ONGC Mangalore Petrochemicals Limited · 2016-08-16 · ONGC Mangalore Petrochemicals Limited...

ONGC Mangalore Petrochemicals Limited

ONGC MANGALORE PETROCHEMICALS LIMITED(A subsidiary of Mangalore Refinery and Petrochemicals Limited)

CIN: U40107KA2006PLC041258

BOARD OF DIRECTORS AS ON 01/08/2016Shri D K Sarraf (DIN 00147870) ChairmanShri H Kumar (DIN 06851988) DirectorShri M Venkatesh (DIN 07025342) DirectorShri A K Sahoo ( DIN 07355933) DirectorShri V P Mahawar (DIN 07208090) DirectorSmt Alka Mittal (DIN 07272207) DirectorShri I S N Prasad (DIN 01469651) Independent DirectorShri G M Ramamurthy (DIN 00064358) Independent DirectorShri Santosh Nautiyal (DIN 01127740) Independent DirectorShri M M Chitale (DIN 00101004) Independent DirectorCOMMITTEE OF DIRECTORSShri Santosh Nautiyal Independent DirectorShri H Kumar DirectorShri A K Sahoo DirectorAUDIT AND ETHICS COMMITTEEShri G M Ramamurthy Independent DirectorShri Santosh Nautiyal Independent DirectorShri A K Sahoo DirectorNOMINATION AND REMUNERATION COMMITTEEShri H Kumar DirectorShri G M Ramamurthy Independent DirectorShri Santosh Nautiyal Independent Director

CORPORATE SOCIAL RESPONSIBILITY COMMITTEEShri H Kumar DirectorShri M Venkatesh DirectorShri G M Ramamurthy Independent Director

BANKERSState Bank of India, ICICI Bank

DEBENTURE TRUSTEE FOR NON-CONVERTIBLEDEBENTURES (NCDs)Axis Trustee Services LimitedAxis house, Ground Floor, Wadia International center,Panduranga Budhkar Marg Worli, Mumbai – 400 025

REGISTRAR AND TRANSFER AGENT FOR NCDs :M/s. Link Intime India Private LimitedC-13, Pannalal Silk Mills Compound,L.B.S. Marg, Bhandup (West), Mumbai- 400 078

REGISTERED OFFICE AND INVESTOR RELATION CELLMangalore Special Economic Zone, Permude, Mangalore- 574 509Phone: 0824 – 2872291 Website: http://ompl.co.inEmail ID: [email protected]

KEY EXECUTIVEShri Sushil K. ShenoyChief Financial Officer &Chief Executive Officer I/c

COMPANY SECRETARYShri K B Shyam Kumar

STATUTORY AUDITORSM/s. Manohar Chowdhry &Associates, Mangalore

SECRETARIAL AUDITORSM/s Chethan Nayak &Associates, Mangalore

Contents

Board’s Report 01Corporate Governance Report 24C & AG’s Comments 33Auditor’s Report 34Balance Sheet 39Statement of Profit and Loss 40Cash Flow Statement 41Notes to Financial Statements 42Notice 60


BOARD’S REPORT

Dear Members,

Your Directors have pleasure in presenting the 10th Annual Report of your Company and the Audited financialstatements for the financial year ended 31st March, 2016, together with the Auditors’ Report and comments onthe Accounts by comptroller and Auditor General of india (C&AG) thereon.

1. PERFORMANCE OF THE COMPANY

1.1 FINANCIAL RESULTSThe Financial Results of your Company for the year ended 31st March, 2016 is summarised below:

Particulars For the year Ended For the year Endedon 31st March, 2016 on 31st March, 2015 in Millions in Millions

Revenue from operations 41,875.74 17,238.91Revenue from Other Income 20.93 43.59Expenses 50,642.19 26,425.49Profit (Loss) before Taxation (8,753.52) (9,142.99)Tax Expenses:Current Tax - -Profit (Loss) for the Year (8,753.52) (9,142.99)

1.2 RESULTS OF OPERATIONSYour Company had commenced its operations from October 01, 2014. During the year your Companyhas achieved a turnover of Rs.41,875.74 million and posted a loss of Rs.8,753.52 million mainly onaccount of interest cost, depreciation, inventory loss and low capacity utilisation. The capacity utilizationfor the period was about 71%.

1.3 OPERATIONAL PERFORMANCEDuring the year, the Company has- produced 0.57 MMT Para-xylene, 0.16 MMT Benzene and 0.15 MMT Paraffinic raffinate.- exported Para-xylene and Benzene worth about Rs.28,238.87 million and Rs.6,981.77 million,

respectively.

1.4 DIVIDEND AND TRANSFER TO RESERVESIn view of the losses incurred in the financial year 2015-16, your Board of Directors has not recommendedany dividend for the financial year 2015-16 and no amount has been transferred to General Reserve forthe financial year 2015-16.

1.5 SHARE CAPITALThe Authorised Share Capital of the company is Rs.20,000 million The Issued, Subscribed and Paid upEquity Share Capital of your Compan y as on 31st March, 2016 stood at Rs.18,776.26 million. During theyear under review, the Company has not issued any shares.

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1.6 FINANCIAL RESOURCES

i. Issue of DebenturesIn its continuing efforts to reduce funded costs, your Company, during the year, issued Secured,Redeemable, Non-Cumulative, Taxable, Non-Convertible Debentures (NCDs) aggregating Rs.5,000million through private placement with a coupon rate of 8.40%. The debentures were secured by way ofextension of mortgage on the assets i.e., mortgage of immovable properties in favour of the DebentureTrustees. Most investors in these NCDs comprised major insurance companies, public sector banks,corporates and investors of repute, indicating their safety perception in your Company’s fundamentalsand prospects. The issue proceeds were utilized for repayment of Rupee Term Loan.

The tenure of NCDs is 3 years 40 days. The interest on these debentures was serviced as and when itbecame due. The aggregate borrowings by way of Secured NCDs as on March 31, 2016 was Rs.5,000million (previous year NIL).

The NCDs issued by your Company were rated ‘IND AAA/RWE’ by India Ratings and Research Pvt.Ltd. (Fitch Group). These NCDs were listed on the Wholesale Debt Market (WDM) segment of theBombay Stock Exchange Limited (BSE).

Your Company has also issued further Rs. 20,000 million NCDs during June 2016 through privateplacement with a coupon rate of 8.12% for a period of 3 years.

ii. Issue of Commercial PaperYour Company has started mobilising funds through commercial paper (CP) during the year andoutstanding as on 31st March, 2016 was Rs.19,000 million. The effective cost of funds was 8.07% p.a.These CPs were rated A1+ (pronounced A One Plus) by ICRA Ltd.

1.7 MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITIONBETWEEN THE END OF FINANCIAL YEAR AND DATE OF REPORT.There is no occurrence of material change and commitment made between the end of financial year anddate of this report which has affected financial position of the company.

1.8 FINANCIAL ACCOUNTINGThe Financial Statements have been prepared in accordance with the Generally Accepted AccountingPrinciples (GAAP) and in compliance with all applicable Accounting Standards (AS-1 to AS-30) andprovisions of the Companies Act, 2013 read with notification issued by the Ministry of Corporate AffairsThe financial statements have been prepared as per the format prescribed under the Schedule III to theCompanies Act, 2013. The significant accounting policies which are consistently applied have been setout in the Notes to the Financial Statements.

1.9 DEPOSITSYour Company has not accepted any deposits and as such, no amount on account of principal or intereston deposits was outstanding as on the date of the balance sheet.

1.10 LOANS, INVESTMENTS OR GUARANTEESYour Company has not given any loans, made any investments or provided guarantee as required to bereported under section 186 of the Companies Act, 2013.

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1.11 CREDIT PROFILEICRA has assigned “AA-” (pronounced Double A minus) to the long-term facilities and A1+ (pronouncedA One Plus) for short term facilities of your Company.

India Ratings and Research, a Fitch Group Company has assigned a rating of “IND AAA”/ RWE to theNCDs issued, ECB Loan and long-term facilities of your company. This rating of the Debentures byIndia Ratings and Research indicates high degree of safety regarding timely servicing of financialobligations.

1.12 AMALGAMATION OF THE COMPANY WITH MANGALORE REFINERY ANDPETROCHEMICALS LIMITEDOn July 08, 2015, the Board has accorded consent for amalgamation of your Company into and withMangalore Refinery and Petrochemicals Limited (MRPL) subject to the requisite approvals ofshareholders, creditors and Ministry of Corporate Affairs and other regulatory authorities as it was opinedthat shareholders’ value would be enhanced by integrating aromatic plant of the Company with refineryof MRPL to create greater synergies in business operations, optimal utilization of the plant of both thecompanies to maximize combined margins of refinery and petrochemicals in tune with the market dynamicsand optimal utilization of resources for better administration and cost reduction.

The Board has also approved the share swap ratio of 100:513, i.e., for every 513 (five hundred thirteen)fully paid-up equity shares of Rs.10 each held by a shareholder in the Company, 100 (one hundred) fullypaid-up equity shares of Rs.10 each of MRPL shall be issued upon sanction of the Scheme.

2 MARKETING & BUSINESS DEVELOPMENTYour company ranks among the leading domestic producers in Para-xylene (PX) and Benzene (BZ).Your Company is in the export market since Q II FY 2014 - 15 and could make presence in all the majorconsuming geographies within a short span at time.

Total sales volume for PX and BZ during the financial year 2015-16 was 0.75 MMT with a sales value ofRs. 36,388.90 million.

Both Para-xylene & Benzene have been well accepted by all global majors across sectors. Your Companyhas been floating short term export tenders for sale of these products.

Para-xylene (PX):Substantial PX quantity was sold in South East Asia. PX was also sold in North East Asia, one of themajor consuming regions and US Gulf depending upon the cost economics from time to time.

During last quarter of the financial year, your company entered into a short term supply agreement of PXto a major end user in Domestic Tariff Area (DTA).

A long term agreement was entered into with a major downstream unit of Purified Terephthalic Acid(PTA) which will reduce dependency on exports and ensure tiding over fluctuating market demand andprices.

Benzene (BZ):Your Company has been selling Bz predominantly to the Arabian Gulf through short term export tenders.

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3 HEALTH, SAFETY AND ENVIRONMENT PERFORMANCESAFETY PERFORMANCEThe major achievements in the Safety are summarized as under:1. Your Company is committed towards imparting continuous training in fire and safety practices.

Regular Mock drills were conducted considering the various emergency scenarios in plant andnon-plant areas. Mock dril conducted in presence of district crisis group and demonstrated theemergency preparedness of aromatic complex.

2. Conducted external safety audit by OISD team for aromatic complex.3. Safety report as per MSIHC 1989 is prepared and submitted to Deputy Director of factories,

Karnataka.

ENVIRONMENT PERFORMANCEThe major achievements in the Environment Management and performance are summarized as under:

1. Hydrogeological study from NGRI has been carried out to assess the baseline Hydrogeology &protection of ground water regime in the aromatic complex. This is found to be in order withrespect to ground water regime. Recommendations are being complied.

2. Utilization of Sewage Treatment Plant (STP) water as make-up to cooling towers carried out. Thismeasure has directly resulted in reduction of fresh water consumption.

3. Vapor recovery unit is installed to minimize the hydrocarbon emissions from the HydrocarbonStorage tanks.

4. SOx & NOx, Online Stack Analyzer data & Treated Effluent online Analyzer parameters like pH,COD, BOD, TSS & Flow, before discharge to sea from the ETP of a aromatic complex are connectedto CPCB server in 2016.

5. Complex has been built with condensate recovery system to save fresh water.6. Hydrocarbon, H2S, Benzene detectors are installed at strategic locations in the complex7. Periodic Manual Stack Monitoring, Ambient Air Quality Monitoring, Surface Water & Ground

Water Monitoring are being carried out by MoEF/KSPCB approved external agency.

4 RELATED PARTY TRANSACTIONSAll transactions entered with Related Parties for the year were on arm’s length basis and in the ordinarycourse of business. Further, there are no material related party transactions during the year with thePromoters, Directors or Key Managerial Personnel.

Particulars of contracts or arrangements with related parties referred to in section 188 of the CompaniesAct, 2013 in the form AOC-2 form part of Board’s Report and placed at Annexure-A.MCA videNotification dated June 05, 2015, has exempted the applicability of Section 188 (1) of the CompaniesAct, 2013 for a transaction entered into between two Government Companies. In view of the same,shareholders’ approval has not been solicited for the transactions with Govt. Companies.

5 INTERNAL CONTROL SYSTEMYour Company has a well established and efficient internal control system and procedure. The Companyhas appointed Internal Auditors and Audit observations are periodically reviewed by the Audit & EthicsCommittee of the Board and necessary directions are issued whenever required.

6 ENTERPRISE RISK MANAGEMENT SYSTEMYour Directors have approved Enterprise Risk Management Policy and Procedure in February 2015.Your Company operates in a business environment that is characterized by increasing globalization of

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market and intense competition. Due to this your Company is exposed to number of risks viz., operationalrisk, strategic risk, reputational risk, compliance risk, financial risk, information risk, environmentalrisk, etc. The Risk Management Policy of your Company clearly structured and defined the procedurefor Risk identification, Risk assessment, Risk measuring, Risk mitigation,Risk monitoring, Risk reportingand Risk optimizing.

The Enterprise Risk Management Reporting System manages, monitors and reports on the principalrisks and uncertainties that can impact the growth and ability to achieve strategic objective of the Company.The Integrated Enterprise Risk Management System is designed to drive a common integrated view ofrisk and optimal risk mitigation.

7 VIGIL MECHANISMAs required under Section 177 (9) of the Companies Act 2013, Board established a vigil mechanism fordirectors and employees to report genuine concerns in your Company. The Chief Vigilance Officer ofMRPL is appointed as a Chief Vigilance Officer for your Company and he can be contacted [email protected] for any complaint.

8 CORPORATE SOCIAL RESPONSIBILITY (UNDER SECTION 135 OF THE COMPANIES ACT,2013)Your company is fully committed to ensuring equitable and sustainable growth of society in and aroundthe area of its operations besides complying with government directives to discharge its socialresponsibility. CSR activities are essentially guided by project based approach in line with the provisionsof the Companies Act, 2013 promulgated by Ministry of Corporate Affairs and Companies (CSR Policy)Rules, 2014 as amended from time to time.

Pursuant to enactment of Companies Act, 2013 and Companies (CSR Policy) Rules 2014 by Ministry ofCorporate Affairs, the CSR Policy has been approved by the Board of Directors in its 55th meeting heldon August 01, 2016.The same is uploaded on the Company’s website. The Committee has not made anyprovision for CSR activities during the financial year 2015-16 as there were no average net profitsduring the immediately preceding three financial years.

9 DIRECTORS

9.1 POLICY ON DIRECTORS’ APPOINTMENT ETC.Your Company being a Government Company, the provisions of section 134(3)(e) of the Companies Act,2013 shall not apply in view of the Gazette notification dated 05.06.2015 issued by Government of India,Ministry of Corporate Affairs.

9.2 PERFORMANCE EVALUATIONYour Company being a Government Company, the provisions of section 134(3)(p) of the CompaniesAct, 2013 shall not apply in view of the Gazette notification dated 05.06.2015 issued by Government ofIndia, Ministry of Corporate Affairs.

9.3 AUDIT COMMITTEEThe Company has constituted Audit Committee which consists of three non-executive directors and themajority of them are independent Directors. The Chairman of the Audit Committee is an independent

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Director. There were no instances where the recommendations of the Audit Committee were not acceptedby the Board.

9.4 BOARD MEETINGSFive Board Meetings were held during the year ended on 31st March 2016. Details of the Board Meetingheld during the year have been furnished in the Corporate Governance Report.

9.5 INDEPENDENT DIRECTORSThe Independent Directors have submitted declaration that they meet the criteria of Independence as persection 149(6) of the Companies Act, 2013.

9.6 MEETING OF INDEPENDENT DIRECTORSThere was no meeting of Independent Directors held during the financial year 2015-16.

9.7 APPOINTMENTS/CESSATION ETCIn accordance with the provisions of the Companies Act, 2013 and the Articles of Association of yourCompany, Shri.H Kumar, Director retires by rotation and being eligible, offers himself for re-appointment.

