Board of Directors - Bombay Stock Exchange...Board of Directors K S Raju Chairman Chandra Pal Singh...

Board of Directors

K S Raju

Chairman

Chandra Pal Singh Yadav Registered Office

Nominee of KRIBHCO D.No 8-2-248,

Nagarjuna Hills, Punjagutta

Hyderabad - 500 082

INDIA

N C B Nath Website

www.norl.co.in

CIN : L23200AP2010PLC071242

S R Ramakrishnan

D Ranga Raju

K Rahul Raju

Auditors

M/s. M Bhaskara Rao & Co.,

Chartered Accountants

Hyderabad - 500 082

INDIA

K Soma Raju Secretary

Manager T Vamsi Krishna

NAGARJUNA OIL REFINERY LIMITED

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NOTICENOTICE IS HEREBY GIVEN THAT THE FOURTH ANNUAL GENERAL MEETINGOF NAGARJUNA OIL REFINERY LIMITED WILL BE HELD AT 12.00 NOON ONFRIDAY, SEPTEMBER 26, 2014 AT SRI SATYA SAI NIGAMAGAMAM, 8-3-987/2,SRINAGAR COLONY, HYDERABAD - 500 073 TO TRANSACT THE FOLLOWINGBUSINESS:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Fourth Annual Report of the company,Balance Sheet as at March 31, 2014, the Statement of Profit and Loss forthe financial year ended March 31, 2014, the Cash Flow Statement for thefinancial year ended March 31, 2014 and the Reports of the Directors andAuditors thereon.

2. To appoint a Director in the place of Shri K S Raju who retires by rotationand is eligible for re-appointment.

3. To appoint a Director in the place of Shri K Rahul Raju who retires by rotationand is eligible for re-appointment.

4. To consider and if thought fit, to pass with or without modification(s) thefollowing resolution which will be proposed as an Ordinary Resolution:

"RESOLVED THAT the retiring Auditors of the company, M/s. M BhaskaraRao and Co., Chartered Accountants, Hyderabad, being eligible for re-appointment be and are hereby re-appointed as Auditors of the company tohold office for a term of five years commencing from the conclusion of the4th Annual General Meeting up to the conclusion of the 9th Annual GeneralMeeting on such terms and conditions as may be fixed by the Board ofDirectors of the company subject to the ratification of the Members of thecompany at every Annual General Meeting."

SPECIAL BUSINESS:

5. To consider and if thought fit, to pass with or without modification(s) thefollowing resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Sections 196, 197, 203and Schedule V and other applicable provisions of the Companies Act, 2013,if any, Shri K Soma Raju be and is hereby appointed as 'Manager' of theCompany for a period of 3 years with effect from August 31, 2014."

"RESOLVED FURTHER THAT Shri K Soma Raju be paid a consolidatedmonthly remuneration of Rs. 10,000/- and other Perquisites as per the Rulesof the Company."

"RESOLVED FURTHER THAT a certified copy of this resolution be furnishedby any one of the Directors of the Company or T Vamsi Krishna, Secretary."

6. To consider and if thought fit, to pass with or without modification(s) thefollowing resolution as an Ordinary Resolution:

"RESOLVED THAT pursuant to the provisions of Sections 149, 152 and otherapplicable provisions of the Companies Act, 2013 and the Rules madethereunder read with Schedule IV to the Companies Act, 2013, Dr. N C BNath, Director of the Company and in respect of whom the company hasreceived a notice in writing from a member under Section 160 of theCompanies Act, 2013 signifying his intention to propose Dr. N C B Nath asa candidate for the office of Director of the company, be and is herebyappointed as an Independent Director of the company to hold office upto theconclusion of the 9th Annual General Meeting or September 25, 2019,whichever is later, not liable to retire by rotation."

7. To consider and if thought fit, to pass with or without modification(s) thefollowing resolution as a Ordinary Resolution:

RESOLVED THAT pursuant to the provisions of Sections 149, 152 and otherapplicable provisions of the Companies Act, 2013 and the Rules madethereunder read with Schedule IV to the Companies Act, 2013, Shri S R

Ramakrishnan, Director of the Company and in respect of whom the companyhas received a notice in writing from a member under Section 160 of theCompanies Act, 2013 signifying his intention to propose Shri S RRamakrishnan as a candidate for the office of Director of the company, beand is hereby appointed as an Independent Director of the company to holdoffice upto the conclusion of the 9th Annual General Meeting or September25, 2019, whichever is later, not liable to retire by rotation.

8. To consider and if thought fit, to pass with or without modification(s) thefollowing resolution as a Ordinary Resolution:

RESOLVED THAT pursuant to the provisions of Sections 149, 152 and otherapplicable provisions of the Companies Act, 2013 and the Rules madethereunder read with Schedule IV to the Companies Act, 2013, Shri D RangaRaju, Director of the Company and in respect of whom the company hasreceived a notice in writing from a member under Section 160 of theCompanies Act, 2013 signifying his intention to propose Shri D Ranga Rajuas a candidate for the office of Director of the company, be and is herebyappointed as an Independent Director of the company to hold office upto theconclusion of the 9th Annual General Meeting or September 25, 2019,whichever is later, not liable to retire by rotation.

By Order of the Board

Hyderabad T Vamsi KrishnaJuly 30, 2014 Company Secretary

NOTES1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING

IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTEINSTEAD OF HIMSELF AND SUCH A PROXY NEED NOT BE AMEMBER OF THE COMPANY.

A PERSON CAN ACT AS A PROXY ON BEHALF OF MEMBERSNOT EXCEEDING FIFTY AND HOLDING IN THE AGGREGATE NOTMORE THAN TEN PERCENT OF THE TOTAL SHARE CAPITALOF THE COMPANY CARRYING VOTING RIGHTS. A MEMBERHOLDING MORE THAN TEN PERCENT OF THE TOTAL SHARECAPITAL OF THE COMPANY CARRYING VOTING RIGHTS MAYAPPOINT A SINGLE PERSON AS PROXY AND SUCH PERSONSHALL NOT ACT AS A PROXY FOR ANY OTHER PERSON ORSHAREHOLDER.

2. The Statement pursuant to Section 102(1) of the Companies Act, 2013 with respectto the Special Business set out in the Notice is annexed.

3. Instrument of proxies in order to be effective must be deposited at the company'sregistered office not less than 48 hours before the meeting.

4. Pursuant to the provisions of Section 108 of the Companies Act, 2013 read with theCompanies (Management and Administration) Rules, 2014 and Clause 35B of theListing Agreement entered into with the Stock Exchanges, the company is providinge-voting facility to enable shareholders to cast their vote electronically on all theresolutions set forth in the Notice to the 4th Annual General Meeting to be held onFriday i.e., September 26, 2014 at 12.00 Noon. The company has engaged the servicesof Central Depository Services (India) Limited to provide e-voting platform to theshareholders.

Please refer to the detailed instructions on e-voting at page no. 24 of the AnnualReport 2013-14.

Shareholders holding shares in demat form and shareholders who have registeredtheir email id with the company will also receive the e-voting instructions by email.

5. Shareholders who do not have access to e-voting facility may use the enclosed BallotForm and send their assent or dissent on or before closing of business hours ofSeptember 22, 2014.

6. Members are requested to notify immediately the change, if any, of the addressregistered with the company.

7. Members desiring to seek any information on the annual accounts are requested towrite to the company at an early date to enable compilation of information.

8. The Register of Members and the Share Transfer Books will remain closed fromSeptember 12, 2014 to September 26, 2014 (both days inclusive).

9. The company has paid the listing fees for the year 2014 - 2015 to The BombayStock Exchange and the National Stock Exchange of India Limited, Mumbai,where the securities of the company are listed.


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10. Members whose shareholding is in the electronic mode are requested to informchange of address, notifications and updates of bank account details to theirrespective Depository Participants.

11. Members are requested to update the new bank account number allotted afterimplementation of Core Banking Solutions (CBS) to the company in case of sharesheld in physical form and to DP in case of shares held in demat form.

12. Members are requested to address all correspondences, to XL Softech SystemsLimited, 3, Sagar Society, Road No 2, Banjara Hills, Hyderabad, 500 034, India.

13. The Annual Report 2013-2014 along with the Notice of the 4th Annual General Meeting,instructions on e-voting, Ballot Form, attendance slip and proxy form is being mailedin electronic mode to all the members whose email addresses are registered with theCompany/ Depository Participant unless communication is received to the contrary.Members who have not registered their email addresses, printed copies of thedocuments are being sent.

The Notice of the 4th Annual General Meeting alongwith the Annual Report 2013-2014 is also available on the Company's website, www.norl.co.in

14. Shareholders are requested to furnish their e-mail ID's to enable the company forwardall the requisite information in electronic mode.

15. Shareholders requiring a printed copy of the Annual Report may forward their requestto the company in writing.

16. The Securities and Exchange Board of India has notified that the shareholders/transferee of shares (including joint holders) holding shares in physical form arerequired to furnish a certified copy of their PAN Card to the company while transactingin the securities market including transfer, transmission or any other corporate action.

Accordingly, all the shareholders/transferee of shares (including joint holders) arerequested to furnish a certified copy of their PAN Card to the company while transactingin the securities market including transfer, transmission or any other corporate action.

17. The company has designated an exclusive e-mail ID [email protected] for redressal of shareholders' complaints/grievances.In case you have any queries/complaints or unresolved grievances, then please writeto us at [email protected].

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIESACT, 2013

Item No. 5

The Board of Directors of the Company at their meeting held on May 29, 2014 consideredthe re-appointment of Shri K Soma Raju as Manager of the Company for a period of 3years effective from August 31, 2014 at a consolidated monthly remuneration of` 10,000/- and other perquisites as per the Rules of the Company.

The appointment of Shri K Soma Raju as Manager of the Company was approved by theNomination and Remuneration Committee of Directors, in terms of the requirements of theSection 196 and Schedule V to the Companies Act, 2013.

Your directors commend the resolution for approval.

None of the Directors or Key Managerial Personnel of the Company or their relatives areconcerned or interested in this resolution except Shri K Soma Raju.

The Board commends the Special Resolution set out at Item Nos. 5 of the Notice forapproval by the shareholders.

Item No. 6, 7 & 8

Dr. NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju are Non- Executive(Independent) Directors on the Board of the company. Dr. NCB Nath, Shri S RRamakrishnan joined the Board of Directors on June 17, 2011 and Shri D Ranga Raju onAugust 22, 2011.

The Securities and Exchange Board of India (SEBI) has amended Clause 49 of the ListingAgreement inter alia stipulating the conditions for the appointment of independent directorsby a listed company.

The Companies Act, 2013 prescribes the manner in which an Independent Director needsto be appointed.

The company has received notices in writing under the provisions of the Section 160 of theCompanies Act, 2013, from a member along with a deposit of `1,00,000/- proposing thecandidature of Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju as IndependentDirectors as per the provisions of Section 149 of the Companies Act, 2013.

The company has received from Dr. NCB Nath, Shri S R Ramakrishnan and Shri D RangaRaju the following:

a) Consent in writing to act as Director in Form DIR- 2

b) Declaration in Form DIR-8 confirming that he is not disqualified under Section 164(2)of the Companies Act, 2013

c) Declaration as per Section 149 (6) of the Companies Act, 2013, that he meets thecriteria of independence.

It is proposed to appoint Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju asIndependent Directors of the company not liable to retire by rotation up to conclusion of 9thAnnual General Meeting or September 25, 2019 whichever is later, pursuant to theprovisions of Section 149 of the Companies Act, 2013 and the Listing Agreement.

In the opinion of the Board, Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Rajufulfill the conditions for appointment as Independent Directors as specified in the Act, Rulesmade thereunder and the Listing Agreement. Dr NCB Nath, Shri S R Ramakrishnan andShri D Ranga Raju are independent of the management.

Brief resume of Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju, nature oftheir expertise in specific functional areas and names of companies in which they holddirectorships and memberships / chairmanships of Board Committees, shareholding andrelationships between directors inter-se as stipulated under Clause 49 of the ListingAgreement with the Stock Exchanges, are provided in the Corporate Governance Reportforming part of the Annual Report.

Copy of the draft letters for respective appointments of Dr NCB Nath, Shri S R Ramakrishnanand Shri D Ranga Raju as Independent Directors setting out the terms and conditions areavailable for inspection by members at the Registered Office of the Company during normalworking hours on working days upto the date of the AGM.

None of the other Directors / Key Managerial Personnel of the Company / their relativesare, in any way, concerned or interested, financially or otherwise, in these resolutionsexcept Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju.

The Board commends the Ordinary Resolutions set out at Item No. 6, 7 & 8 of the Noticefor approval by the shareholders.

Inspection of Documents

The documents pertaining to Special Business are available for inspection at theRegistered Office of the company between 10.30 a.m. and 12.30 p.m. on any workingday prior to the meeting.

