Home  »  Company  »  Brigade Enterprises  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Brigade Enterprises Ltd.

Mar 31, 2013

1. Company overview:

Brigade Enterprises Limited (BEL) was incorporated on 8th November, 1995 and is listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The Company is carrying on the business of real estate development primarily focussed on the development of residential, commercial and hospitality properties in South India. BEL has completed over 100 residential, commercial, retail and hospitality projects, covering over 20 million sft of developable area. The residential properties developed by BEL include integrated lifestyle enclaves and apartment buildings. The commercial properties developed by BEL include state of the art office spaces, software and IT Parks, SEZs, Malls with entertainment facilities, such as multi- plexes. The properties in the hospitality sector developed by BEL include serviced residences, hotels, resorts, spas, recreational clubs, convention centres in Bangalore and other parts of South India.

2.1. Provision for Warranty:

No estimation of liabilities for warranties has been done relating to sale of unit / property, since such costs, if any, are covered by a corresponding warranty from the Company''s contractors / vendors. This cost, if any, is recognised as and when incurred by the Company.

2.2 Segmental information:

The company has identified real estate development, hospitality services and lease rentals as primary business segments. Accordingly the segment revenue, results and capital employed attributable to the segments are reported under each reportable segment.

The company has its operations in India, which makes it a single geographical segment. Hence, providing geographical segment information is not applicable to the company for the current financial year.

2.3 Assets under operating lease:

a. The Company has given certain assets on operating lease. Details of assets given under operating lease are as under:

b. The Company has given on non-cancelable operating lease certain assets, the future minimum lease receivables in respect of which, as at 31st March 2013 are as follows:

c. The Company has taken various residential / commercial premises on cancelable / operating leases. These agreements are normally renewed on expiry.

d. The Company has taken, on non-cancelable operating lease, certain assets (land), the future minimum lease payments in respect of which, as at 31st March 2013 are as follows:

e. There are no exceptional / restrictive covenants in the lease agreements.

f. Contingent rent recognised in the Profit and Loss Account is Rs Nil.

g. The Company has constructed commercial space of 6,80,786 sft in one of its project called Brigade Summit. Till March 31, 2013, the Company has sold 4,03,978 sft (Previous year 45,080 sft) and recognised the income and proportionate cost in its Income Statement. The Company''s intention is to sell this stock over a period of two years and accordingly the same is grouped under Inventory. The Company has leased out 1,65,670 sft as on March 31, 2013 (Previous year 5,01,567 sft) to generate revenue out of unsold stock and recognised the rentals as revenue. Since the said property / units are held for sale, depreciation on this stock Rs 316 lakhs (previous year Rs 1,073 lakhs) has not been provided. Had depreciation on the same been provided, the profits would have been lower by Rs 316 lakhs (previous year Rs 1,073 lakhs).

2.4 Joint ventures

a) BCV Developers Private Limited ("BCV Developers")

In July 2008, the Company and certain Landowners formed a Joint Venture Company called BCV Devel- opers in Bangalore. BCV Developers is engaged in the development of an Integrated Township Project in Devanahalli, Bangalore. As at 31st March 2013, the Company and the Landowners each hold 50% of the equity in BCV Developers Pvt. Ltd.

b) BCV Estates Private Limited ("BCV Estates"):

In September 2010, the Company and certain Landowners formed a Joint Venture Company called BCV Estates in Bangalore. BCV Estates envisages the development of an Integrated Township Project in Devanahalli, Bangalore. As at 31st March 2013, the Company and the Landowners each hold 50% of the equity in BCV Estates.

2.5 During the year the Company has not made any political contribution. (Previous Year Nil).

2.6. Quantitative Details:

The Company is engaged in the business of real estate and property development. Such activity cannot be expressed in any generic unit. Hence, it is not possible to give the quantitative details of sales and the information as required under part II of Schedule VI of the Companies Act, 1956.

2.7 Disclosure under Section 22 of the Micro, Small and medium Enterprises Development Act, 2006.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management.

