Dear Members,
The Board of Directors of the Company (the Board-) present the
Forty-fifth Annual Report on the business and operations of the Company together with
Audited Financial Statements for the financial year ended March 31, 2023 ('the year').
FINANCIAL RESULTS
Pursuant to the provisions of the Companies Act, 2013 ('the Act') and SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time
('Listing Regulations'), the Company has prepared its standalone and consolidated
financial statements for the Financial Year ended March 31, 2023, details of which are
summarised below:
(' in Crore)
Particulars |
Standalone |
Consolidated |
|
2022-23 |
2021-22 |
2022-23| |
2021-22 |
Revenue from operations |
7,973 |
7,294 |
14,246 |
12,544 |
Other Income |
180 |
185 |
309 |
276 |
Total Income |
8,153 |
7,479 |
14,555 |
12,820 |
Profit before Regulatory Income and Tax |
273 |
328 |
463 |
1,179 |
Regulatory
Income |
787 |
716 |
1,276 |
737 |
Profit before tax |
1,060 |
1,044 |
1,739 |
1,916 |
Tax Expenses |
230 |
228 |
342 |
511 |
Profit for the year |
830 |
816 |
1,397 |
1,405 |
Other
comprehensive
loss |
(10) |
(15) |
(18) |
(11) |
Total
comprehensive
Income |
820 |
801 |
1,379 |
1,394 |
Highlights of the Company's financial performance for the year ended March 31, 2023 are
as under:
Standalone
During the year under review, total income was Rs8,153 Crore as against Rs7,479 Crore
for the previous year. Profit before tax was Rs1,060 Crore and Profit after tax (PAT) was
at Rs830 Crore. Total Comprehensive Income for the year after all other adjustments was
Rs820 Crore. Retained earnings as on March 31, 2023 was Rs10,303.40 Crore (March 31, 2022'10,311.81
Crore).
Consolidated
Total consolidated income was Rs14,555 Crore as against Rs12,820 Crore for the previous
year. Profit before tax was Rs1,739 Crore and Profit after tax (PAT) was at Rs1,397 Crore.
Total Comprehensive Income for the year after all other adjustments was Rs1,379 Crore.
There are no material changes and commitments affecting the financial position of the
Company, which have occurred between the end of the financial year and the date of this
report.
The financial results and operational performance, including major developments have
been further discussed in detail in the Management Discussion and Analysis section.
DIVIDEND
During the year under review, an Interim Dividend of 450% i.e. Rs4.50/- per equity
share of Rs1/- each was paid to the Members after deduction of tax at source, at
prescribed rates under the Income Tax Act, 1961. The above dividend was declared in terms
of the Dividend Distribution Policy of the Company.
The Dividend Distribution Policy of the Company is available at the Company's website
and can be accessed at https:// www.cesc.co.in/storage/uploads/policies/Dividend
Policy. pdf
The Notice convening the ensuing Annual General Meeting ("AGM") of the
Members of the Company includes an item for confirmation of the said Interim Dividend.
MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and
Analysis for the year under review is presented in a separate section forming part of this
Report as Annexure 'A'.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of Sections 124 and 125 of the Act and Investor Education
and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 as amended from
time to time, the Company during the year under review has transferred Dividend which
remains unpaid / unclaimed for seven consecutive years and also Equity Shares pertaining
to which Dividend remains unclaimed for a consecutive period of seven years to the
Investors Education and Protection Fund ('IEPF') established by the Central Government.
The details of said Dividend and the Equity shares transferred to IEPF are given
elsewhere in the report and is also available on the website of the Company.
SUBSIDIARIES
As on March 31, 2023, the Company had eighteen subsidiaries.
Details of operations of the Company's subsidiaries are set out in Management
Discussion and Analysis, which forms part of the Annual Report. Pursuant to Section 129(3)
of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement
containing salient features of the financial statement of the subsidiary companies in Form
No. AOC-1 is given in the Annual Report. In accordance with the provisions of Section 136
of the Act and the amendments thereto, read with the Listing Regulations, the audited
financial statements of the subsidiary companies are available on the Company's website
and can be accessed at https://www.cesc.co.in/subsidiaryAccounts
The Company has formulated a Policy for determining Material Subsidiaries. The Policy
is available on the Company's website and can be accessed at: https://
www.cesc.co.in/storage/uploads/policies/POLICY ON MATERIAL SUBSIDIARIES.pdf
Noida Power Company Limited, Haldia Energy Limited and Dhariwal Infrastructure Limited
are three material subsidiaries of the Company as per Regulation 16 (1) (c) of the Listing
Regulations.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of the Act, Indian Accounting Standards and the
Listing Regulations, Consolidated Financial Statements of the Company for the Financial
Year 2022-23, duly audited by Company's Statutory Auditors, Messrs. S. R. Batliboi &
Co. LLP, Chartered Accountants, forming a part of the Annual Report and shall be laid
before the members in the ensuing AGM of the Company as required under the Act.
