfer
application was rejected and the subsidiary has preferred an appeal to the Company Law Board (CLB). The CLB rejected the
application and advised the parties to approach the High Court. The subsidiary had filed an appeal before the Honorable High Court
against the order of the Company Law Board under section 10 F of the Companies Act, which was disposed of with the direction to
keep the transfer of shares in abeyance till the arbitration proceedings between the parties are on. The Honorable Bombay High
Court passed an interim order dated September 18, 2012, restraining the subsidiary from interalia, dealing, selling or creating third
party rights, etc. in the pledged shares and referred the matter to arbitration. The subsidiary had filed a Special Leave Petition (SLP)
before the Supreme Court against this interim order of the Honorable Bombay High Court which the Supreme Court has dismissed
and the matter is presently before the Arbitrator.
The Management is confident of recovery of this amount as underlying value of the said shares is substantially greater than the
amount of loan and interest thereon. However, on a conservative basis, the subsidiary has provided for the entire amount of Rs.10.33
crore in the books of account.
As at 31/03/2016 As at 01/04/2015
Maximum Maximum
Particulars Balance Amount Balance Amount
During the outstanding During the outstanding
Year Year
Loans where there is no repayment schedule
(i) Federal & Rashmikant 5.83 5.83 5.83 5.83
(ii) M/s Dhruv & Co. (Regd.) 4.18 4.18 4.18 4.18
(iii) D. R. Kavasmaneck & Dr. P. R. Kavasmaneck 0.32 0.32 0.32 0.32
165
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
166
Annual Report and Accounts 2016-17
(B) Tax expense related to items recognised in Other Comprehensive Income: 11.09 5.25
A subsidiary benefits from the tax holiday available to units set up under section 80IC and 80IE of Income
Act of 1961. These tax holidays are available for a period of 10 years from the date of commencement of
operations
167
Godrej & Boyce Mfg. Co. Ltd.
7. DEFERRED TAX ASSETS / LIABILITIES AND TAX EXPENSE (contd.) (Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
Deferred Tax Asset:
Deferred tax liabilities on account of:
(a) Property, Plant and Equipment 0.09 (10.99) 161.20
(b) Intangible Assets - (2.29) -
(c) Others - (1.05) (0.37)
0.09 (14.33) 160.83
Deferred tax assets on account of:
(a) Provision for Retirement Benefits - 2.38 -
(b) Provision for Doubtful Debts/Advances 1.04 6.66 (35.68)
(c) Others 14.28 559.20 371.42
15.32 568.24 335.74
Net Deferred Tax Assets as per Balance Sheet 15.41 553.91 496.57
Property Plant and Equipment (12.73) (112.13) 1.03 (73.86) (197.69) (10.99) (186.70)
Intangible Assets (183.85) (27.29) (211.14) (2.29) (208.85)
Others (50.70) 27.05 (23.65) (1.05) (22.60)
Defined Benefit obligations 2.31 (0.47) 1.84 1.84
Provision for Retirement Benefit 2.91 (0.40) 2.51 2.38 0.13
Provision for Doubtful Debts/
Advances (28.04) 36.86 8.82 6.66 2.16
Other Provisions 31.15 186.04 1.74 0.65 219.58 190.62 28.96
Other Deferred Tax Assets 380.93 (23.75) 11.07 368.85 368.58 0.27
Unabsorbed Depreciation &
Indexation Benefit 40.80 (34.05) 6.75 6.75
Deferred Tax Assets/(Liabilities) 182.78 51.86 1.74 1.03 (62.14) 175.87 553.91 (378.04)
168
Annual Report and Accounts 2016-17
A subsidiary's group has not recognized deferred tax liability on undistributed profits of its subsidiaries and associates amounting to Rs. 107.95 crores
for the previous year because it is able to control the timing of the reversal of temporary differences associated with such undistributed profits and it
is probable that such differences will not reverse in the foreseeable future.
During the year, a Subsidiary has not accounted for tax credits in respect of Minimum Alternative Tax (MAT credit), 31st March, 2016 : Rs. 83.65
crores, 1st April, 2015 Rs. 94.72 crores. The Subsidiary is not reasonably certain of availing the said MAT credit in future years against the normal tax
expected to be paid in those years and accordingly has not recognised a deferred tax asset for the same.
Particulars As at As at
Expiry date 31-03-2016 01-04-2015
31-03-2018 33.25 33.25
31-03-2020 42.22
31-03-2021 47.45 47.45
31-03-2022 4.63 4.63
31-03-2023 153.69 153.69
31-03-2024 110.09
391.33 239.02
Unabsorbed Depreciation never expires 17.33 63.62
169
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
8. OTHER NON-CURRENT ASSETS
(a) Balances with Government Authorities
Considered Good - 134.68 144.12
Considered Doubtful - 13.62 12.23
Less: Provision for Doubtful Advances - (13.62) (12.23)
134.68 144.12
(b) Capital Advances 17.06 98.49 175.34
(c) Unamortised Upfront Fees - - -
(d) Prepaid Expenses - 2.75 2.20
(e) Other Non-current Assets
Considered Good - 4.34 4.46
Considered Doubtful - 1.22 -
Less: Provision for Doubtful Advances - (1.22) -
- 4.34 4.46
Total 17.06 240.26 326.12
1. Capital Advances include (31-Mar-16 Rs 0.08 crore; 01-Apr-15 Rs. 5.18 crore)
due from Related Parties.
Notes:
1. Cost is computed on weighted average basis and is net of cenvat.
2. Finished goods includes shares of Tahir Properties Limited - at cost or net realisable
value (whichever is lower)
i) 70 Equity shares of INR 100/- each, INR 20/- paid up
ii) 75 Redeemable Preference Class A shares of INR 100/- each, INR 70/- paid up.
170
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
Notes:
1. The Optionally Convertible Promissory Notes (15%) of Boston Analytics Inc. in
respect of which the Company did not exercise the conversion option and Boston
Analytics Inc. promissory notes (20%) where there was a partial conversion option
which the Company did not exercise, were due for redemption on 30th June, 2009
and 21st August, 2009, respectively. The said promissory notes have not been
redeemed as of the Balance Sheet date and have been fully provided for.
2. 12% promissory notes were repayable on or before 31st December, 2011, along
with interest on maturity. The said promissory notes have not been redeemed as of
the Balance Sheet date and have been fully provided for.
171
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
172
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 31-03-2015
13. LOANS
Secured, Considered Good
(a) Secured Deposits - Projects [Refer Note 13 (1)] - 187.96 208.97
- 187.96 208.97
Unsecured, Considered Good
(a) Loans And Advances:
(i) to Related Parties 5.65 311.27 284.30
(ii) to Others - Considered Good 0.12 53.09 50.98
(b) Loans to Employees 0.38 1.19 1.00
(c) Advances to Suppliers - Considered Good 0.09 - -
(d) Advances recoverable in cash or in kind or for value to be received 0.90 0.45 0.23
(e) Deposits with Statutory Authorities - 95.89 -
(f) Other Deposits 83.31 87.36 67.90
90.45 549.25 404.41
Doubtful
(a) Inter Corporate Deposits - Considered Doubtful - 73.26 42.34
Less: Provision for Doubtful Advances - (5.77) (5.77)
- 67.49 36.57
Total 90.45 804.70 649.95
173
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
16. EQUITY SHARE CAPITAL As at As at As at
(a) Authorised: 31-03-2017 31-03-2016 01-04-2015
(i) 1,100,000 Equity Shares of Rs. 100 each 11.00 11.00 11.00
(ii) 900,000 Cumulative Redeemable Preference Shares of Rs. 100 each 9.00 9.00 9.00
20.00 20.00 20.00
(b) Issued, Subscribed and Paid Up:
678,448 (as at 31/3/2016: 662,910) Equity Shares of Rs. 100 each fully paid up 6.78 6.63 6.63
(1) The Company does not have any holding company.
(2) Details of equity shareholders holding more than 5% shares in the Company are given below:
(3) Terms/rights attached to equity shares: The Company has only one class of equity shares having a par value of Rs.100 per
share. Each holder of equity shares is entitled to one vote per share. Accordingly, all equity shares rank equally with regard
to dividends and share in the Company's residual assets. The dividend proposed by the Board of Directors is subject to the
approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of
liquidation of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company,
remaining after distribution of all preferential amounts, in proportion to the number of equity shares held.
(4) During the year under review, the Company's Equity Share Capital has increased from Rs. 6.63 Crore to Rs. 6.78 Crore.
Pursuant to the sanction of the Scheme of Amalgamation of Cartini India Ltd. (CIL) with the Company, by the Hon'ble High
Court Judicature at Bombay, 15,538 equity shares of the Company have been allotted during the year as fully paid up, to the
equity shareholders of CIL, without payment being received in cash. During the period of five years immediately preceeding
the previous reporting date, there has been no change in the Company's share capital.
(5) The National Company Law Tribunal has by its Order dated 23rd August, 2017, approved the Scheme of Amalgamation of
Godrej Investments Pvt. Ltd. (GIPL) with the Company, with the appointed date of 29th March, 2017. Accordingly, 1,77,429
equity shares of Rs. 100 each of the Company will be issued to the shareholders of GIPL.
174
Annual Report and Accounts 2016-17
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
17. OTHER EQUITY
(a) Capital Reserve 72.70 74.76 81.39
(b) Securities Premium Reserve 20.10 1,561.98 1,518.24
(c) Investment Subsidy Reserve - 0.15 0.15
(d) General Reserve 658.35 497.29 447.01
(e) Capital Redemption Reserve - 23.68 22.23
(f) Debenture Redemption Reserve 20.83 8.54 12.67
(g) Foreign Currency Translation Reserve 38.75 (22.60) -
(h) Special Reserve u/s 45IC of RBI Act, 1934 - 2.28 3.84
(i) Employee Stock Options Outstanding of Subsidiaries - 50.86 33.18
(j) Reserve for Employee Compensation Expenses - 8.36 22.86
(k) Legal and Statutory Reserves 0.37 (1.03) (4.27)
(l) Hedging Reserve - 5.89 5.89
(m) Treasury Stock - (81.27) (103.79)
(n) Revaluation Reserve - 6.30 6.30
(o) Capital Reserve on Business Combinations (19.76) (23.36) (23.36)
(p) Retained Earnings 6,851.94 2,218.42 3,031.78
(q) Fair Valuation through Other Comprehensive Income (FVTOCI) 142.19 (98.20) -
Total 7,785.47 4,232.06 5,054.12
A. Nature and purpose of reserves
1. Securities Premium Reserve:
The amount received in excess of face value of the equity shares is recognised in Securities Premium Reserve. The reserve can be utilised in
accordance with the provisions of the Companies Act.
2. General Reserve:
The Company transferred a portion of the net profit of the Company before declaring dividend to general reserve pursuant to the earlier
provisions of Companies Act 1956. Transfer to general reserve is not mandatory under the Companies Act 2013.
3. Capital Investment Subsidy Reserve:
Capital Investment Subsidy Reserve represents subsidy received from the government for commissioning of Malanpur plant in the nature of
capital investment.
4. Capital Redemption Reserve:
Capital Redemption reserve represents amount set aside by the company for future redemption of capital. A Sub-Subsidiary has recognised
Capital Redemption Reserve on buyback of equity shares from its retained earnings.
5. Debenture Redemption Reserve:
The Company had issued debentures in India and as per the provisions of the Companies Act, 2013, is required to create debenture
redemption reserve out of the profits of the Company available for the payment of dividend. The debenture redemption reserve has been
transferred to retained earning during the year ended 31 March 2016 on redemption of the debentures.
6. Employee Stock Options Outstanding
The shares option outstanding account is used to recognise the grant date fair value of options issued to employees under the Employee
Stock Option Plan and the Employee Stock Grant Scheme which are unvested as on the reporting date and is net of the deferred employee
compensation expense.
Refer note 44 for details on ESOP Plans.
7. Effective portion of Cash Flow Hedges
The cash flow hedging reserve represents the cumulative portion of gains or losses arising on changes in fair value of designated portion of
hedging instruments entered into for cash flow hedges. The cumulative gain or loss arising on changes in fair value of the designated portion
of the hedging instruments that are recognised and accumulated under the heading of cash flow reserve will be reclassified to Statement of
Profit and Loss only when the hedged transaction affects the profit or loss or included as a basis adjustment to the non financial hedged
item.
8. Exchange difference on translating the financial statements of foreign operations
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign
operations.
9. Capital Reserve on Account of Business Combination:
Capital reserves is created on Amalgamation. During amalgamation, the excess of net assets taken, over the cost of consideration paid is
treated as capital reserve and also created on Sale of treasury Shares.
175
Godrej & Boyce Mfg. Co. Ltd.
10. Special Reserve : Reserve created under section 45IC of RBI Act, 1934
11. Foreign Currency Translation Reserve:
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign
operations.
12. Employee Stock Grants Outstanding :
The fair value of the equity-settled share based payment transactions with employees is recognised in Statement of Profit and Loss with
corresponding credit to Employee Stock Options Outstanding Account.
13. Treasury Reserve : The reserve for treasury shares of the respective companies held by the respective ESOP trusts.
14. Reserve for Employee Compensation Expense :
The expenses in respect of a sub-subsidiary's ESOP scheme is charged against the Reserve for employee compensation expense as per court
Scheme
15. Cash Flow Hedge Reserve :
One of the sub-subsidiary companies uses hedging instruments as part of its management of foreign currency risk associated with foreign
currency borrowings. For hedging foreign currency risk, the said sub-subsidiary used foreign currency forward contracts which are
designated as cash flow hedges. To the extent these hedges are effective, the change in fair value of the hedging instrument is recognised in
the cash flow hedge reserve. Amounts recognised in the cash flow hedge reserve is reclassified to statement of profit & loss when the
hedged item affects the profit & loss.
16. Retained Earnings : Retained earnings are the profits that the Group has earned till date, less any transfers to general reserve, dividends or
other distributions paid to shareholders.
B. Notes
(i) In Financial Year 2014-15, the Honourable Bombay High Court and High Court of Madhya Pradesh, Indore Bench approved a Scheme of
Amalgamation ("Scheme") of Wadala Commodities Limited (WCL) , whose business was trading in Vegetable Oils, with the Company
effective from April 1, 2014 being the appointed date. The Effective Date is November 21, 2014, being the date of filing the approval of the
Respective High Courts with the ROC.
In accordance with the Scheme :
a) The Company had followed Purchase Method of accounting and as per the Scheme of Arrangement approved by the Bombay High Court.
b) All the assets and liabilities of the erstwhile WCL have been transferred to and vest in the Company and have been recorded at their book
value which are also their fair value. The excess of net assets of WCL acquired over the amount credited as share capital is Rs. 1.30 crore and
is credited
c) Income to
of Capital
Rs. 0.09Reserves.
crore and Expense of Rs. 0.25 crore of WCL from April to November 2014 has been considered in Statement of Profit
and Loss of the Company.