By Order of the Board

Hyderabad T Vamsi KrishnaJuly 30, 2014 Company Secretary


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DIRECTORS' REPORTYour Directors have pleasure in presenting the Fourth Annual Report together with theAudited Accounts of the Company for the year ended March 31, 2014.FINANCIAL SUMMARY ` in Lakhs

Particulars 2013 - 2014current year

2012-2013previous year

Net Sales/Income from Operations - -Other Income - -Total Expenditure

a. Increase/(decrease) in Stock - -b. Cost of materials consumed - -c. Employee benefits expense 75.86 70.17d. Purchase of traded products - -e. Power and fuel - -f. Other expenses 95.03 83.16

Total 170.89 153.33Finance cost - -Depreciation and amortization 4.03 4.82Profit before tax (174.92) (158.15)Provision for tax - -Deferred tax - -Profit after tax (174.92) (158.15)Dividend - equity shares - -Tax on proposed dividend - -Balance c/d to balance sheet (174.92) (158.15)Paid Up equity share capital(Face value of Re.1/- per share) 4281.82 4281.82Reserves excluding revaluation reserve 73,075.83 73,250.75Earning per share (annualized) - in Rs.Basic and Diluted (0.04) (0.04)

STATUS OF THE OIL REFINERY PROJECTYour company as on date holds 46.78% of Equity Capital in Nagarjuna Oil CorporationLimited (NOCL). NOCL is setting-up 6MMTPA refinery project at Cuddalore, TamilNadu.The implementation of the Project was impacted by cyclone 'Thane'. The physicalcompletion of the Project as on date is 58%.NOCL is actively pursuing with Strategic Investors to participate in equity investmentin view of escalation in the Project Cost and the due diligence by some of theInvestors has completed and awaiting their decision.In view of the escalation in project cost, NOCL is making all efforts to achievefinancial closure at the earliest.CORE INVESTMENT COMPANYYour company has made application to Reserve Bank of India for registration as'Core Investment Company' to comply with Core Investment Companies (ReserveBank) Directions, 2011.SHARE CAPITALThe paid-up equity capital of the company as on March 31, 2014 is ` 42,81,81,821/- consisting of 42,81,81,821 equity shares of ` 1/- each.CORPORATE GOVERNANCEYour company firmly believes that building a culture of compliance is more thanmeeting regulations and standards. Your company is always proactive in meetingmandated standards and practicing corporate governance in spirit and not just theletter of the law.As Mandated by Clause 49 of the Listing Agreement a report on Corporate Governancealongwith a Certificate from Practicing Company Secretary on the compliance ofconditions of Corporate Governance is annexed hereto. Your company is happy toinform you that there were no adverse remarks / qualifications/ reservations raisedin the Corporate Governance Report.NUMBER OF BOARD MEETINGSThe Board of Directors of your company, during the period under review met Fourtimes on May 03, 2013, August 08, 2013, November 07, 2013 and February 06,2014.DIRECTORSNominee DirectorMr Chandra Pal Singh Yadav, Vice Chairman of Krishak Bharati Cooperative Limited(KRIBHCO) was appointed as Nominee Director of KRIBHCO on the Board of thecompany with effect from April 15, 2014.Mr N Sambasiva Rao, Managing Director of KRIBHCO was appointed as AlternateDirector to Shri Chandra Pal Singh Yadav with effect from May 29, 2014

Independent DirectorsIn accordance with Section 149, 152 and Schedule IV read with relevant Rules of theCompanies Act, 2013 and the revised Clause 49 of the Listing Agreement it is proposed toappoint Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju as IndependentDirectors of the company not liable to retire by rotation up to the conclusion of 9th AnnualGeneral Meeting or September 25, 2019, whichever is later.The appointments are being placed before the members of the company at the 4th AnnualGeneral Meeting to be held on September 26, 2014 for their approval.Retiring by RotationIn accordance with Section 152 of the Companies Act, 2013 and the Articles of Associationof the Company, Mr K S Raju and Mr K Rahul Raju, who are liable to retire by rotationbeing eligible, offer themselves for re-appointment as Directors of the Company, subjectto retirement by rotation.Key Managerial Personnel:Manager:The Board has re-appointed Mr K Soma Raju as Manager of the company for a period ofthree years with effect from August 31, 2014, subject to the approval of members of theCompany.There are no other changes in relation to other Key Managerial Personnel.DECLARATION BY INDEPENDENT DIRECTORSThe Independent directors have submitted their disclosure to the Board that they fulfill allthe requirements as to qualify for their appointment as an Independent Director undersection 149(6) of the Companies Act, 2013 as well as revised Clause 49 of the ListingAgreement.AUDITORS AND AUDIT REPORTM/s. M Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the company's auditorsretire at the conclusion of the ensuing Annual General Meeting. They have signified theirwillingness to accept re-appointment and have further confirmed their eligibility underSection 141 of the Companies Act, 2013.The company's Statutory Auditors have also furnished a certificate from the Peer ReviewBoard of the ICAI confirming that they have undergone the process of peer review.The Board of Directors in accordance with the provisions of Section 139 of the CompaniesAct, 2013 and rules made thereunder recommends their appointment for a term of fiveyears from the conclusion of 4th Annual General Meeting to the conclusion of 9th AnnualGeneral Meeting subject to ratification every year at the Annual General Meeting forconsideration of the shareholders.VIGIL MECHANISMThe Company already has put in place a policy to prohibit managerial personnel fromtaking adverse personnel action against employees disclosing in good faith, alleged wrongfulconduct on matters of public concern involving violation of any law, mismanagement,misappropriation of public funds, among others.Employees aware of any alleged wrongful conduct are encouraged to make a disclosureto the Audit Committee.No personnel of the company was denied access to the Audit Committee.SECRETARIAL AUDITORThe Board of Directors at their meeting held on May 29, 2014 pursuant to the provisions ofSection 203 of the Companies Act, 2013 has appointed Mr CSS Krishna, PracticingCompany Secretary as the Secretarial Auditor of the Company to undertake the SecretarialAudit for the financial year 2014-15.PERSONNELThere are no employees as on date on the rolls of the Company who are in receiptof remuneration which requires disclosures under provisions of Section 217(2A) ofthe Companies Act, 1956.DISCLOSURESThere are no disclosures in terms of Companies (Disclouser of Particulars in theReport of the Board of Directors) Rules, 1988 in respect of conservation of energy,technology absorption, earnings and outgo of foreign exchange.AUDIT COMMITTEE CONSTITUTIONIn compliance with the provisions of the Section 177 of the Companies Act, 2013 andthe listing agreement entered into with the stock exchanges, the company hadconstituted an Audit Committee consisting of highly qualified and experienced membersfrom various fields. The committee consists of two independent Directors and onenon-executive Director. The Chairman of the committee Dr. N C B Nath, is anIndependent Director and the committee meets periodically to review the quarterlyfinancial statements and recommends its findings to the Board apart from takingaction independently whenever required. The Statutory Auditors and Secretaryattend and participate in the Audit Committee Meetings.The Audit Committee comprises ofDr. N C B Nath : Chairman, Independent DirectorShri S R Ramakrishnan : Member & Independent DirectorShri K S Raju : Member


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DIRECTORS RESPONSIBILITY STATEMENTPursuant to Section 134(5) of the Companies Act, 2013.

Your Directors hereby report:

(a) that in the preparation of the annual accounts, the applicable accounting standardshad been followed along with proper explanation relating to material departures;

(b) that the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the company at the end of the financialyear and of the profit and loss of the company for that period;

(c) that the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act forsafeguarding the assets of the company and for preventing and detecting fraud andother irregularities;

(d) that the directors had prepared the annual accounts on a going concern basis;(e) that the directors, had laid down internal financial controls to be followed by the

company and that such internal financial controls are adequate and were operatingeffectively.

(f) that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Government of India, Government ofAndhra Pradesh, Government of Telangana and the financial institutions and company'sbankers for their assistance and cooperation.

Further, the company places on record its sincere appreciation for the continuing supportand unstinting efforts of investors, associates and all stakeholders in ensuring an excellentall round operational performance.

On behalf of the BoardHyderabad K S RajuJuly 30, 2014 Chairman

CORPORATE GOVERNANCE REPORT FOR THE YEAR 2013 - 2014(Annexure to the Directors' Report)

A. COMPANY'S PHILOSOPHY

At Nagarjuna, we believe in the philosophy of SERVING SOCIETY THROUGH INDUSTRY,with the Nagarjuna Culture being 'We live every moment of life in harmony with nature tocreate value for ourselves, our stakeholders and the society'.

This philosophy is backed by principles of concern, commitment, ethics, excellence andlearning in all its acts and relationships with stakeholders, customers, associates andcommunity at large which has always propelled the Group towards higher horizons.

We believe in the principles of trusteeship, fair play and transparency in all our dealings.We endeavor to have a work culture, which is performance driven and conducive to improvingdiscipline, accountability, depth of character, team spirit and honesty in all our personaland professional relationships.

GOVERNANCE PHILOSOHPY

Your company firmly believes that building a culture of compliance is more than meetingregulations and standards. Your company is always proactive in meeting mandatedstandards and practicing Corporate Governance in spirit and not just the letter of the Law.

Your company's philosophy on Corporate Governance is based on following principles:

i) Preserving core values and ethical business conduct.

ii) Commitment to maximizing shareholder value on a sustained basis.

iii) To enhance the efficacy of the Board and inculcate a culture of transparency,accountability and integrity across the company.

iv) Perceiving and mitigating the various risks that impact the company.

v) Make timely and transparent disclosures.

vi) Legal and statutory compliances.

Your company's contributory factor is self regulatory system of prompt reporting, monitoring,certification and voluntary code of practice and standards which improves managementeffectiveness, supervision and accountability to stakeholders.

DATE OF REPORT

The information provided in the Corporate Governance Report for the purpose of unanimityis as on March 31, 2014.

The report is updated as on the date of the report wherever applicable.

B. BOARD OF DIRECTORS

ROLE OF BOARD OF DIRECTORS

The Board has its own charter which sets out the role, structure, responsibilities andoperation of the Board.

The primary role of the Board is that of trusteeship to protect the interest of company, itsstakeholders and enhance their value. As trustee, the Board ensures that the companyhas clear goals and policies for achievement which are in alignment with the Vision andMission of the company.

The Board provides strategic direction, reviews corporate performance, authorises andmonitors strategic decisions, ensures regulatory compliances and safeguards interest ofstakeholders.

The Board is responsible for maintaining and nurturing high levels of the corporategovernance in the company.

PECUNIARY RELATIONSHIP

Non executive Directors/ Independent Directors are committed to maintenance of highlevel of Corporate Governance and as such they do not have any material pecuniaryrelationship with the company except as stated in the Corporate Governance Report.

COMPOSITION

The Board of Directors of the company consists of an optimum combination of Executiveand Non Executive Directors, from eminent fields. The composition of the Board is inconformity with Clause 49 of the listing agreement, which stipulates that not less than fiftypercent of the Board of Directors should comprise of Non Executive Directors and wherethe Chairman of the Board is an Executive Director, at least half of the Board shouldcomprise of Independent Directors.

The Board believes that the current size is appropriate based on the present circumstancesand periodically evaluates the need for change in composition and size of the Board.

The table below shows the composition of the Board as on March 31, 2014.

CATEGORYNO. OF

DIRECTORS% OF TOTAL NO.OF DIRECTORS

Executive Directors 0 0Non Executive Directors 2 40%Non Executive andIndependent Directors 3 60%

MANAGER

In compliance with the provisions of Section 196 of the Companies Act, 2013 Shri KSoma Raju was re-appointed as 'Manager' of the Company with effect from August31, 2014 for a period of three years subject to the approval of the members at theensuing Annual General Meeting.

The remuneration of Shri K Soma Raju as Manager will be in accordance with theprovisions of Sections 196, 197 and Schedule V of the Companies Act, 2013.

DIRECTORS ATTENDANCE AND DIRECTORSHIP HELD

None of the Directors of your company are Directors on the Board of more thanfifteen companies or ten Board level Committees or Chairman in more than fiveCommittees, across all companies in which they are Directors.


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The table below gives the details of the Board and AGM attendance, membership in Committees of Board of Nagarjuna Oil Refinery Limited and Directorships andCommittee positions held in other companies, for the year 2013 - 2014.

Director DIN No. Attendance Particulars

BoardMeetingsattended/

held

AGMheld on29-11-13

Committees of Board of NORL

No. of Board, Committee Memberships &Chairmanship (other than NORL) in Public, Pvt. Sec.

25 Companies etc.

Board Board Committee

Chair Director Chair Member

INDEPENDENT & NON EXECUTIVE

NON-EXECUTIVE DIRECTORS

Dr. N C B Nath 00026509 4/4 Yes • Audit• Nomination and Remuneration• Stakeholders Relationship• Management

- 1 3 1

Shri S RRamakrishnan

00015839 4/4 No • Audit• Nomination and Remuneration• Management

- 3 2 6

Shri D RangaRaju

2/4 No • Nomination and Remuneration - 5

Shri K RahulRaju

00015990 4/4 Yes • Shares & Debentures• Banking• Investment• Management• Stakeholders Relationship

- 12 2 6

00066546

Shri K S Raju 00008177 4/4 Yes • Audit• Management• Shares & Debentures• Banking• Investment• Stakeholders Relationship

5 10 10 6

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BOARD MEETINGS AGENDA AND MINUTESAs a system Agenda, Notes on Agenda and information to directors are generallycirculated to the Board members well in advance before the meeting of the Board ofDirectors. All material information is incorporated in the agenda papers for facilitatingfocused discussions at the meeting.The Board of directors meet at least once in every quarter to review the quarterlyfinancial results and operations of your company. Apart from this additionally BoardMeetings are convened by giving appropriate notice to address specific needs andbusiness requirements of the company.The dates of the Board Meeting are decided as far as possible well in advance andare communicated to the Directors to enable them to schedule their meetings.BOARD MEETINGS HELD DURING THE YEARThe Board of Directors met four times during the year on May 03, 2013, August 08,2013, November 07, 2013, and February 06, 2014.Post-meeting follow-up systemThe company has a formal system of follow up, review and reporting on actionstaken by the management on the decisions of the Board and Sub Committees ofthe Board. The company presents a comprehensive Action Taken Report of theprevious meeting to the Board of Directors at the ensuing Meeting of the Board ofDirectors.Matters of urgent nature are approved by the Board by passing resolutions throughcirculation.INFORMATION TO THE BOARDThe Board has complete access to all information within the company interalia thefollowing information is regularly provided to the Board as part of the agenda papers.

• Monthly operations report and quarterly results of the company.• Annual operating plans, budgets, capital budgets, cash flow, updates and all

variances.• Contracts in which Directors are deemed to be interested.• Materially important show cause notices, demand, prosecutions or other legal

notices.• Materially relevant default in financial obligations to and by the company.• Significant labour problems and their proposed solutions and other significant

developments.

• Compliance of any regulatory, statutory nature or listing requirements.• Minutes of the meetings of the Board of Directors and Committees of the

Board of Directors.• Status of subsidiary companies.• Minutes of meetings of the Board of Directors of subsidiary companies.• Details of related party transactions.• Quarterly compliance report on Clause 49 and any non compliance.• Report on risk assessment and minimization procedures.• Information on recruitment and remuneration of senior managerial personnel

below the Board level.• Fatal or serious accidents, dangerous occurrences, any material effluent or

pollution problems.• Issues which involves possible public or product liability claims of substantial

nature, including any judgment or order which may have passed strictures onthe conduct of the company or taken an adverse view regarding anotherenterprise that can have negative implications on the company.

• Significant sale of investments, subsidiaries, assets, which are not in thenormal course of business.

• Details of any joint ventures or collaboration agreements.• Transactions that involve substantial payment towards goodwill, brand equity

or intellectual property.• Quarterly details of foreign exchange exposures and the steps taken by the

management to limit the risks of adverse exchange rate movement, if material.REVIEW OF LEGAL COMPLIANCE REPORTSThe Board periodically reviews during the year the compliance reports in respect ofthe various statutory enactments applicable to the company.REMUNERATION TO DIRECTORSRemuneration to Non Executive Directors/ Independent Directors :The Non Executive Directors of the company, whether Independent or Non Independent,are paid sitting fees for attending the meetings of the Board of Directors / Committees ofBoard of Directors which is within the limits prescribed under the Companies Act, 1956and the company has not paid any other fee or compensation to the Non Executive directors.The table below shows the details of remuneration paid to Non Executive / IndependentDirectors of the company during the financial year 2013 - 2014.


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REMUNERATION TO MANAGERThe details of Compensation of the Manager is :Salary - Rs.10,000/- p.m.Perquisites - as per rules of the company.

Name of the Director

INDEPENDENT & NON EXECUTIVEDr N C B Nath 20,000Shri S R Ramakrishnan 20,000Shri D Ranga Raju 10,000NON-EXECUTIVEShri K S Raju 20,000Shri K Rahul Raju 20,000

Sitting Fees paid for attending meetings ofthe Board of Directors / Committees of

Directors *

(`)

The table below lists the Directors being appointed.