The audited financial statements including the consolidated financial statements of the
Company and all other documents required to be attached thereto, are available on the
Company's website and can be accessed at J https://www.cesc.co.in/annualReports
: DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Act read with the Articles of
Association of the Company, Mr. Shashwat Goenka (DIN : 03486121) will retire by rotation
at the ensuing AGM and being eligible, offer himself for re-appointment. The Board on the
recommendation of Nomination and Remuneration Committee has recommended the said
re-appointment.
The Board on the recommendation of Nomination and Remuneration Committee and subject to
the approval of the Members has recommended the (a) re-appointment of Mr. Rabi Chowdhury
(DIN: 06601588) as the Managing Director (Generation) and Mr. Debasish Banerjee (DIN:
06443204) as the Manging Director (Distribution) for a period of one year with effect from
May 28, 2023 and (b) re-appointment of Mr. Pradip Kumar Khaitan (DIN: 00004821) as a
Non-Executive Non-Independent Director of the Company in terms of Regulation 17(1A) of the
Listing Regulations. Necessary resolutions for the above re-appointment(s) have been
included in the Notice for the forthcoming AGM of the Company.
In the opinion of the Board, all the Directors, including the Directors proposed to be
re-appointed, possess the requisite qualifications, experience and expertise and hold high
standards of integrity. The Company has received necessary disclosures/declarations from
all the Independent Directors of the Company confirming that they meet the criteria of
independence as prescribed under the Act and the Listing Regulations.
The list of key skills, expertise and core competencies of the Board is provided in the
Report on Corporate Governance forming part of this report.
As on March 31, 2023, the Company has the following Key Managerial Personnel (KMP) as
per Section 2(51) of the Act:
Sl.
No. |
Key Managerial Personnel |
Designation |
1. |
Mr. Rabi Chowdhury |
Managing Director (Generation) |
2. |
Mr. Debasish Banerjee |
Managing Director (Distribution) |
3. |
Mr. Rajarshi Banerjee |
Executive Director & CFO |
4. |
Mr. Jagdish Patra |
Company Secretary and Compliance Officer |
There were no changes in the Key Managerial Personnel of your Company.
During the year under review, the Non-Executive Directors of the Company had no
pecuniary relationship or transactions with the Company, other than sitting fees and
commission, as applicable, received by them.
The meeting of the Board of Directors were held during the financial year on May 13,
2022, August 10, 2022, November 14, 2022 and February 14, 2023.
INDEPENDENT DIRECTORS' MEETING
The Independent Directors of your Company met on February 14, 2023, without the
attendance of Non-Independent Directors and members of the management. The Independent
Directors reviewed the performance of Non-Independent Directors, the
Committees of the Board and the Board as a whole along with the performance of the
Chairman of the Company and assessed the quality, quantity and timeliness of flow of
information between the management and the Board that is necessary for the Board to
effectively and reasonably perform their duties.
SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards, i.e., SS-1 and SS-2
issued by the Institute of Company Secretaries of India and notified by the Ministry of
Corporate Affairs, Govt. of India, relating to Meetings of the Board of Directors and
General Meetings respectively.
BOARD DIVERSITY
The Company recognises the importance of a diverse Board in its success and believe
that a truly diverse Board will leverage differences in thought, perspective, industry
experience, knowledge and skills including expertise in financial, global business,
leadership, technology and other domains, will ensure that Company retains its competitive
advantage.
In terms of the provisions of Section 178(3) of the Act and Regulation 19 read with
Part D of Schedule II to the Listing Regulations, the Nomination and Remuneration
Committee ('NRC') is responsible for determining qualification, positive attributes and
independence of a Director.
Additional details on Board diversity are available in the Corporate Governance that
forms part of this Report
BOARD EVALUATION
In order to ensure that the Board and Committees of the Board are functioning
effectively and to comply with statutory requirements, the annual performance evaluation
of all the Directors, Committees of the Board, Chairman of the Board and the Board as a
whole, was conducted during the year. The evaluation was carried out based on the criteria
and framework approved by the NRC. A detailed disclosure on the parameters and the process
of Board evaluation as well as the outcome has been provided in the Report on Corporate
Governance.
COMMITTEES OF THE BOARD
The various Committees of the Board focus on certain specific areas and make informed
decisions in line with the delegated authority.