(ii) A Scheme of Arrangement ("the Scheme") for the demerger of Seeds business of Godrej Seeds and Genetics Limited ("the Demerged
Company) into Godrej Agrovet Limited ("the Resulting Company") effect from 1st April, 2015, ("the Appointed date") was sanctioned by the
Honorable High Court of Judicature at Bombay ("the Court"), vide its Order dated 8th January, 2016 and certified copies of the Order of the
Court sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on 9th February, 2016 (the "Effective Date").
To give effect to the Honourable Bombay High Court's Order dated 8th January, 2016 regarding Scheme of the Arrangement, the following
actions have been performed.
(a) The excess of face value of the preference shares held by the transferee Company over book value of the net assets of the Transferor
Company taken over, along with face value of preference shares issued on account the amalgamation, amounting to Rs.16.94 crore has been
debited to the Surplus in Statement of Profit and Loss as per the Scheme.
(b) The cost and expenses arising out of or incurred in carrying out and implementing the scheme amounting to Rs. 0.19 crore had been
directly charged against the Surplus in Statement of Profit and Loss of the Resulting Company.
Had the Scheme not prescribed the above treatment, the Surplus in Statement of Profit and Loss would have been higher by Rs. 16.94
crore.
(iii) A scheme of Amalgamation ("the Scheme") for the amalgamation of Goldmuhor Agrochem & Feeds Limited (called "the Transferor
Company"), with Godrej Agrovet Limited (the "Transferee Company"), with effect from 1st October, 2013, ("the Appointed date") was
sanctioned by the Honorable High Court of Judicature at Bombay ("the Court"), vide its Order dated 20th September, 2013 and certified
copies of the Order of the Court sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on 13th December, 2013
(the "Effective Date").
To give effect to the Honourable Bombay High Court's Order dated 20th September, 2013 regarding Scheme of the Arrangement, the
following actions have been performed:
(a) The excess of face value of the shares held by the transferee Company over book value of the net assets of the Transferor Company
taken over, amounting to Rs. 0.71 crore has been debited to the General Reserve Account of the Transferee Company as per the Scheme.
(b) The cost and expenses arising out of or incurred in carrying out and implementing the scheme amounting Rs. 0.41 crore have been
directly charged against the balance in General Reserve Account of the Transferee Company.
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Annual Report and Accounts 2016-17
(c) An amount of Rs. 20 crore standing to the credit of the General Reserve Account of the Transferee Company has been utilised to increase
the Reserve for Employee Compensation Account of the Transferee Company. The expenses in respect of the Company's ESOP scheme will
be charged against the Reserve for Employee Compensation Account.
Had the Scheme not prescribed the above treatment, the balance in General Reserve would have been higher by Rs. 21.12 crore.
(iv) A Scheme of Amalgamation ("the Scheme") for the amalgamation of Golden Feed Products Limited (called "the Transferor Company"), with
Godrej Agrovet Limited (the "Transferee Company"), with effect from March 31st, 2014, ("the Appointed date") was sanctioned by the
Hon'ble High Court of Judicature at Bombay ("the Court"), vide its Order dated April 29th, 2014 and certified copies of the Order of the Court
sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on May 19th, 2014 (the "Effective Date").
To give effect to the Honourable Bombay High Court's Order dated April 29th, 2014 regarding Scheme of the Amalgamation, the following
actions have been performed.
The excess of face value of the shares held by the transferee Company over book value of the net assets of the Transferor Company taken
over, amounting to Rs.0.97 crore has been debited to the Surplus in Statement of Profit and Loss as per the Scheme.
Had the Scheme not prescribed the above treatment, the Surplus in Statement of Profit and Loss would have been higher by Rs.0.97 crore.
(v) As per the Scheme of Amalgamation ("the Scheme") of Godrej Gokarna Oil Palm Ltd (GGOPL), Godrej Oil Palm Ltd (GOPL) and Cauvery Palm
Oil Ltd (CPOL), ("the Transferor Companies"), with Godrej Agrovet Limited (the " Transferee Company"), with effect from 1st April, 2011,
("the Appointed date") as sanctioned by the Hon'ble High Court of Judicature at Bombay ("the Court"), vide its Order dated 16th March,
2012, the following entries have been passed.
(a) Amortisation on Intangible Assets of the Transferor Companies amounting to Rs. 4.25 crore in the current year and Rs. 4.25 crore in the
previous year recorded in the books of the Transferee Company are charged against the balance in the General Reserve Account of the
Transferee Company. The Gross Book value of these Assets now held by the transferee Company is Rs. 42.51 crore
(b) The excess of book value of the net assets of the Transferor Company taken over, amounting to Rs. 60.55 crore over the face value of the
shares held by the transferee Company has been credited to the Securities Premium Account as per the Scheme.
Had the Scheme not prescribed the above treatment, the balance in the Securities Premium Account would have been higher by Rs. 60.55
Crore, the balance in General Reserve would have been higher by Rs. 8.50 crore.
(vi) As per the Scheme of Amalgamation ("the Scheme") of Godrej Gold Coin Aquafeed Ltd (the Transferor Company), with Godrej Agrovet
Limited with effect from 1st April, 2010, ("the Appointed date") as sanctioned by the Hon'ble High Court of Judicature at Bombay ("the
Court"), vide its Order dated 5th January, 2011, the following entries have been passed:
(a) The Intangible assets held by GGCAL amounting to Rs. 16.69 crore were adjusted against the balance in the Securities Premium Account
of the Subsidiary Company.
(b) The excess of book value of the net assets of the Transferor Company taken over, amounting to Rs. 25.06 crore over the face value of the
shares held by the transferee Company was credited to the Securities Premium Account as per the Scheme.
Had the Scheme not prescribed the treatment of adjusting Intangibles against the balance in the Securities Premium Account, the balance in
Securities Premium Account would have been higher by Rs. 41.75 crore, the Surplus in Statement of Profit & Loss would have been lower by
Rs. 41.75 crore.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
18. NON-CURRENT BORROWINGS
(a) Secured Term Loans
(i) From Banks (Refer Note 1,2,3 below) 2.50 531.02 517.38
(ii) From Others (Refer Note 4 below) - 19.62 24.90
2.50 550.64 542.28
(b) Debentures - Secured Redeemable Non-Convertible Debentures (NCDs) 498.40 497.90 260.20
(c) Unsecured
(i) Interest-free Loans under the Sales Tax Deferral Schemes of various
State Governments (Refer Notes 7 & 8 below) 40.01 6.89 3.93
(ii) Fixed Deposits (Refer Note 9 below) 587.39 578.25 332.38
(iii) Term Loans
From Banks (Refer Note 5 below) - 3,414.62 2,793.11
From Other Parties (Refer Notes 6 and 10 below) 6.42 103.67 75.24
(iv) Foreign Currency Loans 4.70 15.46
633.82 4,108.13 3,220.12
Total 1,134.72 5,156.67 4,022.60
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Godrej & Boyce Mfg. Co. Ltd.
Notes
1. Secured term loan of Rs 474.75 Crore bearing interest @ CPLR minus 7.30% p.a and secured by way of exclusive mortgage and charge of
movable and immovable property, right, title interest in the designated account / escrow account and receivables of the project situated at
Bandra Kurla Complex at Mumbai and pledge of 51% of equity shares of Godrej Buildcon Pvt. Ltd. held by the Company. Godrej Buildcon
Private Limited will repay a certain percentage of all sales receipts from the project, which percentage receivables is subject to review on a
quarterly basis. However maximum principle outstanding shall not exceed as below from the date of first disbursement :
At the end of 56th Month - Rs 400 crore
At the end of 57th Month - Rs 300 crore
At the end of 58th Month - Rs 200 crore
At the end of 59th Month - Rs 100 crore
At the end of 60th Month - Nil
2. Term loan from AXIS Bank of Rs 4.94 core carries interest rate of 9.65% to 11.50% repayable by August 2020 is secured by hypothecation of
moveable plant and machinery, furniture, fixtures consisting of refrigeration and interior work, both present and future of funded stores.
3. Term loan from Yes Bank of Rs 9.50 core carries interest rate of 10.30% repayable from December 2017 to December 2022 is secured by
hypothecation of moveable plant and machinery, furniture, fixtures consisting of refrigeration and interior work, both present and future of
funded stores.
4. Term loan availed by a sub-subsidiary company from Tata Capital Financial Services Ltd. of Rs 11.88 crore carries interest rate from 9.70% to
10.35% repayble from October 2018 to March 2020 is secured by hypothecation of the Fixed Assets and Current Assets of the funded stores
& head office.
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Annual Report and Accounts 2016-17
7. Deferred Loan against acquisition of Lease hold Land is availed at interest rate 14% under the scheme floated by the Directorate of
Industries, Government of Uttar Pradesh. Loan repayment shall be performed on an Six monthly (period) basis 6 years from 1st July 2016 up
to 1st Jan 2022. Total loan availed was Rs.6.18 crore and outstanding for the year 2016-17 was Rs.5.15 crore with current maturity at Rs.
1.03 crore .
8. Deferred Sales Tax Loan is availed interest free under the scheme floated by the Directorate of Industries, Government of Andhra Pradesh.
Loan repayment shall be performed on an annual basis 14 years from the year of collection, commencing from March 2014 up to March
2021. Total loan availed was Rs. 4.67 crore and outstanding for the year 2016-17 was 3.77 crore with current maturity at Rs. 0.35 crore .
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Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
Notes
1. (i) Secured Working Capital Demand Loan of Rs. 400 crore availed by a sub-subsidiary from Bank is secured by Hypothecation of Current
Assets of the said sub-subsidiary. Mortgage of Immovable property of the said sub-subsidiary at Unit No 5C, on the 5th Floor in Godrej One
(along with car parking spaces) at Pirojshanagar, Vikhroli East, Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private
Limited and Godrej Projects Development Private Limited (both wholly owned subsidiaries) is provided as collateral security and carries
interest rate at 8.00% p.a.(Fixed) repayable on 26th April, 2017.
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Annual Report and Accounts 2016-17
(ii) Secured Working Capital Demand Loan of Rs. 100 crore availed by a sub-subsidiary from Bank is secured by Mortgage of Immovable
property of the said sub-subsidiary Company at Unit No 5C, on the 5th Floor in Godrej One (along with car parking spaces) at Pirojshanagar,
Vikhroli East, Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private Limited and Godrej Projects Development Private
Limited (both wholly owned subsidiaries) is provided as collateral security and carries interest rate at 8.00% p.a.(Fixed) repayable on 15th
April, 2017.
(iii) Secured Working Capital Demand Loan of Rs. 100 crore availed by a sub-subsidiary from Bank is secured by Mortgage of Immovable
property of the said sub-subsidiary Company at Unit No 5C, on the 5th Floor in Godrej One (along with car parking spaces) at Pirojshanagar,
Vikhroli East, Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private Limited and Godrej Projects Development Private
Limited (both wholly owned subsidiaries) is provided as collateral security and carries interest rate at 8.00% p.a.(Fixed) repayable on 19th
April, 2017.
(iv) Secured Working Capital Demand Loan of Rs. 100 crore availed by a sub-subsidiary from Bank is secured by Mortgage of Immovable
property of the said Company at Unit No 5C, on the 5th Floor in Godrej One (along with car parking spaces) at Pirojshanagar, Vikhroli East,
Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private Limited and Godrej Projects Development Private Limited (both
wholly owned subsidiaries) is provided as collateral security and carries interest rate at 8.00% p.a.(Fixed) repayable on 9th April, 2017.
(v) Secured Working Capital Demand Loan of Rs. 100 crore availed by a sub-subsidiary from Bank is secured by Mortgage of Immovable
property of the said subsidiary company at Unit No 5C, on the 5th Floor in Godrej One (along with car parking spaces) at Pirojshanagar,
Vikhroli East, Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private Limited and Godrej Projects Development Private
Limited (both wholly owned subsidiaries) is provided as collateral security and carries interest rate at 8.00% p.a.(Fixed) repayable on 13th
April, 2017.
(vi) Loan Repayble on demand availed from Bank is secured by Hypothecation of the Current Assets of the Company. Mortgage of
Immovable property of the Company at Unit No 5C, on the 5th Floor in Godrej One (along with car parking spaces) at Pirojshanagar, Vikhroli
East, Mumbai and Hypothecation of Current Assets of Godrej Real Estate Private Limited and Godrej Projects Development Private Limited
(both wholly owned subsidiaries) is provided as collateral security and carries interest at 1 Year Marginal Cost of Fund Based Lending Rate
(MCLR )+ 0.35% p.a. Present effective rate 9.55 % p.a.
2. Working capital facilities sanctioned by banks under consortium arrangement are secured by hypothecation of stocks and book debts.
Particulars As at As at
31/03/2016 01/04/2015
Loan carries interest at Base Rate repayable within 6 months 53.26 90.44
Loan carries interest at Base Rate repayable by April 2016 50.00 -
Loan carries interest at Base Rate repayable by May 2016 185.00 -
Loan carries interest at Base Rate repayable by August 2016 75.00 -
Loan carries interest at Base Rate repayable by September 2016 50.00 -
Loan carries interest at Base Rate repayable by April 2015 - 25.00
Loan carries interest at Base Rate+0.10% repayable by June 2015 - 25.00
Loan carries interest at 10.20% p.a.repayable by September 2015 - 50.00
Loan carries interest rate of 5.96% to 13.60% 393.95 45.00
Overdraft facility at Base Rate + 0.25% 10.82 116.60
Invoice Financing at 9.30% pa (FY 2014-15 9.95% pa) 11.20 36.61
Loan carries interest at base rate + 0.10% repayble by October 2016 200.00
Loan carries interest at 9.20% repayble by August 2016 120.00
Loan carries interest at base rate + 0.50% repayble by August 2016 100.00
Loan carries interest at base rate + 0.10% repayble by September 2015 200.00
Loan carries interest at 9.65% repayble by September 2015 120.00
4. Working Capital Loans availed by a sub-subsidiary from Banks for Rs.8.28 crore are payable on demand and at an Interest Rate of HDFC
Bank Base rate + 0.25%. Secured Working Capital Loans by Astec Lifesciencce Limited are payable on 90 to 365 days and at an Interest Rate
of LIBOR + 1.16% p.a., which are secured by way of First Pari passu Charge on the Current Assets of Astec Lifescience Limited, including
inventory and receivables both present & future and second charge on Fixed Assets of the Astec Lifescience Limited present & future
(including Equitable Mortgage/Hypothecation of Factory Land & Bldg/Plant & Machinery). Unsecured Working Capital Loans by Astec
Lifesciencce Limited are payable on 60 to 365 days at an Interest Rate of LIBOR + 1.08% p.a. for Rs.19.04 crore and 15 to 180 days at an
Interest Rate of 7.85% to 14% for Rs.70 crore.