Following changes took place in Board of Directors of your Company, since 09th Annual GeneralMeeting :- Shri V P Mahawar was appointed as an additional director with effect from 12th August 2015,- Smt Alka Mittal was appointed as an additional director with effect from 28th August 2015,- Shri Vishnu Agrawal resigned from Board with effect from 31st January 2016 and- Shri A K Sahoo appointed as an additional director with effect from 05th February 2016

Shri I S N Prasad, Shri. G M Ramamurthy, Shri. Santosh Nautiyal and Shri. M M Chitale were re-appointed by the Board as Independent Directors for a period of one year with effect from 28th March2016 whose appointment is being taken up for approval by the members as a special resolution in thisAnnual General Meeting.

9.8 DETAILS OF OTHER KEY MANAGERIAL PERSONNEL AS PER RULE 8 (5) (III) OF THECOMPANIES (ACCOUNTS) RULES, 2014:Shri. S Ramachandran, Chief Executive Officer completed his term and ceased to be CEO with effectfrom June 30, 2015.

Shri. Sushil K Shenoy, Chief Financial Officer was appointed as Key Managerial Personnel with effectfrom August 16, 2014 and is concurrently holding charge as CEO on the expiry of the term of ShriRamachandran the previous CEO, in view of proposed merger with its holding Company, MangaloreRefinery and Petrochemicals Limited.

Shri. K B Shyam Kumar was appointed as Company Secretary with effect from August 13, 2014 and asKey Managerial Personnel with effect from August 16, 2014.

10 CORPORATE GOVERNANCEThe Company is committed to maintain the highest standards of Corporate Governance in its dealingswith its various stakeholders. A Report on Corporate Governance is annexed to this Report.

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11 HUMAN RESOURCES / PERSONNELYour Company continued to enjoy cordial and harmonious relations with the collectives and there wasno industrial disturbance during the year 2015-16.

Total employee strength as on March 31, 2016 was 465 including 300 Project Displaced Family (PDFs)Candidates. Women employees constituted over 17 percent (80 Nos) of your company’s workforce. Outof the total workforce, 158 employees belong to Management cadre and 307 employees belong to Non-Management cadre.

During the year 2015-16, Your Company devoted 1,193 Mandays for Training, Development and Learningwhich amounted to an average of 2.56 Mandays per employee. This includes functional, developmentaland special training programs covering the entire spectrum of employees. During the year, trainingprograms were specially organized for women employees and nominated women employees for outsidetraining programs. Your Company complies with The Sexual Harassment of Women at Workplace(Prevention, Prohibition and Redressal) Act, 2013 and reported cases, if any, are being inquired into bythe Internal Complaint Committee for taking action.

12 MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEESYour Company being a Govt. company is exempted from furnishing information under Section 197 ofthe CompaniesAct, 2013 vide Ministry of Corporate Affairs (MCA) Notification dated 05/06/2015.

13 INSURANCEAll the insurable interests of your Company including inventories, buildings, plant and machinery andliabilities under legislative enactments are adequately insured.

14 SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTSNo significant and material order was passed by the Regulators/Courts that would impact the goingconcern status of the Company and its future operations.

15 AUDITORS

Statutory Auditors:The Comptroller and Auditor General of India (C&AG) has appointed M/s. Manohar Chowdhry &Associates, Chartered Accountants, Mangalore as Statutory Auditors for the financial year 2015-16 asrequired for the Government Companies.They have audited the Financial Statements for the FinancialYear ended March 31, 2016 and submitted their report which forms part of this report.

Auditors’ Report

The Auditors’ Report to the Members of the Company for the year under review does not have any adverseremark or qualification statement and therefore no explanation is required to be given on the report of theStatutory Auditors.

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Comptroller and Auditor General (C&AG) Report:The Comptroller and Auditor General of India (C&AG) have submitted their report which forms part of thisreport and there are no suplimentary comments by C&AG under section 143(6)(b) of the Companies Act, 2013

Secretarial AuditM/s Chethan Nayak & Associates, Company Secretaries conducted Secretarial Audit pursuant to the provisionsof Section 204 of the Companies Act, 2013, for the financial year 2015-16. M/s Chethan Nayak & Associates,Company Secretaries have submitted the Report confirming compliance with the applicable provisions of theCompanies Act, 2013 and other rules and other regulatory authorities for corporate law. The report in FormMR-3 is placed at Annexure – B.

As regards the observation of the secretarial auditor relating to appointment of independent directors, theBoard in its meeting held on March 28, 2015, appointed the independent directors and the shareholders approvedthe appointment in the 9th Annual General Meeting held on August 08, 2015 for one year with reffect fromMarch 28, 2015. The delay in filing return with ROC was due to technical reason as MCA site was not acceptingthe return based on the Board resolution. Your Company has also obtained a legal opinion which confirms thevalidity of appointment of independent directors.

As regards the observation relating to not holding separate meeting of independent directors as mandated bySchedule IV to the Companies Act, 2013, the Company had noted to comply with this requirement in future.

As regards the observation relating to annual evaluation of the Board, the same is not applicable to the govermentcompanies is terms of notification dated June 05, 2016. Your Company, being the Government Company, theobservation of the Secretarial Auditor was not relavant.

As regards the observation relating to appointment of Cheif Executive Officer in terms of scetion 203 of thecompanies Act, 2013, the board appointed Chief Financial Officer of the company for concurrently holdingcharge of CEO on the expiry of the term of Shri. Ramachandran, the previous CEO, in view of proposedmerger with its holding Company, M/s Mangalore Refinery and Petrochemicals Limited and the vacancy wasperceived to be a short term vacancy only. The non-filing of return with RoC was due to technical reasons onMCA portal.

Cost AuditAs per the Rule 4(3)(ii) of Companies (Cost Records and Audit) Amendment Rules, 2014, Cost Audit is notapplicable to the companies which operating from a Special Economic Zone. In view of the above, Cost Auditwas not done for the period under review.

16 EXTRACT OF ANNUAL RETURNAs per requirement of section 92(3) of the Companies Act, 2013, the extract of the annual return in formMGT-9 is placed at Annexure-C.

17 IMPLEMENTATION OF OFFICIAL LANGUAGE POLICYThe implementation of offical language policy is being under taken by the company during July 2016.

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18 PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ANDFOREIGN EXCHANGE EARNING AND OUTGO

CONSERVATION OF ENERGY:Your Company has commissioned Captive Power Plant successfully and a peak power load of 40 MW(approx.) was recorded. During the design stage, various conservation measures were taken and are nowimplemented effectively. Conservation measures considered as a part of design of the plant, are:

1. Heat recovery from the waste process condensate to heat inlet DM water (increases temperatureof DM water by 70 Deg C).

2. Condensate recovery system to minimize the water usage.

3. Recovery of boiler blow down and using it as a makeup to cooling tower.

4. Installation of timers in all plant lighting systems for automatic switch on and off.

TECHNOLOGY ABSORPTION AND ADAPTATION:i) Your company has made the following efforts towards technology absorption and adaptation as a licensed

user:a. Technologies for the process units i.e. NHT, Platformer, CCRG, SSU, Tatoray unit, BTF unit, Xylene

unit, Parex unit and Isomar unit have been absorbed.b. The utility units i.e., CPP, Nitrogen, IA/PA, RWTP units etc., have been commissioned along with the

process complex.c. Benefits derived as a result of the above effort, the unit complex has been running at 70-75% average

capacity meeting the international standard of p-xylene and benzene quality.ii) Information regarding Imported Technology for last five years:a) Technology imported: The Company has imported Technology, as a licensed user, for supply of know-

how for Aromatic Plant from M/s UOP, USA for the process units viz; Naphtha Hydro Treater, ContinuousCatalytic Reformer, Xylene Fractionation Unit, PX Recovery Unit, Xylene Isomerization Unit, BenzeneToluene Extraction Unit, Benzene Toluene Fractionation and Trans Alkylation & DisproportionationUnit.

b) Has the technology been fully absorbed? – Yes

c) If not fully absorbed- areas where this has not taken place, reason thereof, and future plans of action. –Not applicable

As the Company has commenced the commercial production from 1st October 2014, the Company hasnot carried out any research and development activity during the year under review.

FOREIGN EXCHANGE EARNINGS AND OUTGO DURING THE YEAR:Foreign Exchange Earned:Rs.35,241.34 million (Previous Year Rs.14,973.70 million)Foreign Exchange Outgo: Rs.1,002.32 million(Previous Year Rs.2,736.70 million)

19 DIRECTORS’ RESPONSIBILITY STATEMENTPursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to Directors’Responsibility Statement, it is hereby confirmed that: 99


(i) In the preparation of the annual accounts, the applicable accounting standards have been followed andthere are no material departures from the same;

(ii) The Directors have selected such accounting policies and applied them consistently and made judgementsand estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs ofthe Company as at 31st March, 2016 and of the loss of the Company for the year ended on that date;

(iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting recordsin accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Companyand for preventing and detecting fraud and other irregularities;

(iv) The Directors have prepared the annual accounts of the Company on a ‘going concern’ basis;

(v) The directors have laid down internal financial controls which are being followed by the company andthat such internal financial controls are adequate and are operating effectively; and

(vi) The Directors have devised proper systems to ensure compliance with the provisions of all applicablelaws and that such systems are adequate and operating.

20 ACKNOWLEDGEMENTS

The Directors wish to thank and acknowledge the co-operation, assistance and support extended byCentral Government, Government of Karnataka, Oil and Natural Gas Corporation Limited, MangaloreRefinery and Petrochemicals Limited, Banks, shareholders and debenture holders of the Company.

Your Directors acknowledge the continuing co-operation and support received from New MangalorePort Trust, other stakeholders such as vendors, contractors, transporters and the valued customers for theproducts of the Company.

The Directors also wish to place on record their appreciation for the all-round co-operation and contributionmade by the employees at all levels.

On behalf of the Board of Directors ofONGC Mangalore Petrochemicals Ltd.

Sd/-Dated: August 01, 2016 D K SarrafPlace:New Delhi Chairman

DIN : 00147870

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Form No. AOC-2

(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) of the Companies(Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 includingcertain arm’s length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arm’s length basis:-NIL

(a) Name(s) of the related party and nature of relationship:- NA

(b) Nature of contracts/arrangements/transactions:- NA

(c) Duration of the contracts / arrangements/transactions:- NA

(d) Salient terms of the contracts or arrangements or transactions including the value, if any:- NA

(e) Justification for entering into such contracts or arrangements or transactions:- NA

(f) date(s) of approval by the Board :- NA

(g) Amount paid as advances, if any:- NA

(h) Date on which the special resolution was passed in general meeting as required under firstproviso to section 188:- NA

2. Details of material contracts or arrangement or transactions at arm’s length basis

(a) Name(s) ofthe related partyand nature ofrelationship

MangaloreRefinery andPetrochemicals Limited(HoldingCompany)

(b) Nature ofcontracts/arrangements/transactions

Purchase ofProduct

Sale of Product

ServicesReceived

(c) Duration ofthe contracts /arrangements/transactions

FY 2015-16

FY 2015-16

FY 2015-16

(d) Salient termsof the contractsor arrangementsor transactionsincluding thevalue, if any:Term Sheet

Rs. 39,965.13 MnTerm SheetRs. 7,224.20 MnActualRs. 3.98 Mn

(e) Date(s) ofapproval by theBoard, if any:

NA

NA

NA

f) Amount paidin advance, if

any:

Nil

Nil

Nil

Annexure - A

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Oil and NaturalGas CorporationLimited(HoldingCompany)

MangaloreSpecialEconomic ZoneLimited(Associateof HoldingCompany)

HindustanPetroleumCorporationLimited(Associate ofHoldingCompany)

Reimbursementof expensesDeputation

Advance forcorridor

Lease Rent

Water,Power &MarineOutfall

Deposit forwater

Purchaseof Product

FY 2015-16

Perpetual

FY 2015-16

FY 2015-16

Perpetual

FY 2015-16

ActualRs. 1.16 Mn

Agreement

AgreementRs. 23.40 Mn

AgreementRs. 125.66 Mn

Agreement

AgreementRs. 1,395.87 Mn

NA

30.01.2012

30.01.2012

14.10.2014

14.10.2014

07.02.201505.03.2016

Nil

Rs. 900 Mn

Nil

Rs. 3.13 Mn

Nil

Form No.MR-3SECRETARIAL AUDIT REPORT

FORTHE FINANCIAL YEAR ENDED31.03.2016[Pursuant to section 204 (1) of the Companies Act, 2013 and rule No. 9 of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,

ONGC MANGALORE PETROCHEMICALS LIMITED.

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherenceto good corporate practices by ONGC Mangalore Petrochemicals Limited (here in after called the company).Secretarial Audit was conducted in manner that provided us a resonable basis for evaluating the corporateconducts/ statutory compliances and expressing our opinion thereon.

Based on our verification of the Company’s books, papers, minute books, forms and returns filed and otherrecords maintained by the company and also the information provided by the Company, its officers, agentsand authorized representatives during the conduct of secretarial audit, We here by report that in our opinion,the company has, during the audit period covering the financial year ended on 31st March 2016 compliedwith the statutory provisions listed here under and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

Annexure - B

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We have examined the books, papers, minute books, forms and returns filed and other records maintained byONGC Mangalore Petrochemicals Limited (“the Company”) for the financial year ended on 31st March2016 according to the provisions of:

(i) The Companies Act, 2013(the Act) and the rules made there under;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made there under;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(iv) Foreign Exchange Management Act,1999 and the rules and regulations made thereunder to theextent of Foreign Direct Investment, Overseas Direct Investment and External CommercialBorrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and ExchangeBoard of India Act,1992 (‘SEBI Act’):-

(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 (Issue of Capital and DisclosureRequirements) Regulations, 2009;

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and EmployeeStock Purchase Scheme) Guidelines, 1999;

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations, 2008;

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents)Regulations,1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009;and

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

(vi) Following other laws applicable to the company.

a. Factories Act,1948;

b. Contract Labour (Regulation & Abolition) Act, 1970,

c. Industrial Employment (Standing order) Act, 1946

d. Payment of Wages Act, 1936

e. Industrial Disputes Act, 1947 and

f. Employees State Insurance Act, 1948

g. Maternity Benefit Act, 1961

h. Minimum Wages Act, 1948

i. Payment of Bonus Act,1965

j. Payment of Gratuity Act, 1972.

k. Provisions of Environment (Protection) Act, 1986,

13


l. The Water (Prevention & Control of Pollution) Act, 1974 and

m. The Air (Prevention & Control of Pollution) Act, 1981 and rules made there under.

n. Provisions of Special Economic Zone Act, 2005,

o. The Petroleum Act, 1934,

p. Explosives Act,1884.

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The Listing Agreements entered into by the Company with Bombay StockExchange(s).

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations,Guidelines, Standards, etc. mentioned above subject to the following observations:

1. As per the requirement under section 149 of the Companies Act, 2013, the company is required toappoint the Independent Directors within one year from the date of commencement of Companies Act2013 i.e. within 31.03.2015. It is observed that in the E form - DIR- 12 filed with the Registrar ofCompanies the Independent Directors were appointed as on 08.08.2015 i.e., the date of the 9th

Annual General Meeting of the company in which the said appointment was approved by theshareholders.

2. As per section 149 (8) of the Companies Act 2013, the company and Independent Dorectors shallabide by the provisions specified in the Schedule IV which provides that ‘The independent directorsof the company shall hold at least one meeting in a year, without the attendance of non-independentdirectors and members of management and that the meeting shall;

a. Review the performance of non-independent directors and the Board as a whole;

b. Review the performance of the Chairperson of the company, taking into account the views ofexecutive directors and non-executive directors;

c. Assess the quality, quantity and timeliness of flow of information between the company managementand the Board that is necessary for the Board to effectivaly and reasonably perform their duties.

No such meeting of independent directors has been held during the year 2015-2016.

3. Under Section 134 formal annual evaluation by the Board of its own performance and its committeeand its individual director’s is not applicable subject to the government companies in case the evaluationis carried out by the department of administrative in charge. Since no evaluation has been carried outby the Ministry or Department of the Central Government which is administratively in charge of thecompany, the said exemption provided vide notification No [F.No. 1/2/2014-CLV] dated 05.06.2015is not applicable.

4. Under Section 203 of the Companies Act 2013, appointment of KMP is applicable to the Company.Company has Company secretary and CFO as KMP. The Board has appointed CFO as additional in

14


charge CEO but no return under Rule 3 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules, 2014 has been filed with the Registrar of Companies to this effect.