The following statutory Committees constituted by the Board according to their
respective roles and defined scope:
Audit Committee
Nomination and Remuneration Committee
Corporate Social Responsibility Committee
Stakeholders' Relationship Committee
Risk Management Committee
Details of the composition, terms of reference and number of meetings held for
respective committees are given in the Report on Corporate Governance.
EQUITY SHARE CAPITAL AND DEBT SECURITIES
Equity Shares
During the year under review, there has been no change in the authorised, issued,
subscribed and paid up Equity Share Capital of the Company.
The Equity Shares of the Company continued to be listed on BSE Limited (BSE) and the
National Stock Exchange of India Limited (NSE). The Company has paid the requisite listing
fees to the Stock Exchanges up to the Financial year 2023-24.
Debentures
a. Issue:
During the year under review, the Company had issued and allotted, 5,000 Secured,
Unlisted, Redeemable,
Rated, Non-Convertible Debentures ('NCDs') having a face value of Rs10 lakh each
aggregating to Rs500 Crore for cash at par, on private placement basis. The said NCDs were
issued in compliance with the applicable circulars issued by the Securities and Exchange
Board of India on issuance of debt securities by large corporates.
The funds raised through NCDs have been utilised as per the terms of the issue.
b. Redemption:
On May 20, 2023, the Company has redeemed by exercising call option, 3000 Secured,
Listed, Redeemable, Rated, Non-Convertible Debentures having face value of Rs10 Lakh each
aggregating to Rs300 Crore which were issued and alloted for cash at par on private
placement basis.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act, the Board of Directors hereby state and confirm
that:
i) in the preparation of the accounts for the financial year ended March 31, 2023, the
applicable accounting standards have been followed along with proper explanation relating
to the material departures, if any;
U
ii) the Directors have selected such accounting policies
LU
and applied them consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the Company at the
end of the financial year and of the profit of the Company for that period;
iii) the Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding
the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and are operating
effectively; and
vi) The Directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems are adequate and operating effectively.
CORPORATE GOVERNANCE
The Company is committed to focus on enhancing standards of Corporate Govrnance by long
term value creation and protecting stakeholders' interests by applying proper care, skill
and diligence to business decisions and constant adherance to the requirement of Listing
Regulations.
In compliance with Regulation 34 read with Schedule V of the Listing Regulations, a
Report on Corporate Governance for the year under review, is presented in a separate
section as a part of this Report as Annexure 'B' along with Additional Shareholder
Information as Annexure 'C'.
A certificate from the Auditors of the Company confirming compliance with the
conditions of Corporate Governance, as stipulated under the Listing Regulations, is
annexed to this report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS
No significant and materials orders were passed by the regulators or courts or
tribunals impacting the going concern status and your Company's operations in future.
INSOLVENCY AND BANKRUPTCY CODE, 2016
During the year under review, there was no application made or proceeding pending
against the Company under ^ the Insolvency and Bankruptcy Code, 2016.
o CHANGE IN THE NATURE OF THE BUSINESS
During the year under review, there was no change in the nature of the business of the
Company.
"? CORPORATE SOCIAL RESPONSIBILITY (CSR)
Over the past years, the Company has focused on several corporate social responsibility
programs. The Company continues its endeavour to improve the lives of people and provide
opportunities for their holistic development through its different initiatives in the
areas of Health,
Education, Child Protection, Environmental, Sustainability, and Skill Development.
In terms of Companies (Corporate Social Responsibility Policy) 2014, as amended, the
Company has formulated its Corporate Social Responsibility Policy. The said Policy is
uploaded on Company's website and can be accessed at
https://www.cesc.co.in/storage/uploads/policies/CSR Policy.pdf. A detailed section
on CSR activities undertaken during the year under review is annexed herewith and marked
as
Annexure-'D' and forming part of this Repor
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)
In terms of Regulation 34 (2) (f) of Listing Regulations, SEBI has introduced new
reporting requirements on ESG parameters called the Business Responsibility and
Sustainability Report (BRSR) which seeks disclosures from listed entities on their
performance against the nine principles of the 'National Guidelines on Responsible
Business Conduct' (NGBRCs) and reporting under each principle is divided into essential
and leadership indicators.
The Company has been a torchbearer of responsible business practices, always ensuring
its decisions balance social and environmental considerations with financial factors. Your
Company always believed that being responsible and reliable also means being sustainable.
These principles have always been an integral part of strategic planning of the Company
both to manage risk as well as to enable long term sustainable growth and value creation.
As stipulated under the Listing Regulations, the Business Responsibility and
Sustainability Report (BRSR) describing the initiatives taken by the Company from an
environmental, social and governance perspective, is given in the report as Annexure E'.