181
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
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Annual Report and Accounts 2016-17
Notes:
1. Current Maturities of Long term Debt as at 1st April, 2015 include 2,500 zero-coupon,
unsecured, redeemable, non-convertible debentures having a face value of Rs.10 lakh each,
redeemable at a premium, which will yield 9.35% p.a. at maturity. These debentures have been
redeemed on 18th December, 2015.
2. There are no amounts due to be credited to Investor Education and Protection Fund in
accordance with Section 125 of the Companies Act, 2013 as at the year end.
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
26. OTHER CURRENT LIABILITIES
(a) Advances from Customers 609.28 1,047.13 992.27
(b) Unamortised Forward Cover Premium - - -
(c) Statutory dues including provident fund and tax deducted at source 156.40 271.82 230.06
(d) Other payables 4.02 263.22 154.22
(e) Deferred Revenue 18.76 11.75 5.52
(f) Other liabilities - 45.46 36.91
788.46 1,639.38 1,418.98
Movements in each of the class of "(f) other provisions" above, during the financial year Sales Return Provision
are set out below: towards
Litigation
As at 1/4/2015 23.86 5.88
Additional provisions recognised 6.03 2.16
Unused amounts reversed (0.60)
As at 31/3/2016 29.89 7.44
Sales Returns:
When a customer has a right to return the product within a given period, a subsidiary recognises a provision for sales return. This
is measured basis average past trend of sales return as a percentage of sale. Revenue is adjusted for the expected value of the
returns and cost of sales are adjusted for the value of the corresponding goods to be returned.
Legal Claims:
The provisions for indirect taxes and legal matters comprises of numerous separate cases that arise in the ordinary course of
business. A provision is recognised for legal cases; if the subsidiary assesses that it is possible / probable that an outflow of
economic resources will be required. These provisions have not been discounted as it is not practicable for the subsidiary to
estimate the timing of the provision utilisation and cash outflows, if any, pending resolution.
183
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at As at
31/3/2017 31/3/2016 As at 1/4/2015
28. CONTINGENT LIABILITIES AND COMMITMENTS
(A) CONTINGENT LIABILITIES
1. Claims against the Company not acknowledged as debts
(a) Excise Duty/Customs Duty/Service Tax/Sales Tax/Property Tax/Octroi/
Other Duty demands in dispute and pending at various stages of appeal 50.03 500.21 266.74
(b) The State of Maharashtra has filed a suit against the Company, being
Suit No. 679 of 1973, in the High Court of Judicature at Bombay, claiming
ownership of part of the Company’s lands at Vikhroli, Mumbai. In the said
Suit, which is still pending, various claims have been raised, which are
and not acknowledged as debts due by the Company. According
to the Company's legal advisers, the Company has a complete defence
against the plaintiff in the said Suit, and the said Suit is not sustainable.
(c) Claims against the Group under the Industrial Disputes Act, 1947 - - 2.38
(d) Disputed Provident Fund liability for the period March 1996 to
September on account of disapproval of infancy benefit. The Supreme Court
of India has allowed the Company's appeal and set aside the judgment
of the High Court of Punjab & Haryana; the matter has been remanded
to the Regional Provident Fund Commissioner for a fresh decision in
accordance with law after hearing the parties concerned, expeditiously. 0.46 0.43 0.61
(e) Other Claims against the Group not acknowledged as debt - 16.90 15.61
(f) Income Tax - Demand notices issued by Income-tax Authorities. - 148.98 92.42
2. Surety Bonds
(a) Surety Bonds given by the Company in respect of refund received from
excise authority for exempted units of associate company - refer note 1
below. 26.88 24.88 19.86
(b) Bonds issued by Group on behalf of fellow subsidiary 0.77 0.73 12.33
3. Other money for which the Company is contingently liable
(a) Case / Claim filed by Processors for claiming various expense - 43.98 4.08
(B) COMMITMENTS
(1) Outstanding Export Obligation under EPCG Scheme - 23.47 21.12
(2) Estimated value of contracts remaining to be executed on capital account
to the extent not provided, net of advances there against of Rs. 3.40 crore. 40.27 45.61
Notes:
1. The Corporate Surety Bonds of Rs. 24.88 crore as on 31/3/2016 (Rs.19.86 crore as on 31/3/2015) is in respect of refund received from
excise authority for exempted units (North East) of Godrej Consumer Products Limited, an erstwhile subsidiary company.
2. The Group has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and
disclosed as contingent liabilities where applicable , in its financial statements. The Group does not expect the outcome of these
proceedings to have a materially adverse effect on its financial results.
3. It is not practicable to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective
proceedings as it is determinable only on receipt of judgements/decisions pending with various forums/authorities.
4. One of the sub-subsidiary companies enters into construction contracts for Civil, Elevator, External Development, MEP work etc. with
its vendors. The total amount payable under such contracts will be based on actual measurements and negotiated rates, which are
determinable as and when the work under the said contracts are completed.
5. One of the sub-subsidiary companies has entered into development agreements with owners of land for development of projects.
Under the agreements the company is required to pay certain payments/ deposits to the owners of the land and share in built up area/
revenue from such developments in exchange of undivided share in land as stipulated under the agreements.
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Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
185
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
186
Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
187
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
(f) Dividend paid to non controlling shareholders - (55.90)
(g) Acquisition related costs - (69.58)
Total 822.92 (363.59)
Note: Pursuant to a resolution passed at an extraordinary general meeting of the Company: (i) the
entire holding of 19,39,04,681 shares (book value Rs. 257.77 crores) in Godrej Industries Ltd., was
transferred to Vora Soaps Ltd. - a promoter group company - without consideration; and (ii)
9,35,00,000 shares (book value Rs. 223.48 crores) held by the Company in Godrej Consumer Products
Ltd. were transferred to Godrej Seeds and Genetics Ltd. - a promoter group company - without
consideration. The carrying value of the investments transferred to promoter group companies as
aforesaid, has been charged to the statement of profit and loss (Item VI of the Statement of Profit and
Loss).
The accounting policies of certain subsidiaries, associates and joint ventures especially regarding the method of depreciation, valuation
of inventories, recognition of revenue and accounting for retirement benefits are not in consonance with the group accounting policies.
No effect has been given in the consolidated financial statements on account of such differing accounting policies. In the opinion of the
Management, the impact if any, on account of such difference in accounting policies is not likely to be material.
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Annual Report and Accounts 2016-17
The adoption of Ind AS has been carried out in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards.
In preparing these Ind AS financial statements, the Group has availed certain exemptions and exceptions in accordance with Ind
2. OPTIONAL EXEMPTIONS AVAILED
(i) Deemed cost
The Group has elected to continue with the carrying value for all of its property, plant and equipment, intangible assets and
investment property as recognised in the financial statements as the deemed cost at the date of transition to Ind AS,
measured as per the previous GAAP
(ii) Share based payments
The Group has elected not to apply Ind AS 102 Share-based payment to equity instruments that vested before the date of
transition to Ind AS. Accordingly, the Group has measured only the unvested stock options on the date of transition as per
Ind AS 102.
(iii) Deemed cost for investments in joint ventures and associates
The Group has elected to continue with the carrying value of its investments in joint ventures and associates as recognised
in the financial statements as at the date of transition to Ind AS.
Accordingly, the Group has measured all its investments in joint ventures and associates at their previous GAAP carrying
value.
(iv) Long Term Foreign Currency Monetary Items
A first-time adopter may continue the policy adopted for accounting for exchange differences arising from translation of
long-term foreign currency monetary items recognised in the financial statements for the period ending 31 March 2016.
(v) Business Combination
Ind AS 101 provided the option to apply Ind AS 103 prospectively from the transition date or specific date prior to the
transition date. The Group has elected to apply Ind AS 103 propectively to business combination occurring after its
transition date. Business combination prior to the transition date have not been restated.
(vi) Cumulative translation differences
As per Ind AS 101, an entity may deem that the cumulative translation differences for all foreign operations to be zero as at
the date of transition by transferring any such cumulative differences to retained earnings. The group has elected to avail of
the above exemption.
3. IND AS MANDATORY EXCEPTIONS
(i) Estimates
The estimates at 1st April 2015 and 31st March 2016 are consistent with those made for the same dates in accordance with
the Indian GAAP (after adjustments to reflect any differences if any, in accounting policies). The Group has made estimates
for Investment in equity instruments carried at FVTPL in accordance with Ind AS at the date of transition as these were not
required under previous GAAP.
(ii) Classification and measurement of financial assets
The Group has classified and measured the financial assets on the basis of the facts and circumstances that exist at the date
of transition to Ind AS.
(iii) Non Controlling Interest (NCI)
Ind AS 110 requires that total comprehensive income should be attributed to the owners of the parent and the NCI even if
this results in the NCI having a negative balance. Ind AS 101 requires this requirement to be applied prospectively from the
date of transition to Ind AS. However, if an entity elects to apply Ind AS 103 retrospectively to past business combinations, it
has to also apply Ind AS 110 from the same date. Since the Group has elected to apply Ind AS 103 prospectively to business
combinations that occurred on or after 1 April 2015, it does not have any impact on the carrying value of NCI.
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Godrej & Boyce Mfg. Co. Ltd.
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Annual Report and Accounts 2016-17
2. Investment Property: The properties which were leased were shown under freehold buildings, under Indian GAAP.
However, under Ind AS, these are classified as Investment Property.
191
Godrej & Boyce Mfg. Co. Ltd.
3. Fair Valuation of Investments: Under Indian GAAP, the Company accounted for long term investments in unquoted and
quoted equity shares as investment measured at cost less provision for other than temporary diminution in the value of
investments. Under Ind AS, the Company has designated such investments as FVTPL investments, to be measured at fair
value. At the date of transition to Ind AS, difference between the instruments' fair value and Indian GAAP carrying amount
has been recognised in the statement of profit and loss.
4. Security Deposits Received/Placed: The security deposits received / placed for leased premises have been fair valued and
the difference between the fair value and the face value have been recognised over the lock in period of the deposits.
5. Inventories: Raw Materials received after the reporting date, but for which risk and rewards had passed to the Company,
prior to reporting date are recognised as inventory. Similarly, revenue from sale of goods has been recognised only when
the risk and rewards in the goods passes to the buyer, hence, cost corresponding to the revenue has been deferred.
For industrial products divisions, revenue which was earlier recognised on a completed contract basis is now being
recognised on percentage of completion method as per Ind AS - 11. Other financial current assets include unbilled revenue,
pertaining to revenue recognised under the percentage of completion method under Ind AS.
6. Loans and borrowings: Under Indian GAAP, transaction costs incurred in connection with loans and borrowings are
recognised upfront and charged to profit or loss for the period or capitalised to qualifying assets wherever applicable.
Under Ind-AS, transaction costs are included in the initial recognition of financial liability and recognised as per
effective interest rate method.
7. Construction Projects Reserve: The balance in Construction Projects Reserve has been transferred to the Construction
work-in-process account. The percentage of completion computations under Indian GAAP included land at its fair value.
As per Ind AS, the transfer of land from fixed assets to inventory will be at cost, accordingly the difference in fair value and
cost, earlier credited to the construction projects reserve, has been transferred to construction work-in-process.
8. Derivative contracts: Under Indian GAAP, the premium and discount on forward contracts were amortised over the contract
period. For other derivative contarcts only mark to market losses were recognised based on prudance. However, under Ind
AS all derivatives are measured at fair value at each reporting period and changes therein are recognised in profit and loss.
9. Dealer Incentive Scheme: Under Indian GAAP, Dealer Incentive Scheme was recognised as part of other expenses which
has been adjusted against revenue under Ind AS during the year ended 31st March 2016.
10. Proposed dividend: Under Indian GAAP, proposed dividends are recognised as a liability in the period to which they relate,
irrespective of when they are declared. Under Ind-AS, a proposed dividend is recognised as a liability in the period in which
it is declared by the company (usually when approved by shareholders in a general meeting) or paid.
11. Employee Benefits: Both under Indian GAAP and Ind-AS, the Company recognised costs related to its post-employment
defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are
charged to profit or loss. Under Ind-AS, remeasurements [comprising of actuarial gains and losses, the effect of the asset
ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets
excluding amounts included in net interest on the net defined benefit liability] are recognised immediately in the balance
sheet through other comprehensive income.
Adjustments pertaining to subsidiary Godrej Consumer Products Ltd. (ceased to be a subsidiary on 30th March, 2017)
12. Changes in fair value of put option
Group’s subsidiaries have granted put option to minority interests, which gives the counter part a right to sell their interests to the
Group on agreed terms. On transition to Ind AS, such put option has been classified as a financial liability payable to the investor
and is re-measured at fair value at each reporting date. The minority interest under previous GAAP has been de-recognised for such
subsidiaries and the difference between the fair value of the put option and the carrying value of the minority interest under
previous GAAP has been adjusted through retained earnings on the date of transition. Subsequently the financial liability is
measured at fair value at each reporting date.
Any contingent consideration payable is measured at its acquisition date fair value and included as part of consideration transferred
in the business combination. Subsequently, such a financial liability is measured at fair value at each reporting date and changes in
the fair value are recorded through the profit or loss account.
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24. Goodwill : Under Indian GAAP, any change in the proportion of equity held by the non-controlling interest was adjusted through
goodwill. Under Ind AS, the entity shall recognise directly in equity any difference between the amount by which the non-
controlling interests are adjusted and the fair value of the consideration paid or received, and attribute it to the owners of the
parent.
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25. Realignment of Project Cost : The Group has undertaken a detailed exercise to determine the manner of expense allocation to
inventory in context of the requirements of Ind-AS and accordingly have realigned allocation of expenses to project inventory.
Further, acquisition of stake in a subsidiary has been classified as an asset acquisition and consequently the Goodwill as per Indian
GAAP (representing cost of land) has been reclassified to project inventory.
26. Revenue Recognition: Revenue from sale of goods has been recognised only when the risk and rewards in the goods passes to the
buyer. Also cost corresponding to the revenue has been deferred.
27. Sales Return : Under IND AS, provision for sales return is considered based on history of bad and doubtful debt.
28. Share of profits in Associates and JVs : This is the group’s share in the Ind AS adjustments of the associates and joint ventures
recorded on transition to Ind AS.
