Date: 30 th September, 2017 To, Bombay Stock Exchange Limited Floor 1, P J Towers, Dalal Street, Mumbai-400001 Company Scrip Code: 530407 Sub: Submission of Annual Report for the year 2016-17 Dears Sir/Madam, With reference to the captioned subject please find enclosed herewith the Annual Report for the Financial Year 2016-17. Please take the same on your records. Thanking You, Yours Faithfully, For EPIC ENERGY LIMITED Sd/- Atul Mishra Compliance Officer ENCL: - as above EPIC ENERGY LIMITED An: ISO9001:2008 Company www.epicenergy.biz Registered office: Office No. 1, Ground Floor, “SUNSHINE WILLOWS”, Plot No. 18, Sector-8, Ghansoli,Navi Mumbai- 400701 Email: [email protected], Tel.: +91-22- 65009292 CIN: L67120MH1991PLC063103
Transcript
Date: 30th
September, 2017
To,
Bombay Stock Exchange Limited
Floor 1, P J Towers,
Dalal Street, Mumbai-400001
Company Scrip Code: 530407
Sub: Submission of Annual Report for the year 2016-17
Dears Sir/Madam,
With reference to the captioned subject please find enclosed herewith the Annual Report for
the Financial Year 2016-17.
Please take the same on your records.
Thanking You,
Yours Faithfully,
For EPIC ENERGY LIMITED Sd/- Atul Mishra Compliance Officer
Corporate Information 1 Chairman's Message 2 Board's Report 6-26 Management Discussion and Analysis Report 27-44 Corporate Governance Report 45-65
Financial Statements:
Independent Auditors' Report 66-71 Balance Sheet 72 Statement of Profit and Loss 73 Cash Flow Statement 74 Notes forming part of Financial Statements 75-89
Route Map
Annual General Meeting
Date & Time: Friday, September 29, 2017 at 09.30 a.m.
Venue:
South Coast Hotels & Hospitality Services, RX 31, MIDC, Thane Belapur Road, Opp.Rabale Railway Station, Navi Mumbai- 400 701 Book Closure Date: September 23, 2017 to September 29, 2017
EPIC ENERGY LIMITED
Annual Report 2016-17
EPIC ENERGY LIMITED
Annual Report 2016-17
Corporate Information
BOARD OF DIRECTORS BANKERS
Chairman
Axis Bank Limited
Mr. Nikhil Morsawala
Bank of India
Independent Non-Executive Director
Mr. Sanjay Gugale
Independent Non-Executive Director Mr. Zubin Patel
Non-Executive Director Mrs. Veena Morsawala
KEY MANAGEMENT PERSONNEL
Head - Environment & Innovation Mr. Harshal Gunde
Head- Projects Mr. Jigar Bhatt
Vendor Management (Domestic) Mr. C.V.Nigre
ENVIRONMENT MANAGER
Mrs. Aruna Joshi
ENGINEERING TEAM LEADERS Mr. Satish Mahajan Mr. Satish Gohil
COMPLIANCE OFFICER Mr. Atul Mishra
AUDITORS P.Murali& Co. Chartered Accountants
REGISTRAR AND SHARE TRANSFER AGENT Adroit Capital Services Private Ltd. 17-20, Jafferbhoy Industrial Estate, Makhwana Rd, 400059, Marol, Andheri East, Mumbai, Maharashtra 400059 Phone: 022 4227 0400
It was heartening to see the Government of India take a strong stand on Climate Change in spite of the announcement by the United States of America that it would pull out of the United Nations Framework on Climate Change (UNFCC). Our country has well and truly arrived as a Global Leader in taking serious steps to combat the hazards posed by Climate Change. India now ranks on par with its European counterparts in setting standards on reducing carbon emissions. We must complement the efforts of the Government of India by being economical in our power consumption and reducing our carbon footprint at the household and individual level.
The market for Energy Efficiency products and services picked up some momentum during fiscal 2017, as compared to previous years. This was largely due to the increased spending of some forward looking State Governments with their result focused projects. As a company, we made a beginning in the LED retrofitting market by implementing a 6,200 luminaries project in one Nagar Palika in Gujarat. We hope to implement more such projects in the coming years.
As the Indian Economy moves towards being more transparent and tax efficient, the business ecosystem is also undergoing a change for the better. As someone who has had a ringside view of the Public Private Partnership business model and its evolution, I am now reasonably confident that the model has sufficiently matured and that private companies such as ours will benefit from the Good Governance models being put in place.
As per my annual practice, I would like to wish all members and EENDIANS (Energy Efficient Indians) all the very best for the coming festival season.
Enjoy Responsibly. Save Power. Save the Earth.
Yours in Energy Efficiency
Nikhil Morsawala
Chairman
2
EPIC ENERGY LIMITED
Annual Report 2016-17
Board’s Report
To, The Members of EPIC ENERGY LIMITED
Your Directors are pleased to present the 26th Annual Report and the Company’s Audited Financial Statements for the year ended on March 31, 2017.
FINANCIAL RESULTS:
The Company’s financial performance for the year ended March 31, 2017, is summarised below:
Particulars 2016-17 2015-16
(Rs.) (Rs.)
Total Revenue 195,310,000 192,357,000
Operating Profit before Depreciation & Tax 5,261,606 13,477,536
Less: Depreciation 11,681,254 11,995,389
Profit before exceptional and extraordinary
items and tax (6,419,787) 1,482,147
Exceptional Items (22,958,647) (29,619,000)
Profit before tax (29,378,434) (28,136,853)
Less: Provision for tax - 138,000
Net Profit after tax (29,378,434) (28,274,853)
Balance of profit and loss account brought
Forward 4,034,040 92,308,893
Less:-Transfer to General Reserve - 60,000,000
Balance carried to Balance sheet (25,344,394) 4,034,040
Earnings per share (basic/diluted) _ (4.21)
Earnings per share (Weighted Avg/diluted) (4.31) _
3
EPIC ENERGY LIMITED
Annual Report 2016-17
Financial highlights
Sales
Your Company posted a turnover of Rs. 195,310,000 in the financial year ended on 31st March 2017, as compared to Rs. 192,357,000 in the previous year.
Profitability
Your Company’s Loss before exceptional and extraordinary items and tax for the year ended 31st March, 2017, was recorded at Rs. (6,419,787), as compared to a Profit of Rs. 1,482,147 in the previous year.
Earnings per share
Weighted Avg. EPS was at (4.31) for the year ended 31st March, 2017, as against Basic EPS (4.21) for the year ended 31 March, 2016.
Transfer to Reserves
There is no proposed amount to be transferred to the General Reserve.
Net Worth
The Company’s net worth as on 31st March, 2017, was at Rs. 82,904,697 as compared to Rs. 164,783,130 as on 31st March, 2016.
DIVIDEND
The Directors do not recommend any dividend for the Financial Year ended on 31st March, 2017.
REVIEW OF OPERATIONS
During the current year, your company continued to play a significant role in the Energy Efficiency Market in the organized sector. We made a beginning in the LED retrofitting market by executing one project in one Nagar Palika in Gujarat for 6,200 luminaries. We hope to implement similar projects in the coming years. Energy Efficiency technologies have undergone a sea change over the last three to five years. With advanced Lighting Technology and more efficient home and office appliances with in-built energy efficiency technologies being launched in the market, the type of external energy efficiency products required to enhance energy efficiency has changed substantially. During the year under review, the company embarked on a detailed exercise of reviewing its existing technologies and refurbishing the same. During the course of this exercise, the Company also identified technology assets that were built over a period of time that were no longer relevant and suffered from technological obsolescence. These assets have been appropriately written down in the books of account to correctly reflect the value of the assets to the business of the Company.
Your company wishes to acknowledge the Bureau of Energy Efficiency's continued efforts to promote energy efficiency in every walk of life, which has led to ESCOs gathering sufficient traction in the Indian Energy Market.
4
EPIC ENERGY LIMITED
Annual Report 2016-17
Further recognition of your company's successful Energy Savings efforts has come by way of your Company being re-rated as Grade 3 (indicating “Good” ability to execute ESCO projects) by CRISIL under a rating program jointly undertaken by BEE-CRISIL. Details are available on your company's website as well as on the website of the Bureau of Energy Efficiency, Ministry of Power, Government of India www.bee-india.nic.in.
LISTING OF SECURITIES
The Company’s Equity Shares are listed on the Bombay Stock Exchange Limited (BSE).
The Company has already paid the listing fees to Bombay Stock Exchanges for the Financial Year 2016-17.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board Meeting
The Board consisted of four members as on 31st March, 2017, two of whom are Independent Non Executive Directors. Regular meetings of the Board are held at least once in a quarter, inter-alia, to review the quarterly results of the Company. Additional Board meetings are convened to discuss and decide on various business policies, strategies and other Businesses.
During the year under review, Board of Directors of the Company met Six times, viz 13th Aug, 2016,10th Oct, 2016 14th Nov, 2016, 19th Jan, 2017,14th Feb, 2017,& 30th May 2017.
Committee of Board
Your Company has several Committees which have been established as part of best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes.
The Company has following Committees of the Board:
• Audit Committee
• Nomination and Remuneration Committee
• Stakeholders’ Grievances and Relationship Committee
A detailed note on the committees with respect to composition, meeting, powers, and terms of reference is provided under the corporate governance report section in this Annual Report.
Appointment, Re-appointment and Resignation of Directors
Mrs. Veena Morsawala retires by rotation at the forthcoming AGM. Being eligible, Mrs. Morsawala has offered himself for re-appointment. Your Directors commend her appointment.
Details of Key Managerial Personnel
Mr. Nikhil Morsawala, Chairman and Mr. Atul Mishra, Compliance Officer, are the Key Managerial Personnel as per the provisions of the Companies Act, 2013 and were already in office before the commencement of the Companies Act, 2013. None of the Key Managerial Personnel has resigned or appointed during the year under review.
5
EPIC ENERGY LIMITED
Annual Report 2016-17
Nomination and Remuneration Policy
The Company has, in order to attract motivated and retained manpower in competitive market, and to harmonies the aspirations of human resources consistent with the goals of the Company and in terms of the provisions of the Companies Act, 2013 and the listing agreement as amended from time to time, devised a policy on the nomination and remuneration of Directors, key managerial personnel and senior management.
Key points of the policy are:
A. Policy on appointment of Directors, key managerial personnel and senior management personnel
• The policy is formulated to identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP and senior management personnel and recommend to the Board for his/her appointment.
• A person should possess adequate qualification, expertise and experience for the position he/she is considered for appointment.
• In case of appointment of Independent Director, the Committee shall satisfy itself with regard to the inde-pendent nature of the Director vis-‡-vis the Company so as to enable the Board to discharge its function and duties effectively.
B. Policy on remuneration of Director, key managerial personnel and senior management personnel. The Company’s remuneration policy is driven by the success and performance of the Director, KMP and Senior Management Personnel vis-‡-vis the Company. The Company’s philosophy is to align them and provide adequate compensation with the Objective of the Company so that the compensation is used as a strategic tool that helps us attract, retain and motivate highly talented individuals who are committed to the core value of the Company. The Company follows a combination of fixed pay, benefits and performance-based variable pay. The Company pays remuneration by way of salary, benefits, perquisites and allowance. The remuneration and sitting fees paid by the Company are within the salary scale approved by the Board and Shareholders.
Board Evaluation
Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and individual Director. Schedule IV of the Companies Act, 2013 states that the performance evaluation of independent directors shall be done by the entire Board of Directors excluding the director being evaluated. A structured questionnaire was prepared after taking into consideration of the various aspects of the Board’s functioning, composition of the Board and Committees, culture, execution and performance of specific duties, obligation and governance.
The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The Board approved the evaluation results as suggested by the Nomination and Remuneration Committee. The performance evaluation of the Independent Directors was completed. During the year under review, the Independent Directors met on 30th May, 2017, interalia, to discuss:
6
EPIC ENERGY LIMITED
Annual Report 2016-17
Performance evaluation of Independent Directors and Board of Directors as a whole;
Performance evaluation of the Chairman of the Company;
Evaluation of the quality of the flow of information between the Management and Board for
effective performance by the Board. The Board of Directors expressed their satisfaction with the evaluation process.
PUBLIC DEPOSITS
During the period under review, the Company has not accepted deposits from shareholders and public falling within the ambit of Section 73 of the Companies Act, 2013 and rules made thereunder.
SHARE CAPITAL
The paid-up equity share capital as at 31stMarch, 2017, stood at Rs. 7,21,15,000. During the year under review, the Company issued 5,00,000 shares of Rs 10/- each at a premium of Rs. 5/- per share on a private placement basis as approved by the shareholders via Postal Ballot.
VIGIL MECHANISM
The Company has established a vigil mechanism and accordingly framed a Whistle Blower Policy. The policy enables the employees to report instances of unethical behavior, actual or suspected fraud or violation of Company’s Code of Conduct to the management. Further the mechanism adopted by the Company encourages the Whistle Blower to report genuine concerns or grievances and provide for adequate safeguards against victimization of the Whistle Blower who avails of such mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. The functioning of vigil mechanism is reviewed by the
Audit Committee from time to time. No whistle blower has been denied access to the Audit Committee of the Board.
The Whistle Blower Policy of the Company is available on the website of the Company.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a separate section on Corporate Governance and the certificate obtained from practicing Company Secretary confirming its compliance is provided separately and forms a part of this Report. The Board of Directors supports the basic principles of corporate governance. In addition to this, the Board lays strong emphasis on transparency, accountability and integrity.
7
EPIC ENERGY LIMITED
Annual Report 2016-17
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Your attention is drawn to the perception and business outlook of your management for your company for current year and for the industry in which it operates including its position and perceived trends in near future. The Management Discussion and Analysis Report, as required under Clause 49 of the Listing Agreement with the Stock Exchange is attached and forms part of this Directors’ Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Sub-section 3(a) of Section 134 and Sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules,2014, the extract of the Annual Return as at 31st March 2017 in Form MGT-9 forms part of this Directors’ Report as Annexure-1.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the related party transactions that were entered during the financial year were in the ordinary course of business of the Company and were on arm’s length basis. There were no materially significant related party transactions entered by the Company with its Promoters, Directors, Key Managerial Personnel or other persons which may have potential conflict with the interest of the Company.
