Directors Report of AJR Infra and Tolling Ltd.
Mar 31, 2018
To
The Shareholders of
Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their Seventeenth Annual Report together with the Audited Accounts of the Company, for the financial year ended March 31, 2018 (âFinancial Yearâ).
FINANCIAL HIGHLIGHTS
The financial highlights of the Company on stand-alone and consolidated basis for the Financial Year are as under:
(Rs. in Lakhs)
|
Particulars |
Standalone |
Consolidated |
||
|
Financial Year ended March 31, 2018 |
Financial Year ended March 31, 2017 |
Financial Year ended March 31, 2018 |
Financial Year ended March 31, 2017 |
|
|
Income |
17,669.38 |
21,677.96 |
64,301.88 |
68,585.11 |
|
Earnings before interest, tax, depreciation and amortization |
3,692.53 |
4,337.54 |
26,270.71 |
29,045.59 |
|
Financial costs |
2,239.88 |
2,641.72 |
33,992.90 |
31,223.60 |
|
Depreciation and amortization |
60.85 |
15.72 |
8,724.22 |
4,951.03 |
|
Tax expenses |
247.33 |
45.94 |
1,587.39 |
2,704.58 |
|
Minority interest & share of profit of associates/ subsidiaries |
0.00 |
0.00 |
(3986.28) |
(1,748.10) |
|
Net Profit after Tax / (Loss) |
1,144.47 |
1,875.16 |
-18,553.81 |
(10,405.95) |
DIVIDEND & RESERVES
The Board express its inability to recommend any dividend for the Financial Year in view of the liquidity constraints. No amounts have been transferred to any reserve.
COMPANYâS BUSINESS
Your Company has a basket of three projects in the Road Sector, two in the Port Sector and four in the Power sector, which are at various stages of construction and / or operation and management through project specific special purpose vehicles (SPVs). During the Financial Year, your Company, in consortium with Gammon Engineers and Contractors Private Limited (âGECPLâ), has made successful bid and received a Letter of Award dated January 31, 2018 from the National Highways Authority of India for a road project in the State of Odisha on Engineering, Procurement and Construction (âEPCâ) mode.
ROAD SECTOR:
The Company has the following projects in the Road Sector:
(1) Rajahmundry Godavari Bridge Limited;
(2) Sidhi Singrauli Road Project Limited; and
(3) Patna Highway Projects Limited.
Engineering, Procurement and Construction (EPC) project:
The Company, in consortium with GECPL as the lead member of the consortium, has made successful bid and received the Letter of Award dated January 31, 2018 from the National Highways Authority of India for âRehabilitation and Up gradation of existing 2-lane to 4-lane standards from Duburi to Chandikhole Section of NH 200 (New NH 53) from km. 388.376 to km 428.074 in the State of Odisha under NHDP Phase - III on EPC Mode (Pkg- III)â.
PORT SECTOR:
The Company has the following projects in the Port Sector:
(1) Vizag Seaport Private Limited; and
(2) Indira Container Terminal Private Limited.
POWER SECTOR:
The Company has the following projects in the Power Sector:
(1) Pravara Renewable Energy Limited;
(2) Sikkim Hydro Power Ventures Limited;
(3) Youngthang Power Ventures Limited; and
(4) Tidong Hydro Power Limited.
Status on the above projects and financial performance of respective SPVs for these projects are discussed and covered in the Management Discussion and Analysis Report covered in this Annual Report.
Other Business
In addition to undertaking infrastructure development through SPVs, the Company undertakes EPC works of the underconstruction projects and operation & maintenance of operational road projects.
THE FUTURE
Your Company through its repository of experience in project development and operations in multiple sectors, qualifies for largest projects being offered by project authorities in road, port, transmission and power sector projects.
Your Company, as indeed most players in the infrastructure industry, has been facing a resource crunch in the last few years. There is a sizable gap between the Companyâs internal accruals and the requirement of funds for capital investment in existing and new projects and revenue expenditure. The ability of the Company to raise external funds has also been affected due to adverse market conditions. To ease the present situation, the Company is actively pushing for realization of its receivables from NHAI and other public sector agencies. Further, upon resolution of certain contractual obligations on few of the delayed projects, release of resources stalled thereof will bring back the Company into mainstream.
Going forward, your Company will focus on strategic partnerships at project level with selective opportunities which have lower risk and lower investment, which will supplement our existing portfolio. The focus will be to get âalmost readyâ projects commissioned at the earliest and operate the projects successfully. Limited initiative will also be taken in Engineering, Procurement & Construction work. Your Company is confident that these projects, once completed, will contribute positively to the bottom line and improve the cash position.
SHARE CAPITAL OF THE COMPANY
There has been no change in the share capital of the Company during the Financial Year. The paid up share capital of the Company stood at Rs. 188.36 Crores as at 31st March, 2018 comprising of 941,830,724 equity shares of Rs. 2/- each fully paid up.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Companyâs internal control systems with reference to Financial Statements commensurate with the nature and size of its business operations. Your Company has maintained a proper and adequate system of internal controls. This ensures that all Assets are safeguarded and protected against loss from unauthorized use or disposition and that the transactions are authorised, recorded and reported diligently. The Management continuously reviews the internal control systems and procedures for the efficient conduct of the Companyâs business.
INTERNAL AUDIT
The Board of Directors of the Company has appointed M/s. Nitin H Rajda & Co., Chartered Accountants, Mumbai, as its Internal Auditor. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliances with operating systems, accounting procedures and policies and reports the same on quarterly basis to the Audit Committee.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, your Directors, based on the representations received from the operating management, and after due enquiry, confirm that:
a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit of the Company for the period;
c. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. they have prepared the annual accounts on a going concern basis;
e. they have laid down adequate internal financial controls to be followed by the Company and such internal financial controls operated effectively during the Financial Year; and
f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors
Mr. Abhijit Rajan, Director has vacated office as the director of the company with effect from 7th May, 2018. The Board take on record its appreciation for the valuable services provided by Mr. Abhijit Rajan during his tenure as a director of the Company. In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Vardhan Dharkar is liable to retire by rotation at the ensuing Annual General Meeting and has offered himself for re-appointment.
Mr. Chayan Bhattacharjee was appointed as an additional non-executive director with effect from June 13, 2018 and holds office as such up to the date of ensuing Annual General Meeting.
Independent Directors of the Company have furnished necessary declarations to the Company under Section 149(7) of the Companies Act, 2013, confirming that they meet with the criteria of Independence as prescribed for Independent Directors under Section 149(6) of the Act and Regulation 16(b) of the Securities and Exchange Board of India (Listing Obligations & Disclosures Requirements) Regulations, 2015, (hereinafter âListing Regulationsâ).
Key Managerial Personnel
Mr. Kishor Kumar Mohanty was reappointed as the Managing Director of the Company for a period of 2 (two) years effective from April 12, 2017 which was approved by the shareholders at Annual General Meeting held on December 19, 2017.
Mr. Naresh Sasanwar was appointed as the Chief Financial Officer in place of Mr. Kaushik Chaudhuri with effect from February 14, 2018. Mr. Kaushal Shah was appointed as the Company Secretary of the Company with effect from February 14, 2018.
Further, in terms of the provisions of Section 203 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Mr. Kishor Kumar Mohanty, Managing Director; Mr. Naresh Sasanwar, Chief Financial Officer; and Mr. Kaushal Shah, Company Secretary and Compliance Officer are the Key Managerial Personnel of the Company.
Other Key Personnel:
Mr. Kaushik Chaudhuri - Head Risk & Internal Audit Mr. Prakash R - President - Roads
Remuneration Policy and Board Evaluation
In compliance with the provisions of the Companies Act, 2013 and Regulation 27 of the Listing Regulations, the Board of Directors on the recommendation of the Nomination & Remuneration Committee, adopted a Policy on remuneration of Directors and Senior Management. The Remuneration Policy is stated in the Corporate Governance Report.
Performance evaluation of the Board was carried out during the Financial Year. The details about the same are given in the Corporate Governance Report.
Familiarisation programmes for the Independent Directors
In compliance with the requirements of Listing Regulations, your Company has put in place a familiarization programme for the Independent Directors to familiarise them with their role, rights and responsibilities as Directors, the working of the Company, nature of the industry in which the Company operates, business model, etc. It is also available on the Company website http:// www.gammoninfra.com/sec_info_pdf/Familiarisation_Programme_IndependentDirectors.pdf.
BOARD MEETINGS
The Board met seven times during the Financial Year, the details of which are given in the Corporate Governance Report. The intervening gap between the two consecutive meetings was within the period prescribed under the Companies Act, 2013 and the Listing Regulations.
EMPLOYEE STOCK OPTION SCHEME
During the Financial Year, the Board has not granted any options to employees under the âGIPL Employee Stock Options Scheme - 2013â (âScheme1). Details of the shares issued under the Scheme, as also the disclosures in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014 are set out in Annexure I to this Report.
A certificate from the Statutory Auditors of the Company as required under Regulation 13 of SEBI (Share Based Employee Benefits) Regulations, 2014 shall be placed at the ensuing Annual General Meeting for inspection by the Members.
DEPOSITS
During the Financial Year, the Company has not accepted any deposits within the meaning of Section 73 and 76 of the Act, read with Companies (Acceptance of Deposits) Rules, 2014.
PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES
The details of loans, guarantee or investment under Section 186 of the Companies Act, 2013 are given under Notes to Accounts of financial statements.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All related party transactions entered by the Company during the financial year were in the ordinary course of business and on armâs length basis. Details of material related party transactions are given in the prescribed Form AOC - 2 which is appended to this report as Annexure II.
The policy on Related Party Transactions as approved by the Board is uploaded on the Companyâs website and can be accessed at the Web link http://www.gammoninfra.com/sec_info_pdf/PolicyonRelatedPartyTransactions16032016.pdf
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
In view of the nature of business activities currently being carried out by the Company, your Directors have nothing to report with respect to Conservation of Energy and Technology Absorption as required under Section 134(3)(m) read with Rule 8 of the Companies (Accounts) Rules, 2014.
Foreign exchange outgo (actual outflows): Nil
The foreign exchange earned (actual inflows): Nil
SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES
During the Financial Year 2017-18, the following changes have taken place:
(i) Indira Container Terminal Private Limited, a joint venture, has become a subsidiary of the Company w.e.f. 6th April, 2017; and
(ii) Satluj Renewable Energy Private Limited has ceased to be a step down subsidiary of the Company w.e.f. 18th July, 2017.
An application in Form STK-2 has been filed with the Ministry of Corporate Affairs (âMCAâ) by the following step-down subsidiaries of the Company for striking off the name from the register maintained by the Registrar of Companies:
i) Yamuna Minor Minerals Private Limited filed on April 12, 2018; and
ii) Ghaggar Renewable Energy Private Limited filed on April 13, 2018.
The policy for determining material subsidiaries as approved by the Board is uploaded on the Companyâs website and can be accessed at the web link http://www.gammoninfra.com/sec_info_pdf/Policy_determining_MaterialSubsidiary.pdf
A statement containing salient features of the financial statement of each of the subsidiaries, associates and joint venture companies as required to be provided under section 129(3) of the Act, in Form AOC-1 forms part of this Annual Report.
Pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along-with relevant documents and separate audited accounts in respect of Subsidiaries are available on the website of the Company.
BOARD COMMITTEES
The Board has presently the following committees to assist in its work:
(i) Audit Committee to, inter-alia, oversee and review the financial reporting system and disclosures made in its financial results;
(ii) Stakeholdersâ Relationship Committee to, inter-alia, redress investor complaints;
(iii) Nomination and Remuneration Committee to, inter-alia, approve appointments and remuneration of executive directors and lay down nomination and remuneration policies of the Company;
(iv) Compensation Committee to administer âemployee stock option schemesâ;
(v) Business Review Committee (previously known as Project Committee) to review business, projects and opportunities that arise from time to time;
(vi) Corporate Social Responsibility Committee to formulate and implement a âcorporate social responsibility policyâ for the Company; and
(vii) The Board has voluntarily constituted Risk Management Committee to monitor and review the risk management plan of the Company.
The constitution of the various committees, its powers and duties have been elaborated in greater detail in the âCorporate Governance Reportâ, which is annexed to the Annual Accounts.
The Board of Directors at their Meeting held on February 14, 2018 dissolved the Projects Review Committee.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
Your Company does not have any amount/ shares due to be transferred to Investor Education and Protection Fund.
VIGIL MECHANISM / WHISTLE BLOWER
In terms of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for Directors and employees to report genuine concerns has been established by the Board along with whistle blower policy. The whistle blower policy have been uploaded on the website of the Company and the same can be accessed at the web link http://www.gammoninfra.com/sec_info_pdf/ Whistle_Blower_Policy.pdf
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Since, there is no average net profit for the Company for the previous three financial years, no specific funds are required to be set aside and spent towards the Corporate Social Responsibility of the Company during the Financial Year. The Company is yet to formulate the CSR Policy.
EXTRACT OF ANNUAL RETURN
An extract of Annual Return in Form MGT 9 is appended to this Report as Annexure III.
REPORT ON CORPORATE GOVERNANCE
In terms of Regulation 34 of the Listing Regulations, a Report on Corporate Governance along with Compliance Certificate issued by Mr. Veeraraghavan. N, Practicing Company Secretary (Certificate of Practice Number 4334) is attached and forms integral part of this Report (herein referred to âCorporate Governance Reportâ).
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the members is invited to a separate section titled âManagement Discussion and Analysis Reportâ which is covered in this Annual Report.
SECRETARIAL STANDARDS
The Company complies with all applicable secretarial standards.
AUDITORS
At the 16th Annual General Meeting of the Company, the shareholders had appointed M/s. Nayan Parikh & Co., Chartered Accountants (FRN: 107023W) as the Statutory Auditors of the Company to hold office until the conclusion of the 21st Annual General Meeting (âAGMâ), subject to ratification by shareholders at every subsequent AGM.
Amended provisions of Section 139 of the Act vide Companies (Amendment) Act, 2017 notified from 7th May, 2018 no longer requires ratification of appointment of Auditors by members at every subsequent AGM. In view of this, the appointment of Auditors is not proposed for ratification at ensuing AGM.
M/s. Nayan Parikh & Co., Chartered Accountants (FRN: 107023W) have confirmed that they are not disqualified from continuing as Statutory Auditors of the Company.
AUDITORSâ REPORT
The Auditors have qualified their report to the members on the following matters:
(a) Attention is invited to note 18 (a) of the Standalone Ind AS Financial Statements relating to the excess managerial remuneration paid of Rs. 497.17 lacs for the period upto March 2017 for the reasons detailed in the aforesaid note. The Company had once again submitted its representation to the Ministry to reconsider its decision and allow the waiver of recovery of the excess remuneration paid aggregating to Rs. 388.45 lacs for the period upto March 2016. If the Companyâs representation is not accepted then the company would be required to recover the excess remuneration from the managerial personnel and to that extent the profit will be higher by an amount of Rs. 388.45 lacs. Pending the same no adjustments have been made to the financial results. Subject to the outcome of the representation made to the MCA, we are unable to ascertain the impact on profits on this account for the quarter and the year ended March 31, 2018. Similarly for the previous period ended March 31, 2017, the remuneration in excess of the limits computed under the provisions of Section 197 read with Schedule V to the Companies Act 2013 is Rs. 108.72 lacs for which the Company has made an application to the MCA for approval of the same. Pending these approvals, no adjustments have been made to the financial results for the remuneration of the said period. This matter was qualified in the auditorsâ report dated June 18, 2017 by the previous auditorsâ on the financial statements for the year ended March 31, 2017.
(b) Attention is invited to Note no 29 of the Standalone Ind AS Financial Statements in respect of status of the Tolling Road Project in Andhra Pradesh where termination notice was received from NHAI on 26th August 2016 and consequently, NHAI took over possession of toll plaza. Based on the subsequent negotiation and discussion with NHAI, they agreed to revoke the termination notice vide its letter dated 16th January 2017, subject to completing of financial closure and fulfilling of other commitments specified in the letter within the stipulated timeframe. The Company could not fulfil the said conditions. Ultimately on 8th September 2017, the Company made an application to NHAI for mutual exit from the project. The decision of NHAI in response to the aforesaid letter of mutual exit is pending.
In case the mutual exit proposal is accepted then the exposure of the Company is likely to be capped at Rs.7246.13 lacs as the Bank Guarantee would be released as requested by the Company in its letter dated 8th September 2017. In case the proposal is not accepted then the entire exposure of Rs. 15,666.13 lacs of the Company in the SPV needs to be tested for impairment. Accordingly, the decision of NHAI is more likely to have adverse impact on the Statement of Profit and Loss. No effects have been given in the financial statements of the SPV pending the decision of NHAI. The Auditors of the SPV have, in their audit report on the financial statements of the SPV for the year ended on 31st March 2018, carried a paragraph on Material Uncertainty related to Going Concern. The decision of the NHAI is awaited for determining the possible impairment and giving necessary effects. Pending the decision of NHAI we are unable to quantify the impairment that would be required in the matter and consequent impact on the Standalone Financial Statements.
(c) Attention is invited to Note no. 30 of the Standalone Ind AS Financial Statements, where the Company has defaulted in fulfilling its obligation under the one time settlement (OTS) with IFCI Limited. The Company was required to pay the entire outstanding by September 30, 2017. The Company has been unable to discharge the liability and has not been able to get further extension for the payment of the outstanding although it is actively engaged with IFCI Limited for obtaining the extension and/or non-reversal of the benefits of the OTS. In terms of the original arrangement, the benefits received under the one time settlement were to be reversed. Although the management is hopeful of obtaining the extension and / or non-reversal of the benefits of the OTS, pending the acceptance by IFCI Limited we are unable to state whether the Company has to account for the reversal of benefits of Rs. 3,776.69 lacs in its financial statements. The company has however provided interest at the rate of 11.50% p.a. as per the agreement. The interest payable on the outstanding amount before reversal of the aforesaid benefit as on balance sheet date is Rs 158.13 lacs.