Non - Executive Directors

Name of the Director Date of BirthLast Re-

appointment DateQualification Directorships in Other Companies

(Only Public Cos.,)Membership of Committees of the Board

in other Companies

Shri K S Raju 29-06-1950 August 31, 2012 Mechanical Engineering andhe has over 39 years ofexperience in management ofvarious companies

• Nagarjuna OilCorporation Limited

• Nagarjuna Fertilizers andChemicals Limited

• Jaiprakash Engineeringand Steel CompanyLimited

• Bhagiradha Chemicals &Industries Limited

• Nagarjuna AgrichemLimited

Nagarjuna Fertilizers and ChemicalsLimited• Shares and Debentures committee• Management Committee• Audit Committee• Banking Committee• Investment Committee• CSR Committee• Nomination and Remuneration Committee• Risk Management CommitteeNagarjuna Oil Corporation Limited• Project Management Committee• Audit Committee• Banking Committee• Nomination and Remuneration Committee• Shares Al lotment & Transfer

CommitteeJaiprakash Engineering and SteelCompany Limited• Nomination and Remuneration CommitteeNagarjuna Agrichem Limited• Share Transfer Committee• Banking CommitteeBhagiradha Chemicals andIndustries Limited• Nomination and Remuneration Committee

Shri K Rahul Raju 31-08-1976 B Com (Hons) and havingmore than 16 years ofexperience.

• Nagarjuna Oil CorporationLimited

• Nagarjuna Fertilizers andChemicals Limited

Nagarjuna Fertilizers and ChemicalsLimited

• Management Committee

• Shares & Debentures Committee

• Banking Committee

• Investment Committee

• CSR Committee• Risk Management Committee

August 31, 2012

APPOINTMENT OF THE DIRECTORSNON- EXECUTIVE DIRECTORSAccording to the Articles of Association of the company, one third of the Directors areliable to retire every year and if eligible, offer themselves for re-appointment at every AnnualGeneral Meeting.Shri K S Raju and Shri K Rahul Raju, Directors of the company is liable to retire by rotationand being eligible offers themselves for re-appointment as Director, liable to retire by rotation.INDEPENDENT DIRECTORSIn accordance with Section 149, 152 and Schedule IV read with relevant rules of theCompanies Act, 2013, it is proposed to appoint Dr NCB Nath, Shri S R Ramakrishnan andShri D Ranga Raju as Independent Directors of the company not liable to retire by rotationup to conclusion of 9th Annual General Meeting or September 25, 2019 which ever is laterpursuant to the provisions of Section 149 of the Companies Act, 2013 and the ListingAgreement.The appointments are being placed before the members of the company at the 4th AnnualGeneral Meeting to be held on September 26, 2014 for their approval.

* Excludes Service Tax


7

Name of the Director Date of BirthLast Re-

appointment Date Qualification & ExperienceDirectorships in Other Companies

(Only Public Cos.,)Membership of Committees of the Board

in other Companies

Dr N C B Nath 17 -02-1930 August 1, 2011 PhD (Economics), LLB • Nagarjuna Fertilizers andChemicals Limited

Nagarjuna Fertilizers and ChemicalsLimited• Audit Committee• Nominat ion and Remunerat ion

Committee• Stakeholders Relationship Committee• Management Committee• CSR Committee• Risk Management Committee

Shri D Ranga Raju 20-06-1934 B. Com. • Bhagiradha Chemicals &Industries Limited

• Nagarjuna Agrichem Limited• Vijaynagar Bio-tech Limited

Nagarjuna Agrichem Limited

• Audit Committee

• Share Transfer Committee

• Banking Committee

Bhagiradha Chemicals and IndustriesLimited

• Audit Committee

• Share Transfer Committee

August 22, 2011

Independent Directors

Shri S RRamakrishnan

04-02-1935 August 1, 2011 B.E (Mech) Hons. • Nagarjuna Fertilizers andChemicals Limited

• Shriram EPC Limited

• Nagarjuna OilCorporation Limited

Nagarjuna Fertilizers and ChemicalsLimited• Audit Committee• Nomination and Remuneration Committee• Management Committee• Risk Management Committee

RETIREMENT POLICY OF THE DIRECTORSThe company does not have a Retirement Policy for the members of the Board ofDirectors of the company.RESPONSIBILITIES OF THE DIRECTORSResponsibilities of the BoardThe primary role of the Board is that of trusteeship to protect and enhanceshareholders' value. As trustee, the Board ensures that the company has clear goalsand policies for achievement. The Board oversees the company's strategic direction,reviews corporate performance, authorizes and monitors strategic decision, ensuresregulatory compliance and safeguards interests of stakeholders.SHARES HELD BY NON-EXECUTIVE DIRECTORSNone of the Non-Executive Directors were holding any shares in the company ason March 31, 2014.CODE OF CONDUCT AND ETHICSThe company adopted the Code of Conduct and Ethics for Directors and seniormanagement personnel. The Code has been circulated to all the members of theBoard and senior management and the same has been put on the company's websitewww.norl.co.in.The Board of Directors and senior managerial personnel have affirmed theircompliance with the Code and a declaration to this effect signed by Manager appearsin the annexure to the Corporate Governance Report.LEAD INDEPENDENT DIRECTORDr. N C B Nath, who is the Chairman of the Audit Committee of Board of Directors,is the Lead Independent Director. The Lead Independent Director on behalf of theIndependent Directors provides structural feedback to the Board to encouragehealthy discussions and openness amongst the members of the Board.COMMITTEES TO THE BOARDThe Board of Directors have constituted various Committees with adequatedelegation to focus on specific areas and take decisions so as to discharge day today affairs of the company. Each committee is guided by its charter, which definesthe composit ion, scope and powers of the Committee. All decisions andrecommendations of the Committees are placed before the Board of Directors.The Committees constituted by the Board as on date are:1. SHARES AND DEBENTURES COMMITTEEThe Committee comprises of following members:

Name of the Member Category

Shri K S Raju Chairman

Shri K Rahul Raju Member

The Committee met Seventeen (17) times during the year under review on April 08,2013, April 29, 2013, May 13, 2013, June 10, 2013, July 08, 2013, July 15, 2013,August 12, 2013, August 19, 2013, September 16, 2013, September 30, 2013,October 07, 2013, October 28, 2013, December 16, 2013, December 23, 2013,January 20, 2014, February 10, 2014, March 17, 2014, apart from considering mattersthrough circulation.The quorum is two members present in person.Terms of Reference:Allotment of Shares, accept calls in advance, and / or share capital not called up,approve / reject or otherwise deal with applications for transfer, transmission,transposition, mutation of shares and debentures, issue share and debenturecertificates including duplicate, split, sub-divide or consolidated certificates and todeal with all related matters.2. INVESTOR GRIEVANCES COMMITTEEThe Committee met Four (4) times during the year 2013-2014.The table below shows the list of members of Investor Grievances Committee andthe various dates on which meetings were held and their attendance particulars.

Name of the Member CategoryDate of Meeting and attendance particulars

Dr. N C B Nath Chairman � � � �

Shri K S Raju Member � � � �

Shri K Rahul Raju Member � � � �

� - Present, x - Absent

03-5-2013 08-8-2013 07-11-2013 06-2-2014

The quorum is two members present in person.Terms of reference:The committee, inter alia looks into and redresses shareholders / investors grievancesrelating toa. transfer of sharesb. non-receipt of declared dividendsc. non-receipt of Balance Sheet andd. all such complaints directly concerning the shareholders / investors as stakeholders

of the company.e. and such other matters that may be considered necessary in relation to

shareholders, debenture holders and investors of the CompanyNote: The Committee ceased to exist effective from April 22, 2014 pursuant to the

resolution passed by the Board of Directors.3. STAKEHOLDERS RELATIONSHIP COMMITTEEThe Stakeholders Relationship Committee was constituted with effect from April 22, 2014in compliance with the provisions of the Companies Act, 2013 and Revised Clause 49 ofthe Listing Agreement with the following members.


8

6. Disclosure of any related party transactions.7. Qualifications in the draft audit report.8. Reviewing with the management, the quarterly financial statements before

submission to the Board for approval.e) Reviewing, with the management, the statement of uses / application of funds

raised through an issue (public issue, rights issue, preferential issue, etc.), thestatement of funds utilized for purposes other than those stated in the offer document/ prospectus/ notice and the report submitted by the monitoring agency monitoringthe utilization of proceeds of a public or rights issue, and making appropriaterecommendations to the Board to take up steps in this matter

f) Review and monitor the auditor's independence and performance and effectivenessof audit process.

g) Approval or any subsequent modification of transactions of the company with relatedparties.

h) Scrutiny of inter - corporate loans and investments.i) Valuation of undertakings or assets of the company, wherever it is necessary.j) Evaluation of internal financial controls and risk management systems.k) Reviewing with the management, performance of statutory and internal auditors,

adequacy of the internal control systems.l) Reviewing the adequacy of internal audit function, if any, including the structure of

the internal audit department, staffing and seniority of the official heading thedepartment, reporting structure coverage and frequency of internal audit.

m) Discussion with internal auditors any significant findings and follow up thereon.n) 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 controlsystems of a material nature and reporting the matter to the Board.

o) Discussion with statutory auditors before the audit commences, about the natureand scope of audit as well as post-audit discussion to ascertain any area of concern.

p) To look 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.

q) To review the functioning of the Whistle Blower mechanism;r) To approve the appointment of CFO / Whole Time Finance Director.s) Carrying out any other function as is mentioned in the terms of reference of the

Audit Committee.t) To consider and commend to the Board appointment of Cost Auditor of the

company.The Audit Committee is empowered, pursuant to its terms of reference, to:

a) Investigate any activity within its terms of reference and to seek anyinformation it requires from any employee.

b) Obtain legal or other independent professional advice and to ensure theattendance of outsiders with relevant experience and expertise, whenconsidered necessary.

Note:The Audit Committee of the Board of Directors of the company constituted on July27, 2011 has been re-constituted with regard to the Terms of Reference with effectfrom May 29, 2014 to bring in line with the provisions of the Companies Act, 2013and revised Clause 49 of the Listing Agreement.The Audit Committee has been reconstituted as under:

Name of the Member CategoryDr N C B Nath ChairmanShri S R Ramakrishnan MemberShri K S Raju Member

The quorum for the Audit Committee shall be two members or 1/3rd of the strength of theAudit Committee, whichever is higher.With effect from October 1, 2014 the quorum will require atleast two independent directorspresent.Terms of Referencea) Oversee 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) Recommending to the Board, the appointment, re-appointment, remuneration and

terms of appointment 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 auditors report

thereon before submission to the Board for approval, with particular reference to:i. Matters required to be included in the Director's Responsibility statement to be

included in the Board's Report in terms of clause c of sub- section 3 of Section134 of the Companies Act, 2013.

ii. Changes, if any, in accounting policies and practices and reasons for the same.iii. Major accounting entries involving estimates based on the exercise of judgement

by management.iv. Significant adjustments made in the financial statements arising out of audit

findings.v. Compliance with listing and other legal requirements relating to financial

statements.vi. Disclosure of any related party transactions.vii. Qualifications in the draft audit report.

e. Reviewing with the management, the quarterly financial statements before submissionto the Board for approval.

f. Reviewing, with the management, the statement of uses / application of funds raisedthrough an issue (public issue, rights issue, preferential issue, etc.), the statement offunds utilized for purposes other than those stated in the offer document / prospectus/notice and the report submitted by the monitoring agency monitoring the utilization ofproceeds of a public or rights issue, and making appropriate recommendations to theBoard to take up steps in this matter

Name of the Member CategoryDr N C B Nath ChairmanShri K S Raju MemberShri K Rahul Raju Member

Terms of reference:The terms of reference of the Committee shall be matters that are considered necessaryin relation to shareholders, debenture holders, investors and various other stakeholders ofthe company in relation to Transfer of shares, Non-receipt of declared dividends, Non-receipt of balance sheet, complaints directly concerning the shareholders/ investors asstakeholders of the company but not limited to the above mentioned matters.4. MANAGEMENT COMMITTEEThere were no meetings of the Management Committee of Directors during the financialyear 2013-2014.The table below shows the list of members of the Management Committee .

Name of the Member CategoryShri K S Raju ChairmanDr N C B Nath MemberShri S R Ramakrishnan MemberShri K Rahul Raju Member

The quorum is two members present in person.Terms of reference:1. To review the operations of the company from time to time and also formulate and

review corporate objectives and strategies including long range plans for expansion /diversification of the company's activities.

2. To formulate annual budgets / business plans for the company.3. To approve capital expenditure other than proposals for expansion, diversification,

modernization and de-bottlenecking, including investment in immovable property,above Rs. Five crores upto Rs. Ten Crores per proposal, excluding the authorityalready delegated to Managing Director or Internal Management, as the case maybe, as per Delegation of Authority.

4. To approve revenue expenditure above Rs. Five Crores and upto Rs. Ten Crores incase of procurements on a single tender basis or above Rs. Ten Crores upto Rs.Fifteen Crores on multi tender basis excluding the authority already delegated toManaging Director or Internal Management, as the case may be, as per Delegation ofAuthority.

5. To make donations / contributions to charitable and other funds other than to anypolitical party or for political purposes up to an aggregate amount of Rs. Ten lakhs inany financial year.

6. To lay down and review from time to time company's employment policy.5. AUDIT COMMITTEEThe Audit Committee of Directors consists of well qualified and Independent Directors.Presently it comprises of three members, and complies with the stipulation that two thirdsof the members shall be Independent Directors. All the members of the committee possessadequate knowledge of finance and accounts. The scope of the activities of the committee,are in conformity as are set out in Clause 49 II (D) of the listing agreement with stockexchanges read with section 292A of the Companies Act, 1956.The table shows the list of members of Audit Committee and the various dates on whichmeetings were held and their attendance particulars.

The Secretary of the company acts as Secretary to the Committee. The Statutory Auditor,the Cost Auditor and the Head-Internal Audit and such other executives as the committeeconsiders appropriate are present as invitees for the Meetings of the Audit Committee.The quorum is two independent directors present in person.Terms of reference:a) Oversee 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) Recommending to the Board, the appointment, re-appointment, remuneration and

terms of appointment 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 auditors

report thereon before submission to the Board for approval, with particular referenceto:1. Matters required to be included in the Director's Responsibility statement

to be included in the Board's Report in terms of clause c of sub- section 3of Section 134 of the Companies Act,2013 .

