Dear Members,
The Board of Directors of Aditya Birla Capital Limited ("your
Company" or "the Company" or "ABCL") is pleased to present the 16th_(Sixteenth)
Annual Report and the Audited Financial Statements (Consolidated and Standalone) of the
Company for the financial year ended 31st March 2023 ("financial year
under review").
FINANCIAL SUMMARY AND HIGHLIGHTS
The highlights of the Consolidated and Standalone Financial Statements
are detailed hereunder.
The Company's financial performance for the financial year ended
31st March 2023 as compared to the previous financial year ended 31st
March 2022 is summarized below:
(` in crore)
Particulars |
Consolidated |
Standalone |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Revenue from Operations |
27,415.65 |
22,229.91 |
218.56 |
452.71 |
Profit Before Share of Associates and Joint Ventures and |
5,362.66 |
1,945.82 |
184.20 |
419.05 |
Tax |
|
|
|
|
Share of Profit of Associate/Joint Venture Companies |
272.57 |
340.90 |
- |
- |
Profit/ (Loss) before Tax |
5,635.23 |
2,286.72 |
184.20 |
419.05 |
Tax Expense |
811.16 |
626.65 |
42.91 |
74.36 |
Profit/ (Loss) aer Tax Attributable to: |
4,824.07 |
1,660.07 |
141.29 |
344.69 |
Owners of the Company |
4,795.77 |
1,705.97 |
141.29 |
344.69 |
Non-Controlling Interest |
28.30 |
(45.90) |
- |
- |
Other Comprehensive Income Attributable to: |
(102.29) |
(35.69) |
(0.40) |
0.03 |
Owners of the Company |
(40.44) |
(3.54) |
(0.40) |
0.03 |
Non-Controlling Interest |
(61.85) |
(32.15) |
- |
- |
Total Comprehensive Income Attributable to: |
4,721.78 |
1,624.38 |
140.89 |
344.72 |
Owners of the Company |
4,755.33 |
1,702.43 |
140.89 |
344.72 |
Non-Controlling Interest |
(33.55) |
(78.05) |
- |
- |
Profit/ (Loss) attributable to owners of the Company |
4,795.77 |
1,705.97 |
141.29 |
344.69 |
The above figures are extracted from the Consolidated and Standalone
Financial Statements prepared in accordance with Indian Accounting Standards ("IND
AS") as notified under Sections 129 and 133 of the Companies Act, 2013 ("the
Act") read with the Companies (Accounts) Rules, 2014 and other relevant provisions of
the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("SEBI Listing Regulations").
RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS
For the financial year ended 31st March 2023, on a
Standalone basis revenue of the Company was ` 219 Crore and Net Profit was ` 141 Crore.
Key Highlights of the Company's Consolidated Performance for the
Financial Year Ended 31st March 2023 are as under:
Strong performance with accelerated growth momentum across
businesses
Consolidated Revenue: ` 27,416 Crore (grew 23 % year on year)
Consolidated Net Profit (excluding fair value and stake sale
gains) : ` 2,057 Crore (grew 33% year on year)
Active customer base at ~38 Million (grew 8% year on year) aided
by focus on granular retail growth across all businesses of the Subsidiaries and
Associate(s).
Overall AUM across asset management, life insurance and health
insurance at over ` 3.6 lacs Crore (de-grew 3% year on year)
Overall lending book (NBFC and Housing Finance) at ` 94,364
Crore (grew 40% year on year)
Gross premium (across Life and Health Insurance) at ` 17,787
Crore (grew 28% year on year)
The financial results of the Company and its Subsidiaries and
Associate(s) are elaborated upon in the Management Discussion and Analysis Report, which
forms part of this Annual Report.
ACCOUNTING METHOD
The Consolidated and Standalone Financial Statements of the Company
have been prepared in accordance with Indian Accounting Standards as notified under
Sections 129 and 133 of the Act read with the Companies (Accounts) Rules, 2014, as amended
and other relevant provisions of the Act.
In accordance with the provisions of the Act, applicable Accounting
Standards, the SEBI Listing Regulations, the Audited Standalone and Consolidated Financial
Statements of the Company for the financial year ended 31st March 2023,
together with the Auditors' Report form part of this Annual Report. The Audited
Financial Statements (including the Consolidated Financial Statements) of the Company as
stated above and the Financial Statements of each of the Subsidiaries of the Company,
whose financials are consolidated with that of the Company, are available on the
Company's website at https:// www.adityabirlacapital.com/Investor-Relations.
MATERIAL EVENTS DURING THE YEAR
There were no material events during the year having an impact on the
Company's business.
HOLDING/ SUBSIDIARIES/ JOINT VENTURES/ ASSOCIATES COMPANIES
Holding Company
During the financial year under review, Grasim Industries Limited
continued to remain the Holding Company of the Company. Grasim Industries Limited is
listed at BSE Limited and National Stock Exchange of India Limited. As per Regulation
16(1)(c) of SEBI Listing Regulations, the Company is considered as a Material Subsidiary
of Grasim Industries Limited.
Subsidiaries and Associates
As a Core Investment Company, the Company is primarily a Holding
Company and holds investments in its group companies (Subsidiaries, Joint Ventures and
Associates).
As on 31st March 2023, the Company had 18 (Eighteen) Indian
Subsidiaries, 5 (Five) Foreign Subsidiaries (including step down Subsidiaries) and 1 (One)
Associate.
Provisions of Regulations 24 and 24A of SEBI Listing Regulations, with
reference to Subsidiaries were duly complied with to the extent applicable.