Further, without qualifying their opinion, the Auditors have emphasized the following matters:
a) We invite attention to Note 32 (a) of the Standalone Ind AS Financial Statements, regarding unilateral termination and closure of Concessions in a bridge project, which is subject to pending litigations/arbitrations at various forums, which may impact the carrying values of investments and loans and advances given to the subsidiary. The Companyâs exposure towards the said project (funded and non-funded) is Rs.2,856.96 lacs. Pending conclusion on these legal matters, no adjustments have been made in the financial statements.
b) We invite attention to Note 32(b) of the Standalone Ind AS Financial Statements, in relation to intention to exit one of the hydro power projects at Himachal Pradesh and seeking a claim of an amount against the amount spent on the project. The Companyâs subsidiary has cited reasons for non-continuance on account of reasons beyond its control. The subsidiary is negotiating with its client for an amicable settlement on beneficial terms and has also invoked arbitration. The Companyâs exposure towards the said project includes investment and loans and advances of Rs. 7,119.23 lacs. Pending conclusion between the parties, no adjustments have been made in the financial statements.
c) We invite attention to Note 32 (c) of the Standalone Ind AS Financial Statements, in connection with an amount invested (including deposits and advances given) in the subsidiary of Rs. 13,831.00 lacs (funded and non-funded). As mentioned in the said note a draft supplementary agreement has been discussed between the parties under which the project would go for a re-bid and the SPV has a Right Of First Offer. The management is hopeful that it will successfully match the bid and win the concession and continue to operate the facility, which would be operationally viable under the revised terms. The management has during the year acquired further stake from the JV partner and has obtained control over the SPV and holds 74% of the equity of the SPV Company. The auditors of the SPV have included a separate paragraph on Material Uncertainty related to Going Concern. Pending execution of the supplementary agreement and the conclusion of the Rebid, no adjustments have been made in the financial statements.
d) We invite attention to Note 32 (d) of the Standalone Ind AS Financial Statements, in respect of a tolling bridge project in Andhra Pradesh where the monthly toll collections are not sufficient to pay the interest and the resultant defaults in the loan repayment resulting in the facility being marked NPA. The SPV had earlier submitted a proposal under the Scheme for Sustainable Structuring of Stressed Assets (S4A) to the Lenders, which was cleared by the Lenders for approval of the Overseeing Committee (OC) set up by the Indian Banking Association (IBA), in consultation with the Reserve Bank of India (RBI). The SPV provided its response to the observations of the Lenders and the OC on the S4A proposal and was awaiting the OC/lendersâ approval. In the interim, RBI vide its circular dated 12th February 2018, discontinued with immediate effect all restructuring schemes for stressed assets (including S4A). As per this circular, all schemes, including S4A which have been invoked but not implemented, shall be governed by the new circular. Thus the restructuring proposal proposed by the Company is no longer being pursued by the Lenders. Subsequently the Company has issued a cure period notice to Andhra Pradesh Road Development Corporation (APRDC or the Client) on 26th February 2018 under clause 37.2.1 of the Concession Agreement to cure the breaches of APRDC which includes provision of Revenue shortfall loan along with other mentioned breaches. Pending receipt of the response to the notice for cure period, no adjustments have been made in the financial statements. The auditors of the SPV have included a separate paragraph on Material Uncertainty related to Going Concern on the matter. The Companyâs exposure towards the project/SPV is Rs. 95,578.24 lacs (funded and non-funded).
e) We invite attention to Note 32(e) of the Standalone Ind AS Financial Statements, an annuity project of the Company where the SPV has accounted for the asset as a financial asset. The SPV will have cost overrun on account of issue beyond the scope of the SPV and attributable to the Grantor. This will not result in any changes in the Annuity from the grantor. However this amount would be treated separately as receivable from the Grantor based on certification of delay period attributable to the Grantor certified by the Independent Engineer. The SPV expects a sizeable claim on this amount and has obtained legal support for the validity of its claim from an Independent Expert on claim and litigation. The SPV had also separately applied to the lenders for Scheme for 5:25 Flexible Structuring Scheme for which sanction from two banks among consortium members had been received and sanction from rest bankers were expected in near future. However, in view of the RBI circular dated 12th February 2018, all restructuring schemes for stressed assets (including 5/25 Flexible Structuring Scheme) have been discontinued and the application became infructuous. The management contends that in view of the strong case it has on the claim matter as aforesaid there will be no impairment necessary towards the financial asset or towards the investment of the Company. The exposure of the Company in the SPV is Rs. 1,30,254.07 lacs including non-fund exposure. Pending conclusions no adjustments have been made in the financial statements.
f) We invite attention to Note no 32 (f) of the Standalone Ind AS Financial Statements relating to the Hydropower project in Sikkim. As detailed in the note there are various factors affecting the progress of the project. The management, as detailed in the note, is confident that it will be able to pursue the project viably and does not foresee any need for impairment. Considering the assertion of the management no adjustments have been made towards any possible impairment. The exposure of the Company in the SPV is Rs. 9,622.91 lacs.
g) We invite attention to Note 33 of the Standalone Ind AS Financial Statements, wherein during the year, Western Coalfields Limited (WCF) had encashed Bank Guarantee amounting Rs 1,514.01 lacs given in favour of Aparna Infraenergy India Private Limited (one of the SPVâs sold to BIF India Holding Pte ltd on February 29, 2016). Subsequent to encashment Company has filed an application for converting earlier injunction application to suit for recovery of damages. The management is hopeful of getting favourable decision on the matter and recovery of damages based on legal advice on the matter. Pending the outcome, the Company has shown guarantee encashment amount as receivable from Western Coal Fields and not debited the same to the statement of profit and loss for the year ended March 31, 2018.
It is clarified that the above matters covered in the Auditorsâ Report together with relevant notes in the Notes to Accounts are self-explanatory.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of section 204 of the Companies Act, 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Mr. Veeraraghvan. N, Practicing Company Secretary (Certificate of Practice Number: 4334) was appointed to undertake the Secretarial Audit of the Company.
In terms of provisions of section 204 of the Companies Act, 2013, the Secretarial Audit Report has been annexed to this Board Report as Annexure IV.
Observations made by the Secretarial Auditor in their Report are self-explanatory and do not need further clarification.
PARTICULARS OF EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this Report. In terms of the provisions of Section 197(12) of the Act read with sub-rules (2) and (3) of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said Rules are provided in the Report. However, having regard to the provisions of the second proviso to Section 136(1) of the Act, the details are excluded in the report sent to members. The required information is available for inspection at the registered office and the same shall be furnished on request.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Board has re-constituted Internal Complaints Committee under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 with effect from February 14, 2018. During the Financial Year, no complaint was filed before the said Committee. Internal Complaints Committee comprises of Ms. Hilda Buthello, Ms. Poonam Sabnis, Mr. Sanjay Chaudhary and CA / CS Sunil Dedhia, Practicing Company Secretary as its members with Ms. Hilda Buthello as Chairperson of the Committee.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT
There were no material changes and commitments after the closure of the year till the date of this report, which affect the financial position of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS / TRIBUNALS
No significant or material orders were passed by the Regulators or Courts or Tribunals which impacts the going concern status and Companyâs operations in future.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation for the support received by the Company from its shareholders and employees. The Directors also wish to acknowledge the co-operation and assistance received by the Company from its business partners, bankers, financial institutions and various Governments, Semi Government and Local Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Sushil Chandra Tripathi Kishor Kumar Mohanty
Chairman Managing Director
DIN: 00941922 DIN: 00080498
Place: Mumbai
Date: June 13, 2018
Sep 30, 2014
The Shareholders of
Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their fourteenth Annual
Report together with the Audited Accounts of the Company, for the
period 1st January, 2014 to 30th September, 2014 (the "Period"). This
report has been prepared in accordance with the Company law prevailing
prior to April 01, 2014.
FINANCIAL HIGHLIGHTS
The financial highlights of the Company on stand-alone basis and
consolidated basis for the Period are as under:
As per Consolidated Accounts: (Rs. in lacs)
Particulars Period ended Period ended
September 30, December 31,
2014 2013
(nine month (nine month
period) period)
Income 55168.72 46065.91
Earnings before interest, tax,
depreciation and amortization 31342.68 28384.58
Financial costs 20629.30 21902.87
Depreciation and amortization 16823.75 11956.02
Tax expenses (2157.15) 94.85
Minority interest & share of
profit of associates 71.93 75.24
Net profit / Loss (4025.15) (5644.39)
As per Standalone Accounts: (Rs. in lacs)
Particulars Period ended Period ended
September 30, December 31,
2014 2013
(nine month (nine month
period) period)
Income 8,380.66 8,449.41
Earnings before interest, tax,
depreciation and amortization 2,333.15 3,985.56
Financial costs 5,345.15 5,227.56
Depreciation and amortization 177.15 172.83
Exceptional items 3,916.16 -
Tax expenses (171.60) (30.17)
Net profit / Loss (6,933.71) (1,396.66)
DIVIDEND
The Board regrets its inability to recommend any dividend for the
Period in view of the tight cash position of the Company.
COMPANY''S BUSINESS
ROADS SECTOR:
Following the termination of the concession agreement for four laning
of the Patna to Buxar stretch of National Highway 30 in the State of
Bihar of Patna Buxar Highways Ltd. and unilateral sealing of the toll
booths of Cochin Bridge Infrastructure Company Ltd. at the new
Mattancherry Bridge at Kochi by the Greater Cochin Development
Authority, the Company now has nine active road projects of which five
are in operation.