2.8 Details of Derivative instruments and unhedged foreign currency exposures:

The year-end foreign currency exposures that have not been hedged by derivative instrument or otherwise are given below:

The CIF value of imports and payments for the year ended 31 March 2013, is Rs 1,127 Lakhs (previous year 3,070 lakhs)

2.9 Balances of Debtors and Creditors and Loans and Advances are subject to reconciliation and Confir- mation.

2.10 The Company is examining the applicability of the Transfer pricing regulations with respect to its domestic transactions and the relevant documen- tation, if required, in respect thereof to ensure compliance with the said rules. The management does not anticipate any material adjustment which will have a material bearing on the accounts in this regard.

2.11 Previous Year Amounts:

The figures of the previous year have been regrouped, reclassified and restated wherever necessary.


Mar 31, 2012

1. Company overview:

Brigade Enterprises Limited (BEL) was incorporated on 8th November, 1995 and is listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The Company is carrying on the business of real estate development primarily focussed on the development of residential, commercial & hospitality properties in South India. BEL has completed over 100 residential, commercial, retail and hospitality projects, covering over 20 million sft of developable area. The residential properties developed by BEL include integrated lifestyle enclaves & apartment buildings. The commercial properties developed by BEL include state of the art office spaces, software & IT Parks, SEZs, Malls with entertainment facilities, such as multi- plexes. The properties in the hospitality sector developed by BEL include serviced residences, hotels, resorts, spas, recreational clubs & convention centres in Bangalore & other parts of South India. The Company has income from Real Estate development; Rentals from properties let out and income from Hospitality.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

CIF Value of imports and payments during the year ended 31st March 2012 is Rs 3,069.84 Lakhs (previous year Rs 4,636.36 lakhs).

2.1 Employee Benefit plans

a. Defined contribution plans:

The Company makes Provident Fund contributions to defined contribution plans for qualifying employees. Under the Scheme, the Company is required to contribute a specified percentange of the payroll costs to fund the benefits. The Company recognised Rs 45.02 lakhs (year ended 31st March 2011 Rs 38.29 lakhs) for Provident Fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the Scheme.

b. Defined Benefit plan with Life Insurance Corporation of India:

The Company offers gratuity benefit to its employees. The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial statements.

In case of employees of Sheraton Bangalore at Brigade Gateway, provision for gratuity amounting to Rs 16.52 Lakhs is made based on actuarial valuation on the following assumptions.

2.2 Segment information:

The Company has identified real estate development and hospitality services, as primary business segments. Accordingly the segment revenue, results and capital employed attributable to segments are reported under each reportable segment. The geographical location of the projects represents the secondary segment of reporting.

c. The Company has taken various residential / commercial premises on cancelable / operating leases. These agreements are normally renewed on expiry.

d. The Company has taken, on non-cancelable operating lease, certain assets (land), the future minimum lease payments in respect of which, as at 31st March 2012 are as follows:

e. There are no exceptional / restrictive covenants in the lease agreements.

f. The Company has constructed commercial space of 6,80,786 sft in one of its project called Brigade Summit. Till March 31, 2012, the Company has sold 45,080 sft and recognised the income and proportionate cost in its Income Statement. The Company's intention is to sell this stock over a period of two years and accordingly the same is grouped under Inventory. The Company has leased out 5,01,567 sft as on March 31, 2012 to generate revenue out of unsold stock and recognised the rentals as revenue. Since the said property / units are held for sale, depreciation on this stock is not provided. If provided for, the same would have been Rs 10.73 crores (previous year Rs 1.65 crores)

g. Contingent rent recognised in the Profit and Loss Account is Rs Nil.30.9 Joint ventures

a) BCV Developers Private Limited ("BCV Developers") In July 2008, the Company and certain Landowners formed a Joint Venture Company called BCV Developers in Bangalore. BCV Developers envisages the development of an Integrated Township Project in Devanahalli, Bangalore. As at 31st March 2012, the Company and the Landowners each hold 50% of the equity in BCV Developers.

b) BCV Estates Private Limited ("BCV Estates")

In September 2010, the Company and certain Landowners formed a Joint Venture Company called BCV Estates in Bangalore. BCV Estates envisages the development of an Integrated Township Project in Devanahalli, Bangalore. As at 31st March 2012, the Company and the Landowners each hold 50% of the equity in BCV Estates.