All Related Party transactions are placed before the Audit Committee for approval, wherever applicable. Prior omnibus approval for normal business transactions is also obtained from the Audit Committee for the related party transactions which are of repetitive nature and accordingly, the required disclosures are made to the Committee on a quarterly basis in terms of the approval of the Committee.
All the related party transactions entered into by the Company were in the ordinary course of business and were on an arm’s length basis as provided in Annexure 2.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information relating to conservation of energy, technology and foreign earning and outgo, as required under Section 134(3) (m) of the Companies Act, 2013 forms part of this Directors’ Report as Annexure 3.
PARTICULAR OF EMPLOYEES
The ratio of remuneration of each Director to the median employee’s remuneration and other details in terms of Sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Directors’ Report as Annexure 4.
The details as required under Section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel), 2 014 is not applicable as there is no employee in the Company employed throughout the financial year with salary above
8
EPIC ENERGY LIMITED Annual Report 2016-17
Rs 60 lac p.a.or employed in part of the financial year with average salary above Rs.5 lac per month.
Further, there is no employee employed throughout the financial year or part thereof, who was in receipt of remuneration of in aggregate is in excess of that drawn by the Managing Director or Whole-time Director or Manager and holds, by himself or along with his spouse and dependent Children, not less than two percent (2%) of the equity shares of the Company.
INTERNAL FINANCIAL CONTROL SYSTEMSAND THEIR ADEQUACY
Your Company has laid down the set of standards, processes and structure which enables it to implement internal financial control across the organisation and ensure that the same are adequate and operating effectively. To maintain the objectivity and independence of internal audit, the Internal Auditor reports to the Chairman of the Audit Committee of the Board.
The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with the operating systems, accounting procedures and policies of the Company.
Based on the report of Internal Auditor, the process owners undertake the corrective action in their respective areas and thereby strengthen the control. Significant audit observation and corrective actions thereon are presented to the Audit Committee of the Board.
AUDITORS
M/s. P. MURALI & Co., Chartered Accountants, Hyderabad Registration No. 023412), was appointed as the Statutory Auditors of the Company, to hold the office from the conclusion of the 25th Annual General Meeting to the conclusion of the 26th Annual General Meeting.
The Report of the Auditors on the Accounts of the Company is attached herewith, being self explanatory, does not need further elaboration.
Shareholders are requested to appoint auditors for the next financial year ending 31st March, 2018.
Secretarial Auditor and their report
To discuss Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed Mr. VIJAY TIWARI, Practicing Company Secretary to undertake the
Secretarial Audit of the Company for the FY 2016-17. The Secretarial Audit Report for the FY 2016-17 is annexed to this Directors’ Report as Annexure-5.
DIRECTORS’ RESPONSIBILITY STATEMENT
As stipulated in Section 134(3) (c) read with 134(5) of the Companies Act, 2013, Directors subscribe to the “Directors’ Responsibility Statement” and confirm that:
a) In preparation of annual accounts for the year ended 31st March 2017, the applicable accounting standards have been followed and no material departures have been made from the same;
b) The Directors have 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
9
EPIC ENERGY LIMITED Annual Report 2016-17
the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that year;
c) The Directors have 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 have prepared the annual accounts for the year ended 31st March, 2017 on a going concern basis.
e) The Directors have laid down the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) 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.
AUDITORS’ REPORT
The Auditors’ Report on the accounts of the Company for the accounting year ended 31st March, 2017, is self-explanatory and does not call for further explanations or comments that may be treated as adequate compliance of Section 134 of the Companies Act, 2013.
GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights as to dividend, voting or otherwise.
2. Issue of shares (including sweat equity shares) to employees of the Company under any ESOS scheme.
3. The Company does not have a Managing Director or any subsidiaries, and as such the question of the Managing Director of the Company receiving any remuneration or commission from any of its subsidiaries does not arise.
4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future.
ACKNOWLEDGEMENT
Your Directors express their appreciation for the assistance and cooperation received from its Bankers, various government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company.
By order of the Board
Date: 30th May, 2017
Place: Mumbai Chairman
10
EPIC ENERGY LIMITED Annual Report 2016-17
FORM NO. MGT 9
Extract of Annual Report
As on financial year ended on 31.03.2017 ANNEXURE 1
Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, 2014.
I. REGISTRATION & OTHER DETAILS:
1 CIN L67120MH1991PLC063013 2 Registration Date 28/09/1991 3 Name of the Company EPIC ENERGY LIMITED 4 Category/Sub-category of the Company Public Limited Company
5 Address of the Registered office & Office No. 1, Ground Floor, “SUNSHINE WILLOWS”, Plot No. 18,
6 Whether listed company Listed Company 7 Name, Address & contact details of the Adroit Capital Services Private Ltd.
Registrar & Transfer Agent, if any. 17-20, Jafferbhoy Industrial Estate, Makhwana Rd, 400059, Marol, Andheri East, Mumbai, Maharashtra 400059 Phone: 022 4227 0400 II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the business activities contributing 10 % or more of the total turnover of the company shall be stated) S. Name and Description of main products / services NIC Code of the % to total turnover of the
No. Product/service company
1 Energy Saver & Renewable Energy Saving Appliances 31200 100% 2 Other Income - -
III.PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
The company does not have any holding, subsidiary and associate company SN Name and address of the Company CIN/GLN Holding/ % of Applicable
Subsidiary/ shares Section Associate held
1 NIL NIL NIL NIL
11
EPIC
EN
ERG
Y LI
MIT
ED
Shar
ehol
ding
Pat
tern
(E
quity
Sha
re C
apita
l Bre
akup
as
Perc
enta
ge o
f Tot
al E
quity
) EP
IC E
NER
GY
LTD
- C
ateg
ory-
wis
e Sh
are
Hol
ding
Ann
ual R
epor
t 201
6-17
Cat
egor
y of
Sha
reho
lder
s N
o.of
Sha
res
held
at t
he b
egin
ning
of t
he y
ear
No.
of S
hare
s he
ld a
t the
end
of t
he y
ear
%
C
hang
e
%
of
%
of
durin
g th
e
Dem
at
Phys
ical
To
tal
Tota
l D
emat
Ph
ysic
al
Tota
l To
tal
year
Sh
ares
Shar
es
A.
Prom
oter
s
(1) I
ndia
n
a) In
divi
dual
/HU
F -
- -
- -
- -
- -
b) C
entra
l Gov
t. -
- -
- -
- -
- -
c) S
tate
Gov
t(s)
- -
- -
- -
-
- d)
Bod
ies
Cor
p.
- -
- -
- -
- -
- e)
Ban
ks /F
I -
- -
- -
- -
- -
f) An
y ot
her
f-1
) DIR
ECTO
RS
83
7,96
5 -
837,
965
12.4
9 83
7,96
5 -
837,
965
11.6
2 (0
.87)
f-2
) DIR
ECTO
RS
REL
ATIV
ES
84
0,10
0 -
840,
100
12.5
2 84
0,10
0 -
840,
100
11.6
5 (0
.87)
To
tal S
hare
hold
ing
of p
rom
oter
(A)
1,67
8,06
5 -
1,67
8,06
5 25
.00
1,67
8,06
5 -
1,67
8,06
5 23
.27
(1.7
3)
B.P
ublic
Sha
reho
ldin
g
(1) I
nstit
utio
ns
a)
Mut
ual F
unds
-
- -
- -
- -
- -
b) B
anks
/ FI
-
- -
- -
- -
- -
c) C
entra
l Gov
t. -
- -
- -
- -
- -
d) S
tate
Gov
t(s)
- -
- -
- -
- -
- e)
Ven
ture
Cap
ital F
unds
-
- -
- -
- -
- -
f) In
sura
nce
Com
pani
es
- -
- -
- -
- -
- g)
FIIs
-
- -
- -
- -
- -
h) F
orei
gn V
entu
re C
apita
l Fun
ds
- -
- -
- -
- -
- i)
Oth
ers
(Spe
cify
) -
- -
- -
- -
- -
Sub-
tota
l (B
) (1)
-
- -
- -
- -
- -
(2) N
on -
Inst
itutio
ns
a)
Bod
ies
Cor
p.
i)
Indi
an
969,
532
6,20
0 97
5,73
2 14
.54
755,
891
6,20
0 76
2,09
1 10
.57
(3.9
7)
ii) O
vers
eas
- -
- -
- -
- -
- b)
Indi
vidu
als
i)
Indi
vidu
al s
hare
hold
ers
hold
ing
nom
inal
sha
re c
apita
l
upto
Rs.
1 la
kh
1,01
6,01
7 33
4,83
5 1,
350,
852
20.1
3 1,
095,
780
334,
335
1,43
0,11
5 19
.83
(0.3
0)
ii) In
divi
dual
sha
reho
lder
s ho
ldin
g no
min
al s
hare
cap
ital
in
exc
dess
of R
s.1
lakh
2,
603,
540
46,2
00
2,64
9,74
0 39
.48
3,20
7,28
3 46
,200
3,
253,
483
45.1
2 5.
63
c) O
ther
s (S
peci
fy)
12
EPIC
EN
ERG
Y LI
MIT
ED
Ann
ual R
epor
t 201
6-17
c-1)
NO
N R
ESID
ENT
IND
IAN
S(IN
DIV
IDU
ALS)
57
,111
-
57,1
11
0.85
87
,720
-
87,7
20
1.22
0.
37
c-2)
CLE
ARIN
G M
EMB
ER
- -
- -
26
- 26
0.
00
0.00
Su
b-to
tal (
B)(2
) 4,
646,
200
387,
235
5,03
3,43
5 75
.00
5,14
6,70
0 38
6,73
5 5,
533,
435
76.7
3 1.
73
Tota
l Pub
lic S
hare
hold
ing(
B)=
(B)(1
)+(B
)(2)
4,64
6,20
0 38
7,23
5 5,
033,
435
75.0
0 5,
146,
700
386,
735
5,53
3,43
5 76
.73
1.73
C. S
hare
s he
ld b
y C
usto
dian
for G
DR
s &
AD
Rs.
Prom
oter
and
Pro
mot
er G
roup
-
- -
- -
- -
- -
Publ
ic -
- -
- -
- -
- -
- Su
b-to
tal (
C)
- -
- -
- -
- -
-
Gra
nd T
otal
(A+B
+C)
6,32
4,26
5.0
387,
235.
0 6,
711,
500.
0 10
0.00
6,
824,
765.
0 38
6,73
5.0
7,21
1,50
0.0
100.
00
0.00
13
EPIC ENERGY LIMITED
Shareholding of Promoters
Annual Report 2016-17
No.of Shares held at the No.of Shares held at the end of %
Change in Promoters’ Shareholding ( please specify, if there is no change)
No.of Shares held at Cumulative
the beginning of the Shareholding during
Sl No. As On No. of
% of No. of
% of
Name of Promoter's total total
Date Shares shares
shares shares
1 At the beginning of the year MORSAWALA NIKHIL CHAMPAKLAL 01/04/2016 837,965 12.49 837,965 12.49
At the End of the year 31/03/2017 - - 837,965 11.62
2 At the beginning of the year MORSAWALA VEENA NIKHIL 01/04/2016 840,100 12.52 840,100 12.52
At the End of the year 31/03/2017 - - 840,100 11.65
15
EPIC
EN
ERG
Y LI
MIT
ED
Ann
ual R
epor
t 201
6-17
Sh
areh
oldi
ng P
atte
rn o
f top
ten
Shar
ehol
ders
(oth
er th
an D
irect
ors,
Pro
mot
ers
and
Hol
ders
of G
DR
s an
d AD
Rs)
:
N
o.of
Sha
res
held
at
Cum
ulat
ive
Fo
r Eac
h of
the
Top
10
the
begi
nnin
g of
the
Shar
ehol
ding
dur
ing
Sl N
o.
Nam
e of
Sha
reho
lder
's
% o
f
% o
f
Shar
ehol
ders
A
s O
n N
o. o
f
tota
l N
o. o
f sha
res
tota
l
D
ate
Shar
es
sh
ares
sh
ares
1 A
t the
beg
inni
ng o
f the
yea
r B
EHR
AM B
UR
JOR
MEH
TA
01/0
4/20
16
1,00
0,00
0 14
.90
1,00
0,00
0 14
.90
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 1,
000,
000
13.8
7
2 A
t the
beg
inni
ng o
f the
yea
r C
HA
ND
RA
SHEK
HA
R V
IJA
Y LA
D
01/0
4/20
16
696,
788
10.3
8 69
6,78
8 10
.38
26
/08/
2016
(4
,500
) 0.
07
692,
288
10.3
1
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 69
2,28
8 9.
60
3 A
t the
beg
inni
ng o
f the
yea
r A
SHIS
H S
AR
AF
01/0
4/20
16
- -
- -
D
ate
wis
e In
crea
se /
Dec
reas
e in
S
hare
hol
ding
dur
ing
the
year
19/0
1/20
17
300,
000
4.16
30
0,00
0 4.
16
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 30
0,00
0 4.
16
RID
HIS
IDH
I FIN
AN
CIA
L A
DVI
SOR
Y PR
IVAT
E
4 A
t the
beg
inni
ng o
f the
yea
r LI
MIT
ED
01/0
4/20
16
299,
647
4.46
29
9,64
7 4.
46
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 29
9,64
7 4.
16
GU
AR
DIA
N P
OR
TFO
LIO
CO
NSU
LTA
NTS
PVT
.
5 A
t the
beg
inni
ng o
f the
yea
r LT
D
01/0
4/20
16
201,
045
3.00
20
1,04
5 3.
00
D
ate
wis
e In
crea
se /
Dec
reas
e in
S
hare
hol
ding
dur
ing
the
year
10/0
9/20
16
(201
,045
) 51
.92
- -
16
/09/
2016
19
7,44
5 2.
94
197,
445
2.94
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 19
7,44
5 2.
74
6 A
t the
beg
inni
ng o
f the
yea
r D
EVK
I CH
AK
RA
BA
HA
DU
R B
HA
ND
AR
I 01
/04/
2016
-
- -
-
17
/03/
2017
10
0,00
0 1.