2. Changes, if any, in accounting policies and practices and reasons for thesame.

3. Major accounting entries involving estimates based on the exercise ofjudgement by management.

4. Significant adjustments made in the financial statements arising out ofaudit findings.

5. Compliance with listing and other legal requirements relating to financialstatements.

Name of the Member Category Date of Meeting and attendance particulars

Dr. N C B Nath Chairman � � � �

Shri S R Ramakrishnan Member � � � �

Shri K S Raju Member � � � �

� - Present, x - Absent

03-5-2013 08-10-2013 07-11-2013 06-02-2014


9

g. Review and monitor the auditor's independence and performance and effectivenessof audit process.

h. Approval or any subsequent modification of transactions of the company with relatedparties.

i. Scrutiny of inter - corporate loans and investments.j. Valuation of undertakings or assets of the company, wherever it is necessary.k. Evaluation of internal financial controls and risk management systems.l. Reviewing with the management, performance of statutory and internal auditors,

adequacy of the internal control systems.m. Reviewing the adequacy of internal audit function, if any, including the structure of

the internal audit department, staffing and seniority of the official heading thedepartment, reporting structure coverage and frequency of internal audit.

n. Discussion with internal auditors any significant findings and follow up thereon.o. 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 ofa material nature and reporting the matter to the Board.

p. Discussion with statutory auditors before the audit commences, about the nature andscope of audit as well as post-audit discussion to ascertain any area of concern.

q. To look into the reasons for substantial defaults in the payment to the depositors,debenture holders, shareholders (in case of non payment of declared dividends) andcreditors.

r. To review the functioning of the Whistle Blower mechanism.s. To approve the appointment of CFO / Whole time Finance Director.t. Carrying out any other function as is mentioned in the terms of reference of the Audit

Committee.u. To consider and commend to the Board appointment of Cost Auditor of the company.REPORT OF THE AUDIT COMMITTEE OF DIRECTORS FOR THE YEAR ENDEDMARCH 31, 2014To the shareholders of Nagarjuna Oil Refinery Limited.a. The Audit Committee's suggestions from time to time were implemented by the

company during the course of the year.b. The Audit Committee sought clarifications from the Auditors and the Management

of the company, whenever required, in relation to the financial matters of thecompany as per the scope and powers of the Audit Committee.

c. The Audit Committee meetings were interactive.d. The Committee is recommending to the Board the re-appointment of M/s. M

Bhaskara Rao & Co., Chartered Accountants as statutory auditors of the company,to carry out audit of the accounts of the company for a term of 5 years from theconclusion of 4th Annual General Meeting upto the conclusion of 9th Annual GeneralMeeting. M/s. M Bhaskara Rao & Co., have confirmed their eligibility under Section141 of the Companies Act, 2013.

e. M/s. M Bhaskara Rao & Co., have also confirmed that they have a valid certificateissued by the Peer Review Board of the Institute of Chartered Accountants of Indiaas per the requirements of Clause 41 of the listing agreement.

Hyderabad Sd/-July 30, 2014 Chairman, Audit Committee5. BANKING COMMITTEE

There were no meetings of the Banking Committee of Directors during the financial year

2013-2014.

The banking committee consists of




The quorum is two members present in person.

Terms of reference:

Availment of fund based and non-fund based credit facitilies by the company from Finanical

Instutions and Banks, as per the limites delegated by the Board of Directors of the Company.

6. INVESTMENT COMMITTEE

There were no meetings of the Investment Committee of Directors during the financial

year 2013-2014.

The Investment Committee consists of :





Terms of reference:

1. Investment of surplus funds in units, discounting of LC backed bills, clean bill

discounting, inter-corporate deposits and investment in shares.

2. To dis-invest or pledge the securities such as shares, debentures, government

bonds, etc., held by the company in its name from time to time and do all such

acts, deeds and things that are necessary in this regard.

7. REMUNERATION COMMITTEE

There were no meetings of the Remuneration Committee of Directors during the financial

year 2013-2014

The Remuneration Committee consists of :


Dr. N C B Nath Chairman

Shri S R Ramakrishnan Member

Shri D Ranga Raju Member


Terms of reference:

To look into all matters relating to Remuneration payable to Managing Director andWhole-Time Director and / or Manager from time to time and comply with the provisionsof the Companies Act, 1956 and the limits prescribed under Schedule XIII to theComapnies Act, 1956.

Note : The Committee ceased to exist effective from April 22, 2014 pursuant to theresolution passed by the Board of Directors.

8. NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Reumneration Committee of the Board of Directors consists of


Dr. N C B Nath Chairman

Shri S R Ramakrishnan Member

Shri D Ranga Raju Member


Terms of reference:

1) Formulate and recommend to the Board a Remuneration Policy, relating to theremuneration for the directors, key managerial personnel and other employeesand review/ modify the same from time to time

2) Formulate criteria for determining qualifications, positive attributes andindependence of a director and review/ modify the same from time to time

3) Identify persons who are qualified to become directors and who may be appointedin senior management and recommend to the Board their appointment and removal

4) Carry out evaluation of every director's performance.

5) Devising a policy on Board diversity

6) To select, retain and terminate the services of any consultant who shall assist theCommittee in discharging its functions.

RISK ASSESSMENT AND MINIMISATION PROCEDURE

The company has setup an Enterprise Risk Management System to manage and mitigateunforeseen risks

MANAGEMENT DISCUSSION AND ANALYSIS

This Annual Report has a detailed chapter on Management Discussion and Analysis.

MANAGEMENT DISCLOSURES

Directors and Senior Management Personnel of the company, as well as certain identifiedkey associates make half yearly disclosures to the Board relating to all material, financialand commercial transactions where they have interest, conflicting with the interest ofthe company. The interested Directors do not participate in the discussion nor do theyvote on such matters when the matter is considered by the Board of Directors.

D. STAKEHOLDERS

DISSEMINATION OF INFORMATION

The company has established systems and procedures to disseminate relevantinformation to its stakeholders including shareholders, auditors, suppliers, customers,employees and financers. The primary source of information regarding the operationsof the company, including the quarterly results, can be viewed on the company's websitewww.norl.co.in.


10

The quarterly and annual results of the company are sent to the Stock Exchangesimmediately after they are approved by the Board of Directors and published in widelycirculated English Newpapers i.e., Business Standard and in vernacular newspaper i.e.,Andhra Prabha.

Corp Filing / NEAPS Facility

The company as a good governance measure has commenced filing information to thestock exchanges through CorpFiling website, www.corpfiling.co.in. and NEAPS website,www.connect2nse.com.

Investor Grievance Redressal

The company has 4,48,836 shareholders. The company during April 1, 2013 to March31, 2014 received and attended/resolved 658 letters / complaints from the investors.2270 requests for dematerialization / rematerialisation of shares were received and theshares dematerialised.

The table below shows the details of shareholder's or depositor's queries / complaints/requests received and resolved during the financial year 2013-2014.

Nature of Letters OpeningBalance

Received Replied ClosingBalance

Change of address 0 83 83 0

Share transfers 0 351 351 0

Dematerialisation/Remat of Shares 0 2270 2270 0

Issue of duplicate certificates 0 12 12 0

Transmission of shares 0 180 180 0

General queries 0 563 563 0

SHARE TRANSFER SYSTEM

The company's transfer of shares activity is fully computerized.

The dematerialized shares are directly transferred to the beneficiaries account by thedepositories.

Compliance Officer

Shri T Vamsi Krishna is the Compliance Officer for complying with the requirements ofSEBI (Prohibition of Insider Trading) Regulations, 1992 and the listing agreements withthe stock exchanges of India.

Share Transfer Agents

XL Softech Systems Limited, Hyderabad are the Share Transfer Agents.

Nomination facility

Shareholders holding physical shares may file nominations in prescribed Form SH-13of the Companies (Share Capital and Debentures) Rules, 2014, to the Registrar andTransfer Agents of the company. Those holding shares in dematerialized form maycontact their respective Depository Participant (DP) to avail the nomination facility.

Dematerialization of Shares and Liquidity

The shares of the company are under the category of compulsory delivery indematerialized mode by all categories of investors.

The company has signed agreements with both the depositories i.e., National SecuritiesDepository Limited and Central Depository Services (India) Limited. As on March 31,2014, over 90 % of the shares of the company are held in electronic mode.

The status of the equity shares of the company is furnished below :

Total No. of Equity Shares : 42,81,81,821

Total No. of Shareholders : 4,48,836

The table below shows the status on the dematerialization of the equity shares of thecompany:

The table below shows the distribution of promoter and non-promoter shareholding as onMarch 31, 2014

Category No. of shares held Percentage ofshareholding

A. Promoter's holding 17,17,19,581 40.10B. Non-promoters holding

I. Institutional investorsa. Mutual funds and UTI 2,14,250 0.05b. Banks, Financial Institutions,

Insurance companies(Central/State GovernmentInstitutions/Non-GovernmentInstitutions) 81,20,161 1.90

c. Foreign Institutional Investors 28,88,480 0.67II. Othersa. Private corporate bodies 4,73,88,228 11.07b. Indian public 16,68,18,547 38.96c. NRIs/OCBs 65,42,647 1.53d. Any other (please specify)

Trusts 2,44,89,627 300Foreign National 5.72 0.00

GRAND TOTAL 42,81,81,821 100.00

The company's ISIN No. for dematerialization for both NSDL and CDSL isINE453M01018.

RECONCILIATION OF SHARE CAPITAL AUDIT

A Practicing Company Secretary of the Institute of Company Secretaries of India,has carried out the Reconciliation of Share Capital Audit every quarter to reconcilethe total admitted capital with National Securities Depository Limited (NSDL) andCentral Depository Services (India) Limited (CDSL) and the total issued and listedcapital. The audit confirms that the total issued/ paid-up capital is in agreementwith the aggregate total number of shares in physical form and the total number ofdematerialized shares held with NSDL and CDSL

DISTRIBUTION OF SHAREHOLDING

The table below shows the distribution of shareholding of various groups as onMarch 31, 2014

Upto 5000 445763 99.32 128568639 30.035001 - 10000 1676 0.37 12634015 2.9510001 - 20000 724 0.16 10361897 2.4220001 - 30000 233 0.05 5856465 1.3730001 - 40000 113 0.03 4010752 0.9440001 - 50000 87 0.02 4093853 0.9650001 - 100000 148 0.03 10494231 2.45100001 and Above 92 0.02 252161969 58.89TOTAL 448836 100.00 428181821 100.00

Share Holding Share Holders Share Holding

% to Total Value in ` % to TotalNumber

Mode of Shareholding No. of Shares % to TotalEquityShares

No. of Shareholders

% to TotalShare

holdersPhysical Form 3,96,75,516 9.27 1,99,069 44.35Held in electronicmode 38,85,06,305 90.73 2,49,767 55.65Total 42,81,81,821 100.00 4,48,836 100.00


11

1 Nagarjuna Management Services Private Limited * 16.69

2 Nagarjuna Holdings Private Limited * 7.35

3 Baron Properties Private Limited * 3.89

4 Nagarjuna Corporation Limited * 1.85

Co-Promoters

5 Governor of Andhra Pradesh 4.55

6 KRIBHCO 2.34

7 Fireseed Limited 1.87

Institutional Investors

8 Life Insurance Corporation of India 1.26

Others - Private Corporate Bodies

9 Zuari Global Limited 6.85

10 NFCL Employee Welfare Trust 5.69

S. No. Name of the Company %Core Promoters

The table below shows the details of persons holding more than 1 % shareholding in thecompany, as on March 31, 2014

LIST OF CORE PROMOTER COMPANIES OF THE NAGARJUNA GROUP1. Nagarjuna Corporation LimitedCo-Promoters1. Fireseed Limited2. Government of Andhra Pradesh3. Krishak Bharati Co-operative Limited4. Saipem S.p.A. (formerly Snamprogetti S.p.A)STOCK PRICE DATAThe table below shows the monthly high, low per month on the National Stock Exchangeand Bombay Stock Exchange during the financial year 2013-2014.

MONTH

HIGH & LOW PRICE OF SHARES PER MONTH ON BSE & NSE

HIGH(RS) LOW(RS) HIGH(RS) LOW(RS)

April 2013 4.72 3.04 4.75 2.75

May 2013 3.86 2.81 3.85 2.80

June 2013 3.10 2.65 3.15 2.65

July 2013 4.30 2.81 4.35 2.80

August 2013 3.35 2.87 3.40 2.90

September 2013 4.29 3.00 4.25 3.00

October 2013 4.48 3.25 4.45 3.30

November 2013 4.50 3.52 4.60 3.70

December 2013 4.39 3.53 4.35 3.50

January 2014 5.05 3.51 5.10 3.65

February 2014 4.01 3.45 3.95 3.45

March 2014 4.05 3.50 4.05 3.45

BSE NSE

*A Composite Scheme of Arrangement and Amalgamation between NagarjunaCorporation Limited (NCL), Nagarjuna Management Services Private Limited (NMS),Nagarjuna Holdings Private Limited (NHPL), Baron Properties Private Limited (BPPL),White Stream Properties Private Limited (WSPPL) and Growth Stream Properties PrivateLimited (GSPPL) and their respective shareholders was approved by the Hob'ble HighCourt of Bombay at Mumbai on September 14, 2012. The Scheme was made effectiveon November 9, 2012 and necessary disclosures and reports were filed with BSE, NSEand SEBI. Pursuant to the Scheme NMS, NHPL, BPPL and WSPPL were merged intoNCL. The equity shares held by these companies shall be transferred to NCL afterremoval of pledge by the Banks to whom they are pledged.

Nagarjuna Corporation Limited has since merged into Amlika Mercantile Private Limitedand vested with these shares.

DETAILS OF PUBLIC FUNDING IN THE LAST THREE YEARSThe company has not raised any funds from the public since inception.The company has not issued any GDRs / ADRs.DISCLOSURESCompliance with mandatory requirements of Listing Agreementa. Related party Transactions1. Names of related parties and description of relationship.

a) Associates(i) Nagarjuna Oil Corporation Limited

b) Key Managerial Personneli) Mr K S Raju, Chairmanii) Mr K Soma Raju, Manageriii) Mr K Rahul Raju, Non-Executive Director

c) Enterprises under significant influence of Key Managerial Personnel ortheir relatives.

i) Nagarjuna Fertilizers and Chemicals Limitedii) Nagarjuna Agrichem Limited

` LakhsAdvance Received FromNagarjuna Fertilizers and Chemicals Limited 386.82

b. Disclosure of accounting treatmentIn the preparation of financial statements, the company has followed the accountingstandards issued by the Institute of Chartered Accountants of India

c. Proceeds from the preferential issue of warrantsNot applicable

d. Certifications:1. The Chairman and Chief Financial Officer, certify every quarter that the

unaudited financial results of the company do not contain any false ormisleading statement or figures and do not omit any material fact which maymake the statements or figures contained therein misleading.

GENERAL BODY MEETINGSThe Third Annual General Meeting of the company was held on November 29, 2013Shri K S Raju, Director, chaired the Meeting.

LAST THREE ANNUAL / EXTRA-ORDINARY GENERAL MEETINGS

NO. OFAGM & F.Y

DATE & TIME LOCATION SPECIAL RESOLUTION(S)PASSED

1st AGM2010-11

July 12,201110.00AM

Nagarjuna Hills,Punjagutta,Hyderabad-500082

2nd AGM2011-12

August 31,201209.30 AM

Satya SaiNigamagamam,8-3-987/2, SrinagarColony, Hyderabad -500 073

Under Section 94-Sub division ofNominal Value of shares fromRs.10/- each to Re. 1/- eachIncreased Authorised Capital ofthe company from Rs. 500000 to50 CroresAs per section 31- Altered Articlesof Association of the company

Special Resolution for subscribingto shares, making loans, providingguarantee in the form of SponsorUndertaking to the Lenders ofNagarjuna Oil Corporation Limited(NOCL)

1St EGM2011-12

June 13, 201104.00 PM


As per section 100-103,Cancellation of Capital andreduction by 500000

The table below shows the details of the previous three General Body Meetingsand the Special Resolutions passed.