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Company with its related parties
during the year under review were in accordance with the provisions of the Act and the
Listing Regulations. All such contracts or arrangements, were entered into in the ordinary
course of business and at arm's length basis and approved by the Audit Committee. No
material contracts or arrangements with related parties were entered into during the year
under review. Disclosure of Related Party Transactions as required in terms of Section 134
of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 in Form AOC -2 is not
applicable for this year.
The Policy Statement on Materiality and dealing with Related Party Transactions is
available on the Company's website and can be accessed at https://www.cesc.co.in/
storage/uploads/policies/RELATED PARTIES POLICY.pdf.
Members may please refer to Note 42 to the Standalone Financial Statements for
requisite disclosure in respect of related parties and transactions entered into with them
during the year under review.
RISK MANAGEMENT
The Company has a structured Risk Management Framework, designed to identify, assess
and mitigate risks appropriately. The Risk Management Committee has been entrusted with
the responsibility to assist the Board in a) overseeing the Company's risk management
framework; and b) ensuring that all material Strategic and Commercial including
Cybersecurity, Safety and Operations, Compliance, Control and Financial risks have been
identified and assessed and ensuring that all adequate risk mitigations are in place, to
address these risks. The Audit Committee has additional oversight in the area of financial
risks and controls. Further, details are included in the separate section forming part of
this Report.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has zero tolerance towards sexual harassment at the workplace. In
accordance with the requirements of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition & Redressal) Act, 2013 ("POSH Act") and Rules made
thereunder, the Company has adopted a policy. The Company has constituted an Internal
Complaints Committee(s) (ICC) to redress and resolve any complaints arising under the POSH
Act. Training / awareness programs are conducted throughout the year to create sensitivity
towards ensuring respectable workplace.
Details of complaints received/disposed, if any, during the Financial Year 2022-23 are
provided in the Report on Corporate Governance.
INTERNAL FINANCIAL CONTROL (IFC) AND ITS ADEQUACY
The Company has in place adequate internal financial controls for ensuring orderly and
efficient conduct of the business, including adherence to the Company's policies,
safeguarding of its assets, prevention and detection of frauds and errors, accuracy and
completeness of the accounting records and timely preparation of reliable financial
disclosures. The IFC are adequate and operating effectively. Effectiveness of IFC is
ensured through management reviews, controlled self-assessment and independent testing by
the Internal Audit Department of the Company.
The Company believes that these systems provide reasonable assurance that the Company's
internal financial controls are adequate and are operating effectively as intended.
AUDITORS AND AUDITORS' REPORT
Messrs. S R Batliboi & Co. LLP, Chartered Accountants, (ICAI Firm Registration No.
301003E/E300005) were re-appointed as Statutory Auditors of the Company for a term of five
consecutive years, at the Forty-fourth AGM of the Company.
The Auditors' Report annexed to the financial statements for the year under review does
not contain any qualifications, reservations or adverse remarks. The Notes on financial
statements referred to in the Auditors' Report are self-explanatory and do not call for
any further comments.
During the year under review, the Auditors have not reported any instance of fraud as
referred to in Section 134(3)(ca) of the Act.
COST AUDITORS AND COST AUDIT REPORT
The Company is required to maintain cost records as specified by the Central Government
under Section 148(1) of the Act and such records are maintained accordingly.
The Board of Directors, on the recommendation of the Audit Committee, has appointed
Messrs. Shome & Banerjee, Cost Accountants (Firm Registration No 000001) as Cost
Auditors to conduct the audit of Company's cost records for the financial year ended March
31, 2023. The Cost Audit Report, for the year ended March 31, 2022, was filed with the
Central Government within the statutory time limit.
In accordance with the provisions of Section 148 of the Act read with the Companies
(Audit and Auditors) Rules, 2014, since the remuneration to be paid to the Cost Auditors
for the Financial Year 2023-24 is required to be ratified by the members, the Board of
Directors recommends the same for approval by members at the ensuing AGM. The said
proposal forms part of the Notice of the AGM.
SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT
Messrs. Anjan Kumar Roy & Co., (Certificate of Practice - 4557) Practicing Company
Secretaries, were appointed by the Board as the Secretarial Auditors of your Company for
the Financial Year ended March 31, 2023. The Secretarial Audit Report pursuant to Section
204 of the Act, is attached in the Annexure 'F' forming part of this Report.