30
100,
000
1.39
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 10
0,00
0 1.
39
7 A
t the
beg
inni
ng o
f the
yea
r TR
UPT
I BH
AR
AT R
AW
OO
L 01
/04/
2016
-
- -
-
17
/03/
2017
10
0,00
0 1.
30
100,
000
1.39
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 10
0,00
0 1.
39
16
EPIC
EN
ERG
Y LI
MIT
ED
Ann
ual R
epor
t 201
6-17
8
At t
he b
egin
ning
of t
he y
ear
RAJ
KU
MAR
LO
HIA
01
/04/
2016
15
6,39
4 2.
33
156,
394
2.33
At t
he E
nd o
f the
yea
r
31/0
3/20
17
- -
156,
394
2.17
9 A
t the
beg
inni
ng o
f the
yea
r R
AJ K
UM
AR L
OH
IA
01/0
4/20
16
119,
150
1.78
11
9,15
0 1.
78
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 11
9,15
0 1.
65
10
At t
he b
egin
ning
of t
he y
ear
SON
AL
LOH
IA
01/0
4/20
16
92,4
43
1.38
92
,443
1.
38
09
/12/
2016
20
,813
0.
31
113,
256
1.69
At t
he E
nd o
f the
yea
r
31/0
3/20
17
- -
113,
256
1.57
11
At t
he b
egin
ning
of t
he y
ear
DH
EER
AJ K
UM
AR L
OH
IA
01/0
4/20
16
95,0
49
1.42
95
,049
1.
42
A
t the
End
of t
he y
ear
31
/03/
2017
-
- 95
,049
1.
32
12
At t
he b
egin
ning
of t
he y
ear
RAJ
ASTH
AN
GLO
BA
L SE
CU
RIT
IES
PRIV
ATE
L 01
/04/
2016
75
,944
1.
13
75,9
44
1.13
05/0
8/20
16
(128
) 0.
00
75,8
16
1.13
10/0
9/20
16
(75,
816)
19
.58
- -
16
/09/
2016
73
,837
1.
10
73,8
37
1.10
30/0
9/20
16
(36,
212)
0.
54
37,6
25
0.56
14/1
0/20
16
(22,
500)
0.
34
15,1
25
0.23
At t
he E
nd o
f the
yea
r
31/0
3/20
17
- -
15,1
25
0.21
17
EPIC
EN
ERG
Y LI
MIT
ED
Ann
ual R
epor
t 201
6-17
Sha
reho
ldin
g of
Dire
ctor
s an
d K
ey M
anag
eria
l Per
sona
l
Shar
ehol
ding
at t
he b
egin
ning
of
Cum
ulat
ive
Sha
reho
ldin
g du
ring
the
year
th
e ye
ar
Sl N
o.
Nam
e of
%
of t
otal
sha
res
of
% o
f tot
al s
hare
s of
the
As
On
Dat
e No
. of S
hare
s N
o. o
f sha
res
S
hare
hold
er's
th
e co
mpa
ny
C
ompa
ny
A
t the
beg
inni
ng o
f the
Ye
ar
1 M
OR
SAW
ALA
NIK
HIL
CH
AM
PAKL
AL
01/0
4/20
16
8379
65
12.4
9
31/0
3/20
17
8379
65
11.6
2
2 M
OR
SAW
ALA
VEEN
A N
IKH
IL
01/0
4/20
16
8401
00
12.5
2
31/0
3/20
17
8401
00
11.6
5
3 ZU
BIN
PIR
OJ
PATE
L 01
/04/
2016
74
00
0.11
31/0
3/20
17
1190
0 0.
17
18
EPIC ENERGY LIMITED Annual Report 2016-17
V. INDEBTEDNESS Indebtedness of the Company including interest outstanding/accrued but not due for payment.
(Amt. Rs.)
Particulars Secured Loans Unsecured Loans Deposits Total Indebtedness excluding deposits
Indebtedness at the beginning of the financial year
i) Principal Amount NIL NIL - ii) Interest due but not - - iii) Interest accrued but - - Total (i+ii+iii) NIL - NIL - Change in Indebtedness during the financial year * Addition - - - * Reduction - - Net Change NIL NIL NIL NIL Indebtedness at the end of the financial year i) Principal Amount - - - ii) Interest due but not - - iii) Interest accrued but - - Total (i+ii+iii) NIL - NIL -
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-time Directors and/or Manager:
SN. Particulars of Remuneration Name of MD/WTD/ Manager Total Amount
Name NIL NIL (Rs)
Designation
1 Gross salary 0 0 0
(a) Salary as per provisions contained in section -
-
17(1) of the Income-tax Act, 1961
(b) Value of perquisites u/s 17(2) Income-tax Act, - -
(c) Profits in lieu of salary under section 17(3) -
Income- tax Act, 1961
2
Stock Option NIL
NIL
-
3 Sweat Equity NIL NIL -
Commission NIL NIL -
4 - as % of profit -
- others, specify -
5 Others, please specify NIL NIL -
Total (A) - - Rs. 0.00
Ceiling as per the Act
B. Remuneration to other Directors
SN. Particulars of Remuneration Name of Directors Total Amount
(Rs)
1 Independent Directors NA NA NA
Fee for attending board -
Commission -
Others, please specify -
Total (1) - - - -
2 Other Non-Executive Directors -
19
EPIC ENERGY LIMITED
Annual Report 2016-17
Fee for attending board -
Commission -
Others, please specify -
Total (2) - - - -
Total (B)=(1+2) - - - -
Total Managerial -
Overall Ceiling as per the Act
C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD
SN. Particulars of Remuneration Name of Key Managerial Personnel Total Amount
Name (Rs)
Designation CEO CFO CS
1 Gross salary NA NA NA
(a) Salary as per provisions -
contained in section 17(1) of
(b) Value of perquisites u/s - - - -
(c) Profits in lieu of salary -
under section 17(3) Income-
2 Stock - -
Option - -
3 Sweat - -
Equity -
Commission
4 - as % of profit -
- others, specify -
5 Others, please specify - - -
Total - - - -
VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:
Type Sectio
n Brief Description Details of Penalty / Authority [RD / Appeal made, if any (give n of Punishment/ NCLT/ COURT] Details) the Compounding fees Comp imposed
A. COMPANY Penalty NIL NIL NIL NIL Punishment Compounding B. DIRECTORS Penalty NIL NIL NIL NIL Punishment Compounding C. OTHER OFFICERS IN DEFAULT Penalty NIL NIL NIL NIL Punishment Compounding
Nikhil Morsawala Veena Morsawala Chairman Director
Place: Mumbai Sanjay Gugale Date: 30/05/2017 Director
20
EPIC ENERGY LIMITED
Annual Report 2016-17
ANNEXURE 2
Form No Aoc-2
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 transactions under third proviso thereto
1. Details of contracts or arrangements or transactions not at arm’s length basis:
There were no contracts or arrangements or transactions entered in to during the year ended on 31 March 2017, which were not at arm’s length basis.
2. Details of material contracts or arrangement or transactions at arm’s length
basis
(a) Name(s) of the related party and nature of relationship:
(b) Nature of contracts/arrangements/transactions:
1)Advance Given & Refunded 2) Advance Taken & Repaid
(c) Duration of the contracts / arrangements/transactions: One Year
(d) Salient terms of the contracts or arrangements or transactions including NIL the value, if any:
(e) Justification for entering into such contracts or arrangements or NIL Transactions
(f) Date(s) of approval by the Board: NIL
(g) Amount paid as advances, if any: 1) NIL 2) 35,80,000
(h) Date on which the special resolution was passed in general meeting as NIL required under first proviso to section 188:
21
EPIC ENERGY LIMITED
Annual Report 2016-17
ANNEXURE 3
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
a) Energy conservation measures taken NIL b) Additional investments and proposals if any, being implemented NIL for reduction of consumption of energy
c) Impact of the measures at (a) and (b) above for reduction of NIL energy consumption and consequent impact on the cost of production of goods d) Total energy consumption and energy consumption per unit of NIL production
FORM-A: FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY A. Power and fuel consumption NIL B. Consumption per unit of production NIL
TECHNOLOGY ABSORPTION FORM-B: FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION ETC.,
I. Research and Development NIL II. Technology Absorption, Adaptation and Innovation NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO I. Earnings in Foreign Exchange during the year 38,94,187 II. Foreign Exchange outgo during the year NIL
22
EPIC ENERGY LIMITED
Annual Report 2016-17
ANNEXURE 4
Secretarial
Audit Report
for the financial year ended 31 March 2017
[Pursuant to section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014]
To, The Members, EPIC ENERGY LIMITED Office No. 1, Ground Floor, “SUNSHINE WILLOWS”, Plot No. 18, Sector-8, Ghansoli, Navi Mumbai-400701
I have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Epic Energy Limited (hereinafter called ‘the Company’). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.
Based on my verification of the Company’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 authorised representatives during the conduct of Secretarial
Audit, I hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on 31 March 2017, generally 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:
I have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31 March 2017, according to the provisions of:
(i) The Companies Act, 2013 (‘the Act’) and the rules made there under as applicable;
(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;
(iii) The Depositories Act, 1996 and the Regulations and Byelaws framed there under;
(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment and Overseas Direct Investment;
(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-
23
EPIC ENERGY LIMITED
Annual Report 2016-17
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, 1992;
c) 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;
I have also examined compliance with the applicable clauses of the Listing Agreements entered into by the Company with Bombay Stock Exchange Limited.
Further being a Energy Conservation Company, following are some of the Acts applicable to the Company:
1. The Trade Marks Act, 1999
During the period under review the Company has generally complied with the all material aspects of applicable provisions of the Acts, Rules, Regulations, Guidelines, Standards, etc.
During the Period under review, provisions of the following Acts, Rules, Regulations, Guidelines, Standards, etc. were not applicable to the Company:
i. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009; ii. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the Securities and Exchange Board of India (Share based employee benefits) Regulations,2014; iii. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; iv. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; v. The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998; vi. Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of External Commercial Borrowings; and vii. Secretarial Standards issued by the Institute of Company Secretaries of India. I 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 the 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 generally in advance, 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.
Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes.
24
EPIC ENERGY LIMITED
Annual Report 2016-17
I 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.
Signature: Name of Company Secretary in practice: Vijay S.Tiwari ACS/FCS No: 33084 C P No: 12220 Place: Mumbai Date: 30th May, 2017
25
EPIC ENERGY LIMITED
Annual Report 2016-17
Annexure-A
To, The Members, EPIC ENERGY LIMITED Office No. 1, Ground Floor, “SUNSHINE WILLOWS”, Plot No. 18, Sector-8, Ghansoli, Navi Mumbai-400701
My report of even date is to be read along with this letter.
1. Maintenance of secretarial records is the responsibility of the management of the Company. My responsibility is to express an opinion on these secretarial records based on my audit.
2. I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of secretarial records. The verification was done based on the records and documents provided, on test basis to ensure that correct facts are reflected in secretarial records. I believe that the processes and practices followed by me provide a reasonable basis for my opinion.
3. I have not verified the correctness and appropriateness of financial records and books of accounts of the Company.
4. Wherever required, I have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.
5. The compliance of the provision of corporate and other applicable laws, rules, regulations, standards is the responsibility of management. My examination was limited to verification of procedures on test basis.
6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor the efficacy or effectiveness with which the management has conducted the affairs of the Company.
Signature: Name of Company Secretary in practice: Vijay S.Tiwari ACS/FCS No: 33084 C P No: 12220 Place: Mumbai Date: 30th May, 2017
26
EPIC ENERGY LIMITED Annual Report 2016-17
Management Discussion & Analysis Industry Structure and Developments
Energy Overview
India has an installed power generating capacity of 3,30,273.65 MW (as on 30.6.2017) of which the total thermal power stations share is 2,20,575.88 MW (66.79%). Total installed power generating capacity is increased by 25,512.90 MW than last year and also thermal power stations share is increased by 8720.48 MW. Total Installed Capacity1
Sector MW %age State Sector 103868.27 31.45
Central Sector 81622.25 24.71
Private Sector 144783.13 43.84
Total 330273.65 100.00
Fuel MW
Coal 194552.88
Total Thermal
Gas 25185,38
Diesel 837.63
Total Thermal 220575.88
Hydro (Renewable) 44614.42
Nuclear 6780.00
RES**(MNRE) 58303.35
Total 330273.65
**Renewable Energy Sources(RES) include SHP, BG, BP, U&I and Wind Energy SHP= Small Hydro Project ,BG= Biomass Gasifier ,BP= Biomass Power,
U & I=Urban & Industrial Waste Power, RES=Renewable Energy Sources
EPIC ENERGY LIMITED Annual Report 2016-17 Power Sector in India
Power is one of the most critical components of infrastructure crucial for the economic growth and welfare of nations. The existence and development of adequate infrastructure is essential for sustained growth of the Indian economy.
India’s power sector is one of the most diversified in the world. Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste. Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required.
India ranks third among 40 countries in EY’s Renewable Energy Country Attractiveness Index2, on back of strong focus by the government on promoting renewable energy and implementation of projects in a time bound manner.
With Production of 1278.91 TWh in 2015, India was the 3rd largest producer and 4th largest consumer of electricity in the world, with the installed power capacity 326.84 GW by March 2017. The country also has the 5th largest capacity in the world.
The Government targets capacity addition of 88.5 GW under the 12thfive year plan (2012-17) and around 100 GW under the 13th five year plan (2017-22)
Investments around USD 250 billion are planned for the power sector during the 12thfive year plan.
In June 2017 the government announced intentions to set up an asset reconstruction company for handling the stressed assets in power sector.
Robust growth in Renewable:
Wind Energy is estimated to contribute 60 GW, followed by solar power at 100 GW by
2022.
Favorable Policy Environment:
100% FDI is allowed under the automatic route in the power segment and renewable energy.
Indian Power Sector: Market with enormous growth Potential Indian power sector is undergoing a significant change that has redefined the industry outlook. Sustained economic growth continues to drive electricity demand in India. The Government of India’s focus on attaining ‘Power for all’ has accelerated capacity addition in the country. At the same time, the competitive intensity is increasing at both the market and supply sides (fuel, logistics, finances, and manpower).