We further report that the changes in the composition of the Board of Directors that took place during theperiod 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 onagenda were sent at least seven days in advance, and a system exists for seeking and obtaining furtherinformation and clarifications on the agenda items before the meeting and for meaningful participation atthe meeting. Minutes of the meetings record proper proceedings of the meetings.

We further report that there are adequate systems and processes in the company commensurate with the sizeand operations of the company to monitor and ensure compliance with applicable laws, rules, regulationsand guidelines.

We further report that during the audit period the company has made private placement as per section 42 of theCompanies Act 2013 for the issue of NCD’s. The Private placement was approved at the ninth Annual GeneralMeeting of the Company held on 8th August 2015. Company allotted 5,000 Secured, Non Convertible Debenturesof Rs. 1000000 each as on 03.02.2016. The said NCDs got listed in the Bombay Stock Exchange and arecurrently trading.

Place : Mangaluru

Date : 30.07.2016

For Chethan Nayak & AssociatesCompany Secretaries

Chetan Nayak K.Partner

C.P.No. 3140

15


Form No. MGT-9EXTRACT OF ANNUAL RETURN

as on the financial year ended on 31st March 2016

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of theCompanies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i) CIN:- U40107KA2006PLC041258ii) Registration Date : 09th December 2006iii) Name of the Company: ONGC Mangalore Petrochemicals Ltd.iv) Category / Sub-Category of the Company : Government Companyv) Address of the Registered office and contact details : MSEZ Permude, Mangalore - 574509

vi) Whether listed company : Yes (NCDs are listed)vii) Name, Address and Contact details of

Registrar and Transfer Agent, if any : M/s Link Intime India Private Limited(For NCDs only) C-13, Pannalal Silk Mills Compound,

L.B.S. Marg, Bhandup (West),Mumbai- 400 078Tel No.: 022-25963838 / 25946970Fax No.: 022-25946969E-mail:[email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

Sl. No

1

2

3

Name andDescription ofmain products /services

Paraxylene

Benzene

Paraffine Raffinate

NIC Code ofthe Product/service

19201

19201

19201

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES –

% to totalturnover of thecompany

70 %

17 %

10 %

Sl. No Name andaddressoftheCompany

M/s Mangalore

CIN

L85110KA1988GOI008959

Holding /Subsidiary/Associate

HOLDING

% ofsharesheld

51%

ApplicableSection

2(87)(ii)

Annexure - C

16


Refinery andPetrochemicalsLimited (MRPL)

M/s. Oil and NaturalGas CorporationLimited (ONGC)

2 L74899DL1993GOI054155 ASSOCIATE 48.99% 2(6)

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding :

Category ofShareholders

No. of Shares held at the beginning of the year No. of Shares held at the end of the year %Changeduring

theyear

Demat Physical Total % ofTotal

Shares


Shares

A. Promoters

(1) Indiana) Individnal/HUFb) Central Govtc) State Govtd) Bodies Corp. NIL 1877621500 1877621500 99.99 NIL 1877621500 1877621500 99.99 NILe) Banks / FIf) Any Other.Sub-total (A)(1) NIL 1877621500 1877621500 99.99 NIL 1877621500 1877621500 99.99 NIL

(2) Foreign NIL NIL NIL NIL NIL NIL NIL NIL NILa) NRI-individualb) Other Individualc) Bodies Corp.d) Banks / FIe) Any OtherSub-total (A) (2) NIL NIL NIL NIL NIL NIL NIL NIL NIL

Total shareholdingof Promoter(A) =(A)(1)+(A)(2) NIL 1877621500 1877621500 99.99 NIL 1877621500 1877621500 99.99 NIL

B. PublicShareholding

(1) Indtitutions NIL NIL NIL NIL NIL NIL NIL NIL NILa) Mutual Fundsb) Bankd / FIc) Central Govt

17


Category ofShareholders

No. of Shares held at the beginning of the year No. of Shares held at the end of the year %Changeduring

theyear


Shares


Shares

d) State Govte) Venture CapitalFunds

f) InsuranceCompanies

g) Fllsh) Foreign VentureCapital Funds

i) Others (specify)

Sub-total (B)(1) NIL NIL NIL NIL NIL NIL NIL NIL NIL

(2) Non Instiutions

a) Bodies Corp.i) Indianii) Overseasb) Individuals NIL 4000 4000 0.0002 NIL 4000 4000 0.0002 NILshareholders holdingnominal sharecapitalupto Rs. 1 lakh

ii) Individualshareholders holdingnominal share capitalin excess of Rs 1 lakh

Sub-total (B)(2) NIL 4000 4000 0.0002 NIL 4000 4000 0.0002 NIL

Total Public NIL 4000 4000 0.0002 NIL 4000 4000 0.0002 NILShareholding(B)=(B)(1)+(B)(2)

C. Shares held byCustodian for GDRs& ADRs

Grand Total(A+B+C) NIL 1877625500 1877625500 100 NIL 1877625500 1877625500 100 NIL

18


(ii) Shareholding of Promoters :

Sr.No

Shareholder’sName

Shareholding at the beginning of theyear

Shareholding at the end of the year

No. ofShares

% of totalshares oftheCompany

% of totalSharesPledged/encumbered tototalshares

% oftotalsharesof theCompany

No. ofShares

% of SharesPledged/encumberedto totalshares

% change inshareholdingduring theyear

1

2

Oil andNatural GasCorporationLimitedMangaloreRefinery andPetrochemicalsLtd

920000000 48.99 .. 920000000 48.99 .. ..

957621500 51 .. 957621500 51 .. ..

(iii) Change in Promoters’ Shareholding :

Sr.No

Particulars Cumulative Shareholdingduring the year

No. of Shares % of totalshares oftheCompany

No. of Shares % of totalshares oftheCompany

at the beginning of the year

1

2

Oil and NaturalGas Corporation 01.04.2015 920000000 48.99 920000000 48.99LimitedMangaloreRefinery and 01.04.2015 957621500 51 957621500 51PetrochemicalsLtdIncrease/decrease in shareholding

during the year

NIL

At the end ofthe Year .. Total 1877621500 99.99978 1877621500 99.9997831.03.2016

19


(iv) Shareholding Pattern of top ten Shareholders other than Directors, Promoters and Holders of GDRsand ADRs)

Sr.No

Particulars CumulativeShareholding during

the yearNo. ofShares


No. ofShares


at the beginning of the year

1 Shri Sameer Jain Equity Share 500 500

2 Shri Bahvesh Goel Equity Share 500 500

3 Shri Aditya Kumar Mishra Equity Share 500 500

4 Shri Ankur Sharma Equity Share 500 500

5 Shri Aqurav Goyal Equity Share 500 500

6 Shri Ashith B. Shetty Equity Share 500 500

7 Shri Sanjeev J. Equity Share 500 0.0002 500

8 Smt. Kavitha Sharma Equity Share 500 500

9 Shri Subhachandra Pai. T Equity Share 100 100

10 Shri Yogish Nayak S. Equity Share 100 100

11 Shri Sushil Chandra M. Equity Share 100 100

12 Shri B. Prashantha Baliga Equity Share 100 100

13 Shri Shyam Prasad Kamath Equity Share 100 100

Increase/decrease in shareholding during the year

NIL

At the end of the .. 4,500 0.0002 4,500 0.0002year 31.03.2016

0.0002 0.0002

20


(iv) Shareholding of Directors and Key Managerial Personnel :

Sr.No

Particulars CumulativeShareholding during

the yearNo. ofShares


No. ofShares


For Directors

1 Shri D K Sarraf Chairman 0 0.00 0 0.00

2 Shri H Kumar Director 0 0.00 0 0.00

3 Shri MVenkatesh Director 0 0.00 0 0.00

4 Shri A K Sahoo Director 0 0.00 0 0.00

5 Shri V P Mahawar Director 0 0.00 0 0.00

6 Smt Alka Mittal Director 0 0.00 0 0.00

7 Shri I S N Prasad Director 0 0.00 0 0.00

8 Shri Santosh Nautiyal Director 0 0.00 0 0.00

9 Shri G M Ramamurthy Director 0 0.00 0 0.00

10 M M Chitale Director 0 0.00 0 0.00

Key Managerial Personnel

1 Shri K Sushil Shenoy CFO 0 0.00 0 0.00

2 Shri K B Shyam Kumar CS 0 0.00 0 0.00

Increase / decrease in shareholding during the year

NIL

At the end of the year 31.03.2016 0 0.00 0 0.00

(vi). Indebtedness:

Indebtedness of the Company including interest outstanding/accrued but not due for payment :- ( In millions)

Indebtedness at the beginning of theFinancial yeari) Principal Amount 39,323.84 2,000.00 - 41,323.84ii) Interest due but not paid - - - -iii) Interest accrued but not due - - - -Total (i+ii+iii) 39,323.84 2,000.00 - 41,323.84Change in indebtedness during theFinancial year Addition * 6,566.61 - - 6,566.61 Reduction 21,057.08 2,000.00 - 23,057.08

Secured Loans /deposits

Un secured Loan Deposits Totalindebtedness

21


Net Change -14,490.47 -2,000.00 - -16,490.47Indebtedness at the end of theFinancial yeari) Principal Amount 24,833.3 - - 24,833.37ii) Interest due but not paid - - - -iii) Interest accrued but not due 360.94 - 360.94Total (i+ii+iii) 25,194.32 - 25,194.32

* Addition Secured Loans include an amount of Rs 1159.61 million on account of Exchange Rate Variation

(vii). Remuneration of directors and key managerial personnel:

A. Remuneration to Managing Director, Whole-time Directors and/or Manager: As there is no MD,WTD and / or Manager, the information is NIL.

B. Remuneration to other directors: (Amount in )

Particulars of Remuneration Name of DirectorSr.no

Shri I S NPrasad

Shri G MRamamurthy

ShriSanthoshNautiyal

ShriM MChitale

TotalAmount

1. Independent Directors Nil 160000 170000 10000 340000- Fee for attendingboard \ committeemeetings- Commission- Others, pleasespecifyTotal (1)

2. Other Non-Executive Nil Nil Nil Nil NilDirectors- Fee for attendingboard / committeemeetings- Commission- Others, pleasespecifyTotal (2)Total (B) (1+2)Total ManagerialRemuneration

Overall Ceiling as per the Act The setting fees of Directors are not exceeding one lakh rupees per meeting ,as required under Section 197(5) Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial personnel) Rules, 2014

22


Particulars of RemunerationSr.no

Shri SRamachandran, CEO

Shri K SushilShenoy, CFO

Shri K BShyamKumar, CS

TotalAmount

1. Gross Salary 22,83,068 45,22,321 20,63,880 88,69,269(a) Salary as per provisions containedin section 17(1) of the Income-tax Act,1961

(b) Value of perquisites u/s 17(2) Nil Nil Nil NilIncome-taxAct, 1961

(c) Profits in lieu of salary under Nil Nil Nil Nilsection 17(3) Income-tax Act, 1961

2 Stock Option Nil Nil Nil Nil

3 Sweat Equity Nil Nil Nil Nil

4 Commission Nil Nil Nil Nil- As % of profit- Other,

5 Others, please specify Nil Nil Nil Nil

Total 22,83,068 45,22,321 20,63,880 88,69,269

C. Remuneration to key managerial personnel other than MD/Manager / WTD :

(viii). PENALTIES / PUNISHMENT / COMPOUNDING OF OFFENCES : NIL

Key Managerial Personnal

23


Corporate Governance Report for the year 2015-16

Company’s philosophy on Corporate GovernanceONGC Mangalore Petrochemicals Limited (the Company) is committed to maintain the highest standards ofCorporate Governance in its dealings with its various stakeholders. It is an integral part of the Company’s corevalues which include transparency, integrity and honesty in its dealings. The Company believes in practicinggood Corporate Governance and endeavours to improve on these aspects on an ongoing basis.

Board of DirectorsAs on March 31, 2016, the Board of Directors had ten directors, including a woman director. The Boardcomprises of six Promoter Directors and four Independent Directors. All the Board members are Non-Executive.The Board members possess necessary skills, adequate experience and overall expertise to guide the Company.

The composition of the Board as on 31st March 2016was as under:

Name of the Director Business Relationship Category of DirectorshipShri D K Sarraf Chairman Non-ExecutiveShri H Kumar Director Non-ExecutiveShri M Venkatesh Director Non-ExecutiveShri A K Sahoo Director Non-ExecutiveShri V P Mahawar Director Non-ExecutiveSmt Alka Mittal Director Non-ExecutiveShri I S N Prasad Independent Director Non-ExecutiveShri G M Ramamurthy Independent Director Non-ExecutiveShri Santosh Nautiyal Independent Director Non-ExecutiveShri M M Chitale Independent Director Non-Executive

Changes in the Board of Directors during 2015-16

1. Shri M Venkatesh was appointed as Director w.e.f. 01st April 20152. Shri Ashok Verma was appointed as Director w.e.f. 16th May 2015 and resigned from Board w.e.f. 01st

August 20153. Shri V P Mahawar was appointed as Director w.e.f. 12th August 20154. Smt Alka Mittal was appointed as Director w.e.f. 28th August 20155. Shri Vishnu Agrawal resigned from Board w.e.f 31st January 20166. Shri A K Sahoo was appointed as Director w.e.f. 05th February 2016

Board Meetings held during the year 2015-16.

During the year ended on 31st March 2016, five Board Meetings were held as under:-Date of Meeting Place of Meeting16th May 2015 New Delhi08th July 2015 New Delhi08th August 2015 Mangalore16th November 2015 New Delhi15th March 2016 New Delhi

24


Attendance of Directors at the Board meeting held during the year 2015-16

The attendance at the Board Meetings held during the year ended on 31st March 2016 and at the last AnnualGeneral Meeting are as under:-

Name of the Director No of Attended No of Other No of OutsideMeeting Last AGM Directorship Committee #Attended Public Private Member Chairman

(Held - 5)Shri D K Sarraf 5 Yes 7 - 2 -Shri H Kumar 5 Yes 4 - 1 -Shri Vishnu Agrawal(up to 31.01.2016) 4 Yes - - - -Shri M Venkatesh 4 Yes 3 - 2 -Shri A K Sahoo(from 05.02.2016) 1 NA 2 - 2 -Shri Ashok Verma(between 16.05.2015and 01.08.2015) 2 NA - - - -Shri V P Mahawar(from 12.08.2015) 2 NA 1 - - -Smt Alka Mittal(from 28.08.2015) 2 NA - - - -Shri I S N Prasad 1 No 9 - 9 -Shri G M Ramamurthy 4 Yes 1 1 1 1Shri Santosh Nautiyal 5 Yes 2 - 1 -Shri M M Chitale 1 No 8 1 3 5# Chairmanship/Membership of the Audit Committee and Stakeholders’ Relationship Committee of Public LimitedCompaniesResume of the directors proposed to be re-appointed

The notice of the 10th Annual General Meeting the brief resume of Directors retiring by rotation, AdditionalDirectors seeking appointment and approval for the appointment of independent directors including nature oftheir experience in specific functional areas, names of companies in which they hold directorship and membership/chairmanship of Board/ Committee.

Board Committees

The Company has the following Committees of the Board:

Audit Committee

The Company has listed its Non-convertible Debentures on Bombay Stock Exchange Limited. Hence theprovisions of Chapter III and V of the Securities and Exchange Board of India (Listing ObligationsAnd DisclosureRequirements) Regulations, 2015 are applicable to the Company. Pursuant to Section 177 of the Companies Act2013, the Company has an Audit Committee which was originally constituted on 1st September 2010 and thereafterreconstituted from time to time as a good Corporate Governance Practice. The Audit Committee deals with thematters entrusted by the Board of Directors from time to time which include accounting matters, financialreporting and internal controls. The power, role, delegation, responsibilities and terms of reference of the AuditCommittee have been derived from Section 177 of the Companies Act, 2013 and include the following:

25


A. Overview the company’s financial reporting process and the disclosure of its financial information to

ensure that the financial statement is correct, sufficient and credible;

B. Recommendation relating to remuneration of auditors of the company;

C. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

D. Reviewing, with the management, the annual financial statements and auditor’s report thereon before

submission to the board for approval, with particular reference to;

· Matters required to be included in the Director’s Responsibility Statement in the Board’s report

· Changes, if any, in accounting policies and practices and reasons for the same

· Major accounting entries involving estimates based on the exercise of judgment by management

· Significant adjustments made in the financial statements arising out of audit findings

· Compliance with legal requirements relating to financial statements

· Qualifications in the draft audit report

E. Mandatorily review the following information:

· Management discussion and analysis of financial condition and results of operations;

· Management letters / letters of internal control weaknesses issued by the statutory auditors;

· Internal audit reports relating to internal control weaknesses; and· The appointment, removal and terms of remuneration of the internal auditor shall be subject to review

by the Audit Committee.F. Reviewing, with the management, the quarterly financial statements before submission to the board

for approval;

G. Evaluation of internal financial controls and risk management systems;

H. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the

internal control systems;

I. 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;

J. Holding discussion with internal auditors of any significant findings and follow up there on;

K. 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;

L. Holding discussion with statutory auditors before the audit commences, about the nature and scope of

audit as well as post-audit discussion to ascertain any area of concern;

M. Looking into the reasons for substantial defaults in the payment to the depositors, debenture holders,

shareholders (in case of non-payment of declared dividends) and creditors;

N. Reviewing the functioning of the Whistle Blower mechanism;

O. Considering and reviewing the following with the management, internal auditor and the independent

auditor:26


· Significant findings during the year, including the status of previous audit recommendations· Any difficulties encountered during audit work including any restrictions on the scope of

activities or access to required information,P. Investigating into any matter in relation to the items specified above or referred to it by the Board and

it shall have power to obtain professional advice from external sources and have full access to

information in the records and to seek information from any employee.