EXTRAORDINARY GENERAL MEETINGS

As per section 31, Altered theArticles of Association of thecompany.

2nd EGM2011-12

August22,201104.00 PM


3rd AGM2012-13

November 29,201312.30 PM

Satya SaiNigamagamam,8-3-987/2, SrinagarColony, Hyderabad -500 073

Special Resolution for Alteration ofArticles of Association by insertingprovision relating to Buy Back ofShares of the company.

Appointment of Manager as perSection 269,198,309,310 and SchXIII.

3rd EGM2011-12

September05,201104.00 PM



12

Particulars ClauseCompliance

Status (Yes/No) &Remarks

I. Board of Directors 49 I

A. Composition of Board 49 (IA) Yes

B. Non-executive Directors' Compensation

& Disclosures 49 (IB) Yes

C. Other Provisions as to Board and

Committees 49 (IC) Yes

D. Code of Conduct 49 (ID) Yes

II. Audit Committee 49 II

A. Qualified & Independent Audit Committee 49 (IIA) Yes

B. Meeting of Audit Committee 49 (IIB) Yes

C. Powers of Audit Committee 49 (IIC) Yes

D. Role of Audit Committee 49 (IID) Yes

E. Review of Information by Audit Committee 49 (IIE) Yes

III. Subsidiary Co's 49 III Yes

IV. Disclosures 49 IV

A. Basis of Related Party Transactions 49 (IVA) Yes

B. Accounting treatment 49 (IVB) Yes

C. Board Disclosures 49 (IVC) Yes

D. Proceeds from Public Issues, Rights

Issues, Preferential Issues 49 (IVD) Not Applicable

E. Remuneration of Directors 49 (IVE) Yes

F. Management 49 (IVF) Yes

G. Shareholders 49 (IVG) Yes

V. CEO/CFO Certification 49 (V) Yes

VI. Report of corporate governance 49 (VI) Yes

VII. Compliance 49 (VII) Yes

2. A certificate as stipulated by Clause 49 signed by Managing Director andChief Financial Officer certifying the correctness of the year end financialstatements and cash flow statement, responsibility for internal controls andindication of changes in the internal control and accounting policies appearsin the annexure to this report.

3. A certificate as mandated by Clause 49 signed by Manager certifying thecompliance of the companies code of conduct appears in the annexure tothis report.

e. There were no penalties, strictures imposed on the company by Stock Exchangesor Securities and Exchange Board of India (SEBI) or any Statutory Authority on anymatter related to Capital Markets during the last three years.

Compliance with Mandatory Requirements of Clause 49Your company is fully compliant with the applicable mandatory requirements of the Clause49 of the listing agreement.A certificate from practicing Company Secretary that the conditions of Corporate Governanceas mandated by Clause 49 of the Listing Agreement, has been obtained and the same isshown as an annexure to the Directors Report.The table shows the Compliance Report status(i) Mandatory Matters

COMPLIANCE / NON-ADOPTION OF NON-MANDATORY REQUIREMENTS

S. Particulars Extent ofNo. compliance

1 Maintenance of Chairman'soffice or a non-executive chairman Not Applicable

2 Remuneration Committee Complied3 Shareholders rights Not Adopted4 Audit qualifications Complied5 Training of Board Members Complied6 Mechanism for evaluating

Non-executive Board members Not Adopted7 Whistle Blower Policy Complied

OTHER COMPLIANCESYour company had taken a series of init iatives, going beyond regulatoryrequirements, to ensure excellence in Governance and to promote the interestsof all our stakeholders.Secretarial Audit ReportThe company has voluntarily subjected itself to Secretarial Audit and obtainedSecretarial Audit Report from Practicing Company Secretary of the Institute ofCompany Secretaries of India, for the financial year ended March 31, 2014,confirming the compliance of the applicable provisions of the various corporatelaws.For the financial year 2013-2014, there were no adverse remarks by thePracticing Company Secretary in the Secretarial Audit Report.E-votingPursuant to the provisions of Section 108 of the Companies Act, 2013 read withthe Companies (Management and Administration) Rules, 2014 and Clause 35Bof the Listing Agreement entered into with the Stock Exchanges, the companyis providing e-vot ing faci l i ty to enable shareholders to cast their voteelectronically on all the resolutions set forth in the Notice to the 4th AnnualGeneral Meeting to be held on Friday i.e., September 26, 2014 at 12.00 Noon.The company has engaged the services of Central Depository Services (India)Limited to provide e-voting platform to the shareholders.Please refer to the detailed instructions on e-voting at page no. 24 of the AnnualReport 2013-14.Shareholders holding shares in demat form and shareholders who haveregistered their email id with the company wil l also receive the e-votinginstructions by email.Shareholders who do not have access to e-voting facility may use the enclosedBallot Form and send their assent or dissent on or before closing of businesshours of September 22, 2014.GENERAL SHAREHOLDERS INFORMATION

4th Annual General MeetingDay, Date, Time and Venue

Friday, 26th day of September, 2014 at 12.00 NOONSri Satya Sai Nigamagamam, Srinagar Colony,Hyderabad

September 12, 2014 to September 26, 2014 (bothdays inclusive)

D.No.8-2-248, Nagarjuna Hills, Punjagutta,Hyderabad - 500 082.Shri T Vamsi Krishna, SecretaryPh No.(040) 23355317. Fax (040) 23350247Email : [email protected]

XL Softech Systems LimitedPlot No.3, Sagar Society, Road No. 2,Banjara Hills, Hyderabad - 500 034.Email : [email protected]

The company has not declared dividend sinceinception.

Quarter ending June 30, 2014 - 3rd week ofJuly 2014Quarter ending September 30, 2014 - 3rd week ofOctober 2014Quarter ending December 31, 2014 - 3rd week ofJanuary 2015For the year ending March 31, 2015 - 4th week ofApril 2015

STOCK CODE BSE : 534184The Bombay Stock Exchange, Mumbai CorporateRelationship Department, 1st Floor, New TradingRing, Routunda Building, PJ Towers, Dalal Street,Fort Mumbai -400 001

STOCK CODE NSE : NAGAROILNational Stock Exchange of India Limited,Exchange Plaza, 5th Floor, Plot No.C/1, G Block,Bandra - Kurla Complex, Bandra (E), Mumbai - 400051

Listing fees for the year 2014-15 has been paid tothe stock exchanges, in the stipulated period, wherethe equity shares of the company are listed.

INE453M01018 for NSDL and CDSL

L23200AP2010PLC071242

Dates of Book Closure

Compliance Officer

Registered Office

Share Transfer Agent

Tentative dates forconsideringFinancial Results

Listing on StockExchanges & Stock Code

Listing fee

ISIN No

CIN No.

Dividend history for thelast five years


13

CERTIFICATION BY CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIALOFFICER OF THE COMPANY

We, K Soma Raju, Manager and A Sudhakar Rao, Chief Financial Officer, ofNagarjuna Oil Refinery Limited, to the best of our knowledge and belief certify that :

1. We have reviewed the Balance Sheet and Profit and Loss Account of thecompany for the year ended March 31, 2014 and all its schedules and noteson accounts, as well as the Cash Flow Statement.

2. Based on our knowledge and information, these statements do not containany untrue statement of a material fact or omit to state a material factnecessary to make the statements made.

3. Based on our knowledge and information, the financial statements, and otherfinancial information included in this report, fairly present in all materialrespects, the financial condition, results of operations and cash flows of thecompany as of, and for, the periods presented in this report, and are incompliance with the existing accounting standards and / or applicable lawsand regulations.

4. To the best of our knowledge and information :

a. these statements do not contain any materially untrue statement or omit tostate a material fact or contains statement that might be misleading.

b. these statements together present a true and fair view of the Company'saffairs and are in compliance with existing accounting standards, applicablelaws and regulations.

5. We also certify, that based on our knowledge and the information provided tous, there are no transactions entered into by the company, which arefraudulent or illegal.

6. The company's other certifying officers and we are responsible for establishingand maintaining internal controls and procedures for the Company, and wehave evaluated the effectiveness of the company's internal controls andprocedures and confirm them to be adequate.

7. The company's other certifying officers and we have disclosed, based on ourmost recent evaluation of internal controls and systems and have to state

a. That there were no deficiencies in the design or operation of internal controls,which we are aware;

b. That there have been adequate internal controls in the company.

c. That there was no fraud, which we have become aware of and that involvesManagement or other employees who have a significant role in the company'sinternal control systems;

d. That there were no changes in accounting policies during the year

Sd/- Sd/- K Soma Raju A Sudhakara Rao

HyderabadJuly 30, 2014

DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS ANDSENIOR MANAGEMENT PERSONNEL WITH THE CODE OF CONDUCT ANDETHICSThis is to inform you that the company has adopted a Code of Conduct and Ethicsapplicable to all the Members of the Board of Directors and Senior ManagementPersonnel of the company. The details of the Code of Conduct and Ethics areavailable at the company's website at www.norl.co.in.I confirm that the company has in respect of the financial year ended March 31,2014 received from all the Members of the Board of Directors and all the SeniorManagement Personnel of the company a declaration of compliance with the Codeof Conduct and Ethics as applicable to them.To the best of my knowledge and belief, no transactions entered into by the companyduring the year are violative of the company's code of conduct.Senior Management Personnel are personnel who are part of the core managementteam, comprising personnel one level below the executive directors and includingall functional heads as on March 31, 2014

Sd/-Hyderabad K Soma RajuJuly 30, 2014 Manager

CERTIFICATE OF CORPORATE GOVERNANCE

To the Members ofNAGARJUNA OIL REFINERY LIMITEDWe have examined the compliance of conditions of Corporate Governance byNAGARJUNA OIL REFINERY LIMITED for the year ended on 31st March, 2014, asstipulated in Clause 49 of the Listing Agreement of the said Company with StockExchanges in India.The Compliance of conditions of Corporate Governance is the responsibility of theManagement. Our examination has been in the manner described in the Guidance Noteon Certification of Corporate Governance issued by the Institute of Company Secretariesof India and has been limited to a review of the procedures and implementation thereofadopted by the company for ensuring compliance with the conditions of CorporateGovernance as stipulated in the said Clause. It is neither an audit nor an expression ofopinion on the financial statements of the Company.In our opinion and to the best of our information and according to the explanations given tous and based on our reliance upon the representations made by the management thatthere were no transactions of material nature with the management or by relatives thatmay have potential conflict with the interest of the Company at large, as stated underDisclosures Column of the Company's Report on Corporate Governance.The Share Transfer Agent of the Company has certified the number of complaints receivedfrom the investors and the number of complaints resolved during the financial year andthere are no complaints pending as at the year end as stated under Investor GrievanceRedressal Column of the Company's Report on Corporate Governance.We certify that the Company has complied in all material respects with the conditions ofCorporate Governance as stipulated in the above mentioned Listing Agreement.We further state that such compliance is neither an assurance as to the future viability ofthe Company nor the efficiency or effectiveness with which the management has conductedthe affairs of the Company.

For KBG ASSOCIATESCompany Secretaries

Sd/-(Srikrishna S Chintalapati)

Hyderabad PartnerJuly 17, 2014 CP # 6262


14

MANAGEMENT DISCUSSION AND ANALYSISMARKET ASSESSMENTBusiness Segments of Oil and Gas IndustryThe business segments of the oil and gas industry are usually classified as upstream,midstream, downstream and allied services. While the upstream segment comprises theexploration and production of oil and gas, the midstream segment consists of transportation,storage and trading of crude oil, refined products and natural gas. The downstream segmentdeals with refining and marketing while allied services include oil drilling and oilfield services.Applications of Petroleum ProductsThe applications of various petroleum products to be produced by NOCL's refinery aregiven below:

Liquefied PetroleumGas (LPG) Cooking gas, industrial applicationsNaphtha Feedstock fuel for fertilizer, petrochemical and power plantsMotor Spirit (MS) Automotive fuelsAviation Turbine Fuel(ATF) Aircraft fuelHigh Speed Diesel(HSD) Automotive fuel , agriculture and captive power generationFurnace Oil (FO) Secondary fuel for thermal power plantsBitumen Surfacing of roadsPetcoke Cement industrySulphur Chemical industry

OUTLOOKFuture Outlook

According to the International Monetary Fund's (IMF) World Economic Outlook, world GDPis expected to grow by 4.2 per cent CAGR during 2011 to 2016, as compared to a CAGRof 3.3 per cent during 2006 to 2011. The higher growth is expected to push up petroleumproduct demand by 0.9 per cent CAGR to 92 MBPD in 2016 from 88 MBPD in 2011.

Growth in petroleum products demand will be led by emerging economies with relativelyhigher GDP growth such as China, India, Saudi Arabia and Brazil. Moreover, measurestaken by developing countries (like subsidy mechanisms) to protect consumers from sharpvolatility in petroleum products prices will also lend support to demand. CRISIL Researchexpects aggregate petroleum product demand from Asia Pacific, the Middle East, South &Central America, and Africa to grow at a CAGR of 2.7 per cent during 2011-16 vis-a-vis a3 per cent CAGR posted during 2006 to 2011.

OECD countries have historically accounted for a significant share in the global petroleumproducts demand. However, emerging non-OECD economies are expected to growrelatively faster and account for more than half of the total petroleum products demand by2016. From 2011 to 2016, demand from OECD countries is expected to decline at a CAGRof 1.3 per cent, while demand from non-OECD countries is likely to increase at a CAGR of3.1 per cent. Petroleum product demand from developed countries in North America andEurope is expected to decrease because of an ageing population, declining energy intensity(CAFE regulations in USA - to improve fuel efficiency in transportation) and a focused shiftto cleaner fuels like natural gas.

As per CRISIL Research, Asia Pacific (primarily China and India) will account for 43 percent of the capacity additions, followed by the Middle East at 38 per cent. Meanwhile,unviable refining capacities in the developed economies are likely to shut down. Globally,capacities totalling around 1.5 MBPD are expected to get decommissioned, resulting in anet capacity addition of 3.7 MBPD from 2011 to 2016.

The capacity additions in the Asia pacific region would be able to cater to the demandemerging from the Asia pacific region and also be in a position to export the surplus toregions with supply deficit across the world. This effect shall be more pronounced giventhe change in global refining where refined products would be increasingly produced inemerging markets like the Middle East, India and South East Asia and then exported toother emerging markets and to mature economies with product deficit

Hence there appears to be an excellent opportunity for capacity augmentation in the AsiaPacific region, as India and China, together are expected to drive the incrementalconsumption over the next five years. The domestic refining industry in India stands tobenefit from the fact that India can develop as a refining hub given its proximity to thesource of oil and emerging markets. The viable route for Indian refiners, therefore, wouldbe to export surplus products and value-addition by production of petrochemicals/polymersand other chemicals

Domestic Demand - Supply OutlookDemand Outlook

Demand for petroleum products in India is expected to grow at a CAGR of 3-4 per cent to229 MTPA by 2022-23. However, refining capacity during the same period is slated togrow by only 2-3 per cent. The growth in demand would be largely driven by a highergrowth expected in naphtha demand and healthy growth in demand for Motor Spirit (MS).On the other hand, growth in demand for LPG and diesel is expected to slow down.