The Ministry of Power has set a target of 1,229.4 billion units (BU) of electricity to be generated in the financial year 2017-18, which is 50 BU’s higher than the target for 2016-17. The annual growth rate in renewable energy generation has been estimated to be 27 per cent and 18 per cent for conventional energy.
The Government has added 8.5 GW of conventional generation capacity during the April 2016-January 2017 period. Under the 12th Five Year Plan, the Government has added 93.5 GW of power generation capacity, thereby surpassing its target of 88.5 GW during the period.
Investment Scenario Around 293 global and domestic companies have committed to generate 266 GW of solar, wind, mini-hydel and biomass-based power in India over the next 5–10 years. The initiative would entail an investment of about US$ 310–350 billion.
Between April 2000 and December 2016, the industry attracted US$ 11.4 billion in Foreign Direct Investment (FDI).
Government Initiatives The Government of India has identified power sector as a key sector of focus so as to promote sustained industrial growth. Some initiatives by the Government of India to boost the Indian power sector:
The Union Cabinet, Government of India has given its ex-post facto approval for signing
of a Memorandum of Understanding (MoU) on Renewable Energy between India and Portugal, which will help strengthen the bilateral cooperation between the two countries.
The Ministry of New and Renewable Energy plans to introduce a fixed-cost component to the tariff for electricity generated from renewable energy sources like solar or wind, in a bid to promote a green economy.
The Union Cabinet has approved the ratification of International Solar Alliance's (ISA) framework agreement by India, which will provide India a platform to showcase its solar programmes, and put it in a leadership role in climate and renewable energy issues globally.
The Government of India plans to introduce a scheme to encourage setting up of biomass plants across the country, which will generate electricity and also help dispose of agricultural waste in a carbon-neutral manner to help tackle growing pollution.
The Government of India plans to rationalise various categories of electricity consumers across states, which is expected to bring transparency and efficiency in billing, improve tariff collection and improve the health of distribution companies in the country.
The Government of India plans to set up a US$ 400 million fund, sourced from The World Bank, which would be used to protect renewable energy producers from payment delays by power distribution firms, while at the same time protecting the distribution firms from the shrinking market for conventional grid-connected power, caused by wider adoption of roof-top solar power generation.
29
EPIC ENERGY LIMITED
Annual Report 2016-17
The Ministry of Power plans to set up two funds of US$ 1 billion each, which would give investment support for stressed power assets and renewable energy projects in the country.
Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines, launched an online portal for star rating of mines, which will bring all mines to adopt sustainable practices, and thereby ensure compliance of environmental protection and social responsibility by the mining sector.
The Ministry of New and Renewable Energy (MNRE), which provides 30 per cent subsidy to most solar powered items such as solar lamps and solar heating systems, has further extended its subsidy scheme to solar-powered refrigeration units with a view to boost the use of solar-powered cold storages.
Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines, inaugurated the Tarang (Transmission App for Real Time Monitoring & Growth) mobile app and web portal for electronic bidding for transmission projects, which is expected to enhance ease, accountability, transparency, and boost investor confidence in power transmission sector.
The Ministry of Shipping plans to install 160.64 MW of solar and wind based power systems at all the major ports across the country by 2017, thereby promoting the use of renewable energy sources and giving a fillip to government's Green Port Initiative.
The Government of India and the Government of the United Kingdom have signed an agreement to work together in the fields of Solar Energy and Nano Material Research, which is expected to yield high quality and high impact research outputs having industrial relevance, targeted towards addressing societal needs.
The Ministry of Petroleum and Natural Gas is seeking to enhance India's crude oil refining capacity through 2040 by setting up a high-level panel, which will work towards aligning India's energy portfolio with changing trends and transition towards cleaner sources of energy generation.
The Government of India plans to start as many as 10,000 solar, wind and biomass power projects in next five years, with an average capacity of 50 kilowatt per project, thereby adding 500 megawatt to the total installed capacity.
Minister of State (Independent Charge) for Power, Coal and New & Renewable Energy outlined Government of India’s goal to provide electricity to every home in India by 2020, while also focusing on ensuring the cost of power is affordable to everyone.
Government of India has asked states to prepare action plans with year-wise targets to introduce renewable energy technologies and install solar rooftop panels so that the states complement government's works to achieve 175 GW of renewable power by 2022.
The Government of India announced a massive renewable power production target of 175,000 MW by 2022; this comprises generation of 100,000 MW from solar power, 60,000 MW from wind energy, 10,000 MW from biomass, and 5,000 MW from small hydro power projects.
The Road Ahead The Indian power sector has an investment potential of Rs 15 trillion (US$ 225 billion) in the next 4–5 years, thereby providing immense opportunities in power generation, distribution, transmission, and equipment. The government’s immediate goal is to generate two trillion units (kilowatt hours) of energy by 2019. This means doubling the current production capacity to provide 24x7 electricity for residential, industrial, commercial and agriculture use. The Government of India is taking a number of steps and initiatives like 10-year tax exemption for solar energy projects, etc., in order to achieve India's ambitious renewable energy targets of adding 175 GW of renewable energy, including addition of 100 GW of solar power, by the year 2022. The government has also sought to restart the stalled hydro power projects and increase the wind energy production target to 60 GW by 2022 from the current 20 GW.
30
EPIC ENERGY LIMITED
Annual Report 2016-17
31
EPIC ENERGY LIMITED Market Advantage for India
Annual Report 2016-17
Strong Demand and Policy Support Driving Investments
32
EPIC ENERGY LIMITED
Annual Report 2016-17
Industrial Expansion and Strong GDP Growth Driving Power Demand
Renewable Energy potential and growth in India Renewable energy has been an important component of India’s energy planning. The importance of renewable energy sources in the transition to a sustainable energy base was recognized in the early 1970s. Modern renewable energy is being used increasingly in four distinct markets: power generation, heating and cooling, transport, and rural/off grid energy services. The Ministry of New and Renewable Energy (MNRE) in India has been facilitating the implementation of broad spectrum programs including harnessing renewable power, renewable energy for rural areas for lighting, cooking and motive power, use of renewable energy in urban, industrial and commercial applications and development of alternate fuels and applications. Renewable energy plays an important role in the long term energy supply security, diversification of energy mix, energy access, environmental security and sustainability. Renewable energy is bound to play an increasing role in future energy systems.
India is making giant leaps in the renewable energy sector. In 2016-17 financial year, renewable power projects output rose by 26%3, which makes India's renewable energy sector as the fastest growing in the world. Indian is expected to be the third biggest solar market from 2018 onwards
after China and United States of America. Being the 5th largest power generation portfolio in the world, India's renewable energy contribution stands at 44.8 GW, which includes 27.4 GW of wind power and 8.06 GW of solar power installed capacity. Our target for renewable energy generation is 175 gigawatts4 by 2022. Of the target capacity, 100 GW would be from solar power, 60 GW from wind, 10 GW from biomass and 5 GW from small hydro power.
Solar Energy India’s solar energy capacity has expanded by a record 5,525.98 MW in 2016-175, according to the latest figures provided by the ministry of new and renewable energy (MNRE). In comparison, India had added 3,010 MW of solar capacity in 2015-16, which shows that growth nearly doubled over the past year. Cumulative solar capacity currently stands at 12,288.83 MW, against 6,762.85 MW at the end of March 2016. By the end of next year, our cumulative target will be 20,000 MW as per MNRE. It will add another 7,750 MW in 2017-18. Among the states, Andhra Pradesh added the maximum solar capacity in 2016-17 (1,294.26 MW), followed by Karnataka (882.38 MW) and Telangana (759.13 MW). Other major additions were in Rajasthan (543 MW), Tamil Nadu (630.01 MW), Punjab (388 MW), Uttar Pradesh (193.24 MW) and Uttarakhand (192.35 MW).
Solar Market in India
With 8.8 GW of projected capacity addition (growth of 76 per cent over 2016) in 20176, India is set to become the third largest solar PV market, overtaking Japan. By the end of 2017, India’s solar power capacity is expected to touch 18.7 GW, which will be about five per cent of global solar capacity, growing by 89 per cent over last year. As of March 2017, India had installed 12.2 GW of utility scale solar capacity. “Indian solar market has grown by an average 72 per cent in the last three years and is now worth about 8-9 GW per annum. International Solar Market Total global solar PV installed capacity surpassed 300 GW by the end of 20167. 77 GW was added in 2016, a year-on-year growth rate of 34%. China led with 34.5 GW, followed by the USA (14.5 GW), Japan (10.2 GW) and India (5 GW) in fourth place. In 2017, about 79 GW capacity is expected to be added globally, registering marginal growth over 2016. The stagnation is mainly due to policy pullbacks across major markets including China, Japan, the USA and most parts of Europe. 4 https://scroll.in/article/774844/indias-2022-renewable-energy-goal-will-require-investment-four-times-the-
Key trends shaping the global solar industry Asia continues to dominate the solar industry while Europe continues to fall in rankings. Auctions are gaining universal acceptance - number of countries using auctions to allocate solar capacity has increased from 14 in 2014 to 22 in 2016. Solar module prices continue to fall faster than most experts had anticipated. Prices in India fell to 32 ¢/Wp in Q1 2017 (– 29% over last year). Such a rapid fall has made solar PV the cheapest new source of power in most countries and provided demand boost in emerging economies. Developed countries are slowly shifting towards utility scale projects whereas in emerging markets, governments are trying to encourage more rooftop solar growth.
Wind Energy
Wind operational capacity in India till June 20178 is 32509 MW. India had a record year and was the fourth largest market globally both in terms of cumulative capacity and annual additions last year. The total renewable energy capacity installed in the country crossed the 50 GW mark at the end of 2016. Among renewable, wind power accounted for over 57 percent of the installed capacity. India’s wind power installations accounted for a 6.6 percent share of the global market in 2016. Wind power capacity accounted for over 9.1 percent of total domestic installed capacity . In February 2015, India committed to installing 60 GW of wind and 100 GW of solar by 2022. Further, India made a commitment at COP21 to raise the share of non-fossil-fuel power capacity in the country’s power mix to 40% by 20309.
Wind Market in 2016
2016 was a record breaking year for wind power in India. During 2016 wind power development grew at an unprecedented pace and the majority of wind farms have come up in the States of Andhra Pradesh, Gujarat, Karnataka, Madhya Pradesh and Rajasthan.
Biomass based power generation has been increasing in India with the installation of megawatt scale plants processing a variety of biomass residues such as shells, husks, de-oiled cakes, and wood. According to the MNRE, 500 million tonnes (MT)10 of agricultural and agro industrial residues are generated annually in the country, of which about 120–150 MT per year could be surplus for power generation. 7 Biomass power generation from agriculture and agro -industrial residues is estimated at about 17 000 MW.
LED Lighting Market in India
LED lights are becoming the major source of energy efficient lighting in India. Though, prices of LED lights are higher than incandescent or CFL bulbs, but LED bulbs are becoming the part of mainstream of the market owing to government initiatives and increasing public awareness about benefits of using LED lights.
Rising government initiatives, increasing awareness among customers regarding lower power consumption of LED lighting products, and innovative product offerings to drive LED lighting sales through 2021.
Being the second most populous country and fifth major electricity consumer11, India has been witnessing widening electricity demand-supply gap. Consequently, usage of energy efficient products such as LED lighting products is expected to grow in the coming years. Moreover, rising government support and introduction of innovative LED lighting products by manufacturers has resulted in reduction in prices of these products, thereby offering consumers with more options to choose from, according to their needs and preferences.
The LED lighting market in India is projected to register a CAGR of over 26%12, during 2017-2023, on account of rising personal disposable income, growing government initiatives encouraging use of LED lights and increasing focus on smart city projects. The Government of India launched an initiative in 2016 to replace conventional lights by LED lights by deploying 770 million bulbs and 35 million street lights by 2019. Favorable government initiatives and policies such as state specific and national level programs that offer LED lighting products at subsidized rates is contributing in a huge way towards boosting LED adoption in the country. Additionally, with increasing consumer awareness, demand for LED lights from the residential as well as commercial sectors in the country is growing at a fast pace. Rising adoption of LED lighting in the residential sector can be attributed to low power consumption and long product lifecycle of these lighting solutions. Outdoor lighting applications garnered a revenue share of over 60% in India LED lighting market in 2015 and the trend is expected to continue through 2021. The adoption of LED lighting products has been recorded highest from Southern and Northern states due to higher literacy rate, rising disposable income levels and rising awareness about the benefits of LED lighting products. Rising urban population of the country, which stood at 31% of the total population in 2011, and rose to over 33% in 2015, is expected to further drive demand for LED lighting in India during next five years.
Smart LED Streetlights market in India
The "smart" street lighting market in India is expected to grow at an annual rate of 42.2 per cent to reach USD 1,868.913 million by 2022 as adoption of LED and solar powered systems rises in the country, As a result, a major share of revenues is expected to be realised from urban zones, which are expected to aggregate USD 1,304.8 million in smart street-lighting spending by CY2022. Network components is expected to be about USD 674.6 million, while connectivity technologies and lighting lamps are estimated to touch USD 412.6 million and USD 127.3 million, respectively. Smart cities and smart homes are expected to drive the smart street-lighting market and also ensure the penetration of cloud-based smart street-lighting in the near future. Due to long gestation RoI estimates, more and more smart street-lighting projects are likely to be implemented via the PPP model.
Indian LED lighting market will grow with a CAGR of 42%14 in next five years. Street lighting application accounts for majority of market revenues in the Indian LED lighting market.
It is the initiatives taken by government of India that is bringing in revolution in the lighting industry. GOI is spending on energy efficiency through streetlights projects. The street lighting segment has highest growth as per ESCO model, which enables energy efficiency savings in India. There is immense scope for the growth of infrastructure wherein the government is taking initiative in building housing societies, connecting cities by building more highways, improving and extending the metro services along with better facilities from the municipalities. This has enabled mass consumption of LED through awareness.