29. Business Combination : Under Ind AS, when additional stake is purchased in an equity accounted investee which results in gaining
control over the entity, the previous stake is re-measured at fair value and the resulting gain or loss is recorded through profit and
loss account. Further the business combination is accounted by using the acquisition method.
Also the Group has granted put option to minority interests, which gives the counter party a right to sell their interests to the Group
on agreed terms. On transition to Ind AS, such put option has been classified as a financial liability payable to the investor and is re-
measured at fair value at each reporting date. The minority interest under previous GAAP has been de-recognised for such
subsidiaries and the difference between the fair value of the put option and the carrying value of the minority interest under
previous GAAP has been adjusted through retained earnings on the date of transition. Subsequently the financial liability is
measured at fair value at each reporting date.
30. Others IND AS adjustments : Other Ind AS adjustments include fair valuation of employee stock options, discounting of long term
trade payables etc.
31. Financial instruments: Under Indian GAAP, investments in mutual funds were measured at lower of cost or market value while
under Ind AS, such investments are required to be measured at fair value with the resultant gain or loss being recognised in profit
or loss. Under Ind AS, investments in debentures and other debt instruments are required to be measured at amortised cost with
interest income determined with reference to the effective interest rate.
Under Indian GAAP, the long term investments were measured at cost less provision for other than temporary diminution in the
value of investments. Under Ind AS, the Group has designated such investments as FVTPL , which are measured at fair value. At the
date of transition to Ind AS, difference between the instruments' fair value and Indian GAAP carrying amount has been recognised
in the statement of profit and loss.
32. Bank Overdrafts : The Group has availed bank overdrafts repayable on demand. Under Ind AS, bank overdrafts repayable on
demand and which form an integral part of the cash management process are included in cash and cash equivalents for the purpose
of presentation of cash flows. Under Indian GAAP, bank overdrafts used to be considered as part of borrowings and movement in
bank overdrafts were shown as part of financing activities.
33. Derivative contracts: Under Indian GAAP, the premium and discount on forward contracts were amortised over the contract period.
For other derivative contracts only mark to market losses were recognised based on prudence. However, under Ind AS all
derivatives are measured at fair value at each reporting period and changes therein are recognised in profit and loss.
34. Employee Benefit - ESOP: Under Ind AS, the ESOP Trust is consolidated as the ESOP Trust was established by the Group for the
administration of Employee Stock Option Plan of the Group. As Group has control over the trust, the same is treated as a subsidiary
and all assets and liabilities have been consolidated on a line by line basis.
35. Deferred Tax: Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on
differences between taxable profits and accounting profits for the period. Ind-AS 12 requires entities to account for
deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount
of an asset or liability in the balance sheet and its tax base. The application of Ind-AS 12 approach has resulted in recognition
of deferred tax on new temprorary differences which was not required under Indian GAAP. All adjustments under Ind AS,
have a corresponding deferred tax calculated on these adjusments, which are shown under deferred tax.
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( * ) The Wt. average exercise price stated above is the price of the equity shares on the grant date increased by the interest cost to the ESOP
Trust at the prevailing rates upto 31st March, 2012.
The total excess shares at the end of the previous year are 5,66,298.
The weighted average balance life of ESOP I options outstanding as on 31st March, 2017 is 0.14 years.
The Options granted shall vest after three / five years from the date of grant of option, provided the employee continues to be in
employment and the option is exercisable within two / four years after vesting.
(ii) Employee Stock Option Plans of Godrej Properties Limited (a subsidiary of Godrej Industries Ltd.)
In F.Y. 2007-08, Godrej Properties Limited (GPL) instituted an Employee Stock Option Plan (GPL ESOP) approved by GPL's Board of Directors,
Shareholders and the Remuneration Committee which provided for the allotment of 8,85,400 options convertible into 8,85,400 Equity Shares
of GPL of Rs. 5 /- each to eligible employees of GPL and its Subsidiary Companies (the participating companies) with effect from 28th
December, 2007.
The Scheme is administered by an Independent ESOP Trust which has purchased shares from Godrej Industries Limited (The Holding
Company), equivalent to the number of options granted to the eligible employees of the Participating Companies.
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Previous Year
No. of Options
Options Outstanding at the Beginning of the Year 357400
Options Forfeited / Expired During the Year 1,12,000
Options Outstanding at the Year End 2,45,400
The exercise period of the GPL ESOP has expired on 27th December, 2016 and consequently all the unexercised options were rendered
lapsed. The GPL ESOP now stands terminated and the shares held by the Trust have been sold during the year.
(iii) Employee Stock Option Plans of Godrej Agrovet Limited (a subsidiary of Godrej Industries Ltd.)
Godrej Agrovet Limited (GAVL) has participated in the Godrej Industries Limited Employee Stock Grant Scheme 2011 and on 30th May, 2011
the Compensation Committee of the GAVL has approved the grant of stocks to certain eligible employees in terms of the Employee Stock
Grant Scheme 2011. The grants would vest in three equal parts every year over the next three years. The exercise price is Re. 1 per equity
share as provided in the scheme.GAVL has provided Rs. 1.90 crore (previous year Rs. 1.87 crore) for the aforesaid eligible employees for the
current financial year.
In December 2012, Godrej Agrovet Limited (GAVL) instituted an Employee Stock Option Plan (GAVL ESOP) as approved by GAVL's Board of
Directors and the Shareholders, for the allotment of 5,86,764 options convertible into 5,86,764 equity shares of GAVL of Rs. 10 each and
Bonus Shares issued against the initial allotment for 35,20,584 shares of Rs. 10 each to eligible employees of the Company.
The scheme is administered by an independent ESOP Trust created. GAVL has issued 586,764 equity shares and Bonus Shares issued against
the initial allotment for 76,27,932 shares to the said ESOP Trust at face value of Rs. 10 each amounting to Rs. 0.59 crore. During the current
year, all the stock options were vested, exercised and transferred to the eligible employees by 31/03/2017.
Previous Year
Category A No. of options Exercise price
Options Outstanding at the Beginning of the Year 18,43,457 10
Bonus shares issued against the initial allotment - -
Options Granted During the Year - -
Options Forfeited / Expired During the Year - -
Options Exercised During the Year - -
Options Outstanding at the Year End 18,43,457 10
Previous Year
Category B No. of options Exercise price
Options Outstanding at the Beginning of the Year 22,63,891 10
Bonus shares issued against the initial allotment - -
Options Granted During the Year - -
Options Forfeited / Expired During the Year - -
Options Exercised During the Year - -
Options Outstanding at the Year End 22,63,891 10
The weighted average fair value of options granted during the year ended 31st March, 2016 Rs 309.20) per option.
During the year, the stock options granted under the Company’s stock option scheme were fully vested, exercised and transferred to the
eligible employees including the Managing Director of the Company. The perquisite value of the said stock options have been included in the
managerial remuneration which resulted in the same exceeding the limits prescribed under Section 197 of the Companies Act, 2013 by an
amount of Rs. 86.61 crore. The Company is in the process of obtaining approval from the Shareholders and Central Government of India for
ratification of payment of excess remuneration.
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Annual Report and Accounts 2016-17
b) The ESGS Scheme is effective from 1st April, 2011, (the “Effective Date”) and shall continue to be in force until (i) its termination by the Board
or (ii) the date on which all of the shares to be vested under Employee Stock Grant Scheme 2011 have been vested in the Eligible Employees
and all restrictions on such Stock Grants awarded under the terms of ESGS Scheme, if any, have lapsed, whichever is earlier.
c) The Scheme applies to the Eligible Employees, who are in whole-time employment of the Company or its Subsidiary Companies. The
entitlement of each employee would be decided by the Compensation Committee of the respective Company based on the employee’s
performance, level, grade, etc.
d) The total number of Stock Grants to be awarded under the ESGS Scheme are restricted to 25,00,000 (Twenty Five Lac) fully paid up equity
shares of the Company. Not more than 5,00,000 (Five Lac) fully paid up equity shares or 1% of the issued equity share capital at the time of
awarding the Stock Grant, whichever is lower, can be awarded to any one employee in any one year.
e) The Stock Grants shall vest in the Eligible Employees pursuant to the ESGS Scheme in the proportion of 1/3rd at the end of each year from the
date on which the Stock Grants are awarded for a period of three consecutive years or as may be determined by Compensation Committee,
subject to the condition that the Eligible Employee continues to be in employment of the Company or the Subsidiary company as the case
may be.
f) The Eligible Employee shall exercise her / his right to acquire the shares vested in her / him all at one time within 1 month from the date on
which the shares vested in her / him or such other period as may be determined by the Compensation Committee.
g) The Exercise Price of the shares has been fixed at Re. 1 per share. The intrinsic value, being the difference between market price and exercise
price is treated as Employee Compensation Expenses and charged to the Statement of Profit and Loss. The value of the options is treated as a
part of employee compensation in the financial statements and is amortised over the vesting period.
Following table lists the average inputs to the model used for the plan for the year ended 31st March, 2016:
Previous Year Description of the Inputs used
The weighted average exercise price of the options outstanding as on 31st March, 2016 is Rs. 5 per share) and the weighted average
remaining contractual life of the options outstanding as on 31st March, 2016 0.84 years, as on 31st March, 2015: 0.98 years.
(ii) Employee Stock Grant Scheme of Godrej Properties Limited (a subsidiary of Godrej Industries Ltd.)
The Company instituted an Employee Stock Grant Scheme (GPL ESGS) approved by the Board of Directors, shareholders and the
Remuneration Committee.
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(II). GODREJ CONSUMER PRODUCTS LTD. (ceased to be a subsidiary on 30th March, 2017)
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Annual Report and Accounts 2016-17
Weighted average remaining contractual life of options as at 31st March, 2017 was 1.56 years (31-Mar-16: 1.95 years and 01-Apr-15: 2.09
years).
Weighted average equity share price at the date of exercise of options during the year was ₹ 1,558.62 (previous year ₹ 1223.84).
The fair value of the employee share options has been measured using the Black-Scholes formula. The following assumptions were used for
calculation of fair value of grants:
Year Ended 31/03/2016
Risk-free interest rate (%) 8.71%
Expected life of options (years) 2
Expected volatility (%) 33.20%
Dividend yield 0.51%
The price of the underlying share in market at the time of option grant Rs. 1124.2
3. Pursuant to SEBI notification dated January 17, 2013, no further securities of the Company will be purchased from the open market.
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Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Current Year Previous Year
45. DETAILS OF EMPLOYEE BENEFITS:
The amount recognised in the Group Financial Statements as at the year end are as under :
(a) DEFINED BENEFIT PLAN – GRATUITY:
(i) Change in Defined Benefit Obligation :
Liability at the beginning of the year 287.73 252.13
Current service cost 10.03 18.68
Interest cost 12.51 21.28
Benefit paid (13.59) (24.34)
Exchange difference - 2.14
Actuarial (gain)/loss on obligations 7.62 17.84
Liability at the end of the year 304.30 287.73
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Annual Report and Accounts 2016-17
(Rupees in crore)
Current Year Previous Year
Discount Rate (1% movement) (11.96) 14.00 (10.22) 11.90
Future Salary Growth (1% movement) 13.89 (12.09) 11.85 (10.36)
Rate of Employee Turnover (1% movement) 0.06 (0.08) 0.36 (0.43)
201
Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Carrying amount Fair value
As at 31/03/2017 FVTPL FVTOCI Amortised Total Level 1 Level 2 Level 3 Total
Cost
Financial assets
Non-current
Other investments * - - - - - 1.10 1.10
Quoted Equity Shares 5,093.68 - 5,093.68 5,093.68 - - 5,093.68
Unquoted Equity Shares 146.07 146.07
Trade Receivables - - 7.44 7.44 - - - -
Loans - - 35.51 35.51 - - - -
Other Financial Assets - - 2.56 2.56 - - - -
Current
Current Investments 11.27 - - 11.27 11.27 - - 11.27
Trade Receivables - - 2,019.76 2,019.76 - - - -
Cash and cash equivalents - - 77.23 77.23 - - - -
Bank balances others 87.62 87.62
Loans - - 90.45 90.45 - - - -
Other Current Financial Assets - - 484.47 484.47 - - - -
Derivative asset 10.95 - - 10.95 - 10.95 - 10.95
22.22 5,239.75 2,805.04 8,067.01 5,104.95 10.95 1.10 5,117.00
Financial liabilities
Non-current
Borrowings 1,134.72 1,134.72 - - - -
Other financial liabilities 295.35 295.35 - - - -
Current
Borrowings - - 1,188.82 1,188.82 - - - -
Trade Payables - - 1,116.83 1,116.83 - - - -
Other financial liabilities 782.51 782.51
Derivative liability 11.36 - - 11.36 - 11.36 - 11.36
11.36 - 4,518.23 4,529.59 - 11.36 - 11.36
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Other investments *
Debentures - - 239.18 239.18 - 239.18 239.18
Quoted Equity Shares 7.05 31.81 - 38.86 39.39 - 39.39
Unquoted Equity Shares 1.53 0.05 9.04 10.62 0.05 1.53 - 1.58
Others 2.91 - 25.92 28.83 2.91 2.91
Trade Receivables - - 12.50 12.50 - - - -
Loans - - 209.29 209.29 - 111.45 - 111.45
Other Financial Assets - - 17.26 17.26 - - - -
Current
Current Investments 73.10 511.21 - 584.31 422.14 73.10 - 495.24
Trade Receivables - - 3,423.79 3,423.79 - - - -
Cash and cash equivalents - - 795.75 795.75 - - - -
Bank balances others - - 285.59 285.59 - - - -
Loans - - 804.70 804.70 - 187.73 - 187.73
Other Current Financial Assets - - 1,052.37 1,052.37 - - - -
Derivative asset 11.20 - - 11.20 11.20 11.20
95.79 543.07 6,875.39 7,514.25 461.58 627.10 - 1,088.68
(Rupees in crore)
Carrying amount Fair value
As at 31/03/2016 FVTPL FVTOCI Amortised Total Level 1 Level 2 Level 3 Total
Cost
Financial liabilities
Non-current
Borrowings - - 5,156.67 5,156.67 - 10.86 - 10.86
Liabilities for business combinations 67.19 - - 67.19
Other financial liabilities - - 295.18 295.18 - - 67.19 67.19
Current
Borrowings - - 6,648.31 6,648.31 - 118.77 - 118.77
Trade Payables - - 2,993.01 2,993.01 - - - -
Option Liability 573.55 - - 573.55 - - 573.55 573.55
Other financial liabilities - - 1,923.86 1,923.86 - - - -
Derivative liability 15.04 - - 15.04 - 5.21 - 5.21
655.78 - 17,017.03 17,672.81 - 134.84 640.74 775.58
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Financial liabilities
Non-current
Borrowings 4,022.60 4,022.60 - - - -
Liabilities for business combinations - - 6.36 6.36 - - 6.36 6.36
Other financial liabilities - 200.80 200.80 - - -
Derivative liability 1.96 12.94 14.90 1.96 1.96
Current
Borrowings - - 5,613.09 5,613.09 - - - -
Trade Payables - - 2,803.51 2,803.51 - - - -
Option Liability 861.52 - - 861.52 - - 649.88 649.88
Other financial liabilities - - 2,124.44 2,124.44 - - - -
Derivative liability 16.14 - - 16.14 - 16.14 - -
879.62 - 14,783.74 15,663.36 - 18.10 656.24 658.20
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205
Godrej & Boyce Mfg. Co. Ltd.
This excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and
undiscounted, and include estimated interest payments and exclude the impact of netting agreements.
(Rupees in crore)
Contractual cash flows
As at 31/03/2017 Carrying Total Less than 6-12 1-2 years 2-5 years More than
amount 6 months months 5 years
Non-derivative financial liabilities
Borrowings 1,825.12 2,581.78 1,214.56 34.48 551.35 780.67 0.74
Debentures 498.42 637.25 11.16 22.68 44.63 558.78
Trade Payables 1,116.83 1,116.83 1,116.83 - - - -
Other Financial Liabilities 1,089.22 1,089.22 1,089.22 - - - -
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Annual Report and Accounts 2016-17
Financial liabilities
Long term borrowings - - - -
Short term Borrowings 5.43 - - -
Trade Payables 383.85 11.90 0.75 0.33
Less: Forward contracts for trade payables (328.72) - - -
Other current financial liabilities - - - -
60.56 11.90 0.75 0.33
(Rupees in crore)
As at 31/03/2016 USD EURO GBP Others
Financial Assets
Cash and cash equivalents 63.95 0.46 - 0.26
Current Investments 1.46 - - -
Loans 1.65 - - -
Trade Receivables 553.60 43.68 107.98 0.76
Less: Forward contracts for trade receivables (88.91) (35.82) - -
Other non-current financial assets 23.01 1.13 - -
554.76 9.45 107.98 1.02
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Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
As at 31/03/2016 USD EURO GBP Others
Financial liabilities
Long term borrowings 722.01 - - -
Short term Borrowings 17.81 - - -
Trade Payables 788.29 16.85 1.15 0.07
Less: Forward contracts for trade payables (205.31) (34.76) - -
Other current financial liabilities 3.73 34.81 - -
1,326.53 16.90 1.15 0.07
(Rupees in crore)
As at 01/04/2015 USD EURO GBP Others
Financial Assets
Cash and cash equivalents 121.72 5.25 0.31 0.22
Trade Receivables 421.45 30.98 5.82 1.36
Less: Forward contracts for trade receivables (78.82) (15.25) - -
Other non-current financial assets 4.27 - - -
468.62 20.98 6.13 1.58
Financial liabilities
Long term borrowings 664.33 - - -
Short term Borrowings 37.53 - - -
Trade Payables 811.66 14.69 1.39 -
Less: Forward contracts for trade payables (303.48) - - -
Other Non-current financial liabilities 2.39 - - -
Other current financial liabilities (0.05) 0.12 - -
1,212.38 14.81 1.39 -
Sensitivity analysis
A reasonably possible 3% strengthening (weakening) of the Indian Rupee against USD/GBP/Euro at 31st March would have affected
the measurement of financial instruments denominated in USD/GBP/Euro and affected profit or loss by the amounts shown below.
This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales
and purchases.
(Rupees in crore)
as at 31/03/2017 as at 31/03/2016 as at 1/4/2015
Profit or loss Profit or loss Profit or loss
Effect Strengthening Weakening Strengthening Weakening Strengthening Weakening
USD - 3% movement 1.54 (1.54) (23.15) 23.15 (22.31) 22.31
EUR - 3% movement (0.10) 0.10 (0.22) 0.22 0.19 (0.19)
GBP - 3% movement 0.06 (0.06) 3.20 (3.20) - -
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Annual Report and Accounts 2016-17
Nominal amount As at As at As at
31-03-2017 31-03-2016 31-03-2015
Borrowings
Fixed-rate borrowings 2,306.58 6,758.51 4,715.62
Variable-rate borrowings 5.02 6,011.29 3,386.59
Total 2,311.60 12,769.80 8,102.21
As at 31/03/2016
Variable-rate instruments (60.11) 60.11
Cash flow sensitivity (net) (60.11) 60.11
As at 01/04/2015
Variable-rate instruments (33.87) 33.87
Cash flow sensitivity (net) (33.87) 33.87
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Godrej & Boyce Mfg. Co. Ltd.
Management believes that the unimpaired amounts that are past due by more than 6 months are still
collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk,
including underlying customers’ credit ratings if they are available.
The movement in the allowance for impairment in respect of trade receivables during
the year was as follows:
Loans and advances given are monitored by the Group on a regular basis and these are neither past
due nor impaired.
(Rupees in crore)
Collective impairments
Balance as at 01/04/2015 124.01
Impairment loss recognised 23.24
Balance as at 31/03/2016 147.25
Impairment loss recognised 41.94
Balance as at 31/03/2017 189.19
Amounts written off as at 31/03/2016 30.68
Amounts written off as at 31/03/2017 31.44
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Annual Report and Accounts 2016-17
The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. Management monitors the return on capital as well as the level of dividends to
ordinary shareholders.
The board of directors seeks to maintain a balance between the higher returns that might be possible with higher levels of
borrowings and the advantages and security afforded by a sound capital position.
The Group monitors capital using a ratio of ‘adjusted net debt’ to ‘equity’. For this purpose, adjusted net debt is defined as
total liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. The Group's adjusted net
debt to equity ratio for 3 years is given below:
(Rupees in crore)
As at As at As at
31-03-2017 31-03-2016 01-04-2015
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Godrej & Boyce Mfg. Co. Ltd.
The following table presents the recognised financial instruments that are offset, or subject to enforceable master netting
arrangements and other similar agreements but not offset, as at 31/3/2016 and 1/4/2015.
(Rupees in crore)
Effects of offsetting on the balance sheet Related amounts not offset
Gross amounts Net amounts Amounts subject to Financial
Particulars
Gross set off in the presented in the master netting instrument Net
Amounts balance sheet balance sheet arrangements collateral amount
31-03-2016
Financial assets
Derivative instruments 1.65 - 1.65 1.65 - -
Financial liabilities
Derivative instruments 4.82 - 4.82 -1.65 - 3.17
01-04-2015
Financial assets - -
Derivative instruments 2.22 - 2.22 - - 2.22
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49B. GOODWILL AND OTHER INTANGIBLE ASSETS WITH INDEFINITE USEFUL LIFE
For the purpose of impairment testing, goodwill has been allocated to the Group's CGU as follows:
(Rupees in crore)
As at As at
Particulars 31/03/2016 01/04/2015
India 2.47 2.47
Indonesia 1,298.58 1,308.56
Africa (including SON) 2,248.20 2,167.29
Argentina 305.11 275.91
Others 288.00 292.21
Total 4,142.36 4,046.44
For the purpose of impairment testing, brands have been allocated to the Group's CGU as follows:
As at As at
Particulars 31/03/2016 01/04/2015
India 791.42 791.42
Africa (including SON) - -
The recoverable amount of a CGU is based on its value in use. The value in use is estimated using discounted cash flows over a
period of 5 years. Cash flows beyond 5 years is estimated by capitalising the future maintainable cash flows by an appropriate
capitalisation rate and then discounted using pre tax discount rate.
Operating margins and growth rates for the five year cash flow projections have been estimated based on past experience and
after considering the financial budgets/ forecasts approved by management. Other key assumptions used in the estimation of
the recoverable amount are set out below.The values assigned to the key assumptions represent management's assessment of
future trends in the relevant industries and have been based on historical data from both external and internal sources.
As at As at
Particulars 31/03/2016 01/04/2015
Pre Tax discount rate 16.79% - 26.45% 16.79% - 26.45%
Long term growth rate beyond 5 years 2% - 3% 2% - 3%
The pre tax discount rate is based on risk free rate, beta variant adjusted for market premium and company specific risk factors.
As at 31st March, 2016 and 1st April, 2015, there was no impairment for goodwill and other intangible assets.
With regard to the asessment of value in use, no reasonably possible change in any of the above key assumptions would cause
the carrying amount of the CGUs to exceed their recoverable amount.
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Information about Secondary Business Segments for the year ended 31-03-2016
A subsidiary engaged in the manufacturing of personal and household products has identified geographical segments as reportable segments which are as follows:
Africa
(including Less:
Strength of Africa (including Strength Intersegment
Revenue by Geographical markets India Indonesia Nature) Others Total India Indonesia of Nature) Others Eliminations Total
Segment Revenue 22,407.13 1,451.19 1341.35 1193.33 26,393.00 Segment Assets 20,046.68 2,527.31 3,847.10 867.04 (179.96) 27,108.17
Add/(Less): Inter Segment Revenue (556.54) (6.94) -1.49 -8.53 (573.50) Segment Liabilities 18,748.60 339.68 279.59 302.86 (72.87) 19,597.86
Income from Operations 21,850.59 1,444.25 1,339.86 1,184.80 25,819.50 Total Capital Employed 1,298.09 2,187.63 3,567.51 564.18 (107.09) 7,510.32
Note: Geographical segment reporting is not applicable for the year 2016-17, since the Group is not the holding company for the subsidiary which had identified geographical segments as reportable segments.
Business Segments
The Indian Accounting Standard 108 (Ind AS-108) on “Segment Reporting” requires disclosure of segment information to facilitate better understanding of the performance of an enterprise’s business operations.
The Company has identified Business Segments to comply with the operating segment disclosures as per Ind AS-108, considering the organization structure, internal financial reporting system, and the risk-return profiles of the businesses.
The Company’s organisation structure and management processes are designed to support effective management of multiple businesses while retaining focus on each one of them.
(a) Identification of Business Segments
The Consumer Durables segment includes Furniture, Office Equipment, Home Appliances, Locks and Security Equipment. The Industrial Products segment includes Process Plant and Equipment, Toolings, Special Purpose Machines, Precision
Components/Engineering, Electricals and Electronics, Electric Motors, Storage Solutions and Material Handling Equipment. Chemicals includes the business of production and sale of Oleochemicals and Surfactants such as Fatty Acids,
Fatty Alcohols, refined glycerine, Alpha Olefin Sulphonates, Sodium Lauryl Sulphate and Sodium Lauryl Ether Sulphate. Animal Feed segment includes the business of production and sale of compound feeds for cattle, poultry, shrimp and fish.
Veg oils segment includes the business of processing and bulk trading of refined vegetable oils & vanaspati,international vegetable oil trading and Oil Palm Plantation. Estate & property development segment includes the business of
development and sale of real estate and leasing and leave and licensing of properties. Ready-mix Concrete, Integrated Poultry, Agri Inputs and tissue culture, seeds business, energy generation through windmills and gourmet foods and fine
beverages are included under Other operations. The geographical segments consists of Sales in India represent sales to customers located in India and Sales outside India represent sales to customers located outside India.
(b) Segment Revenue, Results, Assets and Liabilities
Segment revenue and results are arrived at based on amounts identifiable to each of the segments. Inter-segment transfers are valued at cost or market-based prices, as may be negotiated between the segments with an overall
optimization objective for the Company. Other unallocated expenses include corporate expenses, as well as expenses incurred on common shared-services provided to the segments. Segment assets include all operating assets used by the
business segment and consist mainly of net fixed assets, debtors and inventories. Segment liabilities primarily include creditors and advances from customers. Unallocated assets mainly relate to the factory, administrative, employee
welfare, and marketing infrastructure at Vikhroli, Mumbai and at up-country establishments, not directly identifiable to any business segment. Liabilities which have not been identified between the segments are shown as unallocated liabilities.
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Godrej & Boyce Mfg. Co. Ltd.
Financial information of joint ventures and associates that are material to the Group is provided below :
(Rupees in crore)
Place of % of Accounting Carrying Amounts
Name of the entity Relationship
business ownership method 31-03-2017 31-03-2016 01-04-2015
Godrej Consoveyo Logistics Automation Ltd. (formerly
Godrej Efacec Automation and Robotics Ltd.) India 49.00% Joint Venture Equity method 10.35 7.90 7.58
Geometric Ltd. India 18.72% Associate Equity method - 318.31 308.19
Urban Electric Power Inc., USA USA 19.66% Associate Equity method 18.82 24.98 14.63
Godrej Tyson Foods Limited* India 49.00% Joint Venture Equity method - 74.64 65.51
ACI Godrej Agrovet Private Limited* Bangladesh 50.00% Joint Venture Equity method - 51.45 34.78
Al Rahaba International Trading Limited Liability U.A.E 24.00% Associate Equity method 3.16 4.07
Company -
Polchem Hygiene Laboratories Private Limited India 26.00% Associate Equity method - 5.85
-
Personalitree Academy Ltd. India 25.49% Associate Equity method - - -
Bhabhani Blunt Hairdressing India Pvt. Ltd. India 30.00% Associate Equity method - 22.42 22.31
Godrej and Khimji (ME) LLC Oman 49.00% Associate Equity method 17.52 15.04 15.74
Joint Ventures of Property Business India Joint Venture Equity method - 58.25 39.39
Total equity accounted investments 46.69 576.15 518.05
Omnivore India Capital Trust India Investment FVTPL 25.93 12.11
entity
2 Summary financial information of material Joint Venture and Associates not adjusted for the percentage ownership held by the Company, is as follows:
(Rupees in crore)
Godrej Tyson Foods Ltd. ACI Godrej Agrovet Pvt. Ltd.
As at As at As at
As at 01/04/2015
31/03/2016 01/04/2015 31/03/2016
Ownership 49% 49% 50% 50%
Cash and cash equivalent 5.54 5.31 2.95 1.12
Other current assets 54.60 44.60 116.78 50.94
Total current assets 60.14 49.91 119.73 52.06
Total non-current assets 148.81 138.51 193.13 153.60
Total assets 208.95 188.42 312.86 205.66
Current liabilites
Financial liabilities (excluding trade payables and
provisions) 18.45 15.85 119.69 32.29
Other liabilities 17.72 15.57 29.58 19.01
Total current liabilities 36.17 31.42 149.27 51.30
Non Current liabilites
Financial liabilities (excluding trade payables and
provisions) - - 57.91 84.02
Other liabilities 10.13 8.21 3.00 0.84
Total non current liabilities 10.13 8.21 60.91 84.86
Total liabilities 46.30 39.63 210.18 136.16
Net assets 162.65 148.79 102.68 69.50
Groups' share of net assets 79.70 72.91 51.34 34.75
Carrying amount of interest in Associate / Joint
Venture 74.64 65.51 51.45 34.78
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Annual Report and Accounts 2016-17
(Rupees in crore)
Godrej Consoveyo Logistics Godrej Tyson Foods ACI Godrej Agrovet Pvt.