During the financial year under review, the major changes with respect
to the Subsidiaries and Associate(s) of the Company were as under:
Aditya Birla Health Insurance Co. Limited ("ABHI"), a
non-material Subsidiary of the Company, on 21st October 2022, allotted
5,07,07,454 (Five Crore Seven Lakh Seven Thousand Four Hundred and Fiy Four) fully
paid-up Equity Shares of ` 10/- each on private placement basis to Platinum Jasmine A 2018
Trust, acting through its trustee, Platinum Owl C 2018 RSC Limited ("Allottee"),
being a wholly owned Subsidiary of Abu Dhabi Investment Authority ("Investor")
for an aggregate consideration of ` 664,26,76,474/- (Rupees Six Hundred Sixty Four Crore
Twenty Six Lakh Seventy Six Thousand Four Hundred and Seventy Four Only). Pursuant to the
above allotment of Equity Shares, the Investor owns 9.99% stake, the Company holds 45.91%
stake and Momentum Metropolitan Strategic Investments (Pty) Ltd holds 44.10% stake,
respectively, in ABHI. Hence, it ceased to be a Subsidiary of the Company and became an
Associate of the Company w.e.f. 21st_October 2022.
Vide publication of the notice in Form No. STK- 7 (Notice of
striking off and dissolution) in the Official Gazette on 21st_January 2023,
ABCAP Trustee Company Private Limited ("ABCAP") a wholly owned Subsidiary of the
Company, was voluntarily struck-off from the Register of Companies by Registrar of
Companies, Mumbai, Maharashtra. Hence, it ceased to be a Subsidiary of the Company.
Aditya Birla Capital Digital Limited ("ABCDL") was
incorporated as a wholly owned Subsidiary of the Company with effect from 23rd
March 2023.
On 27th March 2023, the Board of Directors, subject
to requisite approvals, approved the sale of the Company's entire stake of 25,65,103
(Twenty Five Lakh Sixty Five Thousand One Hundred and Three) fully paid-up Equity Shares
of ` 10/- each in Aditya Birla Insurance Brokers Limited ("ABIBL") (a
non-material Subsidiary of the Company), representing 50.002% of the issued and paid-up
share capital of ABIBL to Edme Services Private Limited ("Purchaser"), an
affiliate of Samara Alternate Investment Fund. As on the date of this report, approval of
Insurance Regulatory and Development Authority of India ("IRDAI") for the sale
of shares was awaited.
MATERIAL SUBSIDIARIES
As required under Regulations 16(1)(c) of the SEBI Listing Regulations,
the Board has approved and adopted the Policy for determining Material Subsidiaries. The
Policy is available on the Company's website at https://www.adityabirlacapital.
com/investor-relations/policies-and-code.
During the financial year under review, Aditya Birla Sun Life Insurance
Company Limited, Aditya Birla Finance Limited, Aditya Birla Sun Life AMC Limited and
Aditya Birla Housing Finance Limited were the Material Subsidiaries of the Company as per
Regulation 16(1)(c) of the SEBI Listing Regulations. With effect from 1st April
2023, Aditya Birla Housing Finance Limited has ceased to be a Material Subsidiary of the
Company as per Regulation 16(1)(c) of the SEBI Listing Regulations.
REGISTRATION AS A CORE INVESTMENT COMPANY _"CIC"_1
The Company is registered as a Non-Deposit taking Systemically
Important - Core Investment Company ("CIC- ND-SI") pursuant to the receipt of
Certificate of Registration from the Reserve Bank of India ("RBI") dated 16th
October 2015, under Section 45-IA of the Reserve Bank of India Act, 1934 ("RBI
Act") and Master Direction Core Investment Companies (Reserve Bank) Directions
2016 as amended ("RBI Master Directions").
TRANSFER TO RESERVES
For the financial year ended 31st March 2023 an amount of `
28.26 Crore was transferred to Special Reserve in terms of Section 45-IC of the RBI Act.
DIVIDEND
The Directors do not recommend any dividend for the financial year
under review. In terms of the provisions of Regulation 43A of the SEBI Listing
Regulations, the Company has formulated and adopted a Dividend Distribution Policy. The
policy is available on the Company's website at https://www.adityabirlacapital.com/
investor-relations/policies-and-code.
SHARE CAPITAL
As on 31st March 2023, the Company's paid-up Equity
Share Capital was ` 24,17,99,40,420 divided into 2,41,79,94,042 Equity Shares of `10 each.
On 11th May 2023, the Board of Directors have approved the
raising of funds, inter alia, by way of issuance of Equity Shares, global depository
receipts, American depository receipts, foreign currency convertible bonds fully/partly
convertible debentures, non-convertible debentures, and/or any other financial instruments
convertible into equity shares (including warrants, or otherwise, in registered or bearer
form) and/ or any security convertible into equity shares or combination of any of the
aforementioned securities in one or more tranches through one or more public and/ or
private offerings including by way of a qualified institutional placement or any
combination thereof or any other method as may be permitted under applicable laws to
eligible investors and in such manner and on such price, terms and conditions, in
accordance with the Securities and Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2018, as amended and applicable provisions of the
Companies Act, 2013 and rules issued thereunder, as amended in each case, the enabling
provisions of the Memorandum and Articles of Association of the Company and any other
provisions of applicable laws, for an aggregate amount not exceeding ` 3,000 Crore (Rupees
Three Thousand Crore Only) subject to such regulatory/ statutory approvals as may be
required, including the approval of the Shareholders of the Company in the general
meeting. The proceeds from the aforesaid proposed fund raising are intended to be utilised
for meeting funding requirements and growth objectives of the Company and its businesses
including but not limited to supporting growth in lending and insurance businesses,
strengthening digital offerings, meeting capital adequacy and solvency related
requirements and other business and general corporate purposes.
Mr. Amber Gupta, Company Secretary and Compliance Officer of the
Company has been appointed as the Nodal Officer and Mr. Pramod Bohra, Vice President, has
been appointed as the Deputy Nodal Officer for and on behalf of the Company for the
purpose of verification of claims and co-ordination with Investor Education and Protection
Fund Authority.