Global LED Market The global LED lighting market accounted for USD 26.09 billion in 201615 and is expected to reach USD 54.28 Billion by 2022, growing at a CAGR of around 13% between 2017 and 2022. A couple of years ago, application of LED was limited to certain specific lighting needs and had not entered the mainstream general lighting applications. Entrance of LED in applications such as general lightings has given a strong thrust to the market. A variety of technologies are implemented in manufacturing of LED products. Chips and components are the basic materials assembled to manufacture the final lamp product. Companies dealing in this market are strategically diverse as they deal with different steps of the LED value chain. The Global LED market is in its developing phase. The rise in the usage of LEDs16 in different sectors such as automobiles and mobile phones backlighting applications has given the necessary boost to the LED markets’ growth. In the prevailing business scenario, environmental awareness is growing amongst the people. Increasing green construction is one of the major factors for the growth of the LED market in various regions. Moreover, the growing display market and the reducing costs of the LED lamps are the contributing factors towards the growth of the LED market. On the other hand, the high investment cost in the replacement of the conventional lighting would hinder the pace of the market.
With increasing environmental awareness, the adoption of LED’s is expected to increase in buildings. General lighting industry would witness tremendous growth in demand for LED lights in coming years. Most of the lighting companies have started manufacturing LED lights and certain Chinese manufacturers are entering the market with cheaper LED products. Unlike fluorescent lamps, LEDs do not contain mercury, which is a hazardous element. However, LED does contain some poisonous substances such as gallium arsenide, but the quantity of this substance is very small and thus, it can be considered as a greener alternative to fluorescent lamps.
40
EPIC ENERGY LIMITED
Annual Report 2016-17
COMPANY STRATEGY, BUSINESS FOCUS and ACQUISITIONS Demand Side Management - Energy Efficiency Your company/has clearly defined Energy Efficiency, or Demand Side Management, as one of its main business segments.
Energy Saving Equipment
Over the last few years, your company has developed core competencies in the Technology Development, technology assimilation and commercial exploitation of Energy Saving Equipment. The company's products have consistently shown an Energy Savings performance of more than thirty percent in lighting loads and between ten and eighteen percent in mixed loads, which is considered to be very satisfactory. Pictorial depictions and technical specifications are available on your company's website www.epicenergy.biz.
Remote Energy Management Systems (REMS)
Your company constantly strives to improve its technological edge over its competition by offering advanced features on its equipment. Your company offers equipment with. GSM and GPRS capabilities which make Remote Energy Management simple and effective to use. This GSM and GPRS capability has given a cutting edge to the Energy Efficiency efforts of your company's customers, making it one of a select handful of companies capable of offering this in India.
Your company is shortlisted as an approved ESCO (Energy Services Company) by the BEE (www.beeindia.nic.in). In 2017, your company was also granted Grade 3 by CRISIL indicating “Good” ability to deliver and execute Energy Saving Project.
Renewable Energy – Solar Cities
Your company is also recognized by the MNRE to act as Consultants for preparing Master Plans and implementation thereof under the Solar Cities Program of the MNRE.
LED Luminaries Retrofitting
Your company has entered the market for Replacement of existing streetlights with LED Luminaries and replacement of existing streetlight switching points with GPRS /GSM based switching points in various municipalities on ‘Pay from Savings’ (ESCO) basis and with recovery and maintenance period of maximum 10 years. It has made a successful beginning with one Nagar Palika in the State of Gujarat, where it replaced 6,200 conventional luminaries with LED Luminaries on a ten year ESCO basis. Your company expects to implement more such projects in the State of Gujarat and other States in India.
Energy Audits
Your company has successfully implemented various extremely prestigious Audit Assignments granted by Government Agencies. Your company expects to continue to play a major role in this segment also.
41
EPIC ENERGY LIMITED FINANCIAL CONDITION
1. Share Capital
Annual Report 2016-17
At present we have only one class of Shares: Equity shares of par value Rs. 10/- each. Our authorized capital is Rs. Twelve Crores divided into One Crore Twenty Lakh shares of Rs. 10/- each.
During the year under report, the Company issued 5,00,000 Equity Shares on a preferential allotment basis at a premium of Rs 5/- per Equity Share. The proceeds of the issue were utilized to part finance the LED ESCO project implemented by the Company in one Nagar Palika in the State of Gujarat.
2. Reserves and Surplus
a. General Reserves
There was no change in the General Reserves during the year.
b. Share Premium Account
During the year under report, there was an addition of Rs. 25 Lakh in the Share Premium of the Company, being the premium of Rs. 5/- per share received on 5,00,000 shares issued during the year on preferential basis.
c. Profit and Loss Account
The company reported an Operating loss of Rs. (6,419,648) (previous year Operation profit of Rs.1,482,147) before Extra-Ordinary and non-recurring items. After providing for non-recurring items, the loss after Tax was Rs. (29,378,295). The book value per share as on 31st March, 2017, was Rs.11.50 compared to Rs.24.55 as of the previous year end.
d. Special Reserve
During the year under report, the Company conducted an impairment study on its ESCO assets. Changes in technology and advances in the lighting technology field had made a substantial part of the ESCO assets technologically obsolete. Based on the impairment study, the Company wrote down its ESCO Fixed Assets to the extent of Rs 600 lacs by utilizing the Special Reserve created for this purpose. As such, the Reserves of the Company reduced by Rs. 600 lacs.
3. Fixed Assets
Your company added capital assets of Rs 164.55 lacs during the year under review, on account of the LED ESCO project implemented in one Nagar Palika in Gujarat. Capital work-in-progress at the end of the year was Rs. NIL.
4. Inventories
The inventories of finished goods comprise of Epic Power Saver 1090 and Solar Products assembled/purchased by the company. The inventories of stores and spare parts are the maintenance spares which the company keeps to ensure uninterrupted functioning of its equipment.
5. Sundry Debtors
Sundry Debtors are the receivables arising mainly from the Energy Saving Business of the company. During the year, the Company made a provision of Rs. 12,921,647for Bad and Doubtful Debts, based on the Company’s assessment of the recoverability of such debts.
42
EPIC ENERGY LIMITED E. RESULTS OF OPERATIONS
1. Income
Annual Report 2016-17
Your company's main income is from the sales of Energy Efficiency Products & installation of such equipment on BOOT basis. The sales of Solar Products amounted to Rs. 2,627,488 (Previous Year Rs. 31,44,112/-)
2. Expenditure
Purchases represent the cost of inputs for assembling the Energy Products of your company. Maintenance Costs represent cost of spares consumed to keep the equipment & solar products in running condition. Employee / Manpower Expenses consist mainly of outsourcing Expenses, since the Company outsources all of its production and maintenance functions.
3. Net Profit
The company reported a Net Loss after tax of Rs. 2,93,78,295 (Previous Year Net loss of Rs. 2,82,74,853).
4. Provision for Tax
The provision for tax of Rs. NIL (Previous Year Rs. 1,38,000) has been made on the basis of extant Rules and Regulations and the reported Loss for the year.
OPPORTUNITIES AND THREATS
We have identified Energy Efficiency on the Demand Side as one of the main focus areas of our business. Substantial progress has been made in the last few years by implementing prestigious projects with marquee customers to establish the company as a leading implementer of Energy Efficiency Solutions.
Technological Evolution which gives the cutting edge advantage to your company's equipment has been a key factor of your company's R & D efforts. The company offers equipment with GSM and GPRS capabilities.
Solar Products are also expected to play a major role in providing power to energy deficient areas where sunshine is plentiful. In the Institutional Markets, your company is focused on Solar Street Lights, Solar Hoarding Lights, Solar Road Studs, whereas in the Commercial Segment, the focus is on the Home Products Market and the Solar Retail Market. Your company has a range of Solar products for Home Use.
Availability and Prices of Photo Voltaic Solar Panels largely depend on the supply and price of Silicon. Shortage of Silicon affects the cost and availability of Solar Panels.
The technology used in Energy Saving Equipment is continually evolving. Obsolescence is a major threat. Your company is constantly researching and studying the application of various technologies around the world to protect its business interests.
Competition is limited to the few players who have the technology to assemble, test and maintain the type of products dealt with by your company.
43
EPIC ENERGY LIMITED
Annual Report 2016-17
INTERNAL CONTROLS AND THEIR ADEQUACY
Your company has in place adequate systems of internal control procedures covering all financial and operating functions. The Audit Committee periodically reviews the adequacy of these procedures. Your company renewed its ISO 9001:2008 certification during the year and is committed to maintaining the highest standards of quality control at all levels of operations.
RISK CONCERNS AND RISK MANAGEMENT
The Risk Management Function is overseen by the Audit Committee. Risk Management Policies are designed after discussions with various constituents and experts. The following Risk Concerns have been identified and are being dealt with as explained against each concern:
a. Technology Risk:
The Technology used in Energy Saving Devices is constantly evolving. The introduction of newer and better techniques could render our products obsolete. To address this risk, your company is constantly researching and studying the application of various technologies across the world and has a separate team of people upgrading the technologies that we use. Technological Evolution which gives the cutting edge advantage to your company's equipment has been a key factor of your company's R&D efforts.
b. Concentration Risk:
Your company has a reasonable spread in terms of the various segments of Demand Side Management. The company also has its business spread over a few States in India. None of the customers have more than a ten percent share in the revenues of the company.
c. Human Resources:
Your company depends to a large extent on trained engineers, both electronic and electrical. Whilst availability of manpower is not a concern, training and retention is a challenge. Your company has instituted various Employee Training and Retention schemes to mitigate this Risk.
d. General Risk
Your company has adequate insurance policies in place for its equipment and inventories. Medical and Accident Insurance Policies for its employees have also been taken where required.
CAUTIONARY STATEMENT
Statements in the Management Discussion and Analysis describing the Company's objectives, projections, estimates, expectations may be “forward looking” statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company's operations include, among others, economic conditions, affecting demand, supply and price conditions in the markets in which the company operates, changes in the Government regulations, tax laws and other statutes and incidental factors.
44
EPIC ENERGY LIMITED
Annual Report 2016-17
Report on Corporate Governance
[Your Company has complied in all materials respect with the requirements of the Corporate Governance code as per Schedule V (c )of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (hereinafter referred as "SEBI LODR")]
1. Company's philosophy on code of Governance The Company is committed to good Corporate Governance. The Company fully realizes the rights of its shareholders to information on the performance of the Company and considers itself a trustee of its shareholders. The Company is of the view that good Corporate Governance is an optimum mix of regulatory compliances as well as voluntary disclosures and practices.
The Company is focused on attaining the highest levels of transparency, fairness, accountability and integrity in its dealings with all the constituents of its business i.e. the stakeholders. Towards this end, substantial disclosures on the Board of Directors and its Committees, financial and stock performance have been made in this Annual Report.
We believe that Corporate Governance is the key element in improving efficiency, growth and investors confidence.
2. Board of Directors under CA, 2013 and regulation 17 of the SEBI
(LODR) Regulations, 2015
A) Composition of the Board of Directors as on 31st March, 2017, is as follows:
The Board of Directors of the Company have an optimum combination of Independent Non-Executive Directors and Non-Executive Promoter Director who have an in-depth knowledge of business, in addition to the expertise in their areas of specialization. The Board of the Company comprises four Directors that include one Woman Director.
The composition of the Board is in conformity with Regulation 17 of the SEBI (LODR) Regulation, 2015 entered into with the stock exchanges. The Board has received confirmation from the Non-Executive and Independent Directors that they qualify to be considered as Independent as per the definition of ‘Independent Director’ stipulated in Regulation 16 (1)(b) of the SEBI (LODR) Regulation, 2015 and Section 149(6) of the Companies Act, 2013 (hereinafter called “the Act”). None of the Directors hold Directorships in more than 20 companies. Further, any individual director’s directorships in public companies do not exceed 10. None of the Directors is serving as a member of more than ten committees or as the Chairman of more than five committees across all the public companies of which he is a Director. Necessary disclosures regarding committee positions in other public companies as on March 31, 2017 have been made by the Directors. The number of directorships and committee Chairmanships/Memberships held by the Direct.
45
EPIC ENERGY LIMITED
Annual Report 2016-17
Category No. of Directors %
Independent Non Executive Directors 2 50.00
Non-Executive Promoter Director 1 25.00
Non-Executive Director 1 25.00
Total 4 100.00
B) Particulars of Directorships & Committee Chairmanship/ Membership of other Companies & Attendance at the Board
The Board normally meets once in a quarter. Additional meetings are held as and when required.
The gap between any two meetings did not exceed four months. The agenda papers along with notes and other supporting were circulated in advance of the Board Meeting with sufficient information as required under section 173 of Companies Act, 2013 and regulation 17 of SEBI (LODR). The Board meetings are generally held at the registered office of the Company.
During the year under review, Board of Directors of Epic met 6 times, viz 13th Aug, 2016, 10th Oct, 2016, 14th Nov, 2016, 19th Jan, 2017,14th Feb, 2017, and 30th May, 2017.The 25th Annual General Meeting was held on Thursday, 29th September 2016.
46
EPIC ENERGY LIMITED
Annual Report 2016-17
Name of Category & Date of No. of No of Board Attendance No of Shares
The Nature of Appointment Director Committees Meeting at held &
Director’s, Employment ship of which Attended the Last Holding (%)
Designation held in Member(M)/ AGM
n & Age all the Chairman (C)
company
in
India
Mr. Nikhil NED 28/08/19 1 6 PRESE 837,965
Morsawala 91 NT 11.62
Chairman
57 Years
Mr. Zubin ID & NED 31/12/20 1 0 0 PRESE 11,900
Patel 05 NT 0.17
Director
48 Years
Mr. Sanjay ID & NED 31/12/20 1 1 PRESE -
Gugale 05 5 NT
Director
55 Years
Mrs. Veena NED 29/09/20 1 0 PRESE 840100
Nikhil 15 6 NT 11.65
Morsawala
53 Years
47
EPIC ENERGY LIMITED
Annual Report 2016-17
Notes:
1. This number excludes the Directorships/Committee memberships held in private companies and also of the Company. Committee includes Audit Committee and Stakeholders’.