The active projects in the Road Sector are: (a) Toll based projects:
(1) Concession for four laning and operating the Vadape - Gonde stretch
of the National Highway 3 between Mumbai and Nashik in the State of
Maharashtra. The Company''s subsidiary, Mumbai Nasik Expressway Ltd. has
completed construction of the project and has been operating the same
since May, 2010;
(2) Concession for constructing and operating a four lane bridge across
the Godavari River together with its approach roads on either side,
linking Rajahmundry to Kovvur in the State of Andhra Pradesh. The
Company''s subsidiary, Rajahmundry Godavari Bridge Ltd. is the
concessionaire for the project.
(3) Concession for six laning and operating the Vijayawada to
Gundugolanu stretch of National Highway 5, including a four lane bypass
to Vijayawada town, in the State of Andhra Pradesh. The Company''s
subsidiary, Vijayawada Gundugolanu Road Project Pvt. Ltd., is the
concessionaire for the project.
(4) Concession for four laning and operating the Sidhi to Singrauli
section of the National Highway 75E in the State of Madhya Pradesh. The
Company''s subsidiary, Sidhi Singrauli Road Project Ltd., is the
concessionaire for the project.
(b) Annuity based projects:
(1) Concession for four laning and operating the Rajahmundry -
Dharmavaram stretch of National Highway 5 in the State of Andhra
Pradesh. The Company''s subsidiary, Rajahmundry Expressway Ltd., has
completed construction of the project and has been operating the same
since September, 2004.
(2) Concession for four laning and operating the Dharmavaram to Tuni
stretch of National Highway 5 in the State of Andhra Pradesh. The
Company''s subsidiary, Andhra Expressway Ltd., has completed
construction of the project and has been operating the same since
October, 2004.
(3) Concession for constructing and operating a four lane bridge across
the Kosi River on National Highway 57 in the State of Bihar. The
Company''s subsidiary, Kosi Bridge Infrastructure Company Ltd., has
completed construction of the project and has been operating the same
since February, 2012.
(4) Concession for constructing and operating a four lane bypass to
Gorakhpur Town on National Highway 28 in the State of Uttar Pradesh.
The Company''s subsidiary, Gorakhpur Infrastructure Company Ltd., has
completed construction of the project and has been operating the same
since 31st March, 2012.
(5) Concession for four laning and operating the Patna to Muzafarpur
stretch of the National Highway 77 including a bypass to the Muzafarpur
town in the State of Bihar. The Company''s subsidiary, Patna Highway
Projects Ltd., is the concessionaire for the project.
Developments in the Road Sector during the Period
Patna Buxar Highways Ltd., the Company''s subsidiary, applied to the
National Highways Authority of India ("NHAI") for mutual termination of
the concession agreement on account of NHAI''s inability to provide
right of way over a substantial portion of the project stretch.
However, NHAI choose to terminate the concession unilaterally and
forfeited the Company''s bid security to the extent of 1% of the total
project cost. The Company is taking legal recourse to recover the
losses sufered by it from NHAI.
Cochin Bridge Infrastructure Company Ltd. ("CBICL"), the Company''s
subsidiary, which constructed the New Mattancherry Bridge connecting
Fort Kochi with Willingdon Island in the Cochin Port Trust area in the
State of Kerala was operating the same since September, 2001. However,
the Greater Cochin Development Authority has on April 27, 2014 (on the
last day of the original concession period), without compensating CBICL
for freezing the toll rates and in disregard of the Arbitral Tribunal
orders, chosen to unilaterally seal the toll booths of CBICL at the
Bridge. CBICL has put the arbitral proceedings on hold pending
settlement talks with the Government of Kerala.
The Sidhi Singrauli Road Projects Ltd. has achieved financial closure
and upon attaining ''appointed date'' has started construction
activities. The project has achieved about 19% completion as of 1st
January, 2015. However, the progress has slowed down due to delay in
disbursement of debt from the lenders.
The Vijayawada Gundugolanu Road Project Pvt. Ltd. has started tolling
operations on the project stretch with efect from 1st September, 2014.
The revalidation of financial closure, required on account of delay in
''appointed date'', is under process.
Rajahmundry Godavari Bridge Ltd., has not been able to complete the
Godavari bridge project on account of litigation involving land
required for the approach. The project is expected to be completed by
7th April, 2015, within the time extended by the state government
authorities.
Patna Highway Projects Ltd. has not been able to complete the entire
project stretch due to non-availability of land. However, we have
applied to NHAI for a provisional completion certificate based on the
progress of work on land made available to us, which under active
consideration of NHAI.
PORTS SECTOR:
The Company has two active projects in the Port Sector of which one is
in operation:
(1) Concession for constructing and operating two multipurpose berths
in the inner harbor of the Visakhapatnam Port, capable of handling upto
9 MTPA. The Company''s subsidiary, Vizag Seaport Pvt. Ltd., has
completed construction of both the berths, of which one became
operational in July, 2004 and the other in September, 2005.
(2) Concession for constructing and operating two ofshore container
berths at the Mumbai harbor. The project is under construction by
Indira Container Terminal Pvt. Ltd., the special purpose vehicle
promoted by the Company for the project.
Developments in the Port Sector during the Period
The company is pleased to inform that the long awaited deepening of the
inner harbor of Visakhapatnam Port Trust is expected to be achieved
soon. The port trust has already completed dredging up to -12.5 m and
the balance dredging up to -14 m is expected to be completed shortly.
This will come as a significant booster to the VSPL''s business since the
fully loaded panamax size vessels can directly enter the inner harbor
thereafter, without being partially discharged in the outer harbor. The
terminal business is expected to turn around with a sizable increase in
the profit margins. Development of the additional land of 30 acres in
the EXIM park area is already on, upon completion of which the terminal
capacity is expected to go up to 9 MMTPA.
Indira Container Terminal Private Ltd. has been unable to complete the
ofshore container berth projects as the Mumbai Port Trust has not
completed dredging of the berth front and its approach. The Port Trust
has also not filled up and handed over the areas earmarked for stockyard
purposes. Besides, the approval of Central Government for equipment
suppliers is pending. The company and the port trust authorities are
jointly exploring the possibility of gainfully putting to use the
already constructed infrastructure pending the completion of the
project.
The Company''s subsidiary, Mormugao Terminal Ltd., has instituted
appropriate legal proceedings challenging the unilateral termination of
the concession for providing mechanized handling facilities for
handling coal at one of the berths in the Mormugao Port by the Mormugao
Port Trust.
ENERGY SECTOR:
The Company has five projects in the energy sector of which one project
is expected to become operational in February, 2015.
(1) Concession for setting up and operating a 30 MW co-generation power
project at Pravaranagar in Ahmednagar District of Maharashtra. The
Company''s subsidiary, Pravara Renewable Energy Ltd., is the
concessionaire for the project. The project is set to be commissioned
in February, 2015.
(2) Concession for setting up and operating a 66 MW hydro-electric
power project in West Sikkim on the river Rimbhi. The Company''s
subsidiary, Sikkim Hydro Power Ventures Ltd., is the concessionaire for
the project.
(3) Concession for setting up and operating a 261 MW power project on
the river Spiti in the State of Himachal Pradesh. The Company''s
subsidiary, Youngthang Power Ventures Ltd., is the concessionaire for
the project.
(4) Concession for setting up and operating a 60 MW hydro-electric
project on the Tidong River (tributary of Satluj) in the Kinnaur
district of Himachal Pradesh. Tidong Hydro Power Ltd., a special
purpose vehicle promoted by the Company, is the concessionaire for the
project.
(5) A project for setting up and operating a 250 MW thermal power
project in Chandrapur district of Maharashtra for which the Company''s
subsidiary, Aparna Infraenergy India Pvt. Ltd., has the coal linkage.
Developments in the Energy Sector during the Period
During the Period, the Company decided not to pursue the amalgamation
of Pravara Renewable Energy Ltd., the concessionaire for the 30 MW
co-generation project at Pravara Nagar at Ahmednagar, with the Company.
The Pravara project is set to be commissioned in February, 2015.
Youngthang Power Ventures Ltd. has not been able to proceed with the
studies to prepare the Detailed Project Report (DPR) for its project
due to opposition of local farmers. The Company has served a notice on
the state government for refund of the upfront premium of Rs. 52 Cr
with interest and costs. The state government is seeking the opinion of
the local administration on action to be taken in the matter.
Tidong Hydro Power Ltd is conducting geological studies for preparation
of DPR, which has been delayed due to adverse environment conditions
and poor condition of roads at site. A request has been made to the
state government to extend the due date till December end, 2015.
Aparna Infraenergy India Pvt. Ltd., has the requisite land and coal /
water linkages as well as all statutory clearances to proceed with its
thermal power project. However, the Company had to petition the Bombay
High Court against cancellation of the coal linkage on the issue of
alleged management change. The Honorable High court has directed
Western Coalfelds Ltd. not to take any coercive action against the
company till further orders.
Other Business
In addition to undertaking infrastructure development through SPVs, the
Company undertakes operation & maintenance of the five road projects in
operation.
The Company has also ventured into construction work at the
Sidhi-Singrauli road project through subcontractors. The Company also
plans to undertake construction work at the Vijayawada-Gundugolanu road
project through subcontractors.