Their details are available on the website of the Company at
https://www.adityabirlacapital.com/investor-relations/ shareholder-centre.
DEPOSITORY
As on 31st March 2023, out of the Company's paid-up
Equity Share Capital comprising of 2,41,79,94,042 Equity Shares, 2,39,12,85,302 Equity
Shares (98.89%) were held in dematerialised mode.
The Company's Equity Shares are compulsorily tradable in
electronic form.
RESOURCE MOBILISATION
During the financial year under review, no funds have been mobilised by
way of Non-Convertible Debentures (NCD) or Term Loans/ Working Capital Demand Loan (WCDL)
from banks or through Commercial Paper. The Company is a debt free Company.
INVESTMENT IN SUBSIDIARIES AND ASSOCIATE_S_
During the year under review, the Company subscribed to Equity Share
Capital in the following Subsidiaries/ Associate(s):
Name of Subsidiary/ Associate(s) |
Amount of capital infused |
|
(Equity Shares) (` in Cr) |
Aditya Birla Health Insurance Co. Limited |
145.35 |
Aditya Birla Sun Life Insurance Company |
132.60 |
Limited |
|
Aditya Birla Capital Digital Limited |
25.00 |
Further, details of investment in Subsidiaries/ Associate(s) are stated
in the notes to the Financial Statements forming part of this Annual Report.
CREDIT RATING
The Company has neither issued any debt instruments nor undertaken any
fixed deposit programme or any scheme or proposal involving mobilisation of funds in India
or abroad during the financial year under review.
However, the Company continues to avail the below ratings from Credit
Rating agencies to meet any unforeseen fund requirements and ensure continuation of
ratings through any of the following instruments:
Sr. No. Nature of Instrument |
Name of Instrument |
Name of Credit Rating Agency |
Amount Rated (` in Cr) |
Current Rating |
1 Short Term Instrument |
Commercial Paper |
CRISIL |
900 |
A1+ |
2 Short Term Instrument |
Commercial Paper |
ICRA Ltd |
900 |
A1+ |
3 Long Term Instrument |
Non-Convertible Debenture |
ICRA Ltd |
200 |
AAA |
PUBLIC DEPOSITS
The Company, being a CIC-ND-SI, has not accepted any deposits from the
public during the financial year under review in accordance with Section 73 of the Act
read with the Companies (Acceptance of Deposits) Rules, 2014.
PARTICULARS OF LOANS GIVEN, INVESTMENT MADE, GUARANTEES GIVEN OR
SECURITY PROVIDED
The Company is registered as a Core Investment Company with RBI. Thus,
particulars of loans, guarantees and investments under the provisions of Section 186 of
the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, are not
applicable to the Company.
CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION
As the Company is a Core Investment Company investing in Subsidiaries
and Associate(s), the particulars regarding conservation of energy and technology
absorption as required to be disclosed pursuant to provision of Section 134(3)(m) of the
Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are not relevant to its
activities.
However, some of the steps taken by the Company along with its
Subsidiaries/ Associate(s) for conservation of energy include:
The Company and its Subsidiaries/ Associate(s) are committed to
reducing negative environmental impact.
The Company along with Subsidiaries/ Associate(s) tied up with
ViaGreen, an organisation that helps us in waste management and recycling.
Most of the offices of the Company and its Subsidiaries/
Associate(s) have installed LED lights making them very energy-efficient Rooop solar
panel has been installed at Pune, Bengaluru and Noida branch offices.
As a step towards further reducing the environmental impact, the
documents for Board and Committee meetings of the Company and its Subsidiaries/
Associate(s) are transmitted electronically using a secure web-based application, thereby
saving paper.
The energy saving measures taken also include selecting and
designing offices to facilitate maximum natural light utilisation, video-conferencing
facilities across all offices to reduce the need of employee travel, digital learning
initiatives for employees, optimised usage of lights and continuous monitoring and control
of the operations of the air conditioning equipment as well as elimination of
non-recyclable plastic in offices.
FOREIGN EXCHANGE EARNINGS AND OUTGO
There were no foreign exchange earnings during the financial year under
review as well as during the previous financial year. The foreign exchange outgo during
the financial year under review was ` 0.52 Crore as compared to ` 0.09 Crore, during the
previous financial year.
PARTICULARS OF EMPLOYEES
Disclosures pertaining to remuneration and other details, as required
under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, are attached as Annexure I to
this report.
Details as required under Section 197(12) of the Act, read with Rule
5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, with respect to information of employees of the Company will be provided upon
request by a Member. In terms of the provisions of Section 136(1) of the Act, the Annual
Report is being sent to all the Members of the Company whose email address(es) are
registered with the Company/ Depository Participants via electronic mode, excluding the
aforesaid Annexure which shall be made available for inspection by the Members via
electronic mode. If any Member is interested in obtaining a copy thereof, the Member may
write to the Company Secretary at the Registered Office of the Company in this regard or
send an email to abc.secretarial@adityabirlacapital.com.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
The Company forms part of the top 1000 listed entities on BSE and NSE
as on 31st March 2023. Accordingly pursuant to Regulation 34(2) of SEBI Listing
Regulations, Business Responsibility and Sustainability Report forms part of this Annual
Report. The report is also available on the Company's website at
https://www.adityabirlacapital.com/%20investor-relations/financial-reports.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE
COMPANY
There were no material changes and commitments affecting the financial
position of the Company from the end of the financial year up to the date of this Report.
CHANGE IN NATURE OF BUSINESS
During the financial year under review, there has been no change in the
nature of business of the Company.