2. As required by the Companies Act, 2013 And Regulation 13 of Listing Agreement, none of the Directors hold Directorship in more than 15 public companies, membership of Board committees(audit / remuneration / investors grievance committees) in excess of ten and chairmanship of board committees as aforesaid in excess of five.
3. None of the Directors hold Directorships in more than 20 companies. Further, any individual director’s directorships in public companies do not exceed 10. None of the Directors is serving as a member of more than ten committees or as the Chairman of more than five committees across all the public companies of which he is a Director. Necessary disclosures regarding committee positions in other public companies as on March 31, 2017 have been made by the Directors.
4. None of the Directors has any pecuniary relationship with the Company, except receiving sitting fees for attending Board Meetings and Committee Meetings (except Share Transfer, CSR and management Committee). The details of sitting fees, commission and remuneration paid to each Director appear later under the disclosure relating to Remuneration to Directors.
Details of Directors seeking appointment/ re-appointment in forthcoming Annual General Meeting
The information as required by Regulation 36 (3) of the Listing Regulation with the stock exchange in relation to appointment / reappointment of Directors of the Company is given in the notes to the Notice of the Annual General Meeting.
Code of Conduct
In Compliance with Regulation 26 (3) of the Listing Regulation, the Company has adopted a code of ethics for principal Executives and senior management personnel. The said code has been communicated to the Directors and members of the senior management. All the Board members and senior management personnel have affirmed compliance with the code of conduct for the year ended on 31 March 2017. The Code of Conduct is available on the website of the Company at www.epicenergy.biz. A declaration to this effect, duly signed by the Chairman of the Company, is attached herewith and forms part of the Corporate Governance Report.
48
EPIC ENERGY LIMITED
Annual Report 2016-17
AUDIT COMMITTEE
The Company has constituted the Audit Committee with the primary objective to monitor and provide effective supervision of the Management’s financial reporting process with the view to ensure accurate, timely and proper disclosures and transparency, integrity and quality of financial reporting.
Composition
The Audit Committee comprises three members, Mr. Sanjay Gugale, Mr. Nikhil Morsawala and Mr. Zubin Patel. Mr. Sanjay Gugale is the Chairman of the Committee.
The above composition meets all the requirements of Regulation 18 of the SEBI (LODR) Regulation 2015 and Section 177 of the Companies Act, 2013
Meetings
The Audit Committee met 4 times, viz 13th Aug, 2016, 10th Oct, 14th Nov, 2016, 14th Feb, 2017, and 30th May, 2017.
The Audit Committee at its Meeting held on 30th May, 2017, reviewed the audited financial results for the year and quarter ended on 31st March, 2017, and recommended the accounts for approval by the Board of Directors.
The Statutory Auditors and Internal Auditors of the Company are invited to the meeting of the Committee wherever required. The Chairman of the Audit Committee had attended the last Annual General Meeting of the Company held on 29th September, 2016.
Details of attendance of each member of the Audit Committee are as under:
Name Designation Attendance
Sanjay Gugale Chairman, ID Non Executive 4
Nikhil Morsawala Non Executive 4
Zubin Patel ID Non-Executive 0
The Committee has been authorised by the Board in the manner envisaged under Regulation 16 of the SEBI (LODR), 2015. The Committee has been assigned tasks as listed under Regulation 16 of the SEBI (LODR), 2015. The Committee reviews the information as listed under Regulation 16 of the SEBI (LODR), 2015, matters specified under Section 177 of the Companies Act, 2013.
49
EPIC ENERGY LIMITED
Annual Report 2016-17
Broad Terms of Reference
1. Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;
2. Recommendation for appointment, remuneration and terms of appointment of auditors of the Company;
3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
4. Reviewing, with the management, the annual financial statements and Auditors’ report thereon before submission to the Board for approval, with particular reference to:
a) Matters requiring inclusion in the Directors’ Responsibility Statement to be included in the Boards’ report in terms of Clause (c) of Sub-section 3 of Section 134 of the Companies Act, 2013.
b) Changes, if any, in accounting policies and practices and reasons for the same.
c) Major accounting entries involving estimates based on the exercise of judgment by management.
d) Significant adjustments made in the financial statements arising out of audit findings.
e) Compliance with listing and other legal requirements relating to financial statements.
f) Disclosure of any related party transactions.
g) Qualifications in the draft audit report.
5. Reviewing, with the management, the quarterly financial statements before submission to the Board for approval;
6. Reviewing, with the management the statement of uses/application of funds raised through an issue (public issue, right issue, preferential issue, etc.) the statement of funds utilised for purposes other than those stated in the offer document/prospectus/notice and the report submitted by the monitoring agency, monitoring the utilization of proceeds of a public or right issue, and making appropriate recommendations to the Board to take up steps in this matter;
7. Review and monitor the Auditors’ independence and performance and effectiveness of the audit process;
8. Approval or any subsequent modification of transactions of the Company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the Company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
50
EPIC ENERGY LIMITED
Annual Report 2016-17
12. Reviewing, with the management, the performance of statutory and internal auditors and adequacy of the internal control systems;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;
14. Discussion with internal auditors about any significant findings and follow up there on;
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board;
16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well.
17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;
18. Reviewing the management letters/letters of internal control weaknesses issued by the Statutory Auditor.
19. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee:
STAKEHOLDERS’ GRIEVANCE & RELATIONSHIP COMMITTEE
The Stakeholders’ Grievance & Relationship Committee as a committee of the Board has been constituted mainly to focus on the Redressal of Shareholders’ and Investors’ Grievances, if any, like transfer/transmission/demat of shares, loss of share certificates, non-receipt of Annual Report, Dividend Warrants and other grievances, and approve Share Transfers.
Composition
The Stakeholders’ Grievance & Relationship Committee comprises three members, Mr. Nikhil Morsawala, Mr. Sanjay Gugale and Mr. Zubin Patel. Chairperson of the Committee is Mr. Nikhil Morsawala
51
EPIC ENERGY LIMITED
Annual Report 2016-17
Meeting and attendance
During the year, four meetings were held on 13th Aug, 2016, 14th Nov, 2016, 14th Feb, 2017, and 30th May, 2017.Details of the attendance of each member of the Committee are as under:
Name Designation Attendance Nikhil Morsawala Chairman, Non Executive 4
Sanjay Gugale ID NON EXECUTIVE 4
Zubin Patel ID Non Executive 0
During the year, the Company had received no complaints from the shareholders and no complaints were pending as on 31stMarch, 2017.
The following table summarises the status of investor complaints received during the period. These were attended within a reasonable period of time.
Sr. No. Nature of Opening as Received Resolved Pending as
complaints/requests on as on on 01/04/2016 31/03/2017 1 Non-receipt of - - - -
dividend warrant 2 Non-receipt of Annual - - - -
Reports/Sticker 3 Non-receipt of shares - - - -
after transfer /bonus/rights/ shares 4 Letters received from - - - -
SEBI/ROC/Stock 5 Others – Demat - - - -
Credit
Compliance Officer Mr. Atul Mishra provides secretarial support to the committee as he has been appointed as designated compliance officer.
52
EPIC ENERGY LIMITED
Annual Report 2016-17
Board term reference
The Stakeholders’ Grievance & Relationship Committee as a committee of the Board has been constituted mainly to focus on approving requests received for share transfers and on the Redressal of shareholders’/investors’ grievances, if any, like transfer, transmission, demat of shares, loss of share certificates, non-receipt of Annual Report, dividend warrants, etc. The equity shares of the Company are compulsorily traded in electronic form on the stock exchange and hence the handling of physical transfer of shares is minimal. The Board has delegated powers for approving transfer and transmission of shares and issue of duplicate shares to the Share Transfer Committee. The Share Transfer Committee met 25 times during the year. The Company has no transfers pending at the close of the financial year.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee as a committee of the Board has been constituted mainly to determine and recommend to Board, the Company’s policies on remuneration packages for Executive and Non- Executive Directors and policies on Nomination for appointment of Director, KMPs and Senior Management Personnel Composition. The Nomination and Remuneration Committee comprises three members - Mr. Sanjay Gugale, the Chairman Mr. Nikhil Morsawala and Mrs. Veena Morsawala.
Meetings and Attendance
During the year, two meetings were held on 14th August, 2016, and 13th February, 2017.Details of attendance of each member of the Committee are as under:
Name Designation Attendance
Nikhil Morsawala Chairman Non Executive 2
Sanjay Gugale ID Non Executive 2
Zubin Patel ID Non Executive 0
Broad terms of Reference
The terms of reference of the Committee are, inter alia:
1) To recommend to the Board, the remuneration packages of Company’s Managing/Whole time/Executive Directors, including all elements of remuneration package (i.e. salary, benefits, bonus, perquisites, commission, performance incentives, stock options, pension, retirement benefits, details of fixed component and performance linked incentives along with the performance criteria, service contracts, notice period, severance fees, etc).
2) The Company’s policy on specific remuneration packages for Company’s Managing/Joint Managing/Executive Directors, including pension rights and any compensation payment.
53
EPIC ENERGY LIMITED
Annual Report 2016-17
3) To implement, supervise and administer any share or stock option scheme of the Company.
4) Formulation of the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a policy, relating to the remuneration of the Directors, key managerial personnel and other employees.
5) Formulation of criteria for evaluation of Independent Directors and the Board.
6) Devising a policy on Board diversity.
7) Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal.
General Body Meetings:
Details of the last three Annual General Meetings are as under:
AGM DATE TIME Venue No. of Special
Resolutions
25TH 29.09.2016 9.30.A.M HOTEL - SOLITAIRE,
CHAKALA, ANDHERI (E), MUM
24TH 29.09.2015 10.A.M HOTEL -
SOLITAIRE, CHAKALA, ANDHERI (E), MUM
23RD 27.09.2014 10.A.M HOTEL -
SOLITAIRE, CHAKALA, ANDHERI ( E ), MUM
54
EPIC ENERGY LIMITED
Annual Report 2016-17
TRAINING OF BOARD MEMBERS AND INDUCTION
At the Board Meetings, apart from the regular agenda items, it is ensured that the Board members are provided a deep and thorough insight into the business model of the Company and updates through detailed presentations of various business unit heads. The Board members get an open forum for discussion and share their experience. The Board undertakes a periodic review of various matters including risk management, forex, internal audit reports, etc.
CEO/CFO Certification
The Company is duly placing a certificate to the Board from the Chairman & the Compliance Officer in accordance with the provisions of Regulation 17(8) read with Part B of Schedule II of the SEBI (LODR) Regulation, 2015.
The aforesaid certificate, duly signed by the Chairman and the Compliance Officer in respect of the financial year ended 31st March, 2017, has been placed before the Board and given elsewhere in this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, as required under Regulation 34 (2) (e) read with Schedule VB of SEBI (LODR) Regulations 2015, has been given elsewhere in this Annual Report.
DISCLOSURE
Related Party Transaction
All the transactions entered into with related parties as defined under the Companies Act, 2013, and Regulation 23(1) of the SEBI (LODR) Regulations 2015 during the financial year were in the ordinary course of business and on arms’ length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. Prior approval of the Audit Committee is obtained for all Related Party Transactions. There were no materially significant transactions with related parties during the financial year which were in conflict with the interest of the Company. Related Party Transactions during the year have been disclosed vide Note No. 19 (2.4) of notes on financial statements as per the requirement of “Accounting Standards 18- Related Party Disclosure” issued by ICAI.
The Board has approved a policy for related party transactions which has been placed on Company’s website: www.epicenergy.biz
Disclosure of accounting treatment in the preparation of financial statements,
Your Company has followed all relevant Accounting Standards laid down by the Institute of Chartered Accountants of India ( ICAI) while preparing financial statements.
55
EPIC ENERGY LIMITED
Annual Report 2016-17
Details of non-compliance by the Company
Your Company has complied with all the requirement of regulatory authorities. No penalty/strictures were imposed on the Company by stock exchanges or SEBI or any statutory authority on any matter related to capital markets, during the last three years.
Risk Management
Business risk evaluation and management is an ongoing process within the organisation. A detailed exercise on business risk management is yet to be carried out, covering all aspects of business operations.
Proceeds from Public Issue/Rights Issue/Preferential Issue/ Warrant Conversion during the year, the Company has not raised any fund through Public Issue/Rights Issue/Preferential Issue/Warrant Conversion.
Whistle Blower Policy
The Company has implemented a Whistle Blower Policy covering the employees. The policy enables the employees to report to the management instances of unethical behavior, actual or suspected fraud or violation of the Company’s code of conduct. Employees can lodge their Complaints through anonymous e-mails besides usual means of communications like written complaints. No personnel has been denied access to the Audit Committee. The Whistle Blower Policy, as approved by the Board, is placed on the website of the Company: www.epicenergy.biz
Non-Mandatory Requirements • Shareholders’ Right: Half-yearly financial results, including summary of the significant events, are presently not being sent to shareholders of the Company. However, quarterly financial results are published in the leading newspapers and are also available on the website of the Company: www.epicenergy.biz
• Audit Qualification:
There is no qualification in the Auditor’s Report on the Statements to the shareholders of the Company.
Means of Communication
During the year, quarterly, half-yearly and annual financial results of the Company were submitted to the stock exchanges immediately after the conclusion of the Board meetings and were also published in two newspapers namely, in The Financial Express (English) and Navshakti- Mumbai (English and Marathi) These results are also put on the Company’s website: www.epicenergy.biz
56
EPIC ENERGY LIMITED
Annual Report 2016-17
The Company also informs, by way of intimation, the stock exchanges all price-sensitive matters or such other matters which, in its opinion, are material and of relevance to the shareholders and subsequently issues a Press Release on the said matters.
SEBI Complaints Redress System (SCORES)
Securities Exchange Board of India introduced for quick resolution of Investors’ Grievances SEBI Complaints Redress System (SCORES). The investor complaints are processed in a centralised web-based complaints redress system. The salient features of this system are: centralised database of all complaints, online upload of Action Taken Reports (ATRs) by the concerned companies and online viewing by investors of actions taken on the complaint and its current status.