THE FUTURE
The Company and its 100% subsidiary Gammon Road Infrastructure Ltd.
("GRIL"), have qualified to bid for all NHAI projects of an estimated
cost not exceeding Rs.3820 crores approx. The Company has applied for
an enhancement of the limit up to Rs.4800 crores.
The Company has also been qualified to bid for one project in the Port
sector with an estimated total aggregate cost Rs.4000 crores.
The Company, as indeed most players in the infrastructure industry, has
been facing a resource crunch in the last few years. There is a sizable
gap between the Company''s internal accruals and the requirement of
funds for capital investment in existing and new projects and revenue
expenditure. The ability of the Company to raise external funds has
also been afected due to adverse market conditions. To ease the present
situation, the Company is actively pushing for realization of its
receivables from NHAI and monetization of its matured assets at the
appropriate valuation.
Going forward, the Company will focus on selective opportunities which
have lower risk and lower investment, which will supplement our
existing portfolio. Our focus will be to get our "almost ready"
projects commissioned at the earliest and run the operating projects
successfully. We are confdent that these projects, once completed, will
contribute positively to our bottom line and improve our cash position.
EMPLOYEE STOCK OPTION SCHEME
The ''employee stock options'' issued by the Company prior to the initial
public ofer of equity shares have either lapsed or have been exercised.
However, the Company has, with the members'' approval, issued a fresh
tranch of ''employee stock options'' to its executive directors and
senior employees during previous financial year. Details of the
''employee stock options'' allotted, as required to be stated in this
Report in terms of the SEBI Guidelines is annexed as Annexure 1.
A certificate from the Auditors that the Employee Stock Options Scheme
has been implemented by the Company in accordance with the SEBI
Guidelines is annexed to this Report as Annexure 2.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO.
The requirements of Section 217 (1) (e) of the Companies Act, 1956,
read with Rule 2(A) & 2(B) of the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 are not applicable to
the Company.
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to Rs. 23.45 lacs towards
professional services during the period.
SUBSIDIARIES
During the Period, Company has obtained the dissolution of Dohan
Renewable Energy Pvt. Ltd., Indori Renewable Energy Pvt. Ltd., Kasavati
Renewable Energy Pvt. Ltd., Markanda Renewable Energy Pvt. Ltd., and
Sirsa Renewable Energy Pvt. Ltd., subsidiaries of the Company promoted
to implement some renewable energy projects in Haryana, which were
later cancelled. No other changes in the list of subsidiaries of the
Company during the Period.
A statement u/s 212 of the Companies Act, 1956 relating to the
subsidiaries is attached to the Balance Sheet of the Company. The
Company has not attached the audited accounts of the subsidiaries to
the Audited Accounts of the Company. However, the efect of the same has
been brought out in the consolidated Audited Accounts of the Company.
The annual accounts of the subsidiaries and the related information
will be made available to the Company''s and subsidiaries'' investors as
and when required by them. These have also been kept for inspection of
the investors at the Registered Ofce of the Company and of the
concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 is annexed to this Report as Annexure 3.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm that:
a. the applicable accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b. the Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of afairs of
the Company at the end of the Period and of the loss of the Company for
the Period;
c. the Directors have taken proper and sufcient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d. the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
During the Period, Mr. Naresh Chandra, Chairman, had informed the
Company that due to his increased involvement with the Company as
Chairman he should no longer be treated as an Independent Director of
the Company. Mr. Chandra was appointed as an Independent Director as
per Section 149 of the Companies Act, 2013 at the 13th Annual General
Meeting of the Company held on June 30, 2014. The Company has since
then treated him as a director liable to retire by rotation.
Mr. Himanshu Parikh, Vice Chairman, who is liable to retire by
rotation, has intimated his desire not to be re- appointed as a
director at the ensuing 14th Annual General Meeting.
Accordingly, it is proposed to seek the approval of members at the
ensuing 14th Annual General Meeting for changing the designation /
appointment of Mr. Naresh Chandra from independent director to a
director liable to retire by rotation and for not filling up the vacancy
caused by the retirement by rotation of Mr. Himanshu Parikh.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
(i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
(ii) Stakeholders'' Relationship Committee to, inter-alia, redress
investor complaints;
(iii) Nomination and Remuneration Committee to, inter-alia, approve
appointments and remuneration of executive directors and lay down
nomination and remuneration policies of the Company;
(iv) Compensation Committee to administer ''employee stock option
schemes'';
(v) Project Committee to, inter-alia, advice the Company on the
business opportunities that arise from time to time;
(vi) Projects Review Committee to review implementation and working of
projects under development and operation;
(vii) QIP Committee to oversee raising of financial resources from QIBs
in terms of the resolution approved by the members at the Extra
Ordinary General Meeting held on July 15, 2014;
(viii) Corporate Social Responsibility Committee to formulate and
implement a ''corporate social responsibility policy'' for the Company;
and
(ix) Risk Management Committee to monitor and review the risk
management plan for the Company. The constitution of the various
committees, its powers and duties have been elaborated in greater
detail in the ''Corporate Governance Report'', which is annexed to the
Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the members is invited to a separate section titled
''Report on Corporate Governance'' which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan, a
''practicing company secretary'' on compliance with corporate governance
requirements of the Listing Agreement is annexed to this Report as
Annexure 4.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the members is also invited to a separate section titled
''Management Discussion and Analysis Report'' which is annexed to the
Annual Accounts.
AUDITORS
The Company has received the requisite consent and certificate from M/s.
Natvarlal Vepari & Co. under Chapter X of the Companies Act, 2013 for
their appointment as Company''s auditors.
The Board recommends their reappointment.
AUDITORS'' REPORT
The Auditors have qualified their report to the members on the issues
relating to the uncertainty over the outcome of the legal proceedings
initiated by Patna Buxar Highways Ltd. and Mormugao Terminal Ltd.
against unilateral termination of their respective concession
agreements. The Company''s exposure to these projects is Rs.8745.75
lacs, which has not been provided for.
Further, without qualifying their opinion, the Auditors have emphasized
the following matters:
(i) Existence of uncertainty on timing and realization of cash flows as
the Company has incurred a net loss after tax of Rs. 6933.71 lacs and
its current liabilities exceeded the current assets by Rs.4077.27
lacs.;
(ii) ''going concern assumption'' as regards Indira Container Terminal
Pvt. Ltd. due to its net loss during the year and default in payment of
debt obligations to lenders;
(iii) not making a provision for exposure towards Cochin Bridge
Infrastructure Company Ltd. including investments and loans and
advances of Rs. 1,326.05 lacs and Corporate guarantee of Rs. 974.17
lacs in view of the uncertainty over the outcome of legal proceedings
initiated by Cochin Bridge against unilateral termination and closure
of concession; and
(iv) not making a provision for exposure towards Youngthang Power
Ventures Ltd. including investments and loans of Rs. 7,080.37 lacs
which has initiated correspondence for closure of the project for
reasons beyond its control.
(v) excess remuneration to the extent of Rs. 208.55 lacs paid to
managerial persons beyond the limits specified under respective
regulations.
The Board is confdent of a favorable outcome on the legal proceedings
initiated by Patna Buxar Highways Ltd. and Mormugao Terminal Ltd.
The Board is also confdent of the steps being taken by the management
to ease the cash position and narrow the mismatch between current
liabilities and current assets.
The Board is aware of and confdent about a positive outcome on the
talks and correspondence with the Kerala Government on the Cochin
bridge project, and with the Mumbai Port Trust and Ministry of Shipping
and project bankers on the Indira Container Terminal project; and with
the Himachal Government authorities on the Youngthang Power project.
The Company is in the process of making an application to the Central
Govenrment for the approval of excess managerial remuneration.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Naresh Chandra C.C.Dayal K.K.Mohanty
Chairman Audit Committee Chairman Managing Director
Place: Mumbai
Date: February, 14, 2015
Dec 31, 2013
To The Shareholders of Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their thirteenth Annual
Report together with the Audited Accounts of the Company, for the
period 1st April, 2013 to 31st December, 2013 (the Period). This report
has been prepared in accordance with the Company law prevailing prior
to April 01, 2014.
FINANCIAL HIGHLIGHTS
The financial highlights of the Company on stand-alone basis and
consolidated basis for the Period are as under:
As per Consolidated Accounts: (Rs. in lacs)
Particulars December 31, March 31, 2013
2013 (twelve month
(nine month period)
period)
Income 46,065.90 69,813.92
Earnings before interest, tax,
depreciation and amortization 28,384.58 47,512.13
Financial costs 21,902.87 29,683.38
Depreciation and amortization 11,956.02 16,085.22
Tax expenses 94.85 (739.10)
Minority interest & share of profit
of associates 75.24 1,010.01
Net Profit / (Loss) (5,644.39) 1,472.63
As per Standalone Accounts: (Rs. in lacs)
Particulars December 31, March 31, 2013
2013 (twelve month
(nine month period)
period)
Income 8,449.41 14,020.44
Earnings before interest, tax,
depreciation and amortization 3,985.56 9,729.77
Financial costs 5,227.56 4,245.90
Depreciation and amortization 172.83 199.27
Tax expenses (30.17) 2,241.93
Net Profit / (Loss) (1,396.66) 3,042.68
DIVIDEND
The infrastructure industry is passing through a tough phase of
business cycle and your company is not insulated from this
macro-economic scenario. The Board regrets that the Company is not in a
position to declare any dividend for the Period in view of the losses
made by the Company. However, with three projects getting operational
in the near future and with overall improvement of business sentiments,
we hope to perform better in the future and reward the members.