Q. Reviewing and monitoring the auditor’s independence and performance, and effectiveness of audit

process;

R. Granting approval or any subsequent modification of transactions of the company with related parties;

S. Monitoring the end use of the funds raised through public offers and related matters;

T. Scrutinising inter-corporate loans and investments;

U. Carrying out valuation of undertakings or assets of the company, wherever it is necessary;

The information pertaining to composition of the Audit Committee, number of meetings held and attendancesthere by the Members of the Audit Committee meeting held in 2015-16 have provided herein below:

Name of Director Designation No. of MeetingAttended (Held = 6)

Shri G M Ramamurthy Chairman 5Independent Director Shri A K Sahoo Director(w.e.f. 05th February 2016) Member 1Shri Vishnu Agrawal Member 4Director (up to 31st January 2016) Shri Santosh Nautiyal Member 6Independent Director

The Members of the Audit Committee elect Chairman of the meeting. All the Members are Non- ExecutiveDirectors.

Six meetings of the Audit Committee were held during the year 2015-16:

Date of Meeting Place of meeting16th May 2015 New Delhi22nd May 2015 New Delhi08th July 2015 New Delhi07th August 2015 Mangalore16th November 2015 New Delhi02nd March 2016 Mangalore

The Internal Auditors and Statutory Auditors of the Company were invited to the meeting. The CompanySecretary acts as the Secretary to the Audit Committee.

Nomination and Remuneration Committee

The Company has constituted Nomination and Remuneration Committee on 28th March 2015 in terms ofSection 178 of the Companies Act, 2013. The terms of reference, inter alia, includes the following:

27


· To identify 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 for their appointment

and removal.

· To recommend to the Board a policy, relating to the remuneration for the directors, KMP and other

employees.

· To formulate a policy which ensures that

· The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate

directors of the quality required to run the company successfully;

· Relationship of remuneration to performance is clear and meets appropriate performance benchmarks;

and

· Remuneration to directors, KMP and senior management involves a balance between fixed and incentive

pay reflecting short and long-term performance objectives appropriate to the working of the company

and its goals.

· To carry out evaluation of every director’s performance.

· To formulate the criteria for determining qualifications, positive attributes and independence of a

directorThe information pertaining to composition of the Members of the Nomination and Remuneration Committeehave provided herein below:

The Committee consists Shri. G M Ramamurthy, Shri. Santosh Nautiyal, Independent Directors and Shri.HKumar, Director as its members.

The Members of the Nomination and Remuneration Committee elect Chairman of the meeting. All the Membersare Non- Executive Directors. The Committee has not met during 2015-16. The Company Secretary acts as theSecretary to the Audit Committee.

Corporate Social Responsibility CommitteeIn terms of Section 135 of the Companies Act, 2013 it is necessary to constitute a Corporate Social ResponsibilityCommittee to oversee the CSR activities. Accordingly, Corporate Social Responsibility Committee wasconstituted with Shri. G M Ramamurthy, Independent Director, Shri. H Kumar and Shri. M Venkatesh, Directorsas its members by the Board of Directors in its 52nd meeting held on March 15, 2016.

The terms of reference, inter alia, includes the following:

· To formulate and recommend to the Board, a Corporate Social Responsibility (CSR) Policy indicatingactivities to be undertaken by the Company in compliance with provisions of the Companies Act, 2013 andrules made thereunder

· To recommend the amount of expenditure to be incurred on the CSR activities

· To monitor the implementation of the CSR Policy of the Company from time to time

The CSR Policy was approved by the Board on August 01, 2016 and is uploaded on the Company’s website.The Committee has not met during 2015-16. As the Company commenced its commercial operation during

28


2014-15 and was not having positive average profits during the immediately preceding three financial years,the Company has not spent any amount on CSR activities.

Committee of DirectorsThe Board of Directors of the Company constituted a Committee of Directors on 26th November 2009 to lookinto, deliberate and approve high value contracts, negotiate with the short-listed parties and to resolve variousissues regarding pricing, payment mechanism, guarantees, support etc.

The composition of the Committee of Directors during the year under review and the details of meetingsattended by the Members of the Committee are given below:

Name of Director Designation No. of meetings attended (Held = 4)

Shri Santosh Nautiyal Member 3Shri G M Ramamurthy Member 4Shri Vishnu Agrawal(up to 31st January 2016) Member 2Shri H Kumar Member 3Shri A K Sahoo (since 05th February, 2016) Member 1

The Members of the Committee of Directors elect Chairman of the meeting. All the Members of theCommittee of Directors are Non- Executive Directors.

Four meetings of the Committee of Directors were held during the year 2015-16 as under:

Date of Meeting Place of meeting16th May 2015 New Delhi08th July 2015 New Delhi31st December 2015 Mangalore02nd March 2016 MangaloreThe Company Secretary acts as the Secretary to the Committee of Directors.

Remuneration to Directors

All the Directors on the Board of Directors of the Company are Non-executive Directors. Sitting fees ofRs.10,000/- for each meeting were paid for attending the meetings of the Board of Directors and Committeemeetings to the Independent Directors.

Details of Sitting Fees paid during the year 2015-16 are as follows:

Directors Sitting Fees in Rs.Shri I S N Prasad -Shri G M Ramamurthy 1,60,000Shri Santosh Nautiyal 1,70,000Shri M M Chitale 10,000

29


Annual General Meetings (AGM)

The details of the last three Annual General Meetings of the Company are as under:

General Shareholder Information

Company Registration Details

The Company is registered in the State of Karnataka, India. The Corporate Identification Number (CIN) allottedto the Company by the Ministry of Corporate Affairs (MCA) is U40107KA2006PLC041258.

The Annual General Meeting is scheduled to be held on: September 03, 2016.

Financial Calendar:

Adoption of Half yearly results for the period ending Tentative date of the meeting of the Board

30th September 2016 (unaudited) November 07, 2016

31st March 2017 (audited) May 12, 2017

These dates are tentative and subject to change and the last date for submission of the unaudited half yearlyand year to date financial results to the stock exchange is within forty-five days of end of the quarter (exceptthe last quarter). The last date for submission of the financial results of the last quarter is within sixty daysfrom the end of the financial year.

Book Closure: None

Registrars/Transfer Agents (for shares): In-house by Secretarial Department

Registrars/Transfer Agents (for NCDs): Ms/ Link Intime India Private LimitedC-13,Pannalal Silk Mills Compound,L.B.S Marg, Bhandup (West),Mumbai-400 078Tel No.: 022-25963838 / 25946970Fax No.: 022-25946969E-mail: [email protected]

Listing on Stock Exchanges:

The Non-convertible Debentures (NCDs) are listed on the Wholesale Debt Market (WDM) segment of BombayStock Exchange Limited and the details are as below:

Financial YearEnded

Date of AGM Time Venue Specialresolutions

passed

31st March 2015 08th August 2015 14.30 pm Registered office atPermude,Mangalore

Offer or invitation forsubscription for Non-Convertible Debentures(NCDs) aggregating toRs.2,500 Cr on privateplacement.

31st March 2014 13th September 2014 12.30 pm Registered office atPermude, Mangalore

No Special Resolution waspassed in the meeting.

31st March 2013 23th September 2013 12.00 Noon. Registered office atPermude, Mangalore

Appointment of StatutoryAuditors.

30


Name and address Telephone/Fax/E-Mail/Website ID Trading symbolBSE Limited (BSE) Telephone:022-22721233/4 84ONGC19Phiroze Jeejeebhoy Towers, Fax: 022-22721919 812ONGCMP19Dalal Street, Mumbai 400 001 E-mail:[email protected]

Website:www.bseindia.com

Scrip Code

8.4% Debentures: 9533808.12% Debentures: 954148

Listing Fee

Annual listing fee for the year 2016-17, as applicable, has been paid to BSE.

Demat ISIN Number in NSDL & CDSL

8.4% Debentures: INE053T070188.12% Debentures: INE053T07026

Custody fee of NSDL and CDSL has been paid for the financial year 2016-17.

Details of the Debenture Trustees

Axis Trustee Services LimitedAxis house, Ground Floor, Wadia International center,Panduranga Budhkar Marg, Worli, Mumbai – 400 025Tel No.: 022 24255215 / 022 24255216, Fax No.: 022–4325 3000Email: [email protected]

Address for correspondence

Investor CorrespondenceFor Shares/Debentures held in Physical/demat form

Shri K B Shyam KumarCompany SecretaryONGC Mangalore Petrochemicals LimitedMSEZ, Permude, Mangalore – 574 509Phone : 0824-2881576, Fax:0824-2881539Email: [email protected] / [email protected]

Shareholding Pattern as on 31st March 2016:

Sr. No. Name of Shareholder No. of Shares % of Shareholding

1 M/s Oil and Natural Gas Corporation Limited (ONGC) 92,00,00,000 48.9981

2 M/s Mangalore Refinery and Petrochemicals Limited (MRPL) 95,76,21,500 51.0017

3 Others (Individuals) 4,000 0.0002

TOTAL 187,76,25,500 100

31


Means of communication

Half yearly/Annual Results: The Company regularly intimated un-audited as well as audited financial resultsto the Stock Exchange, immediately after they were approved. These financial results were normally publishedin the leading English daily having wide circulation across the country. The results are also displayed on thewebsite of the Company http://ompl.co.in.

Website: The Company’s website http://ompl.co.in contains separate dedicated section ‘Financials’ whereininformation for shareholders/ debenture holders is available.

Annual Report: Annual Report containing inter-alia, Audited Accounts, Board’s Report, Corporate GovernanceReport, Auditor’s Report including information for the shareholders and other important information is circulatedto the members and others entitled thereto.

SEBI Complaints Redress System (SCORES): The investor complaints were processed in a centralisedweb-based complaints redress system. The salient features of this system are: Centralised database of allcomplaints, online upload of Action Taken Reports (ATRs) by concerned companies and online viewing byinvestors of actions taken on the complaint and its current status.

Designated Exclusive email-id: The Company has designated the following email-id exclusively for investorservicing:

[email protected]

Transfer to Investor Education and Protection Fund (IEPF)

The Company has not accepted any deposits from the public and also the Company has not declared anydividend since its incorporation. Interest on debentures were paid to their holders and no amount is lying asunclaimed. Therefore, there were no amounts which remained unpaid/unclaimed for a period of seven yearsand which were required to be transferred by the Company to the Investor Education and Protection Fundestablished by the Central Government pursuant to Section 124 of the Companies Act, 2013.

Code of Conduct

Your Company has framed its own Code of Conduct for the members of the Board of Directors and seniormanagement personnel of the Company.

Fee to Statutory Auditors

The fee paid / payable to the Statutory Auditors for the year was Rs. 3,00,000 (previous year Rs. 3,00,000Lakh) for Statutory Audit Rs. 3,20,000 for certification services Rs. 2,50,000 for tax audit plus reasonabletravelling and out of pocket expenses actually incurred / reimbursable.

Disclosures

There were no significant related party transactions i.e. transactions of the Company of a material nature, withits promoters, the directors or the key managerial personnel or their subsidiaries or relatives, etc., that mayhave potential conflict with the interests of the Company at large.

Compliances

The Company has complied with applicable rules (except as otherwise stated in this report) and the requirementof regulatory authorities on capital market and no penalties or strictures were imposed on the Company duringlast three years. All returns / reports were filed within stipulated with time stock exchange / other authorities.

Plant LocationMSEZPermudeMangalore - 574509

32


COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION143(6)(b) OF THE COMPANIES ACT, 2013 ON THE FINACIAL STATEMENTS OF ONGCMANGALORE PETROCHEMICALS LIMITED, FOR THE YEAR ENDED 31 MARCH 2016

The preparation of financial statements of ONGC Mangalore Petrochemicals Limited, for the year

ended 31 March 2016 in accordance with the financial reporting framework prescribed under the Companies

Act, 2013 (Act) is the responsibility of the management of the company. The statutory auditors appointed by

the Comptroller and Auditor General of India under section 139(5) of the Act are responsible for expressing

opinion on the financial statements under section 143 of the Act based on independent audit in accordance

with standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by

them vide their modified Audit Report dated 06.06.2016.

I, on the behalf of the Comptroller and Auditor General of India, have conducted a supplementary

audit under section 143(6)(a) of the Act of the financial statements of ONGC Mangalore Petrochemicals

Limited, Mangaluru for the year ended 31 March 2016. This supplementary audit has been carried out

independently without access to the working papers of the statutory auditors and is limited primarily to inquiries

of the statutory auditors and company personnel and a selective examination of some of the accounting records.

On the basis of my audit nothing significant has come to my knowledge which would give rise to any comment

upon or supplement to statutory auditors’ report.

For and on the behalf of theComptroller & Auditor General of India

Sd/-(G.SUDHARMINI)

Principal Director of Commercial Audit &Ex Officio Member Audit Board

Place : ChennaiDate : 24.06.2016

33


Independent Auditor’s Report

To The Members of ONGC Mangalore Petrochemicals Limited, Mangaluru.

Report on the Standalone Financial StatementsWe have audited the accompanying financial statement of ONGC Mangalore Petrochemicals Limited (“theCompany”), which comprises the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, theCash Flow Statement for the year then ended, and a summary of the significant accounting policies and otherexplanatory information.

Management’s responsibility for the Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the CompaniesAct, 2013 (“the Act”) with respect to the preparation of these financial statements that give a true and fair viewof the financial position, financial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India, including the Accounting Standards specified under Section 133 Act,read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenanceof adequate accounting records in accordance with the provision of the Act for safeguarding of the assets ofthe Company and for preventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design,implementation and maintenance of internal financial control, that were operating effectively for ensuring theaccuracy and completeness of the accounting records, relevant to the preparation and presentation of thefinancial statements that give a true and fair view and are free from material misstatement, whether due to fraud orerror.

Auditor’s 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 whichare required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of theAct. Those Standards require that we comply with ethical requirements and plan and perform the audit toobtain 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 disclosures in thefinancial statements. The procedures selected depend on the auditor’s judgment, including the assessment ofthe risks of material misstatement of the financial statements, whether due to fraud or error. In making thoserisk assessments, the auditor considers internal financial control relevant to the Company’s preparation of thefinancial statements that give true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by Company’s Directors, as well as evaluating the overallpresentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinion on the financial statements.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the aforesaidstandalone financial statements give the information required by the Act in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted in India, of the state ofaffairs of the Company as at 31st March 2016, and its loss and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

34


1. As required by the Companies (Auditor’s Report) Order, 2016, issued by the Central Government ofIndia in terms of sub-section (11) of section 143 of the Companies Act, 2013 of India (the Act) and on thebasis of such checks of the books and records of the company as we considered appropriate and accordingto the information and explanations given to us, we give the “Annexure A”, a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. Based on the verification of Records of the Company and based on information and explanations given tous, we give below a report on the Directions issued by the Comptroller and Auditor General of India interms of Sec 143(5) of the Companies Act, 2013 :a. The Company has clear title deeds for leasehold land held by the company.b. There is no case of waiver /write -off of debts/loans/interest etc. during the year.c. There is no inventory lying with the third party and no asset is received as gift/grant(s) from

Government or other authorities.3. As required by section 143(3) of the Act, we report that :

a. We have sought and obtained all the information and explanations which to the best of our knowledgeand belief were necessary for the purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by the Company so far asappears from our examination of those books;

c. The Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement dealt with by thisReport are in agreement with the books of account;

d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standardsspecified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e. On the basis of the written representations received from the directors as on 31 March 2016 takenon record by the Board of Directors, none of the directors is disqualified as on 31 March 2016 frombeing appointed as a director in terms of Section 164 (2) of the Act;

f. With respect to the adequacy of the internal financial controls over financial reporting of the Companyand the operating effectiveness of such controls, refer to our separate report in “Annexure B”; and

g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our informationand according to the explanations given to us:

i. The Company has no pending litigations which has material impact of on its financial position.ii. The Company has made provision, as required under the applicable law or accounting standards,

for the material foreseeable losses, if any and as required on the long term contracts includingderivative contracts.

iii. There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Company.