EMPLOYEE STOCK OPTION PLAN
Aditya Birla Capital Limited Employee Stock Option and Performance
Stock Unit Scheme 2022
Pursuant to the approval of the members received through Postal Ballot
on 16th October 2022, the Company has adopted "Aditya Birla Capital
Limited Employee Stock Option and Performance Stock Unit Scheme 2022" ("Scheme
2022") for the benefit of the employees of the Company and its Subsidiaries,
Associates and Group companies.
Aditya Birla Capital Limited Employee Stock Option and Performance
Stock Unit Scheme 2017 and ABCL Incentive Scheme for Stock Options and Restricted Stock
Units 2017
The Company also adopted "Aditya Birla Capital Limited Employee
Stock Option and Performance Stock Unit Scheme 2017" ("Scheme 2017") for
the benefit of the employees of the Company and its Subsidiaries and "ABCL Incentive
Scheme for Stock Options and Restricted Stock Units 2017" ("ABCL
Incentive Scheme") pursuant to the Composite Scheme of Arrangement between erstwhile
Aditya Birla Nuvo Limited and Grasim Industries Limited and the Company and their
respective Shareholders and Creditors.
Scheme 2022, Scheme 2017 and ABCL Incentive Scheme are hereinaer
collectively referred to as the "ESOP Schemes". The aforesaid ESOP Schemes are
in compliance with the Securities and Exchange Board of India (Share Based Employee
Benefits) Regulations, 2014 and the Securities and Exchange Board of India (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021 (collectively referred to as
"SEBI (SBEB) Regulations"), as applicable.
Aditya Birla Capital Limited Stock Appreciation Rights Scheme 2019
The Company also adopted "Aditya Birla Capital Limited Stock
Appreciation Rights Scheme 2019" ("SARs Scheme 2019"), which is a cash
based plan linked to the actual stock price movement over the plan tenure.
Further details on the ESOP Schemes and the SARs Scheme 2019 are
provided in the Corporate Governance Report which forms part of this Annual Report.
There were no material changes made to the aforesaid schemes during the
financial year under review.
The details/disclosure(s) on the aforesaid ESOP Schemes as required to
be disclosed under the SEBI (SBEB) Regulations are available on the Company's website
at https://www. adityabirlacapital.com/investor-relations/financial-reports. Certificates
from the Secretarial Auditors on the implementation of the ESOP Schemes will be made
available via electronic mode at the ensuing 16th (Sixteenth) Annual General
Meeting ("AGM") of the Company for inspection by the Members.
MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to Regulation 34(2) of SEBI Listing Regulations, the
Management Discussion and Analysis Report for the financial year under review forms part
of this Annual Report.
CORPORATE GOVERNANCE REPORT
The Corporate Governance Report as stipulated under Regulation 34(3)
read with Schedule V of the SEBI Listing Regulations forms part of this Annual Report. The
requisite certificate from M/s. Makarand M. Joshi & Co., Practising Company
Secretaries on compliance with the requirements of Corporate Governance forms part of this
Annual Report.
STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENTS OF
SUBSIDIARY AND ASSOCIATE COMPANIES
A report on the performance and financial position of each of the
Company's Subsidiary and Associate companies as per Section 129(3) of the Act read
with the Companies (Accounts) Rules, 2014, in the prescribed Form AOC-1 is attached as Annexure
II to the Board's Report.
RISK MANAGEMENT
Risk Management is at the core of our business and ensuring we have the
right risk-return trade-off in line with our risk appetite is the essence of our Risk
Management practices while looking to optimise the returns that go with that risk.
The Board has constituted a Risk Management Committee as required under
RBI Master Directions read with Regulation 21 of the SEBI Listing Regulations to frame,
implement and monitor the Risk Management Plan of the Company.
The Company has in place a Risk Management Policy ("RMC
Policy") which has been uploaded on the website of the Company at
https://www.adityabirlacapital.com/investor-relations/policies-and-code.
The objectives and the scope of the Risk Management Committee broadly
include:
Risk Identification;
Risk Assessment;
Risk Response and Risk Management Strategy; and
Risk Monitoring, Communication and Reporting.
The Management Discussion and Analysis Report sets out the risks
identified and the mitigation plans thereof.
The Company is a CIC and the risks therefore largely relate to
investments made in its Subsidiaries/ Associate(s). The operations of each of the
Subsidiaries/ Associate(s), the risks faced by them and the risk mitigation tools used to
manage them are reviewed periodically by their Risk Management Committees and Boards of
Directors.
Over the years, the Company and its Subsidiaries/ Associate(s) have
built a strong Risk Management Framework supported by well- established policies and
procedures and a talented pool of Risk Professionals.
The Subsidiaries/ Associate(s) of the Company also have
well-established Risk Management Frameworks designed to identify, assess, monitor and
mitigate risks inherent in their business. The framework enables effective Risk Management
through a structure of Committees, policies, internal controls and reporting. The
organisational structure to manage the risk consists of "Three lines of
defense":
First is: Line Management (Functional Heads) to ensure that
accountability and ownership is as close as possible to the activity that creates the
risks; Second is: Risk Oversight including the Risk and Compliance Function and Risk
Management Committee; Third is: Independent Assurance through Internal Audits being
conducted under the supervision of the Audit Committee. Risk Management Committee, Asset
Liability Management Committee and Audit Committee have been set-up to ensure monitoring
of risks and provide Governance as applicable. These Committees are prima facie governed
by their Charters.
Business Continuity
The Company and its Subsidiaries/ Associate(s) have well-documented
Business Continuity Management Programmes which have been designed to ensure continuity of
critical processes during any disruption. A robust Disaster Recovery framework has been
put in place to ensure uninterrupted operations and service to customers.