2.3 Balances of debtors, creditors and loans and advances are subject to reconciliation and confirmation.

2.4. Previous year amounts

The figures of the previous year have been regrouped / reclassified and restated wherever necessary.


Mar 31, 2011

2.1. Share Capital:

Issued, Subscribed and Paid up capital of Rs 11,225.19 Lakhs and there is no change in the same during the year.

2.2. Secured Loans: 2.2.1 Corporation Bank:

a. Loan of Rs 10,497.59 Lakhs (31.03.2010: Rs 10,999.76 Lakhs) is secured by frst charge on pari-passu basis with Indian Bank on land, building and Multi Level Car Parking of the Brigade Gateway World Trade Center Bangalore, Subramanyanagar, Malleswaram West, Bangalore.

b. Overdraft loan of Rs 1,154.22 Lakhs as against the facility of Rs 2,000 Lakhs (31.03.2010: Rs 1,555.90 Lakhs) is secured by on the property of Augusta Club and EMG of Hulkul Brigade Centre to the extent of 17140 sft situated at No. 82 Lavelle Road, Ward No. 76, Bangalore (third party property), owned by director Mr M. R. Jaishankar and his family members. c. Loan of Rs 12,634.24 Lakhs (31.03.2010: Rs 8,500.27) is secured by EMG / frst charge on the residential buildings, viz., B Block (Altair at Brigade Gateway) and J, K, L Blocks at Brigade Metropolis, Bangalore.

Above loans have been further secured by the personal guarantee of directors Mr M .R. Jaishankar, Mr M. R. Shivram and Mr M. R. Krishna Kumar (to the extent of Rs 15,500.00 Lakhs only).

2.2.2 Indian Bank:

Loan of Rs 5,384.47 Lakhs (31.03.2010: Rs 6,127.27 Lakhs) is secured by frst charge on pari-passu basis with Corporation Bank on land, building and Multi Level Car Parking of the Brigade Gateway World Trade Center Bangalore, Subraman- yanagar, Malleswaram West, Bangalore and the personal guarantee of directors Mr M. R. Jaishankar and Mr M. R. Shivram.

2.2.3. State Bank of India:

Loan of Rs 14,473.88 Lakhs (31.03.2010: Rs 12,623.15 Lakhs) is secured by frst charge on pari- passu basis with State Bank of Mysore and State Bank of Patiala on land and buildings of the Sheraton Hotel and Orion Mall Projects at the Brigade Gateway, Subramanyanagar, Malleswaram West, Bangalore and the personal guarantee of directors Mr M. R. Jaishankar and Mr M. R. Shivram.

2.2.4 State Bank of Mysore:

Loan of Rs 2,838.37 Lakhs (31.03.2010: Rs 4,043.18 Lakhs) is secured by frst charge on pari-passu basis with State Bank of India and State Bank of Patiala on land and buildings of the Sheraton Hotel and Orion Mall Projects at the Brigade Gateway, Subramanyanagar, Malleswaram West, Bangalore and the personal guarantee of directors Mr M. R. Jaishankar and Mr M. R. Shivram.

2.2.5 State Bank of Patiala:

Loan of Rs 2,837.48 Lakhs (31.03.2010: Rs 4,043.23 Lakhs) is secured by frst charge on pari-passu basis with State Bank of Mysore and State Bank of India on land and buildings of the Sheraton Hotel and Orion Mall Projects at the Brigade Gateway, Subraman- yanagar, Malleswaram West, Bangalore. And the personal guarantee of directors Mr M. R. Jaishankar and Mr M. R. Shivram.

2.2.6 ICICI Bank Ltd:

Loan of Rs 575.00 Lakhs (31.03.2010: Rs 704.14 Lakhs) is secured by exclusive mortgage on land and building of the Homestead-2 at Jayanagar, Bangalore, and the personal guarantee of Mr M. R. Jaishankar and Mr M. R. Shivram.