Automation Ltd. Urban Electric Power Inc., USA Ltd. Ltd.
Year ended Year ended Year ended Year ended
Year ended 31/03/2016
31/03/2017 31/03/2016 31/12/2016 31/12/2015
Revenues 99.10 84.30 2.03 - 451.01 535.60
Interest income 0.36 0.58 1.36 3.31 0.46 0.20
Depreciation and amortisation 0.63 0.46 3.39 2.65 (14.32) -
Interest expense 0.78 1.72 0.05 0.03 (0.06) (5.53)
Income tax expense 1.68 2.26 (1.36) 1.32 (6.31) (7.36)
Profit from continuing operations 3.40 4.12 (31.19) (26.45) 14.07 34.89
Profit from discontinued opertaions - - - -
Profit for the year 3.40 4.12 (31.19) (26.45) 14.07 34.89
Other comprehensive income (0.01) (0.02) - - (0.21) -
Total comprehensive income 3.39 4.10 (31.19) (26.45) 13.86 34.89
Group's share of profit 1.67 2.02 (6.13) (5.20) 6.89 17.45
Group's share of Other comprehensive income (0.01) (0.01) - - (0.10) -
Group's share of Total comprehensive income 1.66 2.01 (6.13) (5.20) 6.79 17.45
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Godrej & Boyce Mfg. Co. Ltd.
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
Cartini as at the closing balance sheet as at 31st March, 2016.
As per para 18 of Ind AS, 103, Business Combinations, the acquirer shall measure the identifiable assets acquired and the
liabilities assumed at their acquisition-date fair values. However, the above acquisition was recorded at book value,
under a Court scheme. As per valuation report issued by valuers, V. S. Dastur and Co., Chartered Accountants, the fair value
of Cartini shares amounted to Rs. 16,213 per share, totalling to Rs. 99,21,22,109, for 61,193 shares of Cartini.
Had the acquisition been at fair value, the resultant Capital Reserve would have amounted to Rs. 18,77,88,625.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of Cartini as at the close of business
on the date preceding the aforesaid date, whether or not provided in the books of Cartini, and all liabilities
which arise or accrue on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and
obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of Cartini.
(f) Since the aforesaid Scheme, which is effective from 1st April, 2016, has been given effect to in these accounts,
the figures for the current year to that extent are not comparable with those of the previous year.
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Annual Report and Accounts 2016-17
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
GIPL as at the closing balance sheet as at 29th March, 2017.
(d) With effect from 29th March, 2017, all debts, liabilities, duties and obligations of GIPL as at the close of business on the
date preceding the aforesaid date, whether or not provided in the books of GIPL, and all liabilities which arise or accrue
on or after 29th March, 2017 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of GIPL.
(f) Upon the Scheme coming into effect, and in consideration for the amalgamation of GIPL with the Company, the Company
will issue and allot 1,77,429 equity shares at par, credited as fully paid up, to the shareholders of GIPL, whose names
appear in the Register of Members of GIPL, on the Effective Date, ie. 18th September, 2017, in the ratio of 1 fully paid
equity share of Rs. 100 each of the Company for each share of Rs. 100 each held by GIPL in the Company.
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Godrej & Boyce Mfg. Co. Ltd.
(iii) Amalgamation of wholly-owned subsidiary Busbar Systems (India) Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of Busbar Systems (India) Ltd. (Busbar) with the Company with effect from
1st April 2016, was sanctioned by the National Company Law Tribunal (“NCLT”), Mumbai Bench, on 23rd August, 2017
and by the National Company Law Tribunal (“NCLT”), Bangalore bench, on 16th October, 2017 and certified copies
of the Order of the NCLT sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on
28th October, 2017 and with the Registrar of Companies, Bangalore on 26th October, 2017. Accordingly, the
Scheme has been given effect to in the accounts for the year, and the entire undertaking of erstwhile Busbar stands
transferred to and vested in the Company as a going concern and Busbar, without any further act, stands dissolved
without winding up. Busbar was mainly engaged in the business of manufacturing busbars. The amalgamation
was accounted for as specified in the Scheme.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
Value of Net Assets of Busbar Systems (India) Ltd. taken over as Rupees
at 1st April, 2016 (See Notes below):
Tangible Assets (Gross Block) 2,63,62,045
Less: Accumulated Depreciation 43,93,016
Tangible Assets (Net Block) 2,19,69,029
Intangible Assets (Gross Block) 7,56,530
Less: Accumulated Depreciation 3,47,078
Intangible Assets (Net Block) 4,09,452
Total Fixed Assets 2,23,78,481
Other Financial Assets (Non-Current) 29,11,980
Deferred Tax Asset (Net) 23,04,911
Inventories 8,83,57,881
Trade Receivables 1,53,39,001
Cash and Bank Balances 14,97,95,354
Other Financial Assets (Current) 29,77,504
Other Current Assets 3,03,14,422
Total Assets (A) 31,43,79,534
Less: Liabilities:
Non-Current Liabilities - Provisions 11,04,598
Financial Liabilities
Borrowings 8,94,84,192
Trade Payables 9,28,57,611
Other Current Liabilities 2,84,64,469
Provisions 10,34,539
Current tax liabilities 43,20,910
Total Liabilities (B) 21,72,66,319
Total Value of Net Assets taken over *(A) – (B)+ 9,71,13,215
As per the Order of the Court, adjusted against:
General Reserve 25,37,000
Retained Earnings 9,41,44,314
Other Comprehensive Income (68,099) 9,66,13,215
5,00,000
Less: Book Value of equity shares held by the Company in Busbar written off 22,05,50,000
Balance (22,00,50,000)
Adjusted against: Retained Earnings and General Reserve of Busbar 9,66,81,314
Adjusted as Capital Reserve on Business Combinations (12,33,68,686)
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
Busbar as at the closing balance sheet as at 31st March, 2016.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of Busbar as at the close of business on the
date preceding the aforesaid date, whether or not provided in the books of Busbar, and all liabilities which arise or accrue
on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
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Annual Report and Accounts 2016-17
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of Busbar.
(f) The amalgamation of the wholly-owned subsidiary does not entail issue of shares.
(iv) Amalgamation of wholly-owned subsidiary Mercury Manufacturing Company Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of Mercury Manufacturing Company Ltd. (MMCL) with the Company
with effect from 1st April 2016, was sanctioned by the National Company Law Tribunal (“NCLT”), Mumbai bench,
on 23rd August, 2017 and by the National Company Law Tribunal (“NCLT”), Chennai Bench, on 14th September, 2017
and certified copies of the Order of the NCLT sanctioning the Scheme were filed with the Registrar of Companies,
Maharashtra and Chennai on 3rd October, 2017.
Accordingly, the Scheme has been given effect to in the accounts for the year, and the entire undertaking of erstwhile
MMCL stands transferred to and vested in the Company as a going concern and MMCL, without any further act,
stands dissolved without winding up. MMCL was mainly engaged in the business of manufacture and export of steel
furniture. The amalgamation was accounted for as specified in the Scheme.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
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Godrej & Boyce Mfg. Co. Ltd.
(c) All assets and liabilities, have been recorded in the books of the Company at the values appearing in the books of
MMCL as at the closing balance sheet as at 31st March, 2016.
(d) With effect from 1st April, 2016, all debts, liabilities, duties and obligations of MMCL as at the close of business
on the date preceding the aforesaid date, whether or not provided in the books of MMCL, and all liabilities which arise
or accrue on or after 1st April, 2016 shall be deemed to be the debts, liabilities, duties and obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to
the Scheme, in the name of the Company, such asset and liabilities continue to be in the name of MMCL.
(f) The amalgamation of the wholly-owned subsidiary does not entail issue of shares.
(v) Amalgamation of wholly-owned subsidiary companies, East View Estates Pvt. Ltd., First Rock Infrastructure Pvt. Ltd.
and Miracletouch Developers Pvt. Ltd. with the Company:
(a) A Scheme of Amalgamation ("the Scheme") of East View Estates Pvt. Ltd., First Rock Infrastructure Pvt. Ltd. and
Miracletouch Developers Pvt. Ltd. ("three subsidiaries") with the Company with effect from 1st April 2015,
was sanctioned by the Hon'ble High Court of Judicature at Bombay (“the Court”) on 8th July, 2016 and certified copies
of the Order of the Court sanctioning the Scheme were filed with the Registrar of Companies, Maharashtra on 8th July,
2016. Accordingly, the Scheme has been given effect to in the accounts for the year, and the entire undertaking of the
erstwhile three subsidiaries stands transferred to and vested in the Company as a going concern and the three
subsidiaries, without any further act, stands dissolved without winding up. The three subsidiaries were mainly engaged
in the business of land development.
(b) The details of adjustments made in the accounts pursuant to the Scheme are set out below:
Rupees
Value of Net Assets of the three subsidiaries taken over as at 1st East View First Rock Miracletouch Total
April, 2015 (See Notes below): Estates Pvt. Ltd. Infrastructure Developers Pvt. Ltd.
Pvt. Ltd.
Fixed Assets (Freehold Land) 3,43,49,155 8,20,30,163 6,19,78,315 17,83,57,633
Long-term loans and advances 61,565 61,565
Cash and Cash equivalents 3,25,412 27,668 17,889 3,70,969
Short-term loans and advances 20,331 1,09,289 1,29,620
Total Assets (A) 3,47,36,132 8,20,78,162 6,21,05,493 17,89,19,787
Less: Liabilities:
Short-term borrowings 4,60,42,437 12,36,42,674 9,13,54,069 26,10,39,180
Trade Payables 8,764 132 8,896
Other Current Liabilities 11,236 11,368 22,604
Total Liabilities (B) 4,60,51,201 12,36,53,910 9,13,65,569 26,10,70,680
Total Value of Net Assets taken over *(A) – (B)+ (1,13,15,069) (4,15,75,748) (2,92,60,076) (8,21,50,893)
Less: Book Value of Investments written off (93,85,245) (6,94,07,440) (7,83,84,250) (15,71,76,935)
Balance adjusted against Capital Reserve (2,07,00,314) (11,09,83,188) (10,76,44,326) (23,93,27,828)
Notes:
(c) For recording Fixed Assets in the books of the Company at Fair Values:
Freehold Land has been recorded at the carrying value of Rs. 17.84 crore in the books of the three subsidiaries as at
31st March, 2015.
All assets and liabilities, other than the Fixed Assets items mentioned above, have been recorded in the books of the
Company at the values appearing in the books of the three subsidiaries as at the closing balance sheet as at
31st March, 2015. Since these subsidiaries were 100% owned by the Company, there was no issue of shares,
instead, the carrying values of these investments in the book of the Company have been adjusted (as shown above)
against Capital Reserve.
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Annual Report and Accounts 2016-17
(d) With effect from 1st April, 2015, all debts, liabilities, duties and obligations of the three subsidiaries as at the close of
business on the date preceding the aforesaid date, whether or not provided in the books of the three subsidiaries, and
all liabilities which arise or accrue on or after 1st April, 2015 shall be deemed to be the debts, liabilities, duties and
obligations of the Company.
(e) Pending completion of the relevant formalities for transfer of some of the assets and liabilities, acquired pursuant to the
Scheme, in the name of the Company, such asset and liabilities continue to be in the name of the three subsidiaries.
If the acquisition had occurred on 1/4/2015 , Management estimates that consolidated revenue would have been Rs. 3888.58 crore and
consolidated profit before tax would have been Rs. 338.44 crore.
(a) Purchase consideration
(Rupees in crore)
Cash Paid 167.42
Fair value of Astec ESOP (pre-combination charge) 0.91
Total purchase consideration 168.33
(b) Identifiable assets acquired and liabilities assumed
The following table summaries the recognised amounts of assets acquired and liabilities assumed at the date of acquisition.
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Godrej & Boyce Mfg. Co. Ltd.
(Rupees in crore)
Other financial assets 5.75
Loans and advances 0.42
Cash and cash equivalents 11.78
Other current assets 4.86
Other non-current assets 28.15
Fair value of assets acquired 266.41
Loans and borrowings (81.22)
Current and deferred tax liabilities (1.19)
Other current liability (1.29)
Provisions (6.48)
Other financial liability (18.17)
Trade payables (61.17)
Fair value of liabilities acquired (169.52)
Deferred tax on business combination 13.88
Total identifiable net assets acquired 110.77
The gross contractual amounts and the fair value of trade and other receivables acquired is Rs.73.45 crore. None of the trade and other
receivables are credit impaired and it is expected that the full contractual amounts will be recoverable.
(c ) Goodwill
Particulars (Rupees in crore)
Consideration transferred 168.33
Non-controlling interest in the acquired entity 60.61
Less: Net identifiable assets acquired (110.77)
Goodwill 118.17
The goodwill on acquisition can be attributable to Astec's considerable experience in the development and production of intermediates
and its enduring relationships with large and small companies all over the world. No amount of Goodwill is expected to be deductible for
tax purpose.
The fair value of non-controlling interest has been estimated as proportion of net assets acquired.
(viii) Creamline Dairy Products Ltd. (ceased to be a sub-subsidiary on 27th March, 2017)
On December 21, 2015, Subsidiary Company acquired 25.91% of the shares and voting rights in Creamline Dairy Products Ltd. (‘Creamline’).
As a result, the Group 's equity interest in Creamline increased from 26% to 51.91%, obtaining control of the entity.
Taking control of Creamline will enable the Group to add value through its association with Indian dairy farmers and in-depth knowledge of
agri-businesses & rural marketing. Creamline will also get leverage through the Godrej Agrovet brand, which has strong recall with dairy
farmers through the cattle feed business.
For year ended 31st March, 2016 , Creamline contributed revenue of Rs. 272.89 crore and profit before tax of Rs. 1.20 crore to the group's
results.If the acquisition had occurred on 1st April, 2015 , Management estimates that consolidated revenue would have been Rs. 4409.53
crore and consolidated profit would have been Rs. 366 crore.
In determining these amounts, management has assumed that the fair value adjustments,determined provisionally, that arose on date of
acquisition would have been same if the acquisition had occurred on 1st April, 2015.
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Annual Report and Accounts 2016-17
The gross contractual amounts and the fair value of trade and other receivables acquired is Rs. 8.82 crore. None of the trade and other
receivables are credit impaired and it is expected that the full contractual amounts will be recoverable.