In view of the increased move to digital modes of business and adoption
of new technologies, there was an enhanced focus on Cyber Security and the Company and its
Subsidiaries/ Associate(s) continued to invest in a strong Cyber Defence Programme. The
Risk Management teams of the Company and its Subsidiaries/ Associate(s) are continuously
scanning the internal and external environment to identify Risks and also to capitalise
upon the opportunities presented in the environment.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
During the financial year under review, all transactions entered into
by the Company with related parties were in ordinary course of business and on arm's
length basis and were not considered material as per the provisions of Section 188 of the
Act read with the Companies (Meetings of Board and its Powers) Rules, 2014. Hence,
disclosure in Form AOC-2 under Section 134(3) (h) of the Act, read with the Rule 8 of the
Companies (Accounts of Companies) Rules, 2014, is not applicable.
Prior approval of the Audit Committee is obtained for all Related Party
Transactions ("RPTs") including omnibus approval for transactions which are of a
repetitive nature and entered into in the ordinary course of business and at arm's
length in accordance with the Policy on Related Party Transactions of the Company. A
statement on RPTs specifying the details of the transactions pursuant to each omnibus
approval granted, is placed on a quarterly basis for review by the Audit Committee.
Pursuant to Regulation 23(9) of SEBI Listing Regulations, disclosures of RPTs are
submitted to the Stock Exchanges on a half-yearly basis and published on the
Company's website at https://www.adityabirlacapital.com/investor-relations/
announcements-and-updates.
There were no material transactions entered into with related parties
during the period under review, which may have had any potential conflict with the
interests of the Company at large. The details of transactions with related parties of the
Company for the financial year under review, are given in notes to the Financial
Statements, which form part of this Annual Report. The Policy on Related Party
Transactions as approved by the Audit Committee and the Board, is available on the
Company's website at
https://www.adityabirlacapital.com/investor-relations/policies-and-code.
INTERNAL FINANCIAL CONTROLS
The Company and its Subsidiaries/ Associate(s) have well-established
internal control systems in place which are commensurate with the nature of their business
and size, scale and complexity of their operations. Standard Operating Procedures (SOP)
and Risk Control Matrices designed to provide a reasonable assurance are in place and are
being continuously monitored and updated.
The Company along with its Subsidiaries/ Associate(s) also periodically
engage outside experts to carry out independent review of the effectiveness of various
business processes. The observations and best practices suggested are reviewed by the
management and Audit Committee and appropriately implemented with a view to continuously
strengthen internal controls.
INTERNAL AUDIT
The Company has in place an effective Internal Audit Framework to
monitor the efficacy of internal controls with the objective of providing to the Audit
Committee and the Board of Directors, an independent and reasonable assurance on the
adequacy and effectiveness of the organisation's Risk Management, internal control
and governance processes. The framework is commensurate with the nature of the business,
size, scale and complexity of its operations with a Risk Based Internal Audit (RBIA)
approach.
The Company has implemented a RBIA Programme in accordance with the
requirements of RBI circular dated 3rd_February 2021. The Internal audit plan
is approved by the Audit Committee and Internal audits are undertaken on a periodic basis
to independently validate the existing controls. Internal Audit Reports are regularly
reviewed by the management and corrective action is initiated to strengthen controls and
enhance the effectiveness of existing systems.
Significant audit observations, if any, are presented to the Audit
Committee along with the status of management actions and the progress of implementation
of recommendations.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act and to the best of their
knowledge and belief and according to the information and explanations obtained from the
operating management, Directors of the Company state that:-i) in the preparation of the
Annual Accounts for the financial year ended 31st March 2023, the applicable
Accounting Standards have been followed and there were no material departures from the
same; ii) the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at 31st
March 2023 and of the profit/ loss of the Company for the financial year ended on that
date; iii) the Directors had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding
the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors had prepared the Annual Accounts on a going concern basis';
v) the Directors had laid down Internal Financial Controls and that such Internal
Financial Controls were adequate and were operating effectively; and vi) the Directors had
devised proper systems to ensure compliance with the provisions of all applicable laws and
that such systems are adequate and operating effectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Appointment / Re-Appointment / Resignation of Directors
As on 31st March 2023, the Board of Directors of the Company
("the Board") comprised 8 (Eight) Directors including 1 (One) woman Director.
No Director was appointed/ has resigned from the Board during the
financial year under review.
Retirement by Rotation
Pursuant to Section 152 of the Act read with the Articles of
Association of the Company, Dr. Santrupt Misra (DIN: 00013625), Non-Executive
Non-Independent Director retires from the Board by rotation at the ensuing AGM of the
Company. Although being eligible, he has not offered himself for re-appointment.
Declaration by Independent Directors
All Independent Directors have submitted their declaration of
independence, pursuant to the provisions of Section 149(7) of the Act and Regulation 25(8)
of the SEBI Listing Regulations, stating that they meet the criteria of independence as
provided in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing
Regulations and they are not aware of any circumstance or situation, which exist or may be
reasonably anticipated, that could impair or impact their ability to discharge their
duties with an objective independent judgment and without any external influence.
The Board is of the opinion that the Independent Directors of the
Company possess requisite qualifications, experience and expertise and hold the highest
standards of integrity.
All Independent Directors of the Company have registered their name in
the data bank maintained with the Indian Institute of Corporate Affairs in terms of the
provisions of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Key Managerial Personnel
Mr. Ajay Srinivasan stepped down as Chief Executive Officer (CEO) of
the Company w.e.f. 30th June 2022. Mrs. Vishakha Mulye took over as CEO w.e.f.
1st July 2022.
Mrs. Vishakha Mulye, CEO, Mrs. Pinky Mehta, Chief Financial Officer
(CFO) and Mr. Amber Gupta, Company Secretary and Compliance Officer are the Key Managerial
Personnel of the Company as on
31st March 2023 in terms of the provisions of Sections 2(51)
and 203 of the Act, read with the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014.
Fit and Proper Criteria
All the Directors meet the fit and proper criteria stipulated under the
RBI Master Directions, as amended.