Supply OutlookThe installed refining capacity in India stood at 216 MMTPA (2012-13). Some of the keygreenfield refineries, which are expected to come up in future (till 2016-17) are IOCL ParadipRefinery (15 MMTPA) and NOCL Cuddalore Refinery (6 MMTPA). A key refinery that isexpected to expand is BPCL Kochi Refinery from 9.5 to 15 MMTPA.

Projected Demand Supply Gap At the country level, India is expected to see a surplus in some of the key petroleumproducts like MS, HSD while a deficit is expected in LPG going forward.However, it mustbe noted that the demand-supply balance in various regions of India may differ significantlyfrom the all-India scenario, as the regional demand-supply is governed by local demandand supply options. These variations are on account of transportation and freight advantagethe local refineries and Oil Marketing Companies (OMC) enjoy in the local regions.

Demand - Supply Scenario in Southern Region / Tamil NaduThough a net surplus has been projected for most of the petroleum products in the country,the southern region (comprising 4 major states viz. Tamil Nadu, Andhra Pradesh, Karnatakaand Kerala) and Tamil Nadu State, on a standalone basis, are expected to witness deficitfor many of the petroleum products.

Marketing StrategyBased on the product slate proposed for the refinery and the demand - supply scenario, amarket strategy is developed.

Pricing PolicyAs per Rangarajan committee recommendations of 2006, the sale of automotive fuels(MS and HSD) to Oil Marketing Companies in domestic market is at Trade Parity price(TPP) of receiving location, which is an 80/20 weighted average of IPP and Export ParityPrice (EPP). The price of other petroleum products is also guided by IPP or standardpractice adopted by Oil Industry.

IPP is calculated by adding the quality premium freight from Arab Gulf to Cuddalore(including marine insurance, ocean loss, port wharfage), customs duty, and other purchasecosts to the FOB Arab Gulf price. Export Parity Price is FOB Arab Gulf plus quality premium.

Overall Market AssessmentA surplus in most of the product categories suggest that India as a market is going to seeovercapacity in future, which is in line with the present scenario. This overcapacity can bepartially attributed to the realisation, that there is significant opportunity to leverage India'scommercial and geographic comparative advantages to establish refinery operations thatsupply a share of rapid expansion in the regional (Asia Pacific) liquid fuels demand. Thesurplus capacity can help India focus on exports to the markets in the regions with productdeficits.

NOCL has tied up with IOC, HPCL, Essar Oil and Shell for domestic marketing and withan international trader of repute for exporting 25% of the combined output of select petroleumproducts, viz. MS, HSD, naphtha and ATF.

In South India, Tamil Nadu is expected to be a huge market for NOCL's key products. Asper CRISIL Research's demand-supply analysis of the target area, it is estimated thatNOCL would be able to sell its entire LPG, MS and HSD in South India. Taking advantageof coastal location and proximity to South East Asian Markets, NOCL can additionallyexport products like Naphtha and ATF, which are surplus in the domestic target markets.

Overall Financial Assessment

The revised estimated project cost is ` 16,502 cr. The increase in Project cost from theearlier reported estimate of ` 11,985 cr is primarily on account of increase in hard costdue to escalations, additional revamps and refurbishment, increase in soft cost due todelays in financial closure and consequently refinery commissioning and integration oftwo outsourced facilities viz Power & Utilities and Tankages.

The additional cost of ` 4,517 crore is proposed to be tied up at a suitable component ofequity and debt. The additional equity is proposed to be raised from strategic investors.

The availability of Structured Financial Assistance (around ` 14,234 crore repayable after14 years with an interest rate of 0.1% per annum would be of great strength to the projectand will significantly improve overall cash flow and debt servicing capacity. The assistancecan be used to repay debt, meet working capital/project requirements or used for capacityexpansions

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCEThe refinery is expected to be commissioned within 24-26 months from financial closure.This estimate includes a period of 6 months for project restart activities (zero date). Therefinery will procure and process a variety of crude oil grades in order to maximise itsGross Refining Margins.

HUMAN RESOURCES / INDUSTRIAL RELATIONS:NOCL has significant cooperation from its Associates for execution of the project and hasa harmonious industrial relations situation. The manpower strength of NOCL is 206.


15

Independent Auditors' ReportToThe Members ofNagarjuna Oil Refinery LimitedReport on Financial StatementsWe have audited the accompanying financial statements of Nagarjuna Oil Refinery Limited("the Company"), which comprise the Balance Sheet as at March 31, 2014, the Statementof Profit and Loss and the Cash Flow Statement for the year then ended and a summary ofsignificant accounting policies and other explanatory information.Management's Responsibility for the Financial StatementsManagement is responsible for the preparation of these financial statements that give atrue and fair view of the financial position, financial performance and cash flows of theCompany in accordance with the Accounting Standards referred to in sub section (3C) ofsection 211 of the Companies Act, 1956. This responsibility includes the design,implementation and maintenance of internal control relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement, whether due to fraud or error.Auditor's ResponsibilityOur responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgement, including the assessment of the risks of material misstatement of the financialstatements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internal control relevant to the Company's preparation and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in thecircumstances but not for the purpose of expressing an opinion on the effectiveness of theCompany's internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement, as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion.OpinionIn our opinion and to the best of our information and according to the explanations given tous, the financial statements give the information required by the Act in the manner sorequired and give a true and fair view in conformity with the accounting principles generallyaccepted in India:(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,

2014;(b) in the case of the Statement of Profit and Loss, of the Loss for the year ended on that date;

and(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.Emphasis of MatterWe draw attention to Note No 10.1 regarding opinion of the management that no diminutionis required to be made in the carrying value of investment in associate company for thereasons stated in the said note.Our opinion is not qualified in respect of above matter.Report on Other Legal and Regulatory Requirements1. As required by the Companies (Auditor's Report) Order, 2003 ("the Order") issued

by the Central Government of India in terms of sub-section (4A) of section 227 ofthe Act, we give in the Annexure a statement on the matters specified in paragraphs4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:a. we have obtained all the information and explanations which to the best of our

knowledge and 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 as appears from our examination of those books;c. the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement

dealt with by this Report are in agreement with the books of account;d. in our opinion, the Balance Sheet, the Statement of Profit and Loss and the

Cash Flow Statement comply with the Accounting Standards referred to insubsection (3C) of section 211 of the Companies Act, 1956;and

e. on the basis of written representations received from the directors as on March31, 2014, and taken on record by the Board of Directors, none of the directors isdisqualified as on March 31, 2014, from being appointed as a director in termsof clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

for M. Bhaskara Rao & Co.Chartered Accountants

Firm Registration No. 000459SM.V.Ramana Murthy

Hyderabad PartnerMay 29, 2014 Membership No.206439

Re: Nagarjuna Oil Refinery LimitedAnnexure to the Independent Auditors' Report(Referred to in paragraph '1' under Report on Other Legal and Regulatory Requirements sectionof our report of even date)(i) (a) The Company has maintained proper records showing full particulars including

quantitative details and situation of fixed assets.(b) According to the information and explanations given to us, the fixed assets have

been physically verified by the management during the year. In our opinion, thefrequency of verification is reasonable having regard to the size of the Companyand the nature of the assets. According to the information and explanations givento us, no discrepancies have been noticed on such verification.

(c) The Company has not disposed off any assets during the year; hence clause (c) ofparagraph 4(i) of the Order is not applicable to the Company.

(ii) As the Company has no inventory, clause (a), (b) and (c) of paragraph 4(ii) of the Orderare not applicable to the Company.

(iii) (a) The Company has not granted any loan, secured or unsecured to companies, firms orother parties covered in the register maintained under Section 301 of the CompaniesAct, 1956. Accordingly, clause (b), (c) and (d) of paragraph 4(iii) of the Order are notapplicable to the Company.

(b) According to the information and explanations given to us, the Company has nottaken any loan, secured or unsecured from companies, firms or other parties coveredin the register maintained under Section 301 of the Companies Act, 1956. Accordingly,clause (f) and (g) of paragraph 4(iii) of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, there areadequate internal control systems commensurate with the size of the Company and thenature of its business with regard to purchase of fixed assets and for sale of goods andservices. During the course of our audit, we have not observed any major weakness insuch internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, thereis no contract or arrangement that needs to be entered in the register required to bemaintained under section 301 of the Companies Act, 1956. Accordingly, clause (b)of paragraph 4(v) of the Order is not applicable to the Company.

(vi) The Company has not accepted any deposits from public.(vii) The Company does not have internal audit system during the Year.(viii) The Central Government has not prescribed maintenance of cost records under Section

209(1) (d) of the Companies Act, 1956; hence paragraph 4(viii) of the Order is notapplicable.

(ix) (a) According to the information and explanations given to us, the Company is regularin depositing undisputed statutory dues including Provident Fund, Income-tax,Service Tax, cess and any other material statutory dues applicable to it with theappropriate authorities during the year.

(b) According to the information and explanations given to us, no undisputed amountspayable in respect of the aforesaid dues were outstanding as at March 31, 2014 fora period of more than six months from the date they became payable.

(c) According to the information and explanations given to us, there are no dues ofSales tax / Income tax / Custom duty / Service tax / Excise duty / cess which havenot been deposited on account of any dispute.

(x) The Company is in existence for a period less than five years; therefore reporting onaccumulated losses under paragraph 4(x) of the Order is not applicable to the Companyat present.

(xi) According to information and explanations given to us, the Company has not availedany loans from banks and financial institutions. Accordingly the provisions of paragraph4(xi) of the Order is not applicable to the Company.

(xii) According to the information and explanations given to us, the Company has not grantedany loans and advances on the basis of security by way of pledge of shares, debenturesand other securities. Accordingly, the provisions of paragraph 4 (xii) of the Order is notapplicable to the Company.

(xiii) In our opinion, the Company is not a Chit fund/ Nidhi/ Mutual benefit fund/ Society.Accordingly, the provisions of paragraph 4(xiii) of the Order is not applicable to theCompany.

(xiv) In our opinion and according to the information and explanations given to us, theCompany does not deal or trade in shares, securities, debentures and other investments.Accordingly, the provisions of paragraph 4(xiv) of the Order is not applicable to theCompany.

(xv) According to the information and explanations given to us, the Company during theyear has not given any guarantee for loans taken by others from banks or financialinstitutions except sponsor undertaking executed inrespect of loans availed by anassociate company to the Company.

(xvi) The Company has not availed any term loans. Accordingly, the provisions of paragraph4(xvi) of the Order is not applicable to the Company.

(xvii) The Company has not raised any short term or long term borrowings. Accordingly, theprovisions of paragraph 4(xvii) of the Order is not applicable to the Company.

(xviii) According to the information and explanations given to us, the Company has not madepreferential allotment of shares during the year to parties and companies covered inthe register maintained under section 301 of the Companies Act, 1956.

(xix) According to the information and explanations given to us and the records examinedby us, the Company has not raised funds through debentures, term loans taken frombanks, financial institutions and others both for Rupee loans and Foreign currencyloans.

(xx) During the year covered by our audit, the Company has not raised any money by publicissues.

(xxi) During the course of our examination of the books and other records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us, no instance of fraud on or bythe Company was reported during the year, nor have we been informed of such caseby the management.

for M. Bhaskara Rao & Co.Chartered Accountants

Firm Registration No. 000459SM.V.Ramana Murthy

Hyderabad PartnerMay 29, 2014 Membership No.206439


16

` in lakhs

Particulars Note As at March 31, 2014 As at March 31, 2013

As per our report of even date attachedfor M. Bhaskara Rao & Co.Chartered Accountants

M.V. Ramana MurthyPartner

HyderabadMay 29, 2014

Directors

Balance Sheet as at March 31, 2014

I. EQUITY AND LIABILITIESShareholders' Funds(a) Share Capital 3 4,281.82 4,281.82(b) Reserves and Surplus 4 73,075.83 77,357.65 73,250.75 77,532.57Non-Current Liabilities(a) Long-Term Borrowings 5 386.82 213.53(b) Long-Term Provision 6 3.44 390.26 2.97 216.50Current Liabilities(a) Trade Payables 7 2.75 1.95(b) Other Current Liabilities 8 0.65 0.09(c) Short Term Provisions 6 0.09 3.49 0.19 2.23

Total 77,751.40 77,751.30

II. ASSETSNon-Current Assets(a) Fixed Assets

(i) Tangible Assets 9 124.60 128.45(b) Non-Current Investments 10 77,622.00 77,746.60 77,622.00 77,750.45

Current Assets(a) Cash and Bank balances 11 4.73 0.66(b) Short-Term Loans and Advances 12 0.07 4.80 0.19 0.85

Total 77,751.40 77,751.30Corporate Information and SignificantAccounting Policies 1 & 2

Accompanying Notes form an integral part of the financial statements

For and on behalf of the BoardK.S. RajuChairman


T. Vamsi KrishnaCompany Secretary

A. Sudhakara RaoChief Financial Officer

K. Soma RajuManager

Chandra Pal Singh YadavDr. N C B NathK. Rahul Raju


17

` in lakhs

Particulars Note 2013-14 2012-13

Statement of Profit and Loss for the year ended March 31, 2014

IncomeRevenue from operations - -Other Income - -

Total - -

Expenses

Employee Benefits Expense 13 75.86 70.17Depreciation and amortization 9 4.03 4.82Other expenses 15 95.03 83.16

Total 174.92 158.15

Loss Before Tax (174.92) (158.15)

Earnings per equity share of ` 1/- each fully paid up

Basic and Diluted 18 (0.04) (0.04)

Corporate Information andSignificant Accounting Policies 1 & 2





Directors





K. Soma RajuManager



18

Cash Flow Statement for the year ended March 31, 2014

Particulars 2013 - 14 2012- 13

A. Cash Flow from Operating Activities

Loss before Tax (174.92) (158.15)

Adjustments:

Depreciation and Amortisation 4.03 4.82

Operating Profit before working capital changes (170.89) (153.33)

Movements in Working Capital:

Increase/(decrease) in Trade Payables 0.80 0.94

Increase/(decrease) in Long Term Provisions 0.47 2.56

Increase/(decrease) in Current Liabilities 0.56 (0.15)

Decrease/(increase) in Short Term Loans and Advances 0.12 (0.15)

Increase/(decrease) in Short Term Provisions (0.10) 0.19

Cashed generated from / (used in) operations (169.04) (149.94)

Net cash flow from/(used in) operating activities (169.04) (149.94)

B. Cash flow from Investing activities

Purchase of Fixed Assets (0.18) -

Net cash flow from Investing activities (0.18) -

C. Cash flow from Financing activities

Proceeds from long term borrowings 173.29 148.56

Net cash flow from/ (used in) financing activities 173.29 148.56

Net Increase/(decrease) in cash and cash equivalents 4.07 (1.38)

Cash and cash equivalents as at beginning of the year 0.66 2.04

Cash and cash equivalents as at end of the year 4.73 0.66

The Cash Flow Statement is prepared in accordance with the indirect method stated in Accounting Standard 3 :Cash Flow Statement presents the Cash Flows by operating, investing and financing activities


` in lakhs




Directors





K. Soma RajuManager



19

Notes to Financial Statements for the year ended March 31, 20141. Corporate Information:

Nagarjuna Oil Refinery Limited ("the Company") was incorporated on November16, 2010 under the provisions of the Companies Act, 1956, as a public limitedcompany, primarily engaged in the business of promoting, conceiving, planning,coordinating, executing and monitoring setting up of any business projectsrelating to extraction of oil by any means within India and / or elsewhere in theworld, either directly or through one or more special purpose vehicles and toenter into partnership, agreements, raise funds in order to carry out any one ormore of the aforementioned activities.