We refer to our audit report dated 12 May 2016 already issued on the above referred Balance Sheet as on 31March 2016, the Statement of Profit and Loss, the Cash Flow Statement. The said report is suitably amendedto comply with the observations of the Comptroller and Auditor General of India in connection with thereferences made in respect of the Auditor’s Report. There is no change in the Balance Sheet, the Statement ofProfit and Loss and the Cash Flow Statement referred in our report dated 12 May 2016.

For Manohar Chowdhry & AssociatesChartered AccountantsFirm Registration Number: 001997S

CA Murali MohanPartner, Membership Number: 203592

Place: MangaluruDate: 06 June 2016

35


Annexure A to the Auditors’ ReportThe Annexure referred to in Independent Auditors’ Report to the members of the Company on the standalonefinancial statements for the year ended 31 March 2016, we report that:

a. The Company has maintained proper records showing full particulars, including quantitative detailsand situation of fixed assets.

b. The Company has a regular programme of physical verification of its fixed assets by which fixedassets are verified in a phased manner. In accordance with this programme, certain fixed assets wereverified 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 thenature of its assets.

c. According to the information and explanations given to us and on the basis of our examination of therecords of the Company, the title deeds of immovable properties are held in the name of the Company.

ii. a. As explained to us, physical verification of inventories has been conducted by the management atreasonable intervals.b. In our opinion and according to the explanation given to us, the procedures of physical verificationof inventory followed by the management are reasonable and adequate in relation to the size of thecompany and the nature of its business.c. In our opinion and according to the information and explanation given to us, the company ismaintaining proper records of inventory and no material discrepancies were noticed on physicalverification.

iii. According to the information and explanations given to us, the Company has not granted any loans tocompanies, firms or other parties covered in the Register maintained under Section 189 of the CompaniesAct, 2013; and therefore paragraph 3(iii) of the Order is not applicable.

iv. In our opinion and according to the information and explanations given to us, the Company has compliedwith 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, within the meaning of Section 73 to 76or any other relevant provisions of the Act and Rules framed there under.

vi. As the Company is a SEZ unit, they are exempt from Cost audit regulations as per Circular No 11/2012of the Ministry of Corporate Affairs and hence a cost audit is not performed.

vii. a. According to the information and explanations given to us and on the basis of our examination of therecords of the Company, the company has been generally regular in depositing undisputed statutorydues including provident fund, income-tax, sales tax, value added tax, duty of customs, service tax,cess and other material statutory dues with the appropriate authorities during the year. According tothe information and explanations given to us, there are no arrears of undisputed statutory dues ofmaterial nature outstanding for a period of more than six months from the date they became payable.b. According to the information and explanations given to us, there are no dues of duty of customs,Income tax, sales tax, duty of excise, service tax and value added tax which have not been depositedwith the appropriate authorities on account of any dispute.

viii.In our opinion and according to the information and explanations given to us, the Company has notdefaulted in the repayment of dues to financial institutions, banks and debenture holders.

ix. In our opinion and according to the information and explanations given to us, the Company, has notraised any money by way of initial public offer or further public offer (including debt instruments).Theterm loans were applied for the purposes for which those are raised.

x. According to the information and explanations given to us, no fraud by the Company or on the Companyby its officers or employees has been noticed or reported during the course of our audit.

xi. According to the information and explanations give to us and based on our examination of the recordsof the Company, the Company has paid/provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

36


xii. In our opinion and according to the information and explanations given to us, the Company is not aNidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

xiii.All transactions with the related parties are in compliance with sections 177 and 188 of CompaniesAct, 2013 where applicable and the details have been disclosed in the Financial Statements etc. asrequired by the applicable accounting standards.

xiv. According to the information and explanations give to us and based on our examination of the recordsof the Company, the Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order isnot applicable.

xv. According to the information and explanations given to us and based on our examination of the recordsof the Company, the Company has not entered into non-cash transactions with directors or personsconnected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

xvi.The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act1934.


CA Murali MohanPartner, Membership Number: 203592Place : MangaluruDate : 06 June 2016

Annexure - B to the Auditors’ ReportReport on the Internal Financial Controls under Clause (i) of Sub-section 3 of section 143 ofthe Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of ONGC MangalorePetrochemicals Limited (“the Company”) as of 31 March 2016 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial ControlsThe Company’s management is responsible for establishing and maintaining internal financial controlsbased on the internal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’).These responsibilities include the design, implementation and maintenance of adequate internal financialcontrols 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 detectionof frauds and errors, the accuracy and completeness of the accounting records, and the timely preparationof reliable financial information, as required under the Companies Act, 2013.

Auditors’ ResponsibilityOur responsibility is to express an opinion on the Company’s internal financial controls over financialreporting based on our audit. We conducted our audit in accordance with the Guidance Note on Auditof Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards onAuditing, 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 ofInternal Financial Controls and, both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether adequate internal financial controls

37


over financial reporting was established and maintained and if such controls operated effectively in allmaterial respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding of internal financialcontrols over financial reporting, assessing the risk that a material weakness exists, and testing andevaluating the design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor’s judgment, including the assessment of the risks of materialmisstatement 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 forour audit opinion on the Company’s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial ReportingA company’s internal financial control over financial reporting is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accounting principles. Acompany’s internal financial control over financial reporting includes those policies and proceduresthat

(1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflectthe transactions and dispositions of the assets of the company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparationof financial statements in accordance with generally accepted accounting principles, and thatreceipts and expenditures of the company are being made only in accordance with authorisationsof management and directors of the company; and

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition, use, or disposition of the company’s assets that could have a material effect on thefinancial statements.

Inherent Limitations of Internal Financial Controls Over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, includingthe possibility of collusion or improper management override of controls, material misstatements dueto error or fraud may occur and not be detected. Also, projections of any evaluation of the internalfinancial controls over financial reporting to future periods are subject to the risk that the internalfinancial control over financial reporting may become inadequate because of changes in conditions, orthat the degree of compliance with the policies or procedures may deteriorate.

OpinionIn our opinion, the Company has, in all material respects, an adequate internal financial control systemover financial reporting and such internal financial controls over financial reporting were operatingeffectively as at 31 March 2016, based on the internal control over financial reporting criteria establishedby the Company considering the essential components of internal control stated in the Guidance Noteon Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.


CA Murali MohanPartner, Membership Number: 203592Place : MangaluruDate : 06 June 2016

38


BALANCE SHEET AS AT 31ST MARCH 2016

Note No. As at 31st March 2016 As at March 2015

EQUITY AND LIABILITIESShareholder’s FundsShare Capital 2 18,776.26 18,776.26Reserves and Surplus 3 -14,074.13 -5,320.61

4,702.13 13,455.65Non Current LiabilitiesLong-Term Borrowings 4 21,594.10 38,845.44Other Long Term liabilities 5 - 953.10Long-term Provisions 6 40.34 19.45

21,634.44 39,817.99Current LiabilitiesShort-term borrowings 7 38,276.25 15,367.10Trade Payables 8 4,701.13 2,365.79Other Current Liabilities 9 7,286.31 6,921.81Short-term Provisions 10 2.44 50,266.13 1.63 24,656.33

Total 76,602.70 77,929.97ASSETSNon-current AssetsFixed AssetsTangible assets 12(i) 67,409.08 69,243.71Intangible assets 12(ii) 44.47 80.81Capital Work-in-Progress 13 99.03 111.84

67,552.58 69,436.36Non-current investments 14 4.80 4.80Long-term loans and advances 15 934.37 68,491.75 1,566.22 71,007.38

Current AssetsInventories 16 2,202.41 4,234.17Trade Receivable 17 1,593.95 626.17Cash & Cash Equivalents 18 962.11 1.19Short-term loans and advances 19 3,349.69 2,061.06Other Current Assets 20 2.79 8,110.95 - 6,922.59

Total 76,602.70 77,929.97Contingent Liabilitiesand Commitments 21Significant Accountants Policies 1See accompanying notes to the Financial StatementsAs per our report attachedFor Manohar Chowdhry & AssociatesChartered Accountants(Firm’s Registration No. 1997S)

For ONGC Mangalore Petrochemicals Limited

Murali MohanPartnerMembership No.203592

K.B. Shyam KumarCompany Secretary

A.K. SahooDirectorDIN : 07355933

H. KumarDirectorDIN : 06851988

in millions in millions

Place : BengaluruDate : 12th May 2016

Place : BengaluruDate : 12th May 2016

Sushil K. ShenoyChief Financial Officer & CEO I/c

39


ONGC MANGALORE PETROCHEMICALS LIMITEDSTATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH 2016

Note No.

RevenueRevenue from Operations 24 41,875.74 17,238.91Other Income 25 12.93 43.59

Total Revenue 41,888.67 17,282.50

ExpensesCost of Materials Consumed 26 36,043.37 18,737.49Increase(-)/Decrease in Stock 27 1,257.97 102.49Employee Benefits Expense 28 377.38 138.29Finance Cost 29 4,869.59 2,556.78Depreiation and Amortisation 30 3,087.38 1,353.51Other Expenses 31 5,006.50 3,536.93

Total Expenses 50,642.19 26,425.49

Profit (Loss) before exceptional and extraordinary items and tax (8,753.52) (9,142.99)Exceptional and extraordinary items - -Profit (Loss) before taxes (8,753.52) (9,142.99)Tax expenses:Current Tax 11 - -Deferred Tax 11 - -Profit/(Loss) for the year (8,753.52) (9,142.99)

Earning per share (basic / diluted )(in ) 32 (4.66) (8.67)

Face value per equity share (in ) 10.00 10.00

See accompanying notes to the Financial Statements

As per our report attachedFor Manohar Chowdhry & AssociatesChartered Accountants(Firm’s Registration No. 1997S)

For ONGC Mangalore Petrochemicals Limited

Murali MohanPartnerMembership No.203592



Place: BengaluruDate: 12th May 2016


For the yearended

31st March 2016

For the yearended

31st March 2015 in millions in millions

A.K. SahooDirectorDIN : 07355933


40


A. CASH FLOW FROM OPERATING ACTIVITIES:Profit before tax (8,753.52) (9,142.99)Adjustments for :Depreciation /Amortisation 3,087.38 1,353.51Interest Expense 4,633.40 2,556.77Interest Income (4.31) (12.39)Dividend income (5.08) (10.58)Foreign Currency Translation - Net 1,260.60 257.17Adjustments for :Trade Receivables (967.78) (626.17)Trade Payables 2,335.34 1,902.19Inventories 2,031.75 (2,880.06)Cash generated / (used in) 3,617.78 (6,602.55)Direct Taxes paid (net) 1.97 (1.78)Net cash flow from / (used in) 3,619.75 (6,604.33)

B. CASH FLOW FROM INVESTING ACTIVITIES:Dividend income received 5.08 10.58Interest Income Received 1.52 14.63Purchase of Fixed Assets (4,765.67) (16,091.74)Sale of Fixed Assets 267.95 0.05Net cash flow from / (used in) investing activities (4,491.12) (16,066.48)

C. CASH FLOW FROM FINANCING ACTIVITIES:Proceeds from Equity - 12,723.37Proceeds from Non-Convertible Debenture 5,000.00 -Proceeds from External Commercial Borrowing 1,119.29 1,840.74Proceeds from Rupee Term Loan 407.00 3,043.55Proceeds from Short Term Loan 103,555.25 27,180.37Repayment of Rupee Term Loan (21,607.34) -Repayment of Buyers Credit (1,775.33) (743.94)Repayment of External Commercial Borrowing (2,569.04) (1,116.16)Repayment of Short Term Loan (78,971.74) (18,465.94)Interest and finance charges paid (4,275.80) (2,849.58)Net cash flow from / (used in) financing activities 882.29 21,612.41Net Increase/ (Decrease) in cash and cash equivalents 10.92 (1,058.40)Cash and cash equivalent at the beginning of the year 1.19 1,059.59Cash and cash equivalent at the end of the year 12.11 1.19

NOTES:1) Cash Flow statement has been prepared under the Indirect Method as set out in the Accounting Standard 3; “ Cash Flow Statement”as per Companies (Accounting Standard) Rules, 2014.2) Purchase of fixed assets includes movement of Capital Work-in-progres during the year.3) Cash and cash equivalents include cash and bank balances and short-term highly liquid investments but excludes balances indeposit accounts under lien with Banks.4) Previous year figures have been re-grouped / re-classified wherever necessary to conform to the current year’s presentation.

ONGC MANGALORE PETROCHEMICALS LIMITEDCASHFLOW STATEMENT FOR THE YEAR ENDED 31ST MANRCH 2016

For the yearended

31st March 2016

For the yearended

31st March 2015

As per our report attachedFor Manohar Chowdhry & AssociatesChartered Accountants(Firm’s Registration No. 1997S)

For ONGC MangalorePetrochemicals LimitedA.K. SahooDirectorDIN : 07355933


Murali MohanPartnerMembership No. 203592



in millions in millions



41


NOTES ACCOMPANYING FINANCIAL STATEMENTS

1. Significant Accounting Policies

a) Accounting Conventions and Basis of Presentation/Accounting

i) The financial statements are prepared under the historical cost convention, in accordance withthe Generally Accepted Accounting Principles (GAAP), the provisions of the Companies Act,2013 including the Accounting Standards specified under Section 133 of the Act , read withRule 7 of the Companies(Accounts) Rules,2014.

ii) All income and expenses to the extent considered receivable/payable with reasonable certaintyare accounted for on accrual basis.

b) Use of Estimates

The preparation of financial statements requires estimates and assumptions to be made that affect thereported amount of assets and liabilities on the date of the financial statements and the reportedamount of revenues and expenses during the reporting period. The difference between the actualresults and estimates are recognised in the period in which the results are known/materialised.

c) Cash flow statement

Cash Flow Statement has been prepared in accordance with the indirect method prescribed inAccounting Standard-3 specified under Section 133 of the Companies Act, 2013 read with Rule 7 ofthe Companies (Accounts) Rules, 2014.

d) Fixed assets

i) Tangible Assets

a. Leasehold Land is stated at historical cost less amortisation.

b. Other Fixed Assets are stated at historical cost less accumulated depreciation/amortisationand impairment.

c. Spares received along with the Plant or Equipment and those purchased subsequently forspecific machinery and having irregular use are capitalised.

d. During the period of construction, directly identifiable expenses are capitalised at the firstinstance and all other allocable expenses are capitalised proportionately on the basis of thevalue of assets.

e. Cost for this purpose includes purchase prices, taxes and duties (net of cenvat), incidentalexpenses, erection/commissioning expenses, technical knowhow fee, professional fee, interestupto the date the asset is put to use and exchange rate differences arising on long term foreigncurrency monetary items in so far as they relate to the acquisition of depreciable assets, etc.

ii) Intangible assets

Cost incurred on intangible asset, resulting in future economic benefits are capitalised as intangibleassets and amortised on equated basis over the estimated useful life of such assets.

e) Impairment

Impairment of cash generating units/assets is ascertained and considered where the carrying costexceeds the recoverable amount being the higher of net realisable amount and value in use.