ANNUAL PERFORMANCE EVALUATION
The evaluation framework for assessing the performance of the Directors
of the Company comprises contributions at the Meeting(s) and strategic perspective or
inputs regarding the growth and performance of the Company provided by them, amongst
others.
Pursuant to the provisions of the Act and SEBI Listing Regulations and
in terms of the Framework of the Board Performance Evaluation, the Nomination,
Remuneration and Compensation Committee and the Board of Directors have carried out an
annual performance evaluation of the Board, performance of various Committees of the
Board, Individual Directors, and the Chairman. The manner in which the evaluation has been
carried out has been set out in the Corporate Governance Report, which forms part of this
Annual Report.
Outcome of the Evaluation
The Board of the Company was satisfied with the functioning of the
Board and its Committees. The Committees are functioning well and besides covering the
Committees' terms of reference, as mandated by applicable laws, important issues are
brought up and discussed in the Committee Meetings. The Board was also satisfied with the
contribution of Directors in their individual capacities. The Board has full faith in the
Chairman leading the Board effectively and ensuring participation and contribution from
all the Board Members.
MEETINGS OF THE BOARD AND ITS COMMITTEES
The Board meets at regular intervals to discuss and decide on the
Company's performance and strategies. During the financial year under review, the
Board met 10 (Ten) times on 23rd April 2022, 6th May 2022, 12th
May 2022, 6th June 2022, 3rd August 2022, 11th August
2022, 8th September 2022, 7th November 2022, 2nd February
2023 and 27th March 2023.
Further details on the Board, its Meetings, composition and attendance
are provided in the Corporate Governance Report, which forms part of this Annual Report.
Audit Committee
The Company has constituted an Audit Committee with its composition,
quorum, powers, role and scope in line with the applicable provisions of the Act, SEBI
Listing Regulations and RBI Master Directions.
During the financial year under review, the Audit Committee reviewed
the internal controls put in place to ensure that the accounts of the Company are properly
maintained and that the accounting transactions are in accordance with prevailing laws and
regulations. In conducting such reviews, the Committee found no material discrepancy or
weakness in the internal control system of the Company.
Further details on the Audit Committee, its Meetings, composition and
attendance are provided in the Corporate Governance Report, which forms part of this
Annual Report. During the financial year under review, all recommendations made by the
Audit Committee were accepted by the Board.
Nomination, Remuneration and Compensation Committee
The Company has constituted a Nomination, Remuneration and Compensation
Committee ("NRC"), with its composition, quorum, powers, role and scope in line
with the applicable provisions of the Act, SEBI Listing Regulations and directions/
guidelines/ framework issued by RBI.
Further details on the NRC, its Meetings, composition and attendance
are provided in the Corporate Governance Report, which forms part of this Annual Report.
During the year under review, RBI has issued Guidelines on Compensation
of Key Managerial Personnel (KMP) and Senior Management in NBFCs which came into effect
from 1st_April 2023. The Executive Remuneration Philosophy/ Policy of the
Company which was formulated under the provisions of Section 178(3) of the Act and SEBI
Listing Regulations, was amended with effect from 1st April 2023 to align with
the directions/ guidelines/ framework issued by RBI as applicable. The said Policy is
attached as Annexure III to the Board's Report and the same is uploaded on the
website of the Company at https://www.adityabirlacapital.com/investor-relations/
policies-and-code.
Other Committees
The Board of Directors has also constituted the following Committees:
Corporate Social Responsibility Committee |
Stakeholders' Relationship Committee |
Risk Management Committee |
PIT Regulations Committee |
IT Strategy Committee |
Asset Liability Management Committee |
More information on all of the above Committees including details of
their Meetings, composition and attendance are provided in the Corporate Governance
Report, which forms part of this Annual Report.
ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) of the Act, the Annual
Return in Form MGT-7 of the Company for the financial year 2022-23 is available on the
Company's website at https://
www.adityabirlacapital.com/investor-relations/financial-reports.
AUDITORS
Statutory Auditors, their Report and Notes to Financial Statements
Pursuant to the provisions of Section 139 of the Act and the Companies
(Audit and Auditors) Rules, 2014, SEBI (Listing Regulations) and Circular no.
RBI/2021-22/25 Ref. No. DoS. CD.ARG/SEC.01/08.91.001/2021-22 dated 27th April
2021 issued by RBI on Guidelines for appointment of Statutory Auditors ("RBI
Circular") as amended, B S R & Co. LLP, Chartered Accountants (Firm Registration
No. 101248W/W-100022) were appointed as Statutory Auditors of the Company for a term of 3
(Three) years from the conclusion of 14th (Fourteenth) AGM till the conclusion
of 17th (Seventeenth) AGM of the Company. B S R & Co. LLP have confirmed
that they are not disqualified from continuing to act as Statutory Auditors of the Company
and that they comply with the eligibility criteria/ requirements specified under the RBI
Circular for FY 2023-24.
The observation(s) made in the Auditor's Report are self-
explanatory and therefore, do not call for any further comments under Section 134(3)(f) of
the Act.
The Auditor's Report does not contain any qualifications,
reservations, adverse remarks or disclaimer.
Secretarial Audit and Secretarial Compliance Report
Pursuant to the requirements of Section 204(1) of the Act read with
Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, the Company had appointed M/s. Makarand M. Joshi & Co., Practising Company
Secretaries, to conduct the Secretarial Audit for the financial year under review. The
Secretarial Audit Report in Form MR-3 for the financial year under review, as received
from M/s. Makarand M. Joshi & Co., Company Secretaries, is attached as Annexure IV
to the Board's Report. The Secretarial Audit Report does not contain any
qualification, reservation or adverse remark. Pursuant to Regulation 24A of the SEBI
Listing Regulations, the Annual Secretarial Compliance Report for the financial year under
review will be submitted to the Stock Exchanges and uploaded on the website of the Company
at https://www.adityabirlacapital. com/investor-relations/announcements-and-updates.