2.2.7 Bank of Baroda:

a) Loan of Rs 2,924.72 Lakhs (31.03.2010: Rs 3,000 Lakhs) is secured by equitable mortgage of land and building of the Brigade International School @ Whitefeld, Dyavasandra Industrial Area Phase I, K. R. Puram Hobli, Bangalore.

b) Loan of Rs 8,995.53 Lakhs (31.03.2010: 5,000 Lakhs) is secured by exclusive frst charge of portions owned by the Company at Summit 1 & 2 and the adjoining 7-level MLCP building including car parking space at Brigade Metropolis, Mahadevapura, K. R. Puram Hobli, Bangalore.

2.2.8 Bank of India:

Loan of Rs 1,700 Lakhs (31.03.2010: 500 Lakhs) is secured by Equitable Mortgage of land and building of the Brigade International School @ Gateway Subramanyanagar, Malleswaram West, Bangalore.

2.2.9 Lakshmi Vilas Bank:

a) Loan of Rs 2,094.62 Lakhs (31.03.2010: Rs NIL) is secured by equitable mortgage / hypothecation of land and building of MLR Convention Centre and Woodrose Club situated at Brigade Millennium at Puttenahalli, J. P. Nagar, 7th Phase, Bangalore and Regent Club at Doddanekundi Industrial Area, II Phase, Mahadevapura Village, K. R. Puram Hobli, Bangalore and the Corporate Guarantee of M/s. Brigade Hospitality Services Ltd.

b) Loan of Rs 2,534.40 Lakhs (31.03.2010: NIL) is secured by equitable mortgage/ hypothecation of land and building of MLR Convention Centre and Woodrose Club situated at Brigade Millennium at Puttenahalli, JP Nagar, 7th Phase, Bangalore and Regent Club at Doddanekundi Industrial Area, II Phase, Mahadevapura Village K. R. Puram Hobli, Bangalore and the Corporate Guarantee of M/s. Brigade Hospitality Services Ltd.

2.2.10 Allahabad Bank:

a) Loan of Rs 3,036.92 Lakhs (31.03.2010: Rs NIL) is secured by Assignment of Lease rentals from: Cisco Systems India Pvt. Ltd, Encora Technologies Pvt. Ltd, Quintiles Data Processing Center (India) Pvt. Ltd and Quintiles Technologies (India) Pvt. Ltd with

Collateral security of exclusive equitable mortgage of plot of Land situated at Sy No. 6/1, 7/1, 6/2, 6/3, 6/4, 7/2, 7/3, 7/4,5 in Kurubarakunte Village, Kasaba Hobli, Devanahalli Taluk, Bangalore Rural Dist., which is under Joint Development Agreement between Mr M. R. Jaishankar and M/s. Brigade Enterprises Limited and the personal guarantee of director Mr M. R. Jaishankar. b) Loan of Rs 6,365.59 Lakhs (31.03.2010: NIL) is secured by equitable mortgage of land and building of Orion Mall Projects at Brigade Gateway, Subra- manyanagar, Malleswaram West, Bangalore and the personal guarantee of director Mr M. R. Jaishankar.

2.4. Warranty Costs:

The Company has not recognised warranty cost relating to sale of unit/property, since such costs, if any, are covered by a corresponding warranty from the Companys contractors/ vendors. This cost, if any, is recognised as and when incurred by the Company.

2.5. Gratuity Plan:

The following table spells out the status of the gratuity plan as required under AS-15 (revised).

2.6. Borrowing Cost

A sum of Rs 1,527.91 Lakhs (previous year Rs NIL) being borrowing cost incurred by the company in respect of assets / projects was Capitalised during the year. Sum of Rs 1,499.67 Lakhs (previous year Rs NIL) being borrowing cost incurred by the company in respect of assets / projects, carried forward as stock in trade. A sum of Rs 4422.41 Lakhs (previous year Rs 5137.08 Lakhs) being borrowing cost incurred by the company in respect of assets / projects, carried forward as capital work in progress.

2.7. Segmental Reporting

The Companys operations predominantly relate to construction and development, real estate development, and related activities of leasing/rental of units/properties. Accordingly, real estate development represents a single primary segment in the financials of the Company and the geographical location of the projects represents the secondary segment of reporting.