42


f) Depreciation and amortization

i) Depreciation on Fixed Assets (including those taken on lease)is provided on Straight LineMethod, at the rates and in the manner specified in Schedule II to the Companies Act, 2013.Depreciation for additions to / deductions from tangible assets is calculated pro-rata from/tothe month of additions / deductions.

ii) Cost of leasehold land is amortised over the lease period.

iii) Depreciation on amounts capitalized on account of foreign exchange fluctuation is providedprospectively over residual life of the assets.

iv) Depreciation on spares, having irregular use and purchased subsequent to the installation ofspecific machinery is provided prospectively over residual life of the specific machinery andwritten down value of the spare is charged to Statement of Profit and Loss as and when replaced.

v) Intangible assets are amortized on Straight Line Method (SLM) over the useful life not exceedingthree years from the month of capitalisation.

g) Investments

i. Long term investments are valued at cost. Provision for diminution is made to recognise adecline, other than temporary in value of long term investments and is determined separatelyfor each individual investment.

ii. Current investments are valued at lower of cost and fair value.

h) Inventories

Inventories are valued at lower of cost and net realisable value. Cost of inventories comprises ofpurchase cost and other costs incurred in bringing inventories to their present location andcondition. The cost has been determined as under:

1. Raw material - on First in First out (FIFO) basis.

2. Finished Products – at Raw material, Conversion Cost.

3. Stock-in-Process – at Raw Material and Proportionate Conversion Cost.

4. Stores, Spares, Chemicals and other trading Goods- on weighted average cost.

i) Revenue Recognition

i) Sales are recognised on transfer of custody of goods to customers and includes all statutorylevies except Value Added Tax (VAT) and is net of discounts.

ii) Dividend income is recognised when the right to receive is established.

iii) Interest income is recognised at agreed rates on time proportion basis.

iv) Revenue from sale of scrap are recognised on transfer of custody of goods to customers.

v) Revenue in respect of Liquidated Damages from contractors/suppliers is recognised whendetermined as not payable.

j) Leases

Assets acquired on lease where a significant portion of the risks and rewards of ownership are retainedby the lessor are classified as operating leases. Lease rentals are charged to the Statement of Profit andLoss on accrual basis.

k) Taxes on income

i. Current tax is determined on the basis of taxable income and tax credits computed in accordancewith the provisions of the Income-tax Act, 1961.

43


ii. Deferred tax is recognized on timing differences between the taxable and accounting income/expenditure that originates in one period and are capable of reversal in one or more subsequentperiod(s)are quantified using the tax rates and laws enacted or substantively enacted as at theBalance Sheet date. Deferred Tax Asset is recognised on the basis of virtual/reasonable certaintyabout its realisability, as applicable.

iii. The Carrying amount of Deferred Tax Assets are reviewed at each Balance Sheet date.

l) Provisions, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognised when there is apresent obligation as a result of past events and it is probable that there will be an outflow of resources.Contingent liabilities, if material, are disclosed by way of notes. Contingent Assets are neitherrecognised nor disclosed. Provisions, Contingent Liabilities and Contingent Assets are reviewed ateach Balance Sheet date.

m) Foreign Currency Transactions

i) Foreign currency transactions are accounted for at the exchange rate prevailing on the date ofthe transactions.

ii) The foreign currency monetary assets/liabilities are translated using the exchange ratesprevailing at the reporting date.

iii) The exchange differences on settlement/translation of foreign currency transaction on thereporting date are recognised as income or expenses and adjusted to the Statement of Profitand Loss except the exchange difference arising on reporting of long term foreign currencymonetary items relating to the acquisition of depreciable capital assets, which are adjusted tothe cost of the assets.

n) Employee Benefits

i) All Short Term Employee Benefits i,e company’s contribution to Provident Fund scheme istreated as defined contribution plan. The contribution paid / payable under these schemes /contractual obligations are recognized during the period in which the employees render therelated services. The contributions are made to the funds managed and administered byGovernment of India. The Company’s contribution during the period is charged to the Statementof Profit and Loss.

ii) Employee benefits under defined benefit plans comprising of Gratuity and CompensatedAbsences are recognized based on the present value of Defined Benefit Obligation, which iscomputed on the basis of actuarial valuation using the Projected Unit Credit Method. Actuarialliability in excess of respective plan assets in respect of gratuity is recognised during the year.

iii) Actuarial gains and losses are recognised immediately in the Statement of Profit and Loss.

o) Borrowing Costs

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assetare capitalized as part of the cost of such asset, till such time as the asset is ready for its intended useor sale. A qualifying asset is an asset that necessarily takes a substantial period of time (generallytwelve months) to get ready for its intended use or sale. All other borrowing costs are charged to theStatement of Profit and Loss.

p) Share Issue Expenses

Expenses incurred on share issue are debited to Securities Premium Account.

44


2. Share Capital: a) Particulars of authorised, issued, subscribed and paid up share capital

Particulars As at 31st March 2016 As at 31st March 2015

Authorised Share Capital200,00,00,000 Equity Shares of 10 each 20,000.00 20,000.00Issued Share Capital200,00,00,000 Equity Shares of 10 each 20,000.00 20,000.00Subscribed & Paid up Share Capital1,87,76,25,500 (1,87,76,25,500) Equity Shares of 10 each fully paid up 18,776.26 18,776.26

b) The Company has issued only one class of Equity Shares and no securities have been issued with the right / option toconvert the same into equity.No Shares have been reserved for issue under options and contracts/ commitments for the sale of shares/disinvestment.The shares issued carry equal rights and voting power.All the shares issued carry equal right of dividend declared by the company and no restrictions are attached to anyspecific shareholder.

c) Movement of Share Capital

Particulars Equity SharesNumber

Shares outstanding at the beginning of the year 1,877,625,500 18,776.26Shares Issued during the year - -Shares bought back the year - -Shares outstanding at the end of the year 1,877,625,500 18,776.26

d) Shareholding pattern – Details of shareholders holding more than 5% shareholding in the Company are as under

Name of Shareholder As at 31st March 2015

No. of Shares held % of Holding

Mangalore Refinery and Petrochemicals Ltd. 95,76,21,500 51.0017% 95,76,21,500 51.0017%Oil and Natural Gas Corporation Ltd 92,00,00,000 48.9981% 92,00,00,000 48.9981%

3. Reserves and Surplusa) Securities Premium Account

As at 31st March 2016No. of Shares held % of Holding


Balance as at the beginning of the year 3,747.37 -Add : Premium received during the year - 3,769.92Less: Utilised towards share issue expense - 22.55Balance as at the end of the year 3,747.37 3,747.37

b) Statement of Profit & Loss


Surplus (17,821.50) (9,067.98)

Total (14074.13) (5,320.61)

in Millions in Millions

in Millions



45


Particulars in Millions

As at 31st March 2016 As at 31st March 2015

SurplusBalance as at the beginning of the year (9,067.98) 75.01Transfer from Statement of Profit and Loss (8,753.52) (9,142.99)Balance as at the end of the year (17,821.50) (9,067.98)

c) Movement of Reserves and surplus


Secured DebenturesNon-Convertible Debentures [NCD] 5,000.00 -Secured Term Loan from BanksExternal Commercial Borrowings-I (Refer Notes Below) 11,832.14 13,054.89External Commercial Borrowings-II (Refer Notes Below) 3,123.69 3,802.80External Commercial Borrowings-III(Refer Notes Below) 1,311.76 1,351.26Rupee Term Loan/Corporate Loan (Refer Notes Below) 326.51 18,636.49Unsecured Term Loan from Banks - 2,000.00

Total 21,594.10 38,845.44

4. Long Term Borrowings

a) The Company has issued 5000 Mn non-cumulative, secured, redeemable, taxable, listed, rated Non-ConvertibleDebentures (NCDs) during February 2016 with a coupon rate of 8.4% p.a., and interest payable annually. The NCDs aresecured by first raking pari passu charge on the land totaling an extent of 441.438 acres situated in Permude & KalavarVillages in Mangalore, SEZ, Mangalore Taluk & Registrations Sub-District, Dakshina Kannada Dist. and other fixedassets including Buildings, Roads and Plant and Machinery.

b) The Company has entered into an External Commercial Borrowing (ECB) arrangement for USD 331.32 Million.Entire ECB of USD 331.32 Million is availed.

c) The ECB-I [USD 250 Mn] is repayable in 14 equal half yearly instalments commencing from 1st April 2015 and therate of interest is six month LIBOR + 3.13% reset on the last day of the six monthly interest period. The ECB-II [USD 60Mn] is repayable in 14 equal half yearly instalments commencing from 31st October 2015 and the rate of interest forECB is six month LIBOR + 3.15% reset on the last day of the six monthly interest period. The ECB-III [USD 21.32Mn]is repayable in 14 equal half yearly instalments commencing from 31st October 2016 and the rate of interest for ECBis six month LIBOR + 3.15% reset on the last day of the six monthly interest period commencing from 31st October2016.

d) The above mentioned ECB Loans are secured by the first charge on land and all other fixed assets and second chargeby way of hypothecation on all movable fixed assets and all current assets.

e) The Secured RTL of 19561.20 Million with various bankers was entirely repaid in December 2015. The rate ofinterest for RTL was SBI Base Rate + 1.25% payable on the monthly basis.

f) Corporate loan of 1200 Million from SBI partially availed, is secured by way of second charge on the entire fixedassets of the Company both present and future and first charge on entire inventory, WIP, receivables, book debts andother current assets both present and future. The rate of interest is SBI Base Rate + 0.60% payable on the monthly basis.g) The Unsecured RTL was entirely repaid in September 2015. The rate of interest was Axis Base Rate + 0.50% payableon monthly basis.

Particulars in Millions in Millions


Deferred Payment Liabilities - 953.10

Total - 953.10

5. Other Long Term Liabilities

in Millions


46




Provision for employee benefitsGratuity 16.01 6.60Compensated Absence 24.33 12.85

Total 40.34 19.45

6. Long Term Provisions


SecuredShort Term Loan from Banks : Working Capital 31.85 3,168.01

UnsecuredShort Term Loan repayable on demand from Banks 19,244.40 10,524.72Buyers’ Credit repayable on demand from Banks - 1,674.37Commercial Paper 19,000.00 -

Total 38,276.25 15,367.10

7. Short Term Borrowings

Secured by way of hypothecation of Company’s stocks of raw materials,finished goods, stock-in-process, stores, spares, components, book debts,outstanding monies receivable, claim, bills, contracts, engagements, securities,both present and future secured by second ranking pari passu charge againstCompany’s immovable and movable Fixed Assets both present and future.


Related Party 4,693.62 1,480.89Others 7.51 884.90

Total 4,701.13 2,365.79

8. Trade Payables


Statutory dues and liabilities 114.21 167.81Security deposit 24.97 31.39Retention - Capital Goods 184.27 249.84Interest accrued but not due on Long Term Loans 360.94 -Interest Accrued but not due Short Term Loans - 3.34Intallment of Rupee Term Loan/Corporate Loan due within 1year 204.00 1,094.36Intallment of ECB-I, II & III due within 1year 3,035.28 1,384.04Related Parties 14.69 45.50Capital Goods (includes dues to Micro and Small Enterprises - refer note below) 1,990.79 3,683.74Others (includes dues to Micro and Small Enterprises - refer note below) 1,357.16 261.79

Total 7,286.31 6,921.81

9. Other Current Liabilities

a) Retention represents amount withheld from various suppliers and contractors as per the terms of the contract / purchaseorder repayable within twelve months upon fulfilment of certain conditions.

b) Due to related party represents amount payable to M/s Mangalore SEZ Limited, towards services provided andreimbursement of expenses.

c) Some of the Creditor balances & Other Current Liabilities are subject to confirmation & reconcilaition.d) Disclosure relating to dues to micro and small enterprises.

in Millions




47



For the year ended 31stMarch 2016

a) Principal amount remaining unpaid but not due as at year end to micro andsmall Enterprises.b) Interest due thereon as at year end

c) Interest paid by the Company in terms of section 16 of Micro, Small andMedium Enterprises Development Act, 2006d) Interest due and payable for the year of delay in making payment (which havebeen paid but beyond the appointed day during the year) but without adding theinterest specified under Micro, Small and Medium Enterprises Development Act,2006.e) Interest accrued and remaining unpaid as at year end

f) Further interest remaining due and payable even in the succeeding years, untilsuch date when the interest dues as above are actually paid to the small enterprise


1.37 6.81- -- -

- -

- -- -

11. Tax Expenses

a) Provision for current taxes has not been made since the Company does not have any taxable incomeduring the year.

b) Company is operating as an SEZ Unit and is eligible for exemption under Section 10AA of theIncome Tax Act, 1961, which provides for exemption on taxable export income earned subject tofulfilling certain conditions. In view of this no deferred tax asset/liability are recognised during theyear in respect of timing differences which reverse during the tax holiday period. The carrying amountof deferred tax asset and liability are reviewed and reversed as per the requirement of AS 22. As a resultthe accumulated balance of deferred tax asset and liabilities as at the end of the balance sheet date isNil.

Particulars in Millions in Millions


Provision for employee benefitsGratuity 0.10 0.05Compensated Absence 2.34 1.58

Total 2.44 1.63

10. Short Term Provisions

in Millions

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49



Capital Work in Progress :-Buildings 107.65 1,407.91-Plant & Machinery 81.95 54,581.11-Project Development Expenditure - 12,035.30

Total 189.60 68,024.32Less : Amount Capitalised to Fixed Assets during the year 90.57 67,912.48Net Capital Work-in-Progress- Buildings 99.03 29.89- Plant & Machinery - 81.95

Total 99.03 111.84

13. Capital Work in Progress

Particulars As at 31st March 2016 As at 31st March 201514. Non-Current Investments

Unquoted - Non Trade Investment4,80,000 equity shares of Rs. 10 each of Mangalore SEZ Ltd. an associate company

Total 4.80 4.80


Unsecured, considered goodCapital Advanceto Related Party 900.00 800.00to Others - - 732.59Security Deposit 30.59 29.85MAT Credit Entitlement 3.78 3.78

Total 934.37 1,566.22

15. Long term Loans and advances

a) Capital advance to Related Party represents amount paid to Mangalore SEZ Limited for Development of Pipeline corridorinfrastructure.b) Capital advance to others represents Mobilisation Advance and other capital advances paid to various contractors and suppliersas per the terms of contract or work order.


Raw Materials (including fuel) 438.48 939.50Raw Materials in Transit (including fuel) - 487.20Work- in-progress 193.56 288.75Finished Goods 1,045.96 2,208.74Stores, Spares and Chemicals 524.41 309.98

Total 2,202.41 4,234.17

16. Inventories


Related Party 111.94 107.90Foreign 1,482.01 518.27

Total 1,593.95 626.17

17. Trade Receivables






4.80 4.80

50



Cash on Hand 0.01 0.04Balances with banks in current account 12.10 1.15Deposits with Banks as lien. 950.00 -

Total 962.11 1.19

18. Cash and Cash Equivalents


Unsecured, Considered goodBalance with service tax, value added & tax authorities 2,271.18 1,507.14Advance Tax (Net of Provisions) 2.57 13.01Advance receivable in cash or kind [Related Party] 412.47 430.02Discount on CP 252.68 -Others 410.79 110.89

Total 3,349.69 2,061.06

19. Short Term Loans and Advances


Interest Accrued but Not Due on Bank Deposits 2.79 -

Total 2.79 -

20. Other Current Assets


A. Contingent Liabilities - -

B. CommitmentsEstimated amount of Contracts remaining to be executed onCapital account and not provided for 74.05 34.20

Total 74.05 34.20

21. Contingent Liabilities and Commitments

The company has taken 441.438 acres of land on lease for a period of 47 years and 10 months i.e., from 29-03-2012 to26-01-2060 from Mangalore SEZ Limited. The annual lease rental payable to Mangalore SEZ Ltd is 23.40 Million.

22. a) The Company does not have any pending litigations which would impact its financial position.b) The Company does not have any foreseeable losses on long term contracts including derivative contracts.c) There were no amounts which were required to be transferred to the Investor Education & Protection Fund by the Company.d)The accounts have been prepared on going concern basis considering the future business plan though thecompany has incurred losses and there is erosion of networth during the current year.

23. The Company has commenced commercial operations from 1st October 2014 during the Previous Year. CurrentYear being the first full year of operations the previous year figures are not comparable.