Cost Records and Auditors
The provisions of Cost Records and Cost Audit as prescribed under
Section 148 of the Act are not applicable to the Company.
Reporting of Frauds by Auditors
None of the Auditors of your Company, i.e, the Statutory Auditors and
Secretarial Auditors has reported any incident of fraud to the Audit Committee or the
Board of Directors under Section 143(12) of the Act during the financial year under
review.
CORPORATE SOCIAL RESPONSIBILITY
In accordance with Section 135 of the Act, the Company has constituted
a Corporate Social Responsibility ("CSR") Committee.
The CSR Committee has formulated and recommended to the Board, a
Corporate Social Responsibility Policy ("CSR Policy") indicating the activities
to be undertaken by the Company, which has been approved by the Board. The CSR Policy is
available on the Company's website at https://www.adityabirlacapital.com/
investor-relations/policies-and-code.
During the financial year under review, the Company was not required to
make any expenditure towards CSR projects, in absence of average net profit for three
immediately preceding financial years calculated in accordance with the provisions of
Section 198 of the Act. Accordingly, no CSR activity was undertaken by the Company.
Considering that the Company was not required to contribute any amount towards CSR
activities, report on activities as required under Companies (Corporate Social
Responsibility Policy) Rules, 2014 has not been furnished.
Further details on the CSR Committee are provided in the Corporate
Governance Report, which forms part of this Annual Report.
WHISTLE BLOWER POLICY/ VIGIL MECHANISM
In compliance with the provisions of Section 177(9) of the Act read
with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation
22 of the SEBI Listing Regulations, the Company has formulated a Whistle blower policy/
vigil mechanism for Directors and Employees to report concerns, details of which are
covered in the Corporate Governance Report, which forms part of this Annual Report. The
said policy is available on the Company's website at
https://www.adityabirlacapital.com/investor-relations/ policies-and-codes.
POLICY ON PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has in place a policy which is in line with the
requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition &
Redressal) Act, 2013. An Internal Committee has been set up to redress complaints, if any,
received regarding sexual harassment of women employees. The Company has complied with the
provisions relating to the constitution of Internal Committee under the Sexual Harassment
of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees
(permanent, contractual, temporary, trainees) are covered under this policy. During the
financial year under review, there were no complaints received under the Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company has complied with the provisions of Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
RBI REGULATIONS
The Company has complied with all the regulations of RBI to the extent
applicable as a CIC-ND-SI.
RBI has issued guidelines on Scale Based Regulation (SBR): A
Revised Regulatory Framework for NBFCs' vide its Circular No.
RBI/2021-22/112 Ref.DOR.CRE. REC.No.60/03.10.001/2021-22 dated 22nd
October 2021 ("SBR Framework"), which came into effect from 1st
October 2022. As per the SBR Framework, the Company being a Core Investment Company has
been classified under Middle Layer.
HUMAN RESOURCES
The Company along with its Subsidiaries and Associate(s) has always
aspired to be an organization and a workplace which attracts, retains and provides a
canvas for talent to operate. Its vision of being a leader and a role model in a broad
based and integrated financial services business and a culture that is purpose driven
gives meaning to our people.
We believe that meaning at work is created when people relate to the
purpose of the organisation, feel connected to their leaders and have a sense of
belonging. Our focus stays strong on providing our people a work environment that welcomes
diversity, nurtures positive relationships, provides challenging work assignments and
opportunities based on meritocracy for people to grow and build their careers with us in
line with their aspirations.
As on 31st March 2023, the employee strength of the Company
was 27 and along with the Subsidiaries and Associate(s) it had 34,000+ employees.
The workforce along with Subsidiaries and Associate(s) comprises of
more than 69% millennials and 29% women as on 31st_March 2023.
Talent Management
Building a strong future ready talent pool and robust leadership
succession pipeline continue to be priority areas for us in Talent Management. We focus on
creating well rounded leaders who are passionate about value creation for customers and
execution excellence.
In the last 2 years:
More than 55 leaders have undergone a bespoke comprehensive
leadership development journey curated in partnership with Harvard Business Publishing.
70 members from our talent pool in middle management were
covered in our flagship leadership development program preparing them to take on larger
roles.
570+ employees across levels moved into new / larger roles
helping them advance in their career
Additionally, focus on building future ready skills in the areas of
Digital, Technology, Risk and Analytics has been ongoing during the year. Through various
initiatives and partnerships with global organizations, we have continued our focus on
building skills in these areas.
Employee Wellness and Engagement
Our endeavor to provide a happy, vibrant and engaging work environment
continued during the year.
Revitalizing a culture of connect and camaraderie has been an area of
significant attention for us. Bringing people together through events, townhalls,
leadership connect sessions and celebration of milestones enabled this.
At Aditya Birla Capital (ABC), we consider employee health and
wellbeing to be a non-negotiable proposition. We believe that focusing on employee health
and wellbeing results in a happier workforce which further creates a positive impact on
customer satisfaction and retention. Being in a people-oriented business, we consider
employee well-being a strategic imperative. We proactively design and implement various
wellness solutions across our business units and workforce group year on year.
Our framework focuses on Integrated and Holistic Wellbeing covering not
just the Physical Wellbeing of employees but also Emotional or Mental Wellbeing, Financial
Wellbeing, Intellectual Wellbeing and Social Wellbeing. Close to 5,000 employees are
active on the wellness app and benefit from the holistic digital wellness support. We have
also empaneled with doctors and counsellors to provide preliminary medical consultations
in our corporate offices and on-call consultations for our employees and their families in
emergency cases. Enabling our employees to regularly check their health and wellness
levels we have organized multiple health camps covering Bone density check-ups, Body
composition analysis, Yoga sessions at work, Nutritional counselling, Breast Health
check-ups and awareness drives and many more. During the year alone close to 10,000
employees participated in our wellbeing programs. Lastly, Preventive annual health
check-ups are our way of monitoring and ensuring a physically fit workforce. We have
partnered with close to 300 diagnostic centers across the country that enable a seamless
experience for our employees.