2. Significant Accounting Policies:2.1. Basis of preparation:The financial statements of the Company are prepared on accrual basis underhistorical cost convention in accordance with Generally Accepted AccountingPrinciples (GAAP) applicable in India. The Company has prepared these financialstatements to comply in all material respects with the Accounting Standardsnotified under Companies (Accounting Standards) Rules, 2006 (as amended)and the provisions of the Companies Act, 1956.

The accounting policies adopted in the preparation of financial statements areconsistent with those of previous year.2.2. Use of Estimates:The preparation of financial statements in conformity with Indian GAAP requiresthe management to make estimates and assumptions that affect the reportedamount of assets and liabilities (including contingent liabilities) and the reportedincome and expenses during the year. The management believes that theestimates used in preparation of the financial statements are prudent andreasonable. Future results could differ due to these estimates and the differencesbetween the actual results and the estimates are recognised in the periods inwhich the results are known / materialise.2.3. Fixed Assets:Fixed assets are carried at cost of acquisition or construction less accumulateddepreciation. The cost of fixed assets includes non-refundable taxes, duties,freight and other incidental expenses related to the acquisition and installationof the respective assets. Borrowing costs directly attributable to acquisition orconstruction of those fixed assets which necessarily take substantial period oftime to get ready for their intended use are capitalised.2.4. Impairment of Assets:Impairment of an asset is reviewed and recognised in the event changes andcircumstances indicate that the carrying amount of an asset is not recoverable.Difference between such carrying amount of an asset and the recoverable valueis recognised as impairment loss in the Statement of Profit and Loss in the yearof impairment.2.5. Depreciation on Fixed Assets:Depreciation on fixed assets is provided on straight-line method at the ratesand in the manner prescribed in Schedule XIV of the Companies Act, 1956 or athigher rates as stated below:

Sl.No. Description Schedule XIV

RatesRates adopted

by theCompany.

1 Computer and IT equipments 16.21% 23.75%

2 Office equipment 4.75% 23.75%

3 Electronic equipments /Air Conditioners 4.75% 19.00%

4 Vehicles 9.50% 19.00%

2.6. Investments:Investments are classified as Long Term and Current. Long term Investmentsare carried at cost less provision for other than temporary diminution, if any, invalue of such investments. Current investments are carried at lower of costand fair value.2.7. Foreign Currency Transactions:Foreign currency transactions are accounted at the exchange rates prevailingon the date of transaction. Gains and losses resulting from settlement of suchtransactions are recognised in the Statement of Profit and Loss.

Liabilities related to foreign currency transactions incurred to acquire fixedassets remaining unsettled at the end of the year are translated at year endrates. The difference arising on such translation and realized gain or loss isadjusted to the cost of respective fixed asset. Monetary assets and liabilitiesrelated to foreign currency transactions remaining unsettled at the end of theyear are translated at year end rates. The difference in translation of monetaryassets and liabilities and realized gain and loss on foreign currency transactionsare recognised in the Statement of Profit and Loss.Premium or discount arising on forward exchange contracts is recognized inthe Statement of Profit and Loss.2.8. Borrowing CostsBorrowing costs that are attributable to the acquisition or construction ofqualifying assets are capitalised as part of the cost of such assets. A qualifyingasset is one that necessarily takes substantial period of time i.e. more thantwelve months to get ready for its intended use. All other borrowing costs arecharged to the Statement of Profit and Loss.2.9. Employee Benefits:Liability for employee benefits, both short and long term, for present and pastservices which are due as per the terms of employment are recorded inaccordance with Accounting Standard (AS) 15 “ Employee Benefits” notified bythe Companies (Accounting Standard) Rules, 2006.2.9.1. Gratuity: In accordance with the Payment of Gratuity Act, 1972 the

Company provides for gratuity covering eligible Employees. Liability onaccount of gratuity is covered by a policy with Life Insurance Corporation(LIC) of India and the annual contributions are paid / provided inaccordance with the scheme.

2.9.2. Superannuation: The Company makes monthly contribution to anapproved superannuation fund covered by a policy with LIC of India.The Company has no further obligation beyond the monthly contribution.

2.9.3. Compensated Absences: Liability for compensated absence is treatedas a long term liability and is provided on the basis of valuation by anindependent actuary as at the year end.

2.9.4. Provident Fund: The Company’s contribution towards provident fund,administered and managed by an approved trust, is charged to theStatement of Profit and Loss.

2.10. Earning Per Share :The Company reports basic and diluted earnings per share in accordancewith Accounting Standard (AS) 20, "Earnings Per Share" notified by theCompanies (Accounting Standards) Rules, 2006. Basic earnings perequity share is computed by dividing the net profit for the year attributableto the Equity Shareholders by the weighted average number of equityshares outstanding during the year. Diluted earnings per share iscomputed by dividing the net profit for the year, adjusted for the effectsof dilutive potential equity shares, attributable to the Equity Shareholdersby the weighted average number of the equity shares and dilutivepotential equity shares outstanding during the year except where theresults are anti-dilutive.

2.11. Taxes :2.11.1. Current Tax: Provision for current tax is made based on the taxable

income computed for the year under the Income Tax Act, 1961.

2.11.2.Deferred Tax: Deferred tax is accounted for by computing the tax effectof timing differences which arise during the year and reverse insubsequent periods. Deferred tax assets are recognised and carriedforward only to the extent that there is a certainty that sufficient futuretaxable income will be available against which such Deferred Tax Assetscan be realized.

2.12. Contingencies:The Company recognises provisions when there is present obligation as a resultof past event and it is probable that there will be an outflow of resources andreliable estimate can be made of the amount of the obligation. A disclosure forContingent liabilities is made when there is a possible obligation or presentobligations that may, but probably will not, require an outflow of resources.Contingent assets are neither recognised nor disclosed in the financialstatements.

3. Share Capital March 31, 2014No.of Shares ` in Lakhs

March 31, 2013No.of Shares ` in Lakhs

AuthorisedEquity Shares of Rs.1/-each 50,00,00,000 5,000.00 50,00,00,000 5,000.00Issued, Subscribed and Fully Paid UpEquity Shares of Rs.1/- each 42,81,81,821 4,281.82 42,81,81,821 4,281.82

3.1. Reconciliation of the Number of shares outstanding at the beginning and at the end of the reporting period.


20

Equity Shares of ` 1/- eachBalance at the beginning of the year 42,81,81,821 4,281.82 42,81,81,821 42,81.82Add: Issued during the year - - - -Balance at the end of the year 42,81,81,821 4,281.82 42,81,81,821 42,81.82

3.2. Rights, preferences and Restrictions attached to equity sharesThe Company has only one class of equity shares having a par value of Rs. 1/- per share. Each holder of equity shares is entitled to one vote per share. Inthe event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of allpreferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

3.3. Details of shareholders holding more than 5% of the Shares



Equity Shares of `1/-eachNagarjuna Management Services Private Limited* 7,14,47,812 16.69% 7,14,47,812 16.69%Nagarjuna Holdings Private Limited* 3,14,78,300 7.35% 3,14,78,300 7.35%Zuari Global Limited 2,93,34,310 6.85% 2,93,34,310 6.85%NFCL Employees Welfare Trust 2,34,03,205 5.69% 2,34,03,205 5.47%Nagarjuna Corporation Limited* 79,33,452 1.85% - -Baron Properties Private Limited* 1,66,35,427 3.89% - -White Stream Properties Private Limited* 27,44,600 0.64% - -* A composite Scheme of Arrangement and Amalgamation between Nagarjuna Corporation Limited (NCL), Nagarjuna Management Services Private Limited(NMS), Nagarjuna Holdings Private Limited (NHPL), Baron Properties Private Limited (BPPL), White Stream Properties Private Limited (WSPPL) andGrowth Stream Properties Private Limited (GSPPL) and their respective shareholders was approved by the Hon'ble High Court of Bombay at Mumbai onSeptember 14,2012. The Scheme was made effective on November 09,2012 and necessary disclosures and reports were filed with BSE, NSE andSEBI.Pursuant to the scheme NMS, NHPL, BPPL and WSPPL were merged into NCL. The equity shares held by these companies shall be transferred toNCL after temporary lift of pledge by the banks to whom they are pledged and shall be pledged back again by NCL.

3.4. Aggregate number of shares issued for consideration other than cash428,181,821 Equity Shares of Rs. 1/- each (aggregating to Rs. 4,281.81 Lakhs) were allotted as fully paid up pursuant to the Composite Scheme ofArrangement and Amalgamation during the year 2011-12.

March 31, 2014 March 31, 2013No.of Shares % of share

holdingNo.of Shares % of share

holding

4. Reserves and Surplus:

March 31, 2013` in Lakhs


Capital ReserveOpening Balance 73,483.35 73,483.35Surplus / (Deficit) in the Statement of Profit and LossOpening Balance (232.60) (74.45)Add: Net loss after tax for the year (174.92) (158.15)Closing Balance (407.52) (232.60)

Total 73,075.83 73,250.75



Advances from related parties(Refer Note No. 5.1 and 17b) 386.82 213.53

386.82 213.53

5. Long Term Borrowings (Unsecured):

5.1. The Company is in receipt of the advance from Nagarjuna Fertilizers and Chemicals Limited pursuant to the Composite Scheme of Arrangement and Amalagamation whichwas approved by jurisdictional High Courts in Mumbai and Andhra Pradesh in 2011-12.These advances, in the nature of Loan, are repayable when the company is able tomanage its financial affairs and are interest free.The amount is treated as long term borrowing since repayment of the same may not happen in the next twelve months.

6. ProvisionsNon Current

March 31, 2014 March 31, 2013 ` in Lakhs ` in Lakhs

Provision for Employee Benefits- Gratuity 0.60 0.89 0.05 -- Leave Benefit 2.84 2.08 0.04 0.19

3.44 2.97 0.09 0.19

CurrentMarch 31, 2014 March 31, 2013 ` in Lakhs ` in Lakhs



Trade Payables (Other than acceptances) (Refer Note No. 7.1) 2.75 1.95

7. Trade Payables:

7.1 Based on the information available with the Company there are no dues/interest outstanding to Micro, Small and Medium enterprises as defined under theMicro,Small and Medium enterprises Development Act,2006 as at 31st March 2013 (Previous year - Nil)


21

` In lakhsMarch 31, 2013

` in LakhsMarch 31, 2014

` in Lakhs

Others - Statutory Payables 0.65 0.09

8. Other Current Liabilities:

10. Non Current Investments - (Unquoted - at Cost) March 31, 2014No. of Shares ` in Lakhs

Long Term - TradeIn Associates

In Equity Shares of Rs 10/- each fully paid upNagarjuna Oil Corporation Limited (Refer Note No. 10.1) 776,220,000 77,622.00 776,220,000 77,622.00

Aggregate cost of Unquoted Shares - 77,622.00 - 77,622.0010.1. The Project undertaken by Nagarjuna Oil Corporation Limited (NOCL) is in Construction Stage. Due to delay in tying up of equity for re-assessed cost and

effect of 'Thane Cyclone', the execution of the project was slowed down during the year 2012-13. Keeping in view the steep increase in project cost due todelay and proposed enhancement of Capacity, NOCL decided to induct strategic investor/s operating in similar industry. Five Potential investors haveevinced interest in the project and due diligence exercise is in progress.Considering the status of project which is commercially viable and stage of negotiations with prospective investors, in the opinion of the management, noprovision is required to be made towards diminution in the value of investment at the year end.

March 31, 2013No. of Shares ` in Lakhs

9. Fixed Assets: ` In lakhs

Particulars

Gross Block (at cost) Depreciation Net Block

As at March31, 2013

Additions As at March31, 2014

Upto March31, 2013

For the Year Upto March31, 2014

As at March31, 2014

As at March31, 2013

Tangible AssetsBuildings 139.28 - 139.28 13.50 2.27 15.77 123.51 125.78Furniture, Fixtures andOffice Equipment 2.75 0.18 2.93 2.22 0.24 2.46 0.47 0.53Vehicles 12.37 - 12.37 10.23 1.52 11.75 0.62 2.14

Total 154.40 0.18 154.58 25.95 4.03 29.98 124.60 128.45Previous Year - - 154.40 21.13 4.82 25.95 128.45 -

12. Short Term Loans and Advances:(Unsecured)



Advance to Employees 0.02 0.10Postal Deposit 0.05 0.09

0.07 0.19

13. Employee Benefits Expense:

Salaries and Wages 67.58 62.76Contribution to Provident and Other Funds 8.12 7.21Staff Welfare Expenses 0.16 0.20

75.86 70.17

2012-13` in Lakhs

2013-14` in Lakhs

14. The disclosure required under Accounting Standard 15 “Employee Benefits” notifiedby the Companies (Accounting Standards) Rules 2006, is given below.Defined Contribution PlanThe Company makes Provident Fund and Superannuation Fund contribution todefined contribution retirement benefit plans for qualifying employees including wholetime directors. Under the schemes the Company is required to contribute a specifiedpercentage of the payroll costs to fund the benefits. The Provident Fund schemeadditionally requires the Company to guarantee payment of interest at rates notifiedby the Central Government from time to time, for which shortfall if any, shall be providedfor.Contribution to these Defined Contribution Plan, charged off during the year are asunder:

11. Cash and Bank Balances :March 31, 2013

` in LakhsMarch 31, 2014

` in LakhsBalance with Banks: in Current accounts 4.73 0.66

Particulars 2013-14 2012-13Employer’s contribution to Provident Fund 2.83 2.62Employer’s contribution to Superannuation Fund 0.26 0.28Employer’s contribution to Pension Scheme 0.17 0.17

` in Lakhs

Particulars March 31, 2014 March 31, 2013Defined Benefit obligation at beginning of the year 2.20 -Current Service Cost 0.48 0.42Interest Cost 0.18 -Actuarial (gain)/loss (0.22) 1.78Past service cost - -Benefits paid - -Defined Benefit Obligation at year end 2.64 2.20

a. Reconciliation of opening and closing balance of Defined BenefitObligation Gratuity (Funded)

Defined Benefit PlansThe employees’ gratuity fund scheme managed by Life Insurance Corporation ofIndia (LIC) is a defined benefit plan. The present value of obligation is determinedbased on actuarial valuation using the Projected Unit Credit Method, which recognizeseach period of service as giving rise to additional unit of employee benefit entitlementand measures each unit separately to build up the final obligation. The obligationsand contribution to the Scheme are routed through Nagarjuna Employees GratuityTrust which is monitoring the gratuity scheme through LIC. The Company hascontributed Rs. 0.68 Lakhs to the scheme during the year (Previous Year Rs. 1.32Lakhs)

b. Reconciliation of opening and closing balances of fair value of plan assets

Particulars March 31, 2014 March 31, 2013Fair value of plan assets at beginning of the year 1.32 -Expected return on plan assets - -Actuarial gain/(loss) - -Employer contribution 0.68 1.32Benefits paid - -Fair value of plan assets at year end 2.00 1.32

c . Reconciliation of fair value of assets and obligationsParticulars March 31, 2014 March 31, 2013Fair value of plan assets 2.00 1.32Present value of obligation 2.64 2.20

` in Lakhs

` in Lakhs

` in Lakhs


22

d. Expenses recognized during the year under the head “Employee benefitsexpense"

Particulars 2013 - 14 2012- 13Current service Cost 0.48 0.42Interest Cost 0.18 -Expected return on plan assets - -Actuarial (gain)/loss (0.22) 1.78Past Service Cost - -Net cost 0.44 2.20

e . Investment DetailsMarch 31, 2014 March, 31, 2013

L.I.C. Group Gratuity(Cash Accumulation) Policy 100% 100%Amount (` In Lakhs) 0.68 1.32

f. Actuarial assumptionsMortality Table of L.I.C.Particulars 2013-14 2012-13Discount rate (per annum) 8.20% 8.20%Expected rate or return on plan assets 9.00% 9.00%(per annum)Rate of escalation in salary (per annum) 10.00% 10.00%

The estimate of rate of escalations in salary considered in actuarial valuation, takesin to account inflation, length of service and other relevant factors.