51


Particulars

Sale of Products 41,855.04 17,195.03Sale of Services 20.70 43.88

Total 41,875.74 17,238.91

24. Revenue from OperationsFor the year ended 31st

March 2016For the year ended 31st

March 2015

Particulars

Sale of ProductsExportParaxylene 28,238.87 12,120.76Benzene 6,981.77 2,809.06Domestic - -Paraxylene 1,147.56 -Paraffinic Raffinate 4,145.25 1,874.51Hydrogen 1,341.59 390.70

Total 41,855.04 17,195.03



25. Other Income

Particulars

Dividend from current investments 5.08 10.58Interest on Income tax refund 1.21 -Interest on Deposits with Banks 3.10 12.39Interest - Others 0.76 20.62Miscellaneous receipts 2.78 -

Total 12.93 43.59



26. Cost of Materials Consumed

Particulars

Opening Stock 716.29 2,878.14Add: Purchases 35,644.00 16,806.70

36,360.29 19,684.84Less: Closing Stock 316.92 947.35

Total 36,043.37 18,737.49



Particulars

Raw MaterialImported - -Indegenous - -Naphtha Stream 21,874.91 11,423.98Aromatic Stream 14,168.46 7,313.51

Total 36,043.37 18,737.49








52


27. Increase(-)/Decrease in Stock

Particulars For the year ended For the year ended31st March 2016 31st March 2015

in Millions in MillionsClosing Stock of :Finished Goods 1,045.96 2,208.74Stock-in-Process 193.56 288.75Total Closing Stock 1,239.52 2,497.49

Opening Stock of :Finished Goods 2,208.74 694.97Stock-in-Process 288.75 1,905.01Total Opening Stock 2,497.49 2,599.98

Increase(-)/Decrease in Stock 1,257.97 102.49

28. Employee Benefit ExpensesParticulars For the year ended For the year ended

31st March 2016 31st March 2015 in Millions in Millions

Salaries & Allowances 322.63 108.65Contribution to provident and other funds 17.67 7.09Cost of services 2.05 3.96Staff Welfare Expenses 13.33 6.70Leave Provision 12.24 8.13Gratuity Provision 9.46 3.76

Total 377.38 138.29

29. Finance CostsParticulars For the year ended For the year ended


Interest Expenses 4,609.86 2,524.70Other Borrowing Costs 23.54 32.08Net Exchange (gain)/loss on Foreign Currency Transactions 236.19 -Total 4,869.59 2,556.78

30. Depreciation and Amortisation


in Millions in MillionsOn Tangible Assets 3,051.32 1,315.96On Intangibles Assets 38.50 37.55

3,089.82 1,353.51Capitalised during the year - 75.61Prior period adjustments (Net) (2.44) -Total 3,087.38 1,429.12

53


31 Other ExpensesParticulars For the year ended For the year ended


Power & Fuel 4,149.51 3,274.88Stores, Spares & Chemicals Consumed 100.29 27.43Rent 24.36 13.38Electricity charges 0.82 1.08Repair and maintenance 182.90 58.54Insurance charges 135.37 33.98Rates and taxes 2.88 0.71Payment to AuditorsAudit Fees 0.30 0.30Tax Audit 0.25 -Certification Fees 0.32 0.05Auditor’s out of pocket expenses 0.01 0.01Legal, Professional & Consultancy charges 11.17 23.66Directors’ sitting fees 0.31 0.34Advertisement & Publicity Expenses 2.15 2.78Travelling Expenses 5.79 3.95Net Exchange (gain)/loss on Foreign Currency Transactions (67.52) 1.17Miscellaneous expenses 456.08 94.67

Total 5,004.99 3,536.93Prior Period ItemsConsultancy Fee 1.28 -Staff Welfare Expenses 0.19 -Repairs & Maintenance 0.04 -Total 1.51 -

Grand Total 5,006.50 3,536.93

32. Earnings Per Share (EPS)Particulars For the year ended For the year ended

31st March 2016 31st March 2015

Numerator - Net Profit for the year after tax (8,753.52) (9,142.99)Denominator - Average number of equity shares 1,87,76,25,500 1,87,76,25,500outstanding during the yearDenominator - Weighted Average number of equity shares - 1,05,48,25,500outstanding during the yearEarnings Per Share - Basic & Diluted (4.66) (8.67)Face value per equity share 10 10

33. Effect of changes in Foreign Exchange Rates (AS 11): Pursuant to Notification Number G.S.R. (914)Edated 29th December 2011, issued by MCA, the company has opted to adjust exchange differences arising onreporting of long term foreign currency monetary items, in so far as they relate to the acquisition of depreciableassets, against the cost of such assets and depreciate the said adjustment over the balance life of the asset. Hadthe option not been exercised, the difference amounting to 1296.26 Million (previous year 267.20 Million)on long term foreign currency monetary items relating to depreciable assets would have been charged toStatement of Profit and Loss and Fixed Assets would have been lesser to that extent.

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34. Disclosure as required under Accounting Standard 15 (revised) – “Employee Benefits”is given below:A) Defined Contribution Plans are as under:Eligible employees of the Company receive benefits under the Provident Fund Scheme,wherein both employee and the Company make monthly contributions equal to the specifiedpercentage of employee salary.

B) Defined Benefit Plans:a) Compensated absences

(1) Earned Leave Benefit (EL)Accrual – 30 days per yearAccumulation up to 300 days allowedLeave Encashment on resignation shall be paid upto 50% of accumalatedcredit subject to maximum of 150 days.

(2) Sick Leave (SL):Accrual – 10 days per yearEncashment while in service is not allowedEncashment on retirement is permitted and entire accumulation isallowed for encashmentb) Gratuity:15 days salary for every completed year of service. Vesting period is5 years and the payment is restricted to maximum of 10, 00,000/-

C) The following are the contributions to provident fund (defined contributions plan)during the year:

Particulars For the year ended For the year ended31st March 2016 31st March 2015 in millions in millions

Employer’s contribution to provident fund:Charged to statement of profit and loss 17.67 7.09Total 17.67 7.09

D) Defined benefit plan – Gratuity

a)The amount recognised in the Balance Sheet for post employment benefit plan in respect of Gratuity is as under:


Present Value of funded Obligation - -Fair Value of Plan Assets - -Present Value of Unfunded Obligation 16.11 6.65Unrecognised Past Service Cost - -Net Liability 16.11 6.65

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b) Reconciliation showing the movements during the year in the net liability recognised in thebalance sheet:


Opening defined benefit obligation 6.65 2.89Service Cost 3.13 1.84Interest Cost 0.53 0.27Actuarial losses (gains) 5.80 1.65Exchange differences on foreign plans - -Liability transfer in/out - -Benefits paid - -Closing defined benefit obligation 16.11 6.65

c) The total expenses recognised in the statement of Profit and Loss are as follows:


Current Service Cost 3.13 1.84Interest on obligation 0.53 0.27Expected return on plan assets - -Net actuarial losses / (gains) recognised in the year 5.80 1.65Past Service Cost - -Losses / (Gains) on curtailments and settlements - -Total included in ‘employee benefit expenses’. 9.46 3.76Actual return on plan assets - -

d) Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):


Discount Rate 7.95% 8.85%Expected return on plan assets previous - -Expected return on plan assets Current - -Annual Increase in Premium of Med-claim policy - -Annual increase in Salary 8.00% 5.00%

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35. Value of Imports on C.I.F. Basis


Capital Goods 84.55 125.14

36. Expenditure in foreign currency:


Finance charges 379.24 1,029.64Others 623.08 803.66Total 1,002.32 1,833.30

37. The Company has taken certain residential / office premises under cancellable operating leases.These lease agreements are normally renewed on expiry. The lease rental paid during the year 0.96 Million (previous year 4.32 Million)

38. Segment Reporting (AS 17)Segment wise Revenue, Results and Capital Employed


1 Segment RevenueA. Domestic Sale 6,634.40 2,265.21B. Export Sale 35,241.34 14,973.70Net Sale / Income from Operations 41,875.74 17,238.91

2 Segment Result Profit / (Loss) beforetax and interest from each segmentA. Domestic (520.18) (1,519.52)B. Export (3,376.69) (5,109.12)TOTAL (3,896.87) (6,628.64)Less:i. Interest Payment 4,869.59 2,557.94ii. Other unallocable expenditure net of unallocable income (12.94) (43.59)Profit (Loss) before tax (8,753.52) (9,142.99)

3 Capital Employed (Segments Assets-Segment Liabilities)A. Domestic Sale 111.94 107.90B. Export Sale 1,482.01 518.27TOTAL 1,593.95 626.17Unallocated 3,108.17 12,829.47Total Capital Employed 4,702.12 13,455.64Capital Expenditure 1,203.51 16,505.40Depreciation & Amortisation 3,087.39 1,429.12Other Non Cash Expenses 1,260.58 257.17

S.No.

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39. Disclosure of related parties / related party transactions:

(i) List of related parties with whom the Company had transactions:Name of the related party RelationshipMangalore SEZ Ltd. (MSEZL) Associate of Investor

The Company is a state controlled enterprise and the transactions with other state controlledenterprises are not required to be disclosed as per AS-18

(ii) Nature of transactions and amounts due to and due from related parties: in Millions

Nature of transaction Name Amount of transactions Due from Due to during the year

Payment towards power,water and marine outfall MSEZL 125.66 - 14.69

(149.41) - (20.31)

Advance for Corridor MSEZL 100.00 900.00 -(300.00) (800.00) -

Security Deposit forConstruction Power MSEZL - 11.71 -

(11.71) (11.71)Security Deposit for10MVA Power MSEZL - 15.40 -

(15.40) (15.40) -Budgeted Deposit forWater MSEZL - 3.13

(3.13) (3.13) -Lease Rent MSEZL 23.40 - -

(23.40) - -

Remuneration paid toKey Managerial Personnel;Shri S. Ramachandran, 2.21 - -Chief Executive Officer (5.10)[upto 30th June 2015]

KMPShri Sushil K. Shenoy, 4.84Chief Financial Officer (4.84) - -

Shri Shyam Kumar, 2.21Company Secretary (1.22) - -

(iii) No amounts pertaining to related parties have been written off or written back during the year.

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40. The Board has accorded consent for amalgamation of the Company into and with the HoldingCompany Mangalore Refinery and Petrochemicals Limited (MRPL), subject to necessaryapprovals. The Accounts have been prepared without giving effect to the proposed scheme ofamalgamation.

41. The Company has reclassified / regrouped the previous year figures wherever necessary

For ONGC Mangalore Petrochemicals LimitedAs per our report attachedFor Manohar Chowdhry & AssociatesChartered Accountants(Firm’s Registration No.1997S) A. K. Sahoo H. Kumar

Director DirectorDIN : 07355933 DIN : 06851988

Murali MohanPartner K. B. Shyam Kumar Sushil K. ShenoyMembership No. 203592 Company Secretary Chief Financial Officer & CEO I/c

Place: Bengaluru Place: BengaluruDate: 12th May 2016 Date: 12th May 2016

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NOTICE

NOTICE IS HEREBY GIVEN THAT THE TENTH ANNUAL GENERAL MEETING OF THE MEMBERSOF ONGC MANGALORE PETROCHEMICALS LIMITED (THE COMPANY) WILL BE HELD ON03rd DAY, THE SEPTEMBER, 2016 AT 14.30 HRS. AT THE REGISTERED OFFICE , MANGALORESPECIAL ECONOMIC ZONE, PERMUDE, MANGALORE - 574 509 TO TRANSACT THEFOLLOWING BUSINESSES:

Ordinary Businesses:

Agenda No.1- Consideration of financial statements and the reports of the Board of Directorsand auditors

To receive, consider and adopt the Audited Financial Statements of the Company for the financialyear ended on 31st March, 2016, together with the Reports of the Board of Directors and the Auditors’thereon

Agenda No.2 – Re-appointment of Shri H Kumar

To appoint Director in place of Shri H Kumar, who retires by rotation and being eligible offershimself for re-appointment.

Agenda No.3 – Authorisation to fix remuneration of the Auditor

To authorise Board of Directors of the Company to fix the remuneration of the Statutory Auditorsof the Company for the financial year 2016-17, in terms of the provisions of section 139(5) read withsection 142 of the Companies Act, 2013 and to pass the following resolution, with or without modification(s),as an Ordinary Resolution:

“RESOLVED THAT the Board of Directors of the Company be and is hereby authorised to decide andfix the remuneration of the Statutory Auditors of the Company for the Financial Year 2016-17.”

Special Businesses:

Agenda No.4 – Appointment of Shri V P Mahawar as a Director

To consider and if thought fit, to pass, with or without modification(s), the following resolution asan Ordinary Resolution:

“RESOLVED THAT Shri V P Mahawar (DIN:07208090), who was appointed as an Additional Directoron the Board of the Company in terms of Section 161 of the Companies Act, 2013 and provisions of theArticles of Association of the Company and who holds office up to the date of the ensuing Annual GeneralMeeting, and in respect of whom a Notice has been received in writing, from Oil and Natural Gas CorporationLimited, under Section 160 of the Companies Act, 2013, proposing his candidature for the office of theDirector, be and is hereby appointed as a Director of the Company, liable to retire by rotation”.

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Agenda No.5 – Appointment of Smt Alka Mittal as a DirectorTo consider and if thought fit, to pass, with or without modification(s), the following resolution as

an Ordinary Resolution:

“RESOLVED THAT Smt Alka Mittal (DIN:07272207), who was appointed as an Additional Director onthe Board of the Company in terms of Section 161 of the Companies Act, 2013 and provisions of theArticles of Association of the Company and who holds office up to the date of the ensuing Annual GeneralMeeting, and in respect of whom a Notice has been received in writing, from Oil and Natural Gas CorporationLimited, under Section 160 of the Companies Act, 2013, proposing his candidature for the office of theDirector, be and is hereby appointed as a Director of the Company, liable to retire by rotation”.

Agenda No.6 – Appointment of Shri A K Sahoo as a DirectorTo consider and if thought fit, to pass, with or without modification(s), the following resolution as

an Ordinary Resolution:

“RESOLVED THAT Shri A K Sahoo (DIN:07355933), who was appointed as an Additional Director onthe Board of the Company in terms of Section 161 of the Companies Act, 2013 and provisions of theArticles of Association of the Company and who holds office up to the date of the ensuing Annual GeneralMeeting, and in respect of whom a Notice has been received in writing, from Mangalore Refinery andPetrochemicals Limited, the holding company, under Section 160 of the Companies Act, 2013, proposinghis candidature for the office of the Director, be and is hereby appointed as a Director of the Company,liable to retire by rotation”.

Agenda No.7 – To reappoint/approve the appointment of Shri ISN Prasad as an IndependentDirector

To consider and if thought fit, to pass, with or without modification(s), the following resolution asa Special Resolution:

“RESOLVED THAT pursuant to the provisions of Sections 149, 150(2) and 152(2) read with ScheduleIV and other applicable provisions, if any, of the Companies Act, 2013 (“the Act”) and the Companies(Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) Shri I S N Prasad (DIN:01469651), who qualifies forbeing reappointed as an Independent Director and reappointed as such by the Board of Directors at itsmeeting held on March 15, 2016 for a term of 1 (one) year i.e., from March 28, 2016 to March 27, 2017,be and is hereby approved/reappointed as an Independent Director of the Company.”

Agenda No.8 – To reappoint/approve Shri G M Ramamurthy as an Independent Director


“RESOLVED THAT pursuant to the provisions of Sections 149, 150(2) and 152(2) read with ScheduleIV and other applicable provisions, if any, of the Companies Act, 2013 (“the Act”) and the Companies(Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) Shri G M Ramamurthy (DIN:00064358), who qualifies

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for being reappointed as an Independent Director and reappointed as such by the Board of Directors at itsmeeting held on March 15, 2016 for a term of 1 (one) year i.e., from March 28, 2016 to March 27, 2017,be and is hereby approved/reappointed as an Independent Director of the Company.”

Agenda No.9 – To reappoint/approve Shri Santosh Nautiyal as an Independent Director


“RESOLVED THAT pursuant to the provisions of Sections 149, 150(2) and 152(2) read with ScheduleIV and other applicable provisions, if any, of the Companies Act, 2013 (“the Act”) and the Companies(Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) Shri Santosh Nautiyal (DIN:01127740), who qualifiesfor being reappointed as an Independent Director and reappointed as such by the Board of Directors at itsmeeting held on March 15, 2016 for a term of 1 (one) year i.e., from March 28, 2016 to March 27, 2017,be and is hereby approved/reappointed as an Independent Director of the Company.”

Agenda No.10 – To reappoint/approve Shri M M Chitale as an Independent Director


“RESOLVED THAT pursuant to the provisions of Sections 149, 150(2) and 152(2) read with ScheduleIV and other applicable provisions, if any, of the Companies Act, 2013 (“the Act”) and the Companies(Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) Shri M M Chitale (DIN:00101004), who qualifies forbeing reappointed as an Independent Director and reappointed as such by the Board of Directors at itsmeeting held on March 15, 2016 for a term of 1 (one) year i.e., from March 28, 2016 to March 27, 2017,be and is hereby approved/reappointed as an Independent Director of the Company.”