COMPANY''S BUSINESS
Your Company has a basket of eleven projects in the Road Sector, three
in the Port Sector and five in the Energy Sector, which are at various
stages of construction and / or operation and management through
project specific special purpose vehicles (SPVs).
The SPVs in the Road Sector are:
(a) Toll based projects:
(1) Cochin Bridge Infrastructure Company Ltd. (CBICL), the
concessionaire which constructed the New Mattancherry Bridge connecting
Fort Kochi with Willingdon Island in the Cochin Port Trust area in the
State of Kerala and has been operating and managing the same since
September, 2001.
(2) Mumbai Nasik Expressway Ltd. (MNEL), the concessionaire which four
laned the Vadape - Gonde stretch of the National Highway 3 between
Mumbai and Nashik in the State of Maharashtra and has been operating
and managing the same since May, 2010.
(3) Rajahmundry Godavari Bridge Ltd. (RGBL), the concessionaire for
constructing a four lane bridge across the Godavari River, with its
approach road on either side, linking Rajahmundry to Kovvur in the
State of Andhra Pradesh.
(4) Patna Buxar Highways Ltd. (PBHL), the concessionaire for four
laning the Patna to Buxar stretch of National Highway 30 in the State
of Bihar.
(5) Vijayawada Gundugolanu Road Project Pvt. Ltd. (VGRPPL), the
concessionaire for six laning the Vijayawada to Gundugolanu stretch of
National Highway 5, including a four lane bypass to Vijayawada town, in
the State of Andhra Pradesh.
(6) Sidhi Singrauli Road Project Ltd. (SSRPL), the concessionaire for
four laning the Sidhi to Singrauli section of the National Highway 75E
in the State of Madhya Pradesh.
(b) Annuity based projects:
(1) Rajahmundry Expressway Ltd. (REL), the concessionaire which four
laned the Rajahmundry - Dharmavaram stretch of National Highway 5 in
the State of Andhra Pradesh and has been operating and managing the
same since September, 2004.
(2) Andhra Expressway Ltd. (AEL), the concessionaire which four laned
the Dharmavaram to Tuni stretch of National Highway 5 in the State of
Andhra Pradesh and has been operating and managing the same since
October, 2004.
(3) Kosi Bridge Infrastructure Company Ltd. (KBICL), the concessionaire
which constructed a four lane bridge across the Kosi River on National
Highway 57 in the State of Bihar and has been operating and managing
the same since February, 2012.
(4) Gorakhpur Infrastructure Company Ltd. (GICL), the concessionaire
which constructed a four lane bypass to Gorakhpur Town on National
Highway 28 in the State of Uttar Pradesh and has been operating and
managing the same since 31st March, 2012.
(5) Patna Highway Projects Ltd. (PHPL), the concessionaire for four
laning the Patna to Muzafarpur stretch of the National Highway 77
including a bypass to the Muzafarpur town in the State of Bihar.
Developments in the Road Sector during the Period
The SPV, Yamunanagar Panchkula Highway Pvt. Ltd. (YPHPL) has entered
into an agreement with National Highways Authority of India (NHAI) for
cancelling the concession for four laning the Uttar Pradesh/Haryana
border to Panchkula stretch of National Highway 73 in the State of
Haryana on amicable terms as YPHPL was unable to start construction
activities at the project site on account of non-availability of land
and certain government approvals. For similar reasons, the SPV,
Birmitrapur Barkote Highway Pvt. Ltd. (BBHPL) has entered into an
agreement with NHAI for cancelling the concession for the
rehabilitation and upgradation of the Birmitrapur  Barkote section of
National Highway 23 in the State of Orissa on amicable terms.
SSRPL has achieved financial closure and upon attaining ''appointed
date'' has started construction activities.
However, PBHL is in talks with NHAI for terminating the Patna-Buxar
concession on amicable terms due to non-availability of land and
government approvals.
VGRPPL has not been able to start construction activities at the
project due to non-availability of land. Providing required land and
other clearances are the responsibility of NHAI and we are in constant
touch with them and construction activities shall commence shortly.
RGBL has so far been unable to complete the Godavari bridge project at
Rajahmundry on account of unavailability of land due to litigation.
Now, these issues have been resolved and we expect to complete the
project within six months.
PHPL is in advanced stage of completion but has also not been able to
complete the project due to non-availability of land. However, we have
applied to NHAI for a completion certificate based on the progress of
work on land made available to us and hope to receive the same at the
earliest.
The original concession period of CBICL was till April 27, 2014 which
was extended by the Government of Kerala (GOK) by six years till April
27, 2020 by its Government Order dated January 24, 2005 because CBICL
had not revised the toll rates based on WPI as per the terms of the
Concession and other compliance deficiencies on the part of GOK with
reference to the Concession Agreement. However, instead of entering
into a supplementary agreement to amend the original concession
agreement, as promised, the GOK choose to unilaterally cancel its
Government Order dated January 24, 2005 by its Government Order dated
December 26, 2008. CBICL had referred the issue to arbitration and the
Arbitral Tribunal had passed orders permitting CBICL to collect the
toll fees as per the Government Order dated January 24, 2005. However,
the Greater Cochin Development Authority (GCDA) has on April 27, 2014
(on the last day of the original concession period), without
compensating CBICL and in disregard of the Arbitral Tribunal orders,
chosen to unilaterally seal the toll booths of CBICL at the
Mattancherry Bridge at Kochi. CBICL is exploring all the options
including legal and mutual settlement with GOK.
The three SPVs in the Port Sector are:
(1) Vizag Seaport Pvt. Ltd. (VSPL), which constructed two multipurpose
berths in the inner harbor of the Visakhapatnam Port, capable of
handling upto 9 MTPA, of which the first berth became operational in
July, 2004 and the second in September, 2005.
(2) Indira Container Terminal Pvt. Ltd. (ICTPL), the concessionaire for
constructing two offshore container berths at the Mumbai harbor.
(3) Mormugao Terminal Ltd. (MTL), the concessionaire for providing
mechanized handling facilities for handling coal at one of the berths
in the Mormugao Port.
Developments in the Port Sector during the Period
VSPL has been successful in attaining a cargo volume of 4.22 million
tons during the nine months period ending December, 2013 despite
several operational constraints and severe competition. The dredging
of the entrance channel to the inner harbor and the turning circle in
the inner harbor by the Port Trust (to -16.10 meters) is expected to be
completed by July, 2014. This should enable VSPL to receive Panamax
type vessels of higher capacity in its two berths located in the inner
harbor by October, 2014 after deepening its berths to the same level.
Further, VSPL is increasing its storage capacity by developing the
additional land of 30 acres allotted to it by the Port Trust at the
EXIM Park. VSPL believes that it can, in the process, enhance its cargo
handling capacity to at least 9 million tons per annum.
ICTPL has been unable to complete the offshore container berth projects
as the Mumbai Port Trust has not completed dredging of the berth front
and its approach. The Port Trust has also not filled up and handed over
the areas earmarked for stockyard purposes. Besides, the approval of
Central Government for equipment suppliers is pending. The yard filling
contract has recently been awarded by the Port Trust.
Certain disputes have arisen between MTL and the Mormugao Port Trust
relating to non-compliance of conditions precedents and termination of
concession agreement, which have been referred to competent court and
your Company, has obtained stay order of termination of the project and
invocation of Bank Guarantee.
The five SPVs in the Energy Sector are:
(1) Sikkim Hydro Power Ventures Ltd. (SHPVL), the concessionaire for
the 66 MW hydro-electric power project in West Sikkim on the river
Rimbhi.
(2) Pravara Renewable Energy Ltd. (PREL), the concessionaire for
setting up a 30 MW co-generation power project at Pravaranagar in
Ahmednagar District of Maharashtra.
(3) Youngthang Power Ventures Ltd. (YPVL), the concessionaire for
setting up a 261 MW power project on the river Spiti in the State of
Himachal Pradesh.
(4) Tidong Hydro Power Ltd. (THPL), the concessionaire for setting up a
60 MW hydro-electric project on the Tidong River (tributary of Satluj)
in the Kinnaur district of Himachal Pradesh.
(5) Aparna Infraenergy India Pvt. Ltd. (AIIPL) which has the coal
linkage for setting up a 250 MW thermal power project in Chandrapur
district of Maharashtra.
Developments in the Energy Sector during the Period
Construction activities are in full swing at Pravaranagar and the
co-generation power project is scheduled to start trial production by
end of August, 2014.The amalgamation petition is pending in the
Honorable High Court of Bombay.
YPVL has not been able to proceed with the studies to prepare the
Detailed Project Report (DPR) for its project due to opposition of
local farmers.
THPL is in the process of conducting geological studies for preparation
of DPR. THPL plans to submit the DPR to the Government of Himachal
Pradesh for approval by end of December, 2014.