(c) Goodwill
Particulars (Rupees in crore)
Consideration transferred 148.19
Non-controlling interest in the acquired entity 186.85
Fair value of previously held equity interest 125.88
Less: Net identifiable assets acquired (384.22)
Goodwill 76.70
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Godrej & Boyce Mfg. Co. Ltd.
Goodwill on acquisition comprises the value of expected synergies arising from the acquisition and long-standing relationships with
farmers, which does not meet the criteria for recognition as an intangible asset under Ind AS 38 and hence, has not been separately
recognised. No amount of Goodwill is expected to be deductible for tax purpose.
The fair value of non-controlling interest has been estimated as proportion of net assets acquired.
The remeasurement to fair value of the Group's existing 26% interest in Creamline Dairy resulted in a gain of Rs 91.50 crore, which has
been recognised in other income.
(d) Purchase Consideration - Cash Outflow
Particulars Rupees in Crore
Outflow of cash to acquire subsidiary, net of cash acquired
Cash consideration 148.19
Less: Balance acquired
Cash and Cash equivalents (7.23)
Net outflow of cash - Investing activities 140.96
As at
Particulars
31/03/2016
Pre Tax discount rate 12% - 18%
Long term growth rate beyond 5 years 6% - 9%
The Management believes that any reasonably possible change in the key assumptions would not cause the carrying amount to exceed the
recoverable amount of the cash generating unit.
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Annual Report and Accounts 2016-17
B. Jointly-held subsidiaries (where the Company and its subsidiary Godrej Industries Ltd together hold more than
one-half of the equity share capital):
1. Godrej Consumer Products Ltd. (GCPL) (ceased to be a subsidiary with effect from 30th March, 2017)
2. Godrej One Premises Management Pvt. Limited (ceased to be a subsidiary with effect from 30th March, 2017)
The following companies are step-down subsidiaries (where the Company's subsidiaries listed in A and B above,
directly and/or indirectly through one or more subsidiaries, hold more than one-half of equity share capital):
(I) which remain subsidiaries as at 31.03.2017
C. Subsidiaries of Godrej Infotech Ltd.:
1. Godrej Infotech Americas Inc. (a wholly-owned subsidiary incorporated in North Carolina, USA)
2. Godrej Infotech (Singapore) Pte. Ltd. (a wholly-owned subsidiary incorporated in Singapore)
3. LVD Godrej Infotech NV (incorporated in Belgium)
D. Subsidiaries of Godrej (Singapore) Pte. Ltd.:
1. JT Dragon Pte. Ltd. (Incorporated in Singapore)
2. Godrej (Vietnam) Co. Ltd. (Incorporated in Vietnam) (a wholly owned subsidiary of JT Dragon Pte. Ltd.)
E. Joint Ventures:
1. Godrej Consoveyo Logistics Automation Ltd. (formerly Godrej Efacec Automation & Robotics Ltd.)
2. Godrej & Khimji (Middle East) LLC (incorporated in Sultanate of Oman) [a Joint Venture of Godrej (Singapore) Pte. Ltd.]
3. Godrej UEP (Singapore) Pte. Ltd. (Joint venture between Godrej (Singapore) Pte. Ltd. and Urban Electric Power Inc.)
(II) which have ceased to be subsidiaries as at 31.03.2017
F. Subsidiaries of Godrej Industries Ltd.: (ceased to be a subsidiary with effect from 30th March, 2017)
1. Godrej Agrovet Ltd. (GAVL)
2. Godrej Properties Ltd. (GPL)
3. Ensemble Holdings & Finance Ltd.
4. Godrej International Ltd. (incorporated in the Isle of Man)
5. Natures Basket Ltd.
6. Godrej International Trading & Investments Pte Ltd. (incorporated in Singapore)
7. Godrej International Ltd. (incorporated in Labuan, Malaysia)
G. Subsidiaries of GAVL: (ceased to be a subsidiary with effect from 27th March, 2017)
1. Godvet Agrochem Ltd.
2. Astec LifeSciences Ltd. and its subsidiaries
i. Behram Chemicals Pvt. Limited
ii. Astec Europe Sprl
iii. Comercializadora Agricola Agroastrachem Cia Ltda
3. Creamline Dairy Products Ltd. and its subsidiary
i. Nagavalli Milkline Pvt. Ltd.
4. Godrej Seeds and Genetics Ltd. (upto 18th March, 2017)
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Godrej & Boyce Mfg. Co. Ltd.
H. Subsidiaries of GPL: (ceased to be a subsidiary with effect from 30th March, 2017; as GIL ceased to
be a subsidiary on that date)
1. Godrej Fund Management Pte Ltd.
2. Godrej Real Estate Pvt. Ltd.
3. Godrej Buildcon Pvt. Ltd.
4. Godrej Projects Development Pvt. Ltd. (GPDPL)
5. City Star Infraprojects Ltd. (w.e.f. 12th January, 2017)
6. Godrej Garden City Properties Pvt. Ltd.
7. Godrej Real View Developers Pvt. Ltd. (w.e.f.1st September,2016 and upto 28th March, 2017)
8. Godrej Green Homes Ltd.
9. Godrej Home Developers Pvt. Ltd.
10. Godrej Hillside Properties Pvt. Ltd.
11. Godrej Prakriti Facilities Pvt. Limited ( a subsidiary of Happy Highrises Ltd.w.e.f 9th June, 2015)
12. Godrej Investment Advisers Pvt. Limited ( a subsidiary w.e.f 29th October 2015)
13. Godrej Highrises Properties Pvt. Limited ( a subsidiary w.e.f 26th June, 2015)
14. Godrej Genesis Facilities Management Pvt. Limited ( a subsidiary of Happy Highrises Ltd w.e.f 19th February, 2016)
15. Godrej Residency Private Limited (w.e.f. 16th March, 2017)
16. Godrej Skyline Developers Private Limited (w.e.f. 22nd November, 2016)
17. Godrej Vikhroli Properties India Limited (Godrej Vikhroli Properties LLP converted into a Public Limited Company)
18. Prakritiplaza Facilities Management Private Limited (w.e.f. 28th July, 2016)
19. Godrej Century LLP (w.e.f. 14th March, 2017)
20. Godrej Green Properties LLP (w.e.f. 27th October, 2016)
21. Godrej Highview LLP (w.e.f. 29th September, 2016)
22. Godrej Projects (Bluejay) LLP (w.e.f. 2nd March, 2017)
23. Godrej Projects (Pune) LLP (w.e.f. 5th February, 2017)
24. Godrej Projects (Soma) LLP (w.e.f. 6th March, 2017)
25. Godrej Skyview LLP (w.e.f. 19th October, 2016)
26. Godrej Land Developers LLP
27. Godrej Developers & Properties LLP
28. Godrej Highrises Realty LLP
29. Godrej Project Developers & Properties LLP
30. Godrej Greenview Housing Pvt. Ltd . (upto 29th June, 2016)
31. Wonder Projects Development Pvt. Ltd. (w.e.f. 18th September, 2016)
32. Pearlite Real Properties Pvt. Ltd. (w.e.f. 2nd September, 2016 and upto 29th March, 2017)
I. Subsidiaries and Sub-subsidiaries of GCPL: (ceased to be a subsidiary with effect from 30th March, 2017)
1. Godrej South Africa (Proprietary) Ltd. [formerly, Rapidol (Pty) Ltd.] (incorporated in South Africa)
2. Godrej Netherlands BV (incorporated in the Netherlands)
3. Godrej UK Ltd. (a subsidiary of Godrej Netherlands BV)
4. Godrej Global Mid East FZE (incorporated in Sharjah, U.A.E.) (a subsidiary of Godrej Consumer Products Holding
(Mauritius) Ltd.)
5. Godrej Consumer Products Mauritius Ltd. ( Incorporated in Mauritius)
6. Godrej Consumer Products Holding (Mauritius) Ltd. (incorporated in Mauritius)
7. Godrej Household Products Lanka (Pvt.) Ltd. (incorporated in Sri Lanka)
8. Godrej Household Products Bangladesh Pvt. Ltd. (incorporated in Bangladesh)
9. Godrej Consumer Products Bangladesh Ltd. (incorporated in Bangladesh)
10. Godrej Mauritius Africa Holdings Ltd. (incorporated in Mauritius)
11. Godrej West Africa Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
12. Godrej Consumer Products (UK) Ltd. (a subsidiary of Godrej UK Ltd.)
13. Godrej Consumer Investments (Chile) Spa, (incorporated in Chile) (a subsidiary of Godrej Netherlands BV)
14. Godrej Mideast Holdings Limited (Incorporated in Dubai) (a 100 % subsidiary of Godrej Indonesia IP Holdings
Limited) (w.e.f. 28th July, 2015)
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Annual Report and Accounts 2016-17
15. Godrej Holdings (Chile) Limitada, (incorporated in Chile) (a subsidiary of Godrej Consumer Investments (Chile) Spa)
16. Cosmetica Nacional, (incorporated in Chile) (a subsidiary of Godrej Holdings (Chile) Limitada)
17. Plasticos Nacional, (incorporated in Chile) (a subsidiary of Cosmetica Nacional)
18. Kinky Group (Proprietary) Ltd. (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
19. Godrej Nigeria Ltd. (incorporated in Nigeria) (a subsidiary of Godrej Consumer Products Mauritius Ltd.)
20. Indovest Capital Ltd. (incorporated in Malaysia) (a subsidiary of Godrej Consumer Products Holding (Mauritius) Ltd.)
21. Godrej Consumer Products Dutch Cooperatief UA, (incorporated in the Netherlands) (a subsidiary of Godrej
Consumer Products Holding (Mauritius) Ltd.)
22. Godrej Consumer Products (Netherlands) BV (incorporated in the Netherlands) (a subsidiary of Godrej
Consumer Products Dutch Cooperatief UA)
23. Godrej Consumer Holdings (Netherlands) BV (incorporated in the Netherlands) (a subsidiary of Godrej
Consumer Products Dutch Cooperatief UA)
24. PT Megasari Makmur (incorporated in Indonesia) (a subsidiary of Godrej Consumer Holdings (Netherlands) BV)
25. PT Intrasari Raya (incorporated in Indonesia) (a subsidiary of Godrej Consumer Holdings (Netherlands) BV)
26. PT Ekamas Sarijaya (incorporated in Indonesia) (a subsidiary of Godrej Consumer Holdings (Netherlands) BV)
27. PT Indomas Susemi Jaya (incorporated in Indonesia) (a subsidiary of Godrej Consumer Holdings (Netherlands) BV)
28. PT Sarico Indah (incorporated in Indonesia) (a subsidiary of Godrej Consumer Holdings (Netherlands) BV)
29. Panamar Procuccioness S.A. (incorporated in Argentina) (a subsidiary of Godrej Netherlands Argentina BV)
30. Argencos S.A. (incorporated in Argentina) (a subsidiary of Godrej Netherlands Argentina BV)
31. Laboratoria Cuenca S.A. (incorporated in Argentina) (a subsidiary of Godrej Netherlands Argentina BV)
32. Deciral S.A. (incorporated in Uruguay) (a subsidiary of Laboratoria Cuenca S.A.)
33. Issue Group Brazil Ltd. (incorporated in Brazil) (a subsidiary of Godrej Netherlands Argentina BV)
34. Consell S.A . (incorporated in Argentina) (a subsidiary of Laboratoria Cuenca S.A.)
35. Subinite Pty Ltd. (incorporated in South Africa) (a subsidiary of Godrej West Africa Holdings Ltd.)
36. Lorna Nigeria Ltd (incorporated in Nigeria) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
37. Weave IP Holding Mauritius Pvt. Ltd. (incorporated in Mauritius) (a subsidiary of Godrej West Africa Holdings Ltd.)
38. Weave Trading Mauritius Pvt. Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
39. Hair Trading (Offshore) S. A. L. (incorporated in Lebanon) (a subsidiary of Weave Trading Mauritius Pvt Ltd.)
40. Weave Mozambique Limitada (incorporated in Mozambique) (a subsidiary of Godrej West Africa Holdings Ltd.)
41. Godrej East Africa Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products Ltd.)
42. Style Industries Ltd. (incorporated in Kenya) (a subsidiary of DGH Phase Two Mauritius Pvt. Ltd.)
43. DGH Phase Two Mauritius (incorporated in Mauritius) (a subsidiary Godrej East Africa Holdings Ltd.)
44. Godrej Tanzania Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products Ltd.)
45. DGH Tanzania Ltd (incorporated in Tanzania) (a subsidiary of Godrej Tanzania Holdings Ltd.)
46. Sigma Hair Ind Ltd. (incorporated in Tanzania) (a subsidiary of DGH Tanzania Ltd.)
47. Weave Ghana Ltd. (incorporated in Ghana) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
48. Godrej Consumer Products US Holding Limited (Incorporated in Mauritius) (w.e.f. 29th March, 2016)
49. Darling Trading Company Mauritius Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa
Holdings Ltd.)
50. Godrej Africa Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
51. Godrej Indonesia IP Holdings Ltd. (incorporated in Mauritius) (a subsidiary of Godrej Consumer Products
Holding (Mauritius) Ltd.)
52. Frika Weave Pty Ltd. (incorporated in South Africa) (a subsidiary of Godrej Mauritius Africa Holdings Ltd.)
53. Belaza Mozambiq LDA (w.e.f 30th April, 2015)
54. Charm Industries Ltd. (w.e.f. 14th August, 2015)
55. Canon Chemicals Ltd.
56. Godrej Hair Weave Nigeria Ltd.
57. Godrej International Trading Company (Sharjah)
58. DGH Angola (name changed from Godrej Megasari Holdings)
59. Godrej Hair Care Nigeria Limited (w.e.f 12th January, 2016)
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Godrej & Boyce Mfg. Co. Ltd.