15. Other Expenses:

Rates and Taxes 0.24 0.57Legal, Secretarial and other Consultancy 32.60 30.47Professional and Consultancy 25.17 0.45Advertisement and Publicity 2.06 19.88Electricity Charges 0.13 0.11Postage and Telephone 17.56 15.24Office Maintenance 0.14 0.88Printing and Stationery 12.03 11.34Directors Sitting Fees 0.90 1.20Auditors' Remuneration (Refer Note No.19) 0.95 1.24Bank Charges 0.07 0.11Miscellaneous 3.18 1.67

95.03 83.16

2012-13` in Lakhs

2013-14` in Lakhs

` in Lakhs16. Contingent Liabilities and Commitments (Not Provided for):

16.1. Commitment Shall be Classified as :16.1.1 Other Commitments :

i. Commitment on account of ‘Sponsor undertaking’ pursuant to theagreement with the lenders and shareholders of Nagarjuna OilCorporation Ltd, a associate, for funding of project cost overrun, if any.

ii. Commitment towards all contracts, deeds, bonds, insurance, Letters ofIntent, undertakings, arrangements, policies, agreements (includingerstwhile shareholders agreements and investor agreements) andother instruments, if any, relating to oil business undertaking executedby Nagarjuna Fertilizers and Chemicals Limited which standstransferred and vested pursuant to a Composite Scheme ofArrangement and Amalgamation.

17. Related party transactionsa. Names of related parties and description of relationship.

Associatesi. Nagarjuna Oil Corporation LimitedKey Management Personneli. Mr. K.S. Raju, Chairmanii. Mr. K. Soma Raju, Manageriii. Mr. K. Rahul Raju, Non Executive DirectorEntities under Significant influence of Key Management personnel or

their relativesi. Nagarjuna Fertilizers and Chemicals Limitedii. Nagarjuna Agrichem Limited

b. Related party transactions are as under:



Advances received fromNagarjuna Fertilizers andChemicals Limited 173.29 148.56Balance at the year end

- Long Term Borrowings 386.82 213.53

2012-132013-14

1 Net Profit/(Loss) after tax for the Year Rs In Lakhs (174.92) (158.15)2 Number of Equity Shares (Fully Paid up) Numbers 428,181,821 428,181,8213 Earnings per Share - Basic and Diluted (Face Value of Rs. 1/- per Share) [1]/[2] (0.04) (0.04)

18. Earnings per share :Unit of MeasurementS.No. Particulars

Note: The Company has no dilutive instruments as at March 31, 2014, As such Dilutive earnings per share equals to Basic Earnings per share.19. Auditor’s Remuneration :

2012-13` in Lakhs

2013-14` in Lakhs

Fees TowardsStatutory Audit 0.56 0.84Limited Review 0.34 0.34Other Certifications 0.05 0.06

0.95 1.24Above fee is inclusive of Service Tax Rs. 0.11 Lakhs (Previous Year Rs. 0.14 Lakhs)

20. The figures for the previous year have been restated / regrouped, wherever necessary, to conform to current year classification.

Signatures to Notes ‘‘1 to 20’’

Directors


M.V. Ramana MurthyPartnerT. Vamsi KrishnaSecretary


K. Soma RajuManager




23

��

Nagarjuna Oil Refinery LimitedRegd. Office : D.No. 8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad - 500082.

BALLOT FORM

(The members who are not able to attend the Annual General Meeting can send their assent or dissent in writing in respect of the resolutions

as set out in the notice by sending the duly filled and signed Ballot Form to the Scrutinizer, Mr. CSS Krishna, Partner, M/s. K B G Associates,

Company Secretaries at Flat No. 101, Sri Sai Krishna Residency, 1-2-234/13, Aravind Nagar, Domalguda, Hyderabad - 500 029 so as to reach him

on or before 5.00 P.M. on September 22, 2014.

Sl. No. Particulars Details

1. Name of the First Named

Shareholder (In Block Letters)

2. Postal Address

3. Folio No./ DP ID & Client ID

4. No of shares held

I/ We hereby exercise my/ our vote in respect of Ordinary/Special Resolution enumerated below by recording my/ our assent or dissent to the

said resolution by placing tick (�) mark at the appropriate box below :

Item No Resolution I/ We assent tothe resolution

I/ We dissent fromthe resolution

1 Adoption of financial statements for the year ended March 31, 2014 and the

Directors Report and Auditors Report thereon

2 Appointment of Shri K S Raju, who retires by rotation

3 Appointment of Shri K Rahul Raju, who retires by rotation

4 Appointment of M/s. M Bhaskara Rao & Co as Statutory Auditors of the company

5 Re-appointment of Shri K Soma Raju as Manager for a period of three years

with effect from August 31, 2014 and payment of his remuneration.

6 Appointment of Dr N C B Nath as an Independent Director

7 Appointment of Shri S R Ramakrishnan as an Independent Director

8 Appointment of Shri D Ranga Raju as an Independent Director

Place :

Date (Signature of the shareholder)

1. A Member desiring to exercise vote by ballot form may complete the ballot form and send it to the Scrutinizer, appointed by the Company

Mr. C S S Krishna, Partner, M/s. K B G Associates, Company Secretaries at Flat No. 101, Sri Sai Krishna Residency, 1-2-234/13, Aravind Nagar,

Domalguda, Hyderabad - 500 029.

2. In case of shares held by companies, trusts, societies etc., the duly completed ballot form should be signed by a person

authorised and accompanied by a certified true copy of the resolution indicating the authorisation.

3. Unsigned Ballot Forms will be rejected.

4. Duly completed Ballot Form should reach the Scrutinizer not later than 5.00 P.M. on September 22, 2014, Monday, at the

address mentioned in point No. 1 above.

5. The Scrutinizer’s decision on the validity of a Ballot Form will be final.

INSTRUCTIONS FOR FILLING THE BALLOT FORM


24

The instructions for members for voting electronically are as under:-

In case of members receiving e-mail:

(i) Log on to the e-voting website www.evotingindia.com

(ii) Click on "Shareholders" tab.

(iii) Now, select “Nagarjuna Oil Refinery Limited” from the drop down

menu and click on "SUBMIT"

(iv) Now Enter your User ID

a. For CDSL: 16 digits beneficiary ID,

b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,

c. Members holding shares in Physical Form should enter Folio

Number registered with the Company.

(v) Next enter the Image Verification as displayed and Click on Login.

(vi) If you are holding shares in demat form and had logged on to

www.evotingindia.com and voted on an earlier voting of any

company, then your existing password is to be used.

(vii) If you are a first time user follow the steps given below:

For Members holding shares in Demat Form and Physical Form

PAN* Enter your 10 digit alpha-numeric *PAN issued by Income

Tax Department (Applicable for both demat shareholders

as well as physical shareholders)

* Members who have not updated their PAN with the

Company/Depository Participant are requested to use the

first two letters of their name and the sequence number

(available in the address lable pasted on the Annual Report

and / or in the email sent to members) in the PAN field. In

case the sequence number is less than 8 digits prefix

sufficient number of 0’s before the number after the first

two characters of the name. E.g. If your name is

Ramanathan with sequence number 1234 then enter

RA00001234 in the PAN field.

DOB# Enter the Date of Birth as recorded in your demat account

or in the company records for the said demat account or

folio in dd/mm/yyyy format.

Dividend Enter the Dividend Bank Details as recorded in your demat

Bank account or in the company records for the said demat

Details# account or folio.

# Please enter the DOB or Dividend Bank Details in order to

login. If the details are not recorded with the depository or

company please enter the DP ID and Client id / folio number

in the Dividend Bank details field.

(viii)After entering these details appropriately, click on

"SUBMIT" tab.

(ix) Members holding shares in physical form will then reach

directly to the Company selection screen. However,

members holding shares in demat form will now reach

'Password Creation' menu wherein they are required to

mandatorily enter their login password in the new

password field. Kindly note that this password is to be

also used by the demat holders for voting for resolutions

of any other company on which they are eligible to vote,

provided that company opts for e-voting through CDSL

platform. It is strongly recommended not to share your

password with any other person and take utmost care to

keep your password confidential.

(x) For Members holding shares in physical form, the details

can be used only for e-voting on the resolutions contained

in this Notice.

(xi) Click on the EVSN for “Nagarjuna Oil Refinery Limited” to

vote.

(xii) On the voting page, you will see "RESOLUTION DESCRIPTION"

and against the same the option "YES/NO" for voting. Select the

option YES or NO as desired. The option YES implies that you

assent to the Resolution and option NO implies that you dissent

to the Resolution.

(xiii) Click on the "RESOLUTIONS FILE LINK" if you wish to view the

entire Resolution details.

(xiv) After selecting the resolution you have decided to vote on, click

on "SUBMIT". A confirmation box will be displayed. If you wish to

confirm your vote, click on "OK", else to change your vote, click

on "CANCEL" and accordingly modify your vote.

(xv) Once you "CONFIRM" your vote on the resolution, you will not

be allowed to modify your vote.

(xvi) You can also take print of the voting done by you by clicking on

"Click here to print" option on the Voting page.

(xvii)If Demat account holder has forgotten the changed password then

Enter the User ID and the image verification code and click on

Forgot Password & enter the details as prompted by the system.

• Institutional shareholders (i.e. other than Individuals, HUF,

NRI etc.) are required to log on to https://

www.evotingindia.co.in and register themselves as

Corporates.

• They should submit a scanned copy of the Registration Form

bearing the stamp and sign of the entity to

[email protected].

• After receiving the login details they have to create a user

who would be able to link the account(s) which they wish to

vote on.

• The list of accounts should be mailed to

[email protected] and on approval of the

accounts they would be able to cast their vote.

• They should upload a scanned copy of the Board Resolution

and Power of Attorney (POA) which they have issued in favour

of the Custodian, if any, in PDF format in the system for the

scrutinizer to verify the same.

In case of members receiving the physical copy:

(A) Please follow all steps from sl. no. (i) to sl. no. (xvii) above to cast

vote.

(B) The voting period begins on September 21, 2014 at 9.00 AM

and ends on September 23, 2014 at 5.00 PM. During this

period shareholders' of the Company, holding shares

either in physical form or in dematerialized form, as on

the cut-off date (record date) of August 16, 2014, may cast

their vote electronically. The e-voting module shall be

disabled by CDSL for voting thereafter.

(C) In case you have any queries or issues regarding e-voting,

you may refer the Frequently Asked Questions ("FAQs")

and e-voting manual available at www.evotingindia.co.in

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Nagarjuna Oil Refinery LimitedD.No. 8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad - 500082.

CIN : L23200AP2010PLC071242

PROXY FORM

Name of the member(s):

Registered Address :

Email Id:

Folio No./DP ID & Client ID

DP ID :

I/We, being the member(s) of ______________ shares of the above named company, hereby appoint

1. Name : ______________________________ Address __________________________________________________

Email Id : _____________________________ Signature_______________________________________or failing him

2. Name : ______________________________ Address __________________________________________________


3. Name : ______________________________ Address __________________________________________________


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As my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 4th Annual General Meeting of the

company, to be held on the 26th day of September 2014 at 12.00 noon at Sri Satya Sai Nigamagamam, 8-3-987/2, Srinagar

Colony, Hyderabad - 73 and at any adjournment thereof in respect of such resolution as are indicated below :

Ordinary Business

1. Adoption of financial statements for the year ended March 31, 2014 and the Directors Report and Auditors Report

thereon

2. Appointment of Shri K S Raju, who retires by rotation

3. Appointment of Shri K Rahul Raju, who retires by rotation

4. Appointment of M/s. M Bhaskara Rao & Co as Statutory Auditors of the company

Special Business

5. Re-appointment of Shri K Soma Raju as Manager for a period of three years with effect from August 31, 2014 and

payment of his remuneration.

6. Appointment of Dr N C B Nath as an Independent Director

7. Appointment of Shri S R Ramakrishnan as an Independent Director

8. Appointment of Shri D Ranga Raju as an Independent Director

Affix Revenue

Stamp

Signed this _____day of _________ 20___.

Signature of shareholder

Signature of Proxy holder(s)

Note : This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of theCompany, not less than 48 Hours before the commencement of the Meeting.

Nagarjuna Oil Refinery LimitedRegd. Office : D.No. 8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad - 500082.

4th Annual General Meeting at 12.00 NOON on September 26, 2014

at Sri Satya Sai Nigamagamam, 8-3-987/2, Srinagar Colony, Hyderabad - 500 073.

ADMISSION SLIP

Folio No. / DP ID and Client ID...............................................................................Shares Held............................................

Please tick whether Member / Joint holder / Proxy. Member's or Proxy's Signature............................................

Note: Shareholder / Proxy must bring the Admission Slip to the Meeting and hand it over at the entrance duly signed.

� �

Board of Directors - Bombay Stock Exchange...Board of Directors K S Raju Chairman Chandra Pal Singh...

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Transcript of Board of Directors - Bombay Stock Exchange...Board of Directors K S Raju Chairman Chandra Pal Singh...