Learning
Our Company's philosophy is to provide every employee with
continuous opportunities to learn & grow. Our learning interventions create an
organization wide impact as these are focused on enabling employees to do better at work.
An AI enabled learning app provides employees easy access to super
personalized content that meets their unique individual requirements. 31,000+ relevant
courses, videos & webinars were hosted on Gyanodaya Virtual Campus (GVC) which is
Aditya Birla Group's e-Learning platform for employees. Employees leveraged these
resources to enhance their skills and knowledge.
Additionally, with 3,000+ E Learning courses, 25,000+ video-based
modules and 2,000+ micro-learning modules and 1,400+ Sustainability courses our employees
have the flexibility to learn anytime and from anywhere.
For our large frontline sales force distribution teams, our ABcapital
app learning library offers courses on induction and regulatory training, ensuring that
all new hires receive the necessary foundation to be successful in their roles, 350+
functional courses are available, enabling the frontline distribution force to deepen
their expertise.
SUSTAINABILITY
Sustainability is one of the key focus areas for us and being a CIC,
the Company drives the sustainability practices in its Subsidiaries and Associate(s),
centrally. The sustainability efforts are aligned with Aditya Birla Group's
sustainability strategy and purpose statement. The Company has identified three main
categories to implement sustainability across its Subsidiaries and Associate(s) namely,
Environment, Social and Governance. We have introduced 25 industry specific ESG score
cards based on UN's Equator Principles in the infrastructure lending business. One of
our subsidiaries had raised ` 1,000 Crore in green loan from International Finance
Corporation to finance renewable energy projects. Through its Subsidiary, Aditya Birla Sun
Life AMC Limited, the Company has also launched an ESG focused equity fund with an AUM of
more than ` 798 crores as of 31st March, 2023. Financial inclusion and serving
the under banked has been a key focus area for our Subsidiaries which are engaged in
lending to SMEs, supply chain finance for small vendors, affordable housing, rural
insurance and micro-SIPs with our portfolio expanding to urban, semi urban and rural parts
of India. Enterprise Risk Management function plays an integral part in managing
sustainability risk across all businesses. The Chief Risk Officer (CRO) guides and governs
the sustainability strategy across the businesses. The detailed Sustainability Report will
be made available on the website of the Company at https://www.adityabirlacapital.
com/investor-relations/sustainability-reports.
SECRETARIAL STANDARDS OF INSTITUTE OF COMPANY SECRETARIES OF INDIA
The Company is in compliance with the Secretarial Standards specified
by the Institute of Company Secretaries of India ("ICSI") on Meetings of the
Board of Directors (SS-1) and General Meetings (SS-2).
CODE FOR PROHIBITION OF INSIDER TRADING
Pursuant to SEBI (Prohibition of Insider Trading) Regulation 2015, as
amended, the Company has a Board approved code of conduct to regulate, monitor and report
trading by Insiders and a Code of Practices and Procedures for Fair Disclosure of
Unpublished Price Sensitive Information.
Further details on the same are covered in the Corporate Governance
Report, which forms part of this Annual Report.
AWARDS AND RECOGNITIONS
During the financial year under review, the Company and its
Subsidiaries and Associate(s) have been felicitated with awards and recognitions across
various functional areas which has been elaborated under Awards and Recognitions section
in this Annual Report.
OTHER DISCLOSURES
In terms of applicable provisions of the Act and SEBI Listing
Regulations, the Company discloses that during the financial year under review:
i. there was no issue of shares (including sweat equity shares) to
employees of the Company under any scheme save and except under Employee Stock Option
Scheme referred to in this Report.
ii. there was no Scheme for provision of money for the purchase of its
own shares by employees or by trustees for the benefit of employees.
iii. there was no public issue, rights issue, bonus issue or
preferential issue, etc. iv. there was no issue of shares with differential rights.
v. there was no transfer of unpaid or unclaimed amount to Investor
Education and Protection Fund (IEPF).
vi. no significant or material orders were passed by the Regulators or
Hon'ble Courts or Tribunals which impact the going concern status and Company's
operations in future.
vii. there were no proceedings for Corporate Insolvency Resolution
Process initiated under the Insolvency and Bankruptcy Code, 2016.
viii. there was no failure to implement any Corporate Action.
ix. there were no borrowings from Banks or Financial Institution and no
instance of one-time settlement with any Bank or Financial Institution.
ACKNOWLEDGEMENTS
The Board takes this opportunity to express its appreciation for the
support and co-operation extended by our various partners and other business associates.
The Board gratefully acknowledges the ongoing co-operation and support provided by all
Statutory and Regulatory Authorities.
The Board also acknowledges the support and contribution of
Company's bankers, Stock Exchanges, Registrar of Companies, Depositories, the Reserve
Bank of India, Securities and Exchange Board of India, Central and State Governments and
other regulatory bodies and the shareholders who have always supported and helped the
Company to achieve our objectives. The Board places on record its appreciation for the
exemplary contribution made by the employees of the Company and its Subsidiaries and
Associate(s) at all levels. Their dedicated efforts and enthusiasm have been pivotal to
the Company's and its Subsidiaries and Associate(s)' growth.
|
By Order of the Board of Directors |
|
For Aditya Birla Capital Limited |
|
Kumar Mangalam Birla |
Date: 11th May 2023 |
Chairman |
Place: Mumbai |
DIN: 00012813 |
|