By Order of the Board of Directors ofONGC Mangalore Petrochemicals Ltd.

Place: Mangalore Sd/-Dated: 01st August, 2016 K B Shyam Kumar

Company Secretary

Registered Office:Mangalore Special Economic Zone,Permude,Mangalore- 574 509CIN: U40107KA2006PLC041258

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Website: www.ompl.co.inNOTES:

1. The statement pursuant to Section 102(1) of the Companies Act, 2013 respect to special business setout in the Notice is annexed.

2. A member entitled to attend and vote at the annual general meeting (the “Meeting”) is entitledto appoint a proxy to attend and vote on a poll instead of himself and the proxy need not be amember of the Company. The instrument appointing the proxy should, however, be depositedat the registered office of the Company not less than forty eight hours before the commencementof the Meeting.

3. Corporate member intending to send its authorised representative to attend the Meeting is requestedto send to the Company an authority letter authorising their representative to attend and vote on itsbehalf at the Meeting together with a certified copy of the Board Resolution passed by it.

4. Relevant documents referred to in the accompanying Notice are open for inspection by the membersat the Registered Office of the Company on all working days, except Saturdays, between 11.00 a.m.and 1.00 p.m. up to the date of the Meeting.

5. Members are requested to inform the Company, immediately of change in their particulars, includingtheir residential status.

6. Nomination facility: Pursuant to Section 72 of the Companies Act, 2013 (corresponding section 109Aof the Companies Act, 1956) individual/ joint members are entitled to register nomination in respectof the shares held by them in Form No.SH-13 and send it to the Company.

8. The Register of Directors and Key Managerial Personnel and their shareholding, maintained underSection 170 of the Companies Act, 2013, will be available for inspection by the members at theAGM.

9. The Register of Contracts or Arrangements in which Directors are interested, maintained under Section189 of the Companies Act, 2013, will be available for inspection by the members at the AGM.

10. In terms of the Articles of Association of the Company, read with Section 152 of the Companies Act,2013, Shri. H Kumar, Director, retire by rotation at the ensuing Meeting and being eligible, offerhimself for re-appointment. Brief profile of the Director seeking re-appointment is given here-in-below:

Shri H. Kumar, 57 Years, is a Honours Mechanical Engineer from Calicut University and trained in Advancedmanagement Strategies by IIM, Kolkatta. He has over three decades of professional experience in acrossthe entire gamut of petroleum functions while serving in India’s foremost Oil PSEs – HPCL. Shri Kumarhas held key positions in different verticals and diverse functional streams of Corporate Strategy, RetailServices & Ops, Projects & Pipelines and LPG Projects and is credited with many benchmarks in thecourse of his service. Presently he is the Managing Director of Mangalore Refinery and PetrochemicalsLimited. He also holds directorship in Mangalore SEZ Limited, Shell MRPL Aviation Fuel and ServicesLimited and Petronet MHB Limited.He does not hold any shares of the company.He is holding one Committee Membership in one public company.

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Statement pursuant to Section 102(1) of the Companies Act, 2013

Item No.4

The Board appointed Shri V P Mahawar as an Additional Director of the Company with effect fromAugust 12, 2015 through Circular Resolution, pursuant to Section 161 of the Companies Act, 2013, readwith Articles of Association of the Company.

Pursuant to the provisions of Section 161 of the Companies Act, 2013, Shri V P Mahawar will hold officeup to the date of ensuing AGM. The Company has received notice in writing under the provisions ofSection 160 of the Companies Act, 2013, from Oil and Natural Gas Corporations Limited along with adeposit of Rs.1,00,000/- proposing the candidature of Shri V P Mahawar for the office of director.

Shri V P Mahawar, is a Mechanical Engineering graduate having 33 years of vast experience of managingdrilling and operational functions, holding various key positions across vast spectrum of oil field activities.He is also Director (Onshore) of ONGC.

He does not hold any shares of the company.

No director, key managerial personnel or their relatives, except Shri V P Mahawar, to whom the resolutionrelates, is interested or concerned in the resolution.

The Board recommends the resolution set forth in Item No.4 for the approval of the Members.

Item No.5

The Board appointed Smt Alka Mittal as an Additional Director of the Company with effect from August28, 2015 through Circular Resolution, pursuant to Section 161 of the Companies Act, 2013, read withArticles of Association of the Company.

Pursuant to the provisions of Section 161 of the Companies Act, 2013, Smt Alka Mittal will hold office upto the date of ensuing AGM. The Company has received notice in writing under the provisions of Section160 of the Companies Act, 2013, from Oil and Natural Gas Corporations Limited along with a deposit ofRs.1,00,000/- proposing the candidature of Smt Alka Mittal for the office of director.

Smt Alka Mittal, is a Post Graduate in Economics (gold medallist) and MBA-(HRM) and Doctorate inCommerce & Business Studies and having expertise in CSR, Corporate Governance, Ethics and values.Presently she is working as GM – Head CSR in ONGC.

She does not hold any shares of the Company.

No director, key managerial personnel or their relatives, except Smt Alka Mittal, to whom the resolutionrelates, is interested or concerned in the resolution.


Item No.6

The Board appointed Shri A K Sahoo as an Additional Director of the Company with effect from February05, 2016 through Circular Resolution, pursuant to Section 161 of the Companies Act, 2013, read withArticles of Association of the Company.

Pursuant to the provisions of Section 161 of the Companies Act, 2013, Shri A K Sahoo will hold office upto the date of ensuing AGM. The Company has received notice in writing under the provisions of Section160 of the Companies Act, 2013, from Mangalore Refinery and Petrochemicals Limited (Holding Company)along with a deposit of Rs.1,00,000/- proposing the candidature of Shri A K Sahoo for the office of director.

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Shri A K Sahoo is a Fellow Member of the Institute of Cost Accountants of India. He is a Post Graduate inAnalytical and Applied Economics. He is also Director (Finance) of MRPL.

He does not hold any shares of the Compnay.

No director, key managerial personnel or their relatives, except Shri A K Sahoo, to whom the resolutionrelates, is interested or concerned in the resolution.


Item No.7In accordance with the provisions of Section 149, 150(2) and 152(2) read with Schedule IV to the Act, anIndependent Director shall be reappointed by the company in general meeting/ his reappointment is requiredto be approved by the company in general meeting. The Board of Directors at its meeting held on March15, 2016 has reappointed Shri I S N Prasad as an Independent Director of the Company for a period of oneyear from March 28, 2016.

The reappointment of Shri I S N Prasad is required to be approved by the members in the Meeting.

Shri I S N Prasad is not disqualified from being appointed as a Director in terms of Section 164 of the Actand has given his consent to act as a Director. The Company has received a declaration from Shri I S NPrasad that he meets the criteria of independence as prescribed both under sub-section (6) of Section 149of the Act. In the opinion of the Board, Shri I S N Prasad fulfils the conditions for his reappointment as anIndependent Director as specified in the Act. Shri I S N Prasad is independent of the management andpossesses appropriate skills, experience and knowledge.

Brief resume of Shri I S N PrasadShri I S N Prasad, is Indian Administrative Service (IAS) – 1986 - Karnataka Cadre. He has academicbackground of BE (Civil), Delhi College of Engineering, Delhi and Master in Development Management,Asian Institute of Management, Manila, Philippines.

Shri I S N Prasad held posting at various levels as Assistant Commissioner, Deputy Secretary, ChiefExecutive Officer, Joint Commissioner, Chief Project Officer and also as Managing Director & CEO withvarious Government Departments. Shri I S N Prasad was promoted as Principal Secretary to Chief Minister,Govt. of Karnataka with effect from 1st January 2011 and Principal Secretary to Government, Departmentof Information Technology, Biotechnology and Science & Technology from 9th July 2012. Shri. I S NPrasad joined the Board of ONGC Mangalore Petrochemicals Limited as an independent director from20th March 2008.

He does not hold any shares of the Company in his name.

Copy of the draft letter for appointment of Shri I S N Prasad as an Independent Director setting out theterms and conditions is available for inspection by members at the registered office of the Company.

Save and except Shri I S N Prasad and his relatives, to the extent of their shareholding interest, if any, inthe Company, none of the other Directors / Key Managerial Personnel of the Company / their relatives are,in any way, concerned or interested, financially or otherwise, in the resolution set out at Item No. 7 of theNotice.

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The Board recommends the Special Resolution set out at Item No. 7 of the Notice for approval by themembers.

Item No.8

In accordance with the provisions of Section 149, 150(2) and 152(2) read with Schedule IV to the Act, anIndependent Director shall be reappointed by the company in general meeting/ his reappointment is requiredto be approved by the company in general meeting. The Board of Directors at its meeting held on March15, 2016 has reappointed Shri G M Ramamurthy as an Independent Director of the Company for a periodof one year from March 28, 2016.

The reappointment of Shri G M Ramamurthy is required to be approved by the members in the Meeting.

Shri G M Ramamurthy is not disqualified from being appointed as a Director in terms of Section 164 ofthe Act and has given his consent to act as a Director. The Company has received a declaration from ShriG M Ramamurthy that he meets the criteria of independence as prescribed both under sub-section (6) ofSection 149 of the Act. In the opinion of the Board, Shri G M Ramamurthy fulfils the conditions for hisappointment as an Independent Director as specified in the Act. Shri G M Ramamurthy is independent ofthe management and possesses appropriate skills, experience and knowledge.

Brief resume of Shri G M Ramamurthy

Shri G M Ramamurthy, a law graduate and a qualified company secretary, served IDBI for over 27 yearsand retired as Executive Director. He practiced law for over eight years in civil courts. Before assumingcharge as Executive Director, he worked at different levels in the legal department of IDBI and handled alllegal issues relating to lending and recovery of loans. During his tenure he also effectively handled theNPA Recovery portfolio in addition to catering to corporate legal affairs, the performing loan portfolio.Shri G M Ramamurthy was a member of the Empowered Committee of IDBI, which accorded approvalfor financial assistance up to Rs. 10 crore and negotiated settlements/ one- time settlement of outstandingfinancial assistance with defaulting borrowers.

Shri G M Ramamurthy was chairman of Secondary Market Operations Committees that dealt with shortterm investments in the stock market.

Shri G M Ramamurthy also served as Chairman of the Corporate Debt Restructuring Empowered Group(CDREG), set up under the Corporate Debt Restructuring Mechanism by the Reserve bank of India. Hehad been director on the board of companies engaged in the business of depository, custodian, registrarand transfer agent, real estate financing, asset reconstruction and manufacturing.

Shri G M Ramamurthy was a member of the High Powered Committee constituted by the CentralGovernment to examine the law related to insolvency of companies (popularly known as Eradi Committee).

Shri G M Ramamurthy is also an independent director on the Boards of the JM Financial Asset ManagementLimited and JM Financial Asset Reconstruction Company Private Limited. He is the Chairman of theAudit Committee of JM Financial Asset Management Ltd and a member of the Audit Committee of JMFinancial Asset Reconstruction Company Private Limited.

Shri G M Ramamurthy joined ONGC Mangalore Petrochemicals Limited from 26th November 2009.


Copy of the draft letter for appointment of Shri G M Ramamurthy as an Independent Director setting outthe terms and conditions is available for inspection by members at the registered office of the Company.

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Save and except Shri G M Ramamurthy and his relatives, to the extent of their shareholding interest, ifany, in the Company, none of the other Directors / Key Managerial Personnel of the Company / theirrelatives are, in any way, concerned or interested, financially or otherwise, in the resolution set out at ItemNo. 8 of the Notice.


Item No.9

In accordance with the provisions of Section 149, 150(2) and 152(2) read with Schedule IV to the Act, anIndependent Director shall be reappointed by the company in general meeting/ his reappointment is requiredto be approved by the company in general meeting. The Board of Directors at its meeting held on March15, 2016 has reappointed Shri Santosh Nautiyal as an Independent Director of the Company for a period ofone year from March 28, 2016.

The reappointment of Shri Santosh Nautiyal is required to be approved by the members in the Meeting.

Shri Santosh Nautiyal is not disqualified from being appointed as a Director in terms of Section 164 of theAct and has given his consent to act as a Director. The Company has received a declaration from ShriSantosh Nautiyal that he meets the criteria of independence as prescribed both under sub-section (6) ofSection 149 of the Act. In the opinion of the Board, Shri Santosh Nautiyal fulfils the conditions for hisappointment as an Independent Director as specified in the Act. Shri Santosh Nautiyal is independent ofthe management and possesses appropriate skills, experience and knowledge.

Brief resume of Shri Santosh Nautiyal

Shri Santosh Nautiyal was a member of the Indian Administrative Service (IAS). He retired from the postof Chairman of the National Highways Authority of India (NHAI) which is engaged in implementation ofthe monumental National Highways Development Project (NHDP). He has also held many other importantpositions under both, the Central Government as well as the State Government (Orissa). These includeManaging Director of the Industrial Promotion & Investment Corporation of Orissa Ltd (IPICOL), and,later, Principal Secretary, Industries Department in the State Government.

Shri Santosh Nautiyal was Joint Secretary in the Steel Ministry for a period of five years. With these variedand important postings, he has acquired a good insight into the industrial and infrastructure sectors. Duringhis tenure as Chairman NHAI, Shri Santosh Nautiyal gained valuable experience of successfulimplementation of large projects in the highways sector in the PPP (Public Private Participation) mode.He has also served as Independent Director in the Board of Directors of prestigious PSUs like ONGC andNTPC

Shri Santosh Nautiyal joined ONGC Mangalore Petrochemicals Limited from 29th November 2009.


Copy of the draft letter for appointment of Shri Santosh Nautiyal as an Independent Director setting outthe terms and conditions is available for inspection by members at the registered office of the Company.

Save and except Shri Santosh Nautiyal and his relatives, to the extent of their shareholding interest, if any,in the Company, none of the other Directors / Key Managerial Personnel of the Company / their relativesare, in any way, concerned or interested, financially or otherwise, in the resolution set out at Item No. 9 ofthe Notice.

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Item No.10

In accordance with the provisions of Section 149, 150(2) and 152(2) read with Schedule IV to the Act, anIndependent Director shall be reappointed by the company in general meeting/ his reappointment is requiredto be approved by the company in general meeting. The Board of Directors at its meeting held on March15, 2016 has reappointed Shri M M Chitale as an Independent Director of the Company for a period of oneyear from March 28, 2016.

The reappointment of Shri M M Chitale is required to be approved by the members in the Meeting.

Shri M M Chitale is not disqualified from being appointed as a Director in terms of Section 164 of the Actand has given his consent to act as a Director. The Company has received a declaration from Shri M MChitale that he meets the criteria of independence as prescribed both under sub-section (6) of Section 149of the Act. In the opinion of the Board, Shri M M Chitale fulfils the conditions for his appointment as anIndependent Director as specified in the Act. Shri M M Chitale is independent of the management andpossesses appropriate skills, experience and knowledge.

Brief resume of Shri M MChitale

Shri M M Chitale is Managing Partner of Mukund M. Chitale & Co. He has more than 45 years of experienceon advising companies on their business, financial & strategic matters.

Shri M M Chitale was the Chairman of the National Advisory Committee on Accounting Standards(NACAS), constituted by the Government of India.

Shri M M Chitale was the President of the Institute of Chartered Accountants of India (ICAI) during 1997-98; and a member of Central Council of ICAI during 1985-1998. He was Chairman of Western IndiaRegional Council of ICAI during 1984-85. He was a member of The International Auditing PracticesCommittee of the International Federation of Accountants during January 1998 to June 2000.

Shri M M Chitale joined ONGC Mangalore Petrochemicals Limited from 20th March 2008.


Copy of the draft letter for appointment of Shri M M Chitale as an Independent Director setting out theterms and conditions is available for inspection by members at the registered office of the Company.

Save and except Shri M M Chitale and his relatives, to the extent of their shareholding interest, if any, inthe Company, none of the other Directors / Key Managerial Personnel of the Company / their relatives are,in any way, concerned or interested, financially or otherwise, in the resolution set out at Item No. 10 of theNotice.

The Board commends the Special Resolution set out at Item No. 10 of the Notice for approval by themembers.

By Order of the Board of Directors ofONGC Mangalore Petrochemicals Ltd.

Place: Mangalore Sd/-Dated: 01st August, 2016 K B Shyam Kumar

Company Secretary

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ONGC Mangalore Petrochemicals Limited · 2016-08-16 · ONGC Mangalore Petrochemicals Limited...

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