The 26thAnnual General Meeting of the members of the company is scheduled to be held on Friday, the 29th September, 2017, at 9.30 a.m. at South Coast Hotels & Hospitality Services, RX 31, MIDC, Thane Belapur Road, Opp.Rabale Railway Station, Navi Mumbai-400 701.
All the members are invited to attend the meeting.
The members and proxies who intend to attend the meeting are requested to bring the Attendance slip sent herewith duly filed in to the meeting.
57
EPIC ENERGY LIMITED
Annual Report 2016-17
Financial Calendar:
Financial year 2016-17 (1st April, 2016, to 31st March, 2017) results were announced on 30thMay, 2017.
13th August, 2016 First quarter ended 2016
14thNov, 2016 Second quarter ended 2016
14th Feb, 2017 Third quarter ended 2017
30thMay, 2017 Fourth quarter ended 2017
Book closure date: Saturday, 23rd September, 2017 to 29th September, 2017 (both days inclusive).
Annual General Meeting: Friday, 29th September, 2017 at 9.30 a.m.
Stock Code
Name of Stock Exchange Code no. Bombay Stock Exchange 530407
Details of Shares
Types of shares Equity shares No. of paid up shares 72,11,500
Market lot of shares 1 Share
Listing
The Company’s shares are listed and traded on Bombay Stock Exchange Limited (BSE) at Mumbai.
58
EPIC ENERGY LIMITED
Annual Report 2016-17
Stock Data
Monthly share price data on BSE for the financial year 2016-17 is as under:-
Month High Rs. Low Rs. Average Rs. Volume (No. of
shares) April, 2016 12.89 11.30 12.89 1,328
May, 2016 12.25 11.60 11.60 1,103
June, 2016 11.65 9.99 9.99 4,294
July, 2016 9.51 7.50 8.56 25,069
August, 2016 9.24 7.17 8.80 14,910
September, 11.72 8.18 11.72 1,49,982
2016 October, 2016 14.76 9.30 9.95 83,162
November,2016 10.96 8.90 9.00 21,242
December, 9.77 8.90 9.65 68,339
2016 January, 2017 10.47 7.80 9.37 36,336
February, 2017 11.70 8.43 8.57 26,494
March, 2017 10.90 8.08 9.90 33,111
Shares Held in Physical and Dematerialised Form
The Company’s shares are compulsorily traded in the dematerialised mode. As on 31stMarch, 2017, 94.64% shares were held in the dematerialised form and the balance 5.36% shares were held in physical form. The shareholders whose shares are held in physical form are requested to dematerialize the same at the earliest in their own interest. The demat security code (ISIN) for the equity shares is INE 932F01015. As on that date, total promoter’s holding is 23.27 % of the share capital. Shareholding pattern of the Company as on 31stMarch, 2017, is given below:
59
EPIC ENERGY LIMITED
Annual Report 2016-17
Distribution of Shareholding (as on 31stMarch, 2017)
Applications for transfer of shares in the physical form are processed by the Company’s Registrar & Transfer Agent M/s. Adroit Corporate Services Pvt Limited. The Share Transfer Committee constituted for transfer/transmission of shares, issue of duplicate shares and allied matters considers and approves the share transfer once in ten days, subject to
60
EPIC ENERGY LIMITED
Annual Report 2016-17
transfer instrument being valid and complete in all respects. The Company has obtained half-yearly certificates from the Company Secretary in practice for compliance of share transfer formalities as per the requirement of SEBI (LODR) Regulation, 2015.
Details of Dividend:
The Board of Directors has not recommended any dividend for the year.
PAN requirement for transfer of shares in the physical form
The Securities & Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) for securities market transactions and off-market/private transactions involving transfer of shares in the physical form of listed companies. Therefore it shall be mandatory for PAN requirement for transfer of shares in the physical form. The Securities & Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) for securities market transactions and off-market/private transactions involving transfer of shares in the physical form of listed companies. Therefore it shall be mandatory for the transferee(s) to furnish a copy of the PAN Card to the Company/Registrar & Share Transfer Agents for Registration of such transfers. Members/Investors are therefore requested to make note of the same and submit their PAN Card copy to the Company Registrar and Share Transfer Agents. Members are also requested to use new Transfer Forms (Form No. SH-4) pursuant to Section 56 of the Company’s Act, 2013 and its applicable rules.
Details of Unclaimed Dividend
Accounting Date of Dividend Amount (in Expected date
Year declaration of payment % Rs.) of transfer of Dividend unclaimed
dividend of IEPF 2011-2012 Aug-12 7.50 2,08,650 Sep-18
Outstanding GDRs/ADRs/Warrants/Any other convertible instruments
The Company does not have any outstanding instruments of the captioned type.
Nomination Facility
It is in the interest of the shareholders to appoint a nominee for their investments in the Company. Those members who are holding shares in the physical mode and have not appointed a nominee or want to change the nomination are requested to send us the nomination form duly filled in and signed by all the joint holders.
61
EPIC ENERGY LIMITED
Annual Report 2016-17
Change in shareholders’ details
In case you are holding your shares in dematerialised form (e.g. in electronic mode), communication regarding change in address, bank account details, change in nomination, dematerialization of your share certificates or other inquiries should be addressed to your DP where you have opened your demat account, quoting your client ID number. In case of physical holding of shares, any communication for change of any details should be addressed to our R&T agent of the Company, M/s Adroit Corporate Services Pvt Ltd, as per the address mentioned below.
Investors Communication
Share transfers/Dematerialization or other queries relating to shares of the Company should be addressed to:
As required under Regulation 26 (3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, it is hereby affirmed that all the Board members and senior management personnel have complied with the Code of Conduct of the Company. The Company has obtained confirmation for the compliance of Code of Conduct from the Board members and senior management personnel on an annual basis. The code is available on the website of the www.epicenergy.biz.
Place: Mumbai Chairman
62
EPIC ENERGY LIMITED
Annual Report 2016-17
CHAIRMAN AND COMPLIANCE OFFICER CERTIFICATION
We, Mr. Nikhil Morsawala, Chairman and Mr. Atul Mishra Compliance Officer of Epic Energy Limited, to the best of our knowledge and belief, certify that:
1. We have reviewed the Balance Sheet and Profit and Loss account, its schedule and notes to the accounts and cash flow statements for the year ended 31stMarch, 2017, and that to the best of our knowledge and belief:
a. These statements do not contain any materially untrue statement or omit any material fact or contain statements that may be misleading;
b. These statements together present a true and fair view of the Company’s affairs and are in compliance with existing accounting standards, applicable laws and regulations.
2. We also certify that based on our knowledge and information provided to us, there are no transactions entered into by the Company during the year which are fraudulent, illegal or violate the Company’s code of conduct.
3. We accept the responsibilities for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining to financial reporting and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps taken or propose to take to rectify these deficiencies.
4. We have indicated to the Auditors and the Audit Committee:
a. Significant change in internal control over financial reporting during the year.
b. Significant changes in accounting policies during the year and that the same have been disclosed in notes to the financial statements; and
c. Instances of significant fraud of which we have become aware and involvement therein, if any, of the management or an employee having a significant role in the Company’s internal control system over financial reporting.
Date: 30thMay, 2017 Mr. Nikhil Morsawala Mr. Atul Mishra Place: Mumbai Chairman Compliance Officer
We have examined the compliance of conditions of corporate governance by Epic Energy Limited (‘the Company’) for the year ended 31st March, 2017, as stipulated in regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of regulation 46 and paragraph C, D and E of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) with Stock Exchanges in India.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above-mentioned Listing Regulations, as applicable.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.
Signature:
Name of Company Secretary in practice: Vijay S.Tiwari
ACS/FCS No: 33084
C P No: 12220
Place: Mumbai
Date: 30th May, 2017
64
EPIC ENERGY LIMITED
Annual Report 2016-17
Auditors’ Certificate on Corporate Governance
P MURALI & CO, Chartered Accountants
To, The Members of, EPIC ENERGY LIMITED
We have examined the compliance of conditions of corporate governance by Epic Energy Limited for the year ended on 31st March, 2017, as stipulated in Clause 49 of the Listing Agreement of the said company with stock exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.
As required by the Guidance Note issued by the Institute of Chartered Accountants of India, we have to state that no investor grievance is pending for a period exceeding one month against the company as per the records maintained by the Board of Directors.
We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the company.
We have audited the accompanying financial statements of Epic Energy Limited (‘the Company’), which comprise the Balance Sheet as at 31st March 2017, the statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes 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 frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and 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.
Auditors’ Responsibility
Our responsibility is to express an opinion on these 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 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 financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the 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 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 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 financial statements. 66
EPIC ENERGY LIMITED
Opinion
Annual Report 2016-17
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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, of the state of affairs of the Company as at 31st March 2017 and its loss and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
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:
1. 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. 2. 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; 3. the balance sheet, the statement of profit and loss and the cash flow statement
dealt with by this Report are in agreement with the books of account; 4. in our opinion, the aforesaid financial statements comply with the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
5. on the basis of the written representations received from the directors as on 31st March 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2017 from being appointed as a director in terms of Section 164 (2) of the Act; 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
6. 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 does not have any pending litigations which would impact its
financial position. ii) The Company did not have any long-term contracts including derivative contracts
for which there were any material foreseeable losses. iii) There were no amounts which were required to be transferred to
the Investor Education and Protection Fund by the Company. iv) The Company has provided requisite disclosures in its financial statements
(Note No. 2.19) as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and these are in accordance with the books of accounts maintained by the Company.
The Annexure referred to in Independent Auditors’ Report to the members of the Company on the financial statements for the year ended 31st March 2017, we report that:
(i) (a) The Company has maintained proper records showing full particulars, including
quantitative details and situation of fixed assets
(b) The Company has a regular Programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this Programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.
(c) Company has no immovable properties, thus question of title deeds does not arise.
(ii) (a) The management has conducted the physical verification of inventory at
reasonable intervals.
(b) The discrepancies noticed on physical verification of the inventory as compared to books records which has been properly dealt with in the books of account were not material.
(iii) The Company has not granted loans to corporate covered in the register maintained under section 189 of the Companies Act, 2013 (‘the Act’).
(iv) In our opinion and according to the information and explanations given to us, the
Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans and investments made.
(v) The Company has not accepted any deposits from the public.
(vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company.
7) (a) According to information and explanations given to us and on the basis of our
examination of the books of account, and records, the Company has been 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 statutory dues with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2017 for a period of more than six months from the date on when they become payable.
According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax outstanding on account of any dispute, except an amount of Rs.8,548,000/- being the aggregate of Income Tax demands for the Financial Years 2009-10, 2010-11, and 2011-12 against which the Company has preferred appeals before the relevant Tax authorities.
68
EPIC ENERGY LIMITED Annual Report 2016-17
(8) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks. The Company has not taken any loan either from financial institutions or from the government and has not issued any debentures.
(9) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) of the Order is not applicable.
(10) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
(11)According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not 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.
(12) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii) of the Order are not applicable to the Company.
(13) In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.
(14) Based upon the audit procedures performed and the information and explanations given by the management, the company has made preferential allotment on private placement basis of 500,000 shares of Rs. 10/- each at a premium of Rs. 5/- each during the year under review.
.
(15) Based upon the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.
(16) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
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 Epic Energy Limited (“the Company”) as of 31st March 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing and maintaining internal financial controls 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 (‘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 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.
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 on Audit of Internal Financial Controls over Financial Reporting (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 applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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 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.
70
EPIC ENERGY LIMITED Annual Report 2016-17
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 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.
(c) Long-term loans and advances 6 47,534,564 51,683,386 (d) Other non-current assets 7 4,500,000 4,500,000
2 Current assets (a) Inventories 8 102,344 407,000 (b) Trade receivables 9 13,994,413 37,568,550 (c) Cash and cash equivalents 10 1,313,144 752,088 (d) Short-term loans and advances 11 817,068 814,100 (e) Other current assets 12 1,489,387 -
TOTAL 103,209,701 184,409,477
Significant Accounting Policies & other notes 18 0 0 Notes 1 to 12 & 18 form an integral part of the Accounts
AUDITOR'S REPORT For and Behalf of the Board As per our separate report of even date attached. Nikhil Morsawala - Chairman For P.Murali& Co Chartered Accountants Veena Morsawala - Director
NOTE 9 TRADE RECEIVABLES (Unsecured and considered good) - outstanding for a period exceeding 6 months
- other debts
Less:-Provision for Receivables for doubtful of Recovery
NOTE 10
i) CASH AND CASH EQUIVALENTS
Balance with Banks Cash on Hand
NOTE 11
SHORT TERM LOAN & ADVANCES
(unsecured and considered good)
Tax Deducted at Source
NOTE 12
OTHER CURRENT ASSETS
Share issue expenses
Annual Report 2016-17
AS AT AS AT
31.03.2017 31.03.2016 (Rs.) (Rs.)
18,672 123,657
83,672 283,343 102,344 407,000
AS AT AS AT
AS AT AS AT
31.03.2017 31.03.2016
(Rs.) (Rs.)
12,921,647 12,921,647
13,994,413 24,646,903
(12,921,647) - 13,994,413 37,568,550
AS AT AS AT
31.03.2017 31.03.2016 (Rs.) (Rs.)
725,510 617,530 587,634 134,558
1,313,144 752,088
AS AT AS AT
31.03.2017 31.03.2016 (Rs.) (Rs.)
817,068 814,100
817,068 814,100
AS AT AS AT
31.03.2017 31.03.2016 (Rs.) (Rs.)
1,489,387 -
1,489,387 -
77
EPIC
EN
ERG
Y LI
MIT
ED
Ann
ual R
epor
t 201
6-17
N
ote
of fi
xed
Asse
ts A
nnex
ed to
and
For
min
g Pa
rt o
f Bal
ance
She
et
NO
TE 5
GR
OSS
BLO
CK
DEP
REC
IATI
ON
NET
BLO
CK
PUR
CH
ASE
D
SALE
S/TR
F
UP
TO
FO
R T
HE
UP
TO
TO
TAL
TOTA
L
PAR
TIC
ULA
RS
A
S O
N
DU
RIN
G
DU
RIN
G
AS
ON
YE
AR
1.