AIIPL has the requisite land and has the water permission as well as
all statutory clearances to proceed with its project. However, the coal
linkage is now being reviewed by the Coal Ministry for approval of name
change. AIIPL expects a positive response from the Ministry in the near
future.
Other Sectors
Special Economic Zones
No progress has been achieved in the project to develop the
auto-component SEZ over 90 acres of land at Adityapur in the State of
Jharkhand. The project has been delayed for want of forest clearance.
Your Company is a minority partner in the project.
The Company has decided to withdraw from the multi-purpose ''special
economic zone'' project at Tada in Andhra Pradesh in view of the
unfavorable business climate for such projects. However, the Company
has mutual agreement to receive a total consideration of Rs. 45 crores,
out of which we have already received Rs. 16 crores and in the process of
receiving the balance amount.
Other Business
In addition to undertaking infrastructure development through SPVs, the
Company undertakes operation & maintenance of the five road projects
developed by AEL, REL, MNEL, KBICL and GICL.
The Company has also ventured into construction work at the
Sidhi-Singrauli project through subcontractors.
THE FUTURE
The Company and its 100% subsidiary Gammon Road Infrastructure Ltd.
("GRIL"), have been qualified to bid for all NHAI projects of an
estimated cost not exceeding Rs. 3820 crores approx.
Further, the Company has qualified to bid for five projects in the
Ports sector with an estimated total aggregate cost Rs. 5974 crores. It
has also qualified for an Energy sector project with an estimated cost
of Rs. 1200 crores and an urban infra-project with an estimated cost of
Rs. 3235 crores.
There is a gap between the Company''s requirement of funds and its
internal accruals. The Company is also facing challenges in its cash
position. The ability of the Company to raise external funds has also
been affected due to adverse market conditions. However, the Company
is actively following up with NHAI for realization of receivables and
has also started discussion with potential investors for monetization
of its matured assets at the right valuation to ease present and future
fund requirements.
Going forward, the Company will focus on selective opportunities which
have lower risk and lower investment, which will supplement our
existing portfolio. Our focus will be to get our "almost ready"
projects commissioned at the earliest and run the operating projects
successfully. We are confident that these projects, once completed,
will contribute positively to our bottom line and improve our cash
position.
EMPLOYEE STOCK OPTION SCHEME
The ''employee stock options'' issued by the Company prior to the initial
public offer of equity shares have either lapsed or have been
exercised.
However, the Company has, with the members'' approval, issued a fresh
tranch of ''employee stock options'' to its executive directors and
senior employees during the year. Details of the ''employee stock
options'' allotted, as required to be stated in this Report in terms of
the SEBI Guidelines is annexed as Annexure 1.
A certificate from the Auditors that the Employee Stock Options Scheme
has been implemented by the Company in accordance with the SEBI
Guidelines is annexed to this Report as Annexure 2.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO.
The requirements of Section 217 (1) (e) of the Companies Act, 1956,
read with Rule 2(A) & 2(B) of the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 are not applicable to
the Company.
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to Rs. 26,519 on foreign
travel during the Period.
SUBSIDIARIES
During the Period, Gammon Renewable Energy Infrastructure Ltd. has
changed its name to Gammon Renewable Energy Infrastructure Projects
Ltd.
During the Period, Dohan Renewable Energy Pvt. Ltd.(since struck off
and dissolved as a defunct company), Ghaggar Renewable Energy Pvt.
Ltd., Indori Renewable Energy Pvt. Ltd., Kasavati Renewable Energy Pvt.
Ltd. (since struck off and dissolved as a defunct company), Markanda
Renewable Energy Pvt. Ltd., Sirsa Renewable Energy Pvt. Ltd., Satluj
Renewable Energy Pvt. Ltd., Tangri Renewable Energy Pvt. Ltd. and
Yamuna Minor Minerals Pvt. Ltd. have become subsidiaries of the Company
following the definition of the term ''subsidiary'' in the Companies Act,
2013 being brought into force, as the Company and its other
subsidiaries hold the entire equity stake in these companies.
A statement u/s 212 of the Companies Act, 1956 relating to the
subsidiaries is attached to the Balance Sheet of the Company. The
Company has not attached the audited accounts of the subsidiaries to
the Audited Accounts of the Company. However, the effect of the same
has been brought out in the consolidated Audited Accounts of the
Company. The annual accounts of the subsidiaries and the related
information will be made available to the Company''s and subsidiaries''
investors as and when required by them. These have also been kept for
inspection of the investors at the Registered Office of the Company and
of the concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 is annexed to this Report as Annexure 3.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm that:
a. the applicable accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b. the Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Period and of the loss of the Company for
the Period;
c. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d. the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
Mr. Abhijit Rajan, on ceasing to be the Chairman & Managing Director of
the Company, is liable to retire by rotation at the 13th Annual General
Meeting and has offered himself for re-appointment.
Ms. H. Daruwalla, independent director, is liable to retire by rotation
at the 13th Annual General Meeting. It is proposed to appoint her as an
independent director of the Company for a consecutive term of five
years from the 13th Annual General Meeting of the Company. Ms.
Daruwalla has given her consent for her appointment as an independent
director of the Company.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
(i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
(ii) Shareholders/Investors Grievance Committee to, inter-alia, redress
investor complaints;
(iii) Remuneration Committee to approve appointments and remuneration
of executive directors;
(iv) Compensation Committee to administer ''employee stock option
schemes'';
(v) Project Committee to, inter-alia, advice the Company on the
business opportunities that arise from time to time; and
(vi) Projects Review Committee to review implementation and working of
projects under development and operation.
The constitution of the various committees, its powers and duties have
been elaborated in greater detail in the ''Corporate Governance Report'',
which is annexed to the Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the Shareholders is invited to a separate section titled
''Report on Corporate Governance'' which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan, a
''practicing company secretary'' on compliance with corporate governance
requirements of the Listing Agreement is annexed to this Report as
Annexure 4.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the Shareholders is also invited to a separate section
titled ''Management Discussion and Analysis Report'' which is annexed to
the Annual Accounts.
AUDITORS
The Company''s auditors, M/s. Natvarlal Vepari & Co. and M/s. S.
R.Batliboi & Co. LLP retire at the Annual General Meeting and being
eligible and willing to be re-appointed as Auditors of the Company,
have submitted their certificates to the effect that their
re-appointments, if made, will be within the limits prescribed under
Section 224 (1B) of the Companies Act, 1956.
The Board recommends their reappointment.
AUDITORS'' REPORT
The Auditors have in their CARO Report pointed out that the Company has
used short term funds to the tune of Rs. 248 crores approx. for
investment in long term assets.
The Company proposes to monetize some of its mature assets as well as
securitize some of its future receivables and is in active discussions
with various lenders for long term debts. The Company will also
generate income from internal sources by way of developer fees,
contracting income and operation & maintenance income. These funds will
be used for achieving an optimal balance between short term funds and
long term funds in the business of the Company.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Naresh Chandra Himanshu Parikh K.K.Mohanty
Chairman Vice Chairman Managing Director
Place: Mumbai
Date: May 03, 2014
Mar 31, 2013
To The Shareholders of Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their twelfth Annual Report
together with the Audited Accounts of the Company, for the period 1st
April, 2012 to 31st March, 2013 (the "Period").
FINANCIAL HIGHLIGHTS
For a true assessment of your Company''s strength, you are requested to
refer to the Âconsolidated accounts'' of the Company as well as the
Âstand-alone accounts''.
As per Consolidated Accounts:
(Rs.in Lakhs)
Particulars March 31,
2013 March 31,
2012
Income 69,813.92 42,937.53
Earnings before interest, tax,
depreciation and amortisation 47,512.13 22,277.32
Financial costs 29,683.38 15,565.94
Depreciation and amortisation 16,085.22 7,789.92
Tax expenses (739.11) 1,152.56
Minority interest & share of
profit of associates 1,010.01 310.71
Net profit 1,472.63 (2,541.81)
As per Standalone Accounts: (Rs. in Lakhs)
Particulars March 31,
2013 March 31,
2012
Income 14,020.44 11,127.97
Earnings before interest, tax,
depreciation and amortisation 9,729.77 6,440.29
Financial costs 4,245.90 2,226.51
Depreciation and amortisation 199.27 199.71
Tax expenses 2,241.93 720.06
Net profit 3,042.67 3,294.01
DIVIDEND
With a view to conserve resources for funding the ongoing projects, the
Board has not recommended any dividend on equity shares for the Period.
COMPANY''S BUSINESS
Your Company has a basket of thirteen projects in the Road Sector,
three in the Port Sector and five in the Energy Sector, which are at
various stages of construction and/or operation and management through
various SPVs.
The SPVs in the Road Sector are:
(a) Toll based projects:
(1) Cochin Bridge Infrastructure Company Ltd., the SPV which
constructed and has been operating and managing the New Mattancherry
Bridge connecting Fort Kochi with Willingdon Island in the Cochin Port
Trust Area in the State of Kerala since September, 2001.
(2) Mumbai Nasik Expressway Ltd., which four laned and has been
operating and managing the Vadape to Gonde stretch of National Highway
3 connecting Mumbai and Nashik in the State of Maharashtra since May,
2010.