During the current year, the financials of the Company represent a single primary segment (real estate devel- opment). The Revenues from Hospitality being a new Primary segment does not exceed 10% of the overall revenues of the company. With respect to secondary segment, the Company has its projects in India, which makes it a single segment. Hence, providing of segmental information is not applicable to the Company for the current financial year.

2.8. Related Party Disclosure:

Related party disclosures, as required by AS-18, "Related Party Disclosures" are given below:

2.8.1 Relationships:

Holding Companies NIL

Subsidiary Companies

Brigade Hospitality Services Ltd

Brigade Tetrarch Pvt. Ltd

Brigade Estates and Projects Pvt. Ltd

Brigade Properties Pvt. Ltd.

Brigade Infrastructure & Power Pvt. Ltd

WTC Trades and Projects Pvt. Ltd

Associated Companies & Joint Venture

Tandem Allied Services Pvt. Ltd

BCV Developers Pvt. Ltd

BCV Estates Pvt. Ltd

Other related parties where common control exists

Mysore Holdings Pvt. Ltd

Brigade Foundation

Mr M. R. Jaishankar (HUF)

Key Managerial Personnel (KMP)

Mr M. R. Jaishankar,

Chairman and Managing Director

Ms Githa Shankar, Executive Director

Relatives of Key Managerial Personnel

Ms Nirupa Shankar (Daughter of KMP) Ms Pavitra Shankar (Daughter of KMP) Mr M. R. Shivram (Relative of KMP)

2.9.3. The Company has taken various residential / commercial premises on cancelable operating leases. These agreements are normally renewed on expiry.

2.9.5. Contingent rent recognised in the Profit and Loss Account is Rs Nil.

2.12. Joint Ventures: a) BCV Developers Private Limited ("BCV Developers") In July 2008, the Company and certain Landowners formed a Joint Venture Company called BCV Devel- opers in Bangalore. BCV Developers envisages the development of an Integrated Township Project in Devanahalli, Bangalore. As at March 31, 2011, the Company and the Landowners each hold 50% of the equity in BCV Developers.

The Companys proportionate share in assets, liabilities, income and expense of the Joint Venture is detailed below.

B) BCV Estates Private Limited ("BCV Estates")

In September 2010, the Company and certain Landowners formed a Joint Venture Company called "BCV Estates" in Bangalore. BCV Estates envisages the development of an Integrated Township Project in Devanahalli, Bangalore. As at March 31, 2011, the Company and the Landowners each hold 50% of the equity in BCV Estates.

2.13. Contingent Liabilities:

Capital Commitments and Contingent liabilities on account of:

(Rupees in Lakhs)

Particulars 31st March 2011 31st March 2010

Capital Commitments not 28,959.48 54,123.17 provided in the books

Towards Letter of Credits and 1,770.55 3,637.20 Bank Guarantees

Claims from government departments not acknowledged 153.14 164.95 as debts

Claims from government departments not acknowledged 1056.24 1305.76 as debts paid under protest and under appeal

2.16. As per the information available with the company, the principal amount payable to Micro, Small, and Medium Enterprises falling under the provisions of Micro, Small, and Medium Enterprises Development Act, 2006, Rs 15.70 Lakhs.

2.17. Balances of Debtors, Creditors and Loans and Advances are subject to reconciliation and confirmation.

2.18. Prior Period income of Rs 1190.73 Lakhs (Previous Year Rs 96.77 lakhs) is accounted in the books.

2.19. During the year the Company has made a political contribution of Rs 5 Lakhs (Previous Year Rs 20 Lakhs) to Bharatiya Janata Party.

2.20. Quantitative Details:

The Company is engaged in the business of real estate and property development. Such activity cannot be expressed in any generic unit. Hence, it is not possible to give the quanti- tative details of sales and the information as required under paragraphs 3, 4C, and 4D of part II of Schedule VI of the Companies Act, 1956.

CIF Value of imports and payments for the year ended March 31, 2011, is Rs 4636.36 Lakhs (Previous year 1064.96 Lakhs).

2.22. Previous Year Amounts:

The figures of the previous year have been regrouped, reclassified and restated wherever necessary.

 
Subscribe now to get personal finance updates in your inbox!