04.2
016
THE
YEAR
TH
E YE
AR
31
.3.2
017
31.0
3.20
16
31
.03.
2017
31.0
3.20
17
31.0
3.20
16
(R
s.)
(Rs.
) (R
s.)
(Rs.
) (R
s.)
(R
s.)
(Rs.
)
(Rs.
) (R
s.)
EN
ERG
Y SA
VIN
G E
QU
IPM
ENT
20
3,82
4,09
6 -
20
3,82
4,09
6 11
6,56
1,43
3 69
,851
,955
18
6,41
3,38
8
17,4
10,7
08
87,2
62,6
62
EN
ERG
Y SA
VIN
G E
QU
IPM
ENT
-
16,4
55,6
83
16,4
55,6
83
- 1,
645,
568
1,64
5,56
8
14,8
10,1
15
-
C
OM
PUTE
RS
614,
710
-
614,
710
613,
951
240
614,
191
51
9 75
9
FU
RN
ITU
RE
2,30
9,24
5 -
2,
309,
245
1,39
8,85
9 86
,487
1,
485,
346
82
3,89
9 91
0,38
6
O
FFIC
E EQ
UIP
MEN
T
1,18
6,92
8 -
1,
186,
928
676,
383
97,0
03
773,
387
41
3,54
1 51
0,54
5
To
tal
20
7,93
4,97
9 16
,455
,683
-
224,
390,
662
119,
250,
627
71,6
81,2
54
190,
931,
880
33
,458
,782
88
,684
,352
Prev
ious
Yea
r 20
7,93
4,97
9 -
- 20
7,93
4,97
9 10
7,25
5,23
7 11
,995
,389
11
9,25
0,62
6
88,6
84,3
53
100,
679,
742
78
EPIC ENERGY LIMITED
Annual Report 2016-17
Note Forming Part of Profit & Loss Account AS AT AS AT NOTE 13 31.03.2017 31.03.2016 REVENUE FROM OPERATIONS (Rs.) (Rs.) Energy Solutions Division 195,310,000 192,357,000 195,310,000 192,357,000
AS AT AS AT NOTE 14 31.03.2017 31.03.2016 EMPLOYEE BENEFITS EXPENSES (Rs.) (Rs.) (a) Employee / Manpower Expenses (Including Outsourcing Expenses) 12,765,493 12,865,493 (b) Staff welfare expenses 372,507 253,507 13,138,000 13,119,000
AS AT AS AT NOTE 15 31.03.2017 31.03.2016 FINANCE COSTS (Rs.) (Rs.) Bank Charges 71,862 14,464 71,862 14,464
AS AT AS AT NOTE 16 31.03.2017 31.03.2016 DEPRECIATION AND AMORTIZATION EXPENSE (Rs.) (Rs.)
AS AT AS AT NOTE 17 31.03.2017 31.03.2016 OTHER EXPENSES (Rs.) (Rs.) Power & Fuel 1,670,745 1,509,200 Audit Fees 150,000 150,000 Legal & Professional Fees 7,856,289 7,943,891 Telephone & Internet Charges 2,964,513 3,010,191 Travelling Expense 3,098,317 2,983,655 Business Promotion 1,188,142 1,069,139 Rent 1,421,181 1,291,025 Miscellaneous Expense 1,399,951 1,585,899 19,749,138 19,543,000
79
EPIC ENERGY LIMITED
Annual Report 2016-17
Notes on Financial Statements
for the year ended March 31, 2017
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES:
a) Accounting and preparation of financial statements Presentation and disclosure of financial statements
The financial statements have been prepared on the basis of going concern, under historical cost convention to comply in all material aspect with applicable accounting principles in India, the Accounting Standards section 133 of Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rule, 2014, and the relevant provisions of the Companies Act, 2013.
The preparation of financial statements in conformity with accounting standards requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities at the date of financial statements, and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates.
All assets and liabilities have been classified as current or non –current as per the operating cycle criteria set out in the schedule III of the Companies Act, 2013.
The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.
The Company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.
b) Use of Estimates
The preparation of financial statements requires estimates and assumptions that affect the reported balances of assets and liabilities and disclosure relating to contingent liabilities as at the date of the financial statements and reported amounts of income and expenses during the period. Any revision to accounting estimates is recognized prospectively in current and future periods.
c) Fixed Assets
All fixed assets are stated at cost less accumulated depreciation. Cost is inclusive of freight, duties, levies and any directly attributable cost of bringing the assets to their present working condition. Advances given towards acquisition of fixed assets and the cost of fixed asset not yet ready for their intended use at the balance sheet date are disclosed under capital work-in-progress.
d) Depreciation on Fixed Assets
Depreciation on Fixed Assets has been provided on the basis and manner provided in Schedule II to The Companies Act 2013, as per Notification GSR 627(E) dated August 29, 2014. In respect of Energy Saving Equipments depreciation is written off over BOOT period.
80
EPIC ENERGY LIMITED
Annual Report 2016-17
e) Impairment of Assets An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss, if any is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.
f) Foreign Currency Transactions/Translation:
(a) Transactions denominated in foreign currencies are recorded at the rate of exchange prevailing on the date of transactions. (b) Monetary items denominated in foreign currencies at the yearend are restated at year end rates. (c) Non monetary foreign currency items are carried at cost. (d) In respect of branches, which are non-integral operations, all assets and liabilities, both monetary and non-monetary, are translated at closing rate, while all income and expenses are translated at closing rate for the year. (e) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets, in which they are adjusted to the carrying cost of such assets.
g) Investments
Investments which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments. On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties. If an investment is acquired, or partly acquired, by the issue of shares or other securities, the acquisition cost is the fair value of the securities issued. Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.
h) Inventory: Inventories are valued after providing for obsolescence, as under: 1. Finished Goods: At lower of weighted average cost or net realizable value 2. Work in Progress: at lower of cost (including related overheads) or net realizable value. 3. Spare Parts: At lower of weighted average cost or net realizable value.
i) Revenue
Recognition Sales
Income is generally accounted on accrual basis as they are earned.
81
EPIC ENERGY LIMITED
Annual Report 2016-17
j) Provision for Current and Deferred Tax:
Provision for Current tax is made after taking into consideration benefits admissible under the provisions of the Income tax Act, 1961. Deferred tax resulting from “timing differences” between taxable incomes and accounting income is accounted for using the tax rates and laws that are enacted or substantively enacted as on the balance sheet date. The deferred tax asset is recognized and carried forward only to the extent that there is a virtual certainty that the asset will be realized in future.
k) Provisions, Contingent liabilities and Contingent Assets:
Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.
2. NOTES TO ACCOUNTS:
2.1 The previous year’s figure has been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as integral part of the current year financial statements and are to be read in relation to the amount and other disclosure relating to the current year.
2.2 Micro and Small Scale Business Entities There are no Micro and Small Enterprises, to whom the Company owes dues, which are outstanding as at31st March, 2014. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.
2.3Payment to Auditors
Particulars 2016-17 2015-16 Audit Fees 1,50,000 1,50,000 Other Services - - Total 1,50,000 1,50,000
82
EPIC ENERGY LIMITED
Annual Report 2016-17
2.4Related party disclosure
As per the Accounting Standard 18, the disclosure of transactions with the related parties as defined in the accounting standards are given below:
(i) List of the related parties where control exists and related parties with whom transactions have taken place and relationship:
Sr. Name of the Relationship Opening Debit Credit Closing
No. Related party
1 Hydragen Key Management
Infrastructure Personnel
12,336,768 9,150,000 21,486,768 -
Private Limited Advance Given &
Refunded
2 Nikhil Morsawala Chairman
Advance Taken &
3,980,000 400,000 _ 3,580,000
Repaid
83
EPIC ENERGY LIMITED Annual Report 2016-17
2.5. Segment Reporting
The company has identified two reportable segments viz. Power conditioners & savers and Renewable Energy & energy saving appliances. Segments have been identified and reported taking into account nature of products and services, the differing risks and returns and the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policy of the company with following additional policies for segment reporting.
(a) Revenue and expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue and expenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as “Unallocable”. (b) Segment assets and segment liabilities represent assets and liabilities in respective segments. Investments, tax related assets and other assets and liabilities that cannot be allocated to a segment on reasonable basis have been disclosed as “Unallocable”.
Power Renewable Energy & conditioners & energy saving Total ( Rs in Particulars savers appliances Lakhs)
Segment Capital Employed 614.49 1162.97 135.63 335.12 750.12 1498.09
Total unallocated Capital 78.93 149.74
84
EPIC ENERGY LIMITED
Annual Report 2016-17
2.6 Details of due to Micro, Small and Medium Enterprises Development Act, 2006
a. An amount of Rs. Nil and Rs. Nil was due and outstanding to the suppliers as at the
end of the accounting year on account of Principal and Interest respectively b. No Interest was paid during the year in terms of section 16 of the of the Micro, Small
and Medium Enterprises Development Act, 2006 and no amount was paid to the supplier beyond the appointed day.
c. No amount of Interest is payable at the end of the year other than interest under Micro, Small and Medium Enterprises Development Act, 2006
d. No amount of Interest was accrued and unpaid at the end of the accounting year.
The above information and that given in Current Liabilities regarding the Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the Company. This has been relied upon by the auditors. The company does not possess information as to which of its Suppliers are covered under mirco, small and medium Enterprise Development Act, 2006. However, the company is regular in making payments to its Suppliers and has not received any claim in respect of interest for delayed payment.
2.7Balance Confirmation
All advances, receivables and payables are subject to confirmation and reconciliation, if any.
2.8 Contingent Liability
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements unless the possibility of an outflow is remote.
2.9 Taxes on Income
Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Company operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss. Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date. Deferred income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss. Deferred tax liabilities are recognized for all taxable timing differences. Deferred
85
EPIC ENERGY LIMITED
Annual Report 2016-17
tax assets are recognized for deductible timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. At each reporting date, the Company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred tax asset to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realized. The carrying amount of deferred tax assets are reviewed at each reporting date. The Company writes-down the carrying amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set-off current tax assets against current tax liabilities and the deferred tax assets and deferred taxes relate to the same taxable entity and the same taxation authority. Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Company recognizes MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Company recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as “MAT Credit Entitlement.” The Company reviews the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Company does not have convincing evidence that it will pay normal tax during the specified period in future.
2.10 Earnings per share
Basic earnings/(loss) per share are calculated by dividing the net profit / (loss) for the period attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period are adjusted for any bonus shares issued during the year and also after the balance sheet date but before the date the financial statements are approved by the board of directors. For the purpose of calculating diluted earnings/(loss) per share, the net profit/(loss) for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.
2.11 Provisions
A provision is recognized when the Company has a present obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made of the amount of obligation. Provisions are not discounted to their present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These estimates are reviewed at each balance sheet date and adjusted to reflect the current best estimates.
86
EPIC ENERGY LIMITED
Annual Report 2016-17
2.12 Cash and Cash equivalents
Cash and cash equivalents for the purpose of cash flow statement comprise cash at bank and in hand, cheques on hand and short-term investments with an original maturity of three months or less.
. 2.13 Deferred Tax
Deferred tax asset has been provided on account of Depreciation difference between the Companies Act and Income Tax Act.
2.14 Other
Figures pertaining to the previous years have been disclosed in brackets in notes and also the figures of the previous years have been regrouped / reclassified wherever necessary to correspond with those of the current year’s classification/disclosure.
2.15 Earnings per share (EPS)
The earnings per share, computed as per the requirement under Accounting Standard 20 on Earnings Per share issued by The Institute of Chartered Accountants of India, is as under:
Current Year Previous Year
Net Profit (29,378,433) (28,274,853) Number of shares 72,11,500 (Previous 67,11,500)
Basic / Diluted EPS (Rs.) (on nominal value of Rs. 10 per share) (4.21)
Weighted Average / Diluted EPS (Rs.) (on nominal value of Rs. 10 per share) (4.31)
2.16 Contingent Liabilities
As per the best estimate of the management, no provision is required to be made as per Accounting Standard (AS) – 29 – Provisions, Contingent Liability and Contingent Assets as notified by Companies (Accounting Standards) Rules, 2006, in respect of any present obligations as a result of a past event that could lead to a probable outflow of resources, which would be required to settle such obligations.
87
EPIC ENERGY LIMITED
Annual Report 2016-17
2.17 Exceptional Items 1) The company has made a provision of Rs. 100,37,000 for Loan & Advances which are doubtful of recovery. The company is making all efforts to recover these debts.
2) The company has made a provision of Rs. 12,921,647 for Receivables which are doubtful of recovery. These receivables are from customers whose ability to pay is uncertain. The company is making all efforts to recover these debts.
2.18 Sales & Purchase quantitative details
The revenues of the company, except for the solar products, is not capable of quantification since it is based either on energy actually saved by the customer of the company or on a complete Turnkey basis. The quantitative details of Solar Products are as follows:
Opening Closing
Particulars Balance Purchase Sales Balance
Qty Value Qty Value Qty Value Qty Value
Solar Street Lights - - 122 351,116 122 366,359 - - Solar Lamps - - 112 192,080 112 198,963 - - Solar Home Lighting Systems - - 28 564,452 28 590,915 - - Solar Water Heating Systems - - 27 864,324 27 924,138 - - Solar Modules - - 56 534,576 56 547,113 - - - - 345 2,506,548 345 2,627,488 - -
88
EPIC ENERGY LIMITED
Annual Report 2016-17
2.19 Disclosure as required under Part I (6) (X) of Schedule III to the
Companies Act, 2013:
Details of Specified Bank Notes (SBN) held and transferred during the period from 8thNovember, 2016 to 30th December, 2016
Particulars SBN’s Other Total
Denomination
notes
Closing cash hand as on
08-Nov-16 -
14,00,000 1,400,000
Add: Permitted receipts - - -
Less: Permitted Payments - - -
Less : Amount Deposited -
in Banks 1,400,000 1,400,000
Closing cash in hand as on - - -
December 30,2016
As per our report of even date. On behalf of the Board
For P MURALI & CO For EPIC ENERGY LIMITED
Chartered Accountants
P Murali Mohana Rao Nikhil Morsawala Veena Morsawala