(3) Rajahmundry Godavari Bridge Ltd., which is constructing a four lane
bridge across the Godavari River, together with the approach roads on
both sides, linking Rajahmundry to Kovvur in the State of Andhra
Pradesh. Construction is in an advanced stage.
(4) Patna Buxar Highways Ltd., which has signed the concession
agreement with the National Highways Authority of India ("NHAI") for
four laning the Patna to Buxar stretch of National Highway 30 in the
State of Bihar. The debt portion of the project cost has been tied up
and resource mobilization at the site has been initiated.
(5) Vijayawada Gundugolanu Road Project Pvt. Ltd., which has signed the
concession agreement with NHAI for six laning the Vijayawada to
Gundugolanu stretch of National Highway 5, including a four lane bypass
to Vijayawada town, in the State of Andhra Pradesh. The debt portion of
the project cost has been tied up. However, construction at the site
has not commenced as the client has not handed over the project site to
the SPV.
(6) Yamunanagar Panchkula Highway Pvt. Ltd., which has signed the
concession agreement with NHAI for four laning the Uttar
Pradesh/Haryana border to Panchkula stretch of National Highway 73 in
the State of Haryana. The debt portion of the project cost has been
tied up. However, construction at the site has not commenced as the
client has not handed over the project site to the SPV.
(7) Birmitrapur Barkote Highway Pvt. Ltd., which has signed the
concession agreement with NHAI for undertaking the rehabilitation and
upgradation of the Birmitrapur to Barkote section of National Highway
23 in the State of Orissa. The debt portion of the project cost has
been tied up. However, construction at the site has not commenced as
the client has not handed over the project site to the SPV.
(8) Sidhi Singrauli Road Project Ltd., which has signed the concession
agreement with Madhya Pradesh Road Development Corporation for four
laning the Sidhi to Singrauli section of the National Highway 75E in
the State of Madhya Pradesh. The debt portion of the project cost has
been tied up. However, construction at the site has not commenced as
the client has not handed over the project site to the SPV.
(b) Annuity based projects:
(1) Rajahmundry Expressway Ltd., which four laned and has been
operating and managing the Rajahmundry to Dharmavaram stretch of
National Highway 5 in the State of Andhra Pradesh since September,
2004.
(2) Andhra Expressway Ltd., which four laned and has been operating and
managing the Dharmavaram to Tuni stretch of National Highway 5 in the
State of Andhra Pradesh since October, 2004.
(3) Kosi Bridge Infrastructure Company Ltd., which has constructed a
four lane bridge across the Kosi River on National Highway 57 in the
State of Bihar, which received the provisional completion certificate
on 8th February, 2012. The project has been in operation since then.
(4) Gorakhpur Infrastructure Company Ltd., which has constructed a four
lane bypass to Gorakhpur Town on National Highway 28 in the State of
Uttar Pradesh. The project received the provisional completion
certificate on 31st March, 2012.
(5) Patna Highway Projects Ltd., which has signed the concession
agreement with NHAI for four laning the Patna to Muzafarpur stretch of
the National Highway 77 together with a bypass to the Muzafarpur town
in the State of Bihar. Construction is in an advanced stage.
The three SPVs in the Port Sector are:
(1) Vizag Seaport Pvt. Ltd., which constructed two multipurpose berths
in the inner harbor of the Visakhapatnam Port, capable of handling upto
9 MTPA, of which the first berth became operational in July, 2004 and
the second in September, 2005.
(2) Indira Container Terminal Pvt. Ltd, which is constructing two
offshore container berths at the Mumbai harbor. Construction is in an
advanced stage.
(3) Mormugao Terminal Ltd., which signed a Concession Agreement with
the Mormugao Port Trust for providing mechanized handling facilities
for handling coal at one of the berths in the Mormugao Port.
Further, the Company has decided not to pursue the project to construct
an iron ore berth at Paradip Port on account of the Port Trust''s
inability to obtain timely environmental and forest clearances.
The five SPVs in the Energy Sector are:
(1) Sikkim Hydro Power Ventures Ltd., which has started construction
activities for the 66 MW hydro-electric power project in West Sikkim on
the river Rimbhi, a tributary of river Rangit.
(2) Pravara Renewable Energy Ltd., which has started construction
activities for a 30 MW cogeneration power project at Pravaranagar in
Ahmednagar District of Maharashtra. The financial closure of the
project has been achieved. It is proposed to merge this SPV with the
Company.
(3) Youngthang Power Ventures Ltd., which has the license to set up a
261 MW power project on the river Spiti in the State of Himachal
Pradesh.
(4) Tidong Hydro Power Ltd., which has the license to set up a 60 MW
hydro-electric project on the Tidong River (tributary of Satluj) in the
Kinnaur district of Himachal Pradesh.
(5) Aparna Infraenergy India Pvt. Ltd. which is in the process of
completing the preliminary requirements for setting up a 250 MW thermal
power project in Chandrapur district of Maharashtra.
Other Sectors
Special Economic Zones
No progress has been achieved in the project to develop the
auto-component SEZ over 90 acres of land at Adityapur in the State of
Jharkhand. The project has been delayed for want of forest clearance.
Your Company is a minority partner in the project.
The Company has also decided to go slow on the project to set up a
multi-purpose Âspecial economic zone'' at Tada in Andhra Pradesh in view
of the unfavorable business climate for projects of this nature.
Other Business
In addition to undertaking infrastructure development through SPVs, the
Company also undertakes operation & maintenance of the five road
projects developed by Andhra Expressway Ltd., Rajahmundry Expressway
Ltd., Mumbai Nasik Expressway Ltd., Kosi Bridge Infrastructure Company
Ltd. and Gorakhpur Infrastructure Company Ltd.
The Company is also undertaking construction work at the Patna-Buxar
and Sidhi-Singrauli projects.
THE FUTURE
The Company and its 100% subsidiary Gammon Road Infrastructure Ltd.
("GRIL"), have been shortlisted to bid for 32 projects across sectors
such as roads, ports, power including transmission and urban infra
collectively having an estimated project cost of over Rs. 31,663.66
Crores.
Further, the Company and GRIL have submitted pre-qualification
applications for 49 projects across various sectors, which have an
estimated aggregate project cost of over Rs. 51,281.88 Crores. Results
are awaited for these pre-qualification applications.
Going forward the Company will focus on selective opportunities which
have lower risk, lower investment and which will supplement our
existing portfolio.
EQUITY CAPITAL
The paid up capital of the Company has increased from Rs. 1,465,629,736
to Rs.1,476,155,376 during the Period, mainly on account of allotment of
bonus shares in the ratio of 1:34 to the existing shareholders of the
Company other than the Promoters. The bonus issue was made to comply
with SEBI''s stipulation that public holding in listed companies should
be at least 25%.
The Company has not been able to make the rights issue of shares in
view of the unfavorable investment climate for infrastructure
securities.
EMPLOYEE STOCK OPTION SCHEME
Details of the Âemployee stock options'' already issued by the Company,
required to be stated in this Report as per SEBI Guidelines is annexed
to this Report as Annexure 1. A certificate from the Auditors that the
Employee Stock Options Scheme has been implemented by the Company in
accordance with the SEBI Guidelines is annexed to this Report as
Annexure 2.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO.
The requirements of Section 217 (1) (e) of the Companies Act, 1956,
read with Rule 2(A) & 2(B) of the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 are not applicable to
the Company.
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to just over Rs.10.87 lakhs
during the Period.
SUBSIDIARIES
During the Period, the Company incorporated four subsidiaries, namely,
Birmitrapur Barkote Highway Pvt. Ltd., Yamunanagar Panchkula Highway
Pvt. Ltd., Sidhi Singrauli Road Project Ltd., and Mormugao Terminal
Ltd.
A statement u/s 212 of the Companies Act, 1956 relating to the
subsidiaries is attached to the Balance Sheet of the Company. The
Company has not attached the audited accounts of the subsidiaries to
the Audited Accounts of the Company. However, the effect of the same
has been brought out in the consolidated Audited Accounts of the
Company. The annual accounts of the subsidiaries and the related
information will be made available to the Company''s and subsidiaries''
investors as and when required by them. These have also been kept for
inspection of the investors at the Registered Office of the Company and
of the concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 is annexed to this Report as Annexure 3.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm that:
a. the applicable accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b. the Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Period and of the profits of the Company
for the Period;
c. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d. the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
As per Article 169 of the Articles of Association of your Company, Mr.
Himanshu Parikh and Mr. Parag Parikh are liable to retire by rotation
at the ensuing Annual General Meeting and being eligible, have offered
themselves for re-appointment.
Mr. Sanjay Sachdev, Mr. Kunal Shroff and Mr. Rajeevkumar Malhotra have
resigned from the Board since the last Annual General Meeting.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
(i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
(ii) Shareholders/Investors Grievance Committee to, inter-alia, redress
investor complaints;
(iii) Remuneration Committee to approve appointments and remuneration
of executive directors;
(iv) Compensation Committee to administer the ÂEmployee Stock Option
Scheme'';
(v) Project Committee to, inter-alia, advice the Company on the
business opportunities that arise from time to time; and
(vi) Projects Review Committee to review implementation and working of
projects under development and operation.
The constitution of the various committees, its powers and duties have
been elaborated in greater detail in the ÂCorporate Governance Report'',