60. Godrej Household Insecticide Nigeria Ltd. (w.e.f 12th January, 2016)
61. Hair Credentials Zambia Limited (w.e.f 23rd December 2015)
62. Godrej SON Holdings Inc. (Incorporated in USA) (w.e.f. 24th March, 2016)
63. Old Pro International Inc (USD)
64. Strength of Nature LLC (USA)
65. Strength of Nature South Africa Proprietary Limited
66. Style Industries Uganda Limited
67. Weave Senegal Ltd
68. DGH Uganda
69. Godrej Consumer Products International FZCO
(ii) Associates over which the Company's Chairman and Managing Director is able to exercise significant influence: Nil
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Annual Report and Accounts 2016-17
(b) Others:
1. Mr. P. K. Gandhi, Chief Financial Officer
2. Mr. P. E. Fouzdar, Executive Vice President and Company Secretary
(vii) Relatives of Whole-time Directors with whom the Company has transactions:
1. Mrs. P. J. Godrej (spouse of Mr. J. N. Godrej)
2. Mr. N. J. Godrej (son of Mr. J. N. Godrej)
3. Ms. R. J. Godrej (daughter of Mr. J. N. Godrej)
4. Mrs. S. G. Crishna (spouse of Mr. V. M. Crishna)
5. Mrs. F. C. Bieri (daughter of Mr. V. M. Crishna)
6. Mrs. N. Y. Holkar (daughter of Mr. V. M. Crishna)
(viii) Key Managerial Personnel having significant influence over the group:
1. Mr. A. B. Godrej, Non-Executive Director for the parent company
2. Mr. N. B. Godrej, Non-Executive Director for the parent company
3. Ms. Nisaba Godrej (daughter of Mr. A. B. Godrej)
4. Ms. Tanya Dubash (daughter of Mr. A. B. Godrej)
5. Mr. P. A. Godrej (son of Mr. A. B. Godrej)
(b) PARTICULARS OF TRANSACTIONS WITH RELATED PARTIES DURING THE YEAR: (Rupees in crore)
Current Year
Associate Previous Year
Companies Associate Companies
[Items (a)(i), (iii), [Items (a)(i), (iii), (iv)
(iv) and (vi)] and (v)]
(i) Transactions carried out with the related parties,
(a) Purchase of Materials/Finished Goods/Services 11.03 13.04
(b) Sales, Services Rendered and Other Income 38.52 34.75
(c) Dividends Received - 7.48
(d) Interest paid on Deposits taken - 7.41
(e) Dividends paid - 180.69
(f) Unsecured Deposits taken and repaid - 252.00
(g) Trade and other Receivables 11.13 7.66
(h) Trade and other Payables 0.02 2.19
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Godrej & Boyce Mfg. Co. Ltd.
(b) PARTICULARS OF TRANSACTIONS WITH RELATED PARTIES DURING THE YEAR: (Rupees in crore)
Current Year
Associate Previous Year
Companies Associate Companies
[Items (a)(i), (iii), [Items (a)(i), (iii), (iv)
(iv) and (vi)] and (v)]
(i) Deposits received, outstanding at year end - 109.36
(j) Deposits refunded - 17.9
(k) Guarantees given, outstanding at year end 73.16 26.50
(l) Rent, Establishment & other exps paid 0.82 6.46
(m) Other Income - 70.1
(n) Advances given - 21.91
(o) Advances received - 1.91
(p) Repayment of loan given - 5.64
(q) Inter Corporate deposits advanced - 35.75
(r) Redemption of Debentures - 34.32
(s) Investment in Debentures - 140.88
(t) Issue of Equity Shares - 1.14
(u) Share of Profit in LLP - 16.56
(Rupees in crore)
Current Year Previous Year
(ii) Transactions carried out with Mr. J. N. Godrej, Chairman & Managing Director
(a) Dividends paid 2.29 15.70
(b) Unsecured Deposits outstanding 15.00 15.00
(c) Interest paid on Deposits taken 1.37 0.37
(iii) Transactions carried out with Mr. V. M. Crishna, Executive Director:
(a) Dividends paid * - 0.01
(b) Unsecured Deposits outstanding 7.00 7.00
(c) Interest paid on Deposits taken 0.64 0.02
(iv) Transactions carried out with Mr. N. J. Godrej, Executive Director:
(a) Dividends paid - 7.88
(v) Transactions carried out with Mr. A. B. Godrej, Chairman (Godrej Industries Ltd):
(a) Dividends paid - 15.47
(vi) Transactions carried out with Mr. N. B. Godrej, Managing Director (Godrej Industries Ltd):
(a) Dividends paid - 31.91
(b) Issue of equity shares
(vii) Dividend paid to relatives of Whole-time Directors:
(a) Mrs. P. J. Godrej - 0.02
(b) Ms. R. J. Godrej (beneficiary of The Raika Godrej Family Trust) 1.25 7.88
(c) Mrs. S. G. Crishna 2.47 16.96
(d) Mrs. F. C. Bieri 1.17 7.26
(e) Mrs. N. V. Crishna 1.17 7.26
(viii) Remuneration paid/payable to Key Management Personnel (Whole-time Directors) 25.07 84.45
(ix) Outstanding Remuneration paid/payable to Key Management Personnel
(Whole-time Directors) - 25.73
*(Amount less than Rs.0.01 crore)
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Annual Report and Accounts 2016-17
(b) Lease income from operating leases is recognised in the Statement of Profit and Loss. Initial direct costs incurred
specifically to earn revenues from operating leases of fixed assets are charged to the Statement of Profit and Loss as
incurred. These assets pertain to land, commercial/residential premises, forklifts and vending machines given on
lease on varying tenure and other terms.
The future minimum lease rentals receivable under non-cancellable operating leases are estimated at:
(Rupees in crore)
As at As at As at
31/03/2017 31/03/2016 1/4/2015
Within one year 83.12 48.37 47.47
Later than one year not later than 5 years 72.54 118.56 175.08
Later than 5 years - 53.14 49.96
Total 155.66 220.07 272.51
The Group assessed one of its arrangements as an embedded lease transaction and determined the same as finance lease. Accordingly,
Property, plant and equipment have been derecognised and finance lease receivable have been accounted at present value of minimum
lease payments and resultant difference have been charged to retained earnings. Revenue elements identified as fixed charges towards
leasing as per the agreement which are covered under minimum lease receivable definition for finance lease accounting is adjusted partly
against finance lease receivable to the extent of principal amount and partly recognised as finance income.
At 31/03/2016, the future minimum lease receivable under finance lease arrangement as follows.
(Rupees in crore)
Future value Unearned Present value of
Particulars of minimum finance income minimum lease
lease receivables
receivables
Less than one year 111.36 61.16 50.20
Between one and five years 445.44 162.49 282.94
More than five years 111.36 13.85 97.51
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Godrej & Boyce Mfg. Co. Ltd.
56. Details of Loans Given , Investments made and Guarantee given, covered under section 186(4) of Companies Act, 2013
are given under the respective heads.
57. The figures of the current year are not strictly comparable with those of the corresponding figures of the previous year
in view of amalgamation made.
Figures for the previous year have been regrouped / restated wherever necessary to conform to current year’s
presentation.
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Annual Report and Accounts 2016-17
61. ADDITIONAL INFORMATION, AS REQUIRED UNDER SCHEDULE III TO THE COMPANIES ACT, 2013, OF ENTERPRISES
CONSOLIDATED AS SUBSIDIARY / ASSOCIATES
Net Assets (i.e. total assets Share in Profit / Loss Share in Other Share in Total
Name of the Enterprise
minus total liabilities) account Comprehensive Income Comprehensive Income
As % of Amount As % of As % of Amount As % of
Amount Amount
consolidated (Rs. in consolidated consolidated (Rs. in consolidated
(Rs. in crore) (Rs. in crore)
net assets crore) profits profits crore) profits
Parent
Godrej and Boyce Manufacturing Company Limited 99.61% 7,762.15 219.81% 4,269.24 12.88% (15.78) 233.75% 4,253.47
Subsidiaries
Indian
1 Godrej Infotech Ltd. 0.21% 16.46 0.31% 6.01 0.09% (0.11) 0.32% 5.90
2 India Circus Retail Pvt. Ltd. 0.02% 1.22 -0.32% (6.30) 0.00% (0.00) -0.35% (6.30)
3 Godrej Industries Ltd. (ceased to be a subsidiary
w.e.f. 30th March, 2017) 0.00% - 22.35% 434.17 19.33% (23.69) 22.56% 410.48
4 Godrej Consumer Products Ltd. (ceased to be a
subsidiary w.e.f. 30th March, 2017) 0.00% - 66.88% 1,298.94 67.69% (82.96) 66.82% 1,215.98
Foreign
1 Godrej (Singapore) Pte. Ltd., Singapore 1.11% 86.34 0.46% 8.89 0.49% 8.89
2 Veromatic International BV, the Netherlands 0.15% 11.80 -0.02% (0.42) -0.02% (0.42)
3 Godrej Americas Inc. , USA. 0.01% 1.07 -0.03% (0.51) -0.03% (0.51)
4 Sheetak Inc., USA. -0.31% (24.46) -0.76% (14.71) -0.81% (14.71)
Grand Total 100.00% 7,792.25 100.00% 1,942.22 100.00% (122.54) 100.00% 1,819.68
235
Godrej & Boyce Mfg. Co. Ltd.
Form AOC - 1
[ PURSUANT TO FIRST PROVISO TO SUB SECTION (3) OF SECTION 129 READ WITH RULE 5 OF COMPANIES (ACCOUNTS) RULES, 2014 ]
STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENT OF SUBSIDIARIES/ASSOCIATE COMPANIES / JOINT VENTURES/ LIMITED LIABILITY PARTNERSHIPS
Part "A": Subsidiaries
Rupees in Crore
Sr. Name of Subsidiary Reporting Period for the subsidiary Reporting currency and Share Reserves & Total Assets Total Investments Turnover Profit Provision for Profit after Proposed % of
No. concerned, if different from the exchange rate as on the last capital surplus Liabilities before taxation taxation Dividend share-
holding company's reporting period date of the relevant financial taxation holding
year in case of foreign
subsidiaries
Reporting
currency Exchange rate
1 Godrej Infotech Ltd. 01-Apr-2016 To 31-Mar-2017 INR 1.00 0.10 14.37 40.35 25.88 1.60 93.96 6.58 2.36 4.22 - 52.06%
2 India Circus Retail Private Ltd 01-Apr-2016 To 31-Mar-2017 INR 1.00 0.38 (22.16) 3.53 25.31 - 3.65 (6.30) (0.01) (6.29) - 51.95%
3 Godrej (Singapore)Pte. Ltd., Singapore 01-Jan-2016 to 31-Dec-2016 SGD 46.8339 8.37 73.95 98.20 15.88 17.53 58.19 9.83 1.25 8.57 - 100%
4 Veromatic International BV, the Netherlands 01-Jan-2016 to 31-Dec-2016 EURO 71.3035 32.21 (20.32) 27.42 15.53 - 45.53 (0.14) (0.41) 0.27 - 99.95%
5 Godrej Americas Inc. USA. 01-Apr-2016 To 31-Mar-2017 USD 64.7468 1.94 (0.87) 1.07 - - - (0.65) (0.14) (0.51) - 100%
6 Sheetak Inc., USA 01-Jan-2016 to 31-Dec-2016 USD 64.7468 34.55 (59.01) 7.46 31.92 - 8.06 (14.71) - (14.71) - 50.95%
SUBSIDIARY AND SUB-SUBSIDIARY OF GODREJ SINGAPORE PTE LTD
7 JT Dragon Pte. Ltd., Singapore 01-Jan-2016 to 31-Dec-2016 SGD 46.8339 24.38 1.60 26.01 0.03 24.24 - 0.57 0.00 0.57 - 100%
8 Godrej (Vietnam) Co. Ltd., Vietnam 01-Jan-2016 to 31-Dec-2016 VND 0.00296 12.21 20.46 36.76 4.09 - 42.00 7.61 1.12 6.50 - 100%
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Annual Report and Accounts 2016-17
Amount of
Investment in Extent of
Associate Holding Considered in Not Considered
Number /Joint Venture % Consolidation in Consolidation
A Joint Ventures:
1 Godrej Consoveyo Logistics Automation Ltd. 01-Apr-2016 to 31-Mar-2017 7,50,000 0.75 49% There is significant influence by virtue of Godrej and Boyce Mfg. Co. Ltd stake is 10.34 1.66 1.73
(formerly Godrej Efacec Automation and joint control. less than 51%
Robotics Ltd.) (Joint Venture)
2 Godrej and Khimji (Middle East) L.L.C. -Oman 01-Jan-2016 to 31-Dec-2016 5,78,200 17.53 49% There is significant influence by virtue of Godrej and Boyce Mfg. Co. Ltd stake is 17.56 0.57 0.59
[Joint Venture of Godrej (Singapore) Pte. Ltd.] joint control. less than 51%
B Associates:
3 Godrej Enterprises LLP * 01-Apr-2016 to 31-Mar-2017 NA 0.00 50% Godrej and Boyce Mfg. Co. Ltd is Godrej and Boyce Mfg. Co. Ltd stake is 0.00 (0.00) (0.00)
holding more than 20% of share capital less than 51%
4 Future Factory LLP 01-Apr-2016 to 31-Mar-2017 NA 2.67 20% Godrej and Boyce Mfg. Co. Ltd is Godrej and Boyce Mfg. Co. Ltd stake is 2.75 0.36 1.46
holding 20% of share capital less than 51%
5 Urban Electric Power LLC, USA 01-Jan-2016 to 31-Dec-2016 16,21,539 33.59 19.66% There is significant influence by virtue of Godrej and Boyce Mfg. Co. Ltd stake is 5.42 (5.36) (21.91)
almost 20% of share capital held. less than 51%
237
Godrej & Boyce Manufacturing Company Limited
ENCLOSURE 5
238
ENCLOSURE 5
Folio No. :
I/We being the holders of ________ shares of the above named Company hereby appoint
(1) Name:
Address:
E-mail:
or failing him/her
(2) Name:
Address:
E-mail:
as my/our proxy to attend and vote for me/us on my/our behalf at the Annual General Meeting of the Company
to be held on Friday, 24th November, 2017 at 10:00 a.m. at Pirojshanagar, Vikhroli, Mumbai 400079, and at any
adjournment thereof in respect of such resolution as indicated below:
ORDINARY BUSINESS
1. Adoption of the Financial Statements for the financial year ended 31st March, 2017.
2. Appointment of Mr. A.G.Verma as Director liable to retire by rotation.
3. Appointment of Mr. A.B. Godrej as Director liable to retire by rotation.
4. Appointment of M/s.Deloitte Haskins & Sells LLP as Auditors of the Company.
SPECIAL BUSINESS
5. Appointment of Ms. Nyrika Holkar as Executive Director- Corporate Affairs.
6. Appointment of Mr. Navroze J Goderj as Non Executive Director.
7. Ratification of remuneration payable to M/s. P. D. Dani & Associates, Cost Accountants and Mr. A. N.
Raman, Cost Accountant, for the financial year 2017-18
Signature of Shareholder
_________________
Signature of Proxy
Note: 1. This form, in order to be effective, should be duly stamped, signed, completed and deposited at the
Registered Office of the Company, not less than 48 hours before the meeting.
2. The Proxy-holder is required to carry an identity proof at the time of attending the meeting.
Godrej & Boyce Manufacturing Company Limited
Pirojshanagar, Vikhroli, Mumbai 400 079