Pursuant to Regulation 24A of the Listing Regulations, the Secretarial Audit Reports of
three material unlisted subsidiaries of the Company namely Noida Power Company Limited,
Haldia Energy Limited and Dhariwal Infrastructure Limited, for the Financial Year 2022-23
are also attached and are forming part of the Annual Report as Annexures 'F1', 'F2' and
'F3'. The Secretarial Audit Reports of such material unlisted subsidiaries do not
contain any qualifications, reservations or adverse remarks.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Your Company promotes safe, ethical and compliant conduct of all its business
activities The Company has a Vigil Mechanism and Whistle-blower policy in accordance with
Section 177 of the Act and Regulation 22 of Listing Regulations to bring Company's
attention to instances of illegal or unethical conduct, actual or suspected incidents of
fraud, actions that affect the financial integrity of the Company.
The said policy has been uploaded on the Company's website and can be accesssed at
https://www.cesc. co.in/storage/uploads/policies/WhistleBlowerPolicy.pdf. The said
policy provides a mechanism for employees of the Company to approach the Chairman of the
Audit Committee of the Company through the Company Secretary for redressal. No person had
been denied access to the Chairman of the Audit Committee and there was no such reporting
during the financial year 2022-23.
INSIDER TRADING
The Company's 'Insider Trading Prohibition Code' which is in line with the SEBI
(Prohibition of Insider Trading) Regulations, 2015, as amended from time to time, lays
down the guidelines and procedures to be followed and disclosures to be made by the
Insiders, while dealing in Company's securities.
In view of the aforesaid Regulations and SEBI Circular, the Company also has in place a
Structured Digital Database wherein details of persons with whom Unpublished Price
Sensitive Information is shared on need to know basis and for legitimate business purposes
is maintained with time stamping and audit trails to ensure non-tampering of the data
base.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Your Company, being a company providing infrastructure facilities is exempt from the
provisions applicable to loans, guarantees, security and investments under Section 186
(11) of the Act. Therefore, no details are required to be provided.
DEPOSITS FROM PUBLIC
Your Company during the year under review, has not accepted any deposit from the public
and as such no amount of principal or interest was outstanding as on the date of the
Balance Sheet.
1 CONSERVATION OF ENERGY, RESEARCH &
DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN I EXCHANGE EARNINGS AND OUTGO
Particulars as required under Section 134 of the Companies Act, 2013 relating to
Conservation of Energy and Technology Absorption is given in Annexure 'G', forming
a part of this report.
ANNUAL RETURN
Pursuant to Section 92 of the Act and Rule 12 of the Companies (Management and
Administration) Rules, 2014, the Annual Return is available on the website of the Company
and can be accessed at https://www.cesc.co.in/storage/
uploads/annreport/CESC_AnnualReturn_2022-23.pdf.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197(12) of the Act read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided
in Annexure 'H'.
Details of employee remuneration as required under provisions of Section 197 of the Act
and the Rule 5(2) and 5(3) of the aforesaid Rules are provided in Annexure I. In
terms of proviso to Section 136(1) of the Act, the Annual Report is being sent to the
Members excluding the Annexure I. The said statement is also available for inspection by
the shareholders at the Registered Office of the Company during business hours on working
days of the Company. Any Member interested in obtaining a copy of the same may write to
the Company Secretary at secretarial@rpsg.in.
None of the employees listed in the said Annexure are related to any Director of the
Company.
The Company has in place a Remuneration Policy for Directors, Key Managerial Personnel
and other employees, duly recommended by the Nomination and Remuneration Committee and
approved by the Board. The said Policy is uploaded on the website of the Company and can
be accessed at https://www.cesc.co.in/storage/uploads/ policies/REMUNERATION%20POLICY
CESC SM.pdf.
Other details relating to remuneration paid during the year to Directors and Key
Managerial Personnel are furnished in the Report on Corporate Governance which forms a
part of this report.
INDUSTRIAL RELATIONS
Industrial relations in the Company, during the year, continued to be cordial. A
detailed section on the Company's Human Resource initiatives is included in the Management
Discussion and Analysis forming a part of this report.
ACKNOWLEDGEMENT
Your Directors wishes to place on record its deep sense of appreciation for the
committed and dedicated services by the Company's employees at all levels, co-operation
received from the shareholders, business partners, financial institutions, banks,
consumers and vendors during the year under review.
The Directors are also thankful to the Government of India, the various ministries of
the State Governments, the central and state electricity regulatory authorities,
communities in the neighborhood of our operations, municipal authorities of Kolkata and
local authorities in areas where we are operational in India for all the support rendered
during the year.
Your Directors are also grateful for your continued encouragement and support.
On behalf of the Board of Directors
|
|
Dr. Sanjiv Goenka |
Place |
: Kolkata |
Chairman |
Date : |
May 22, 2023 |
DIN: 00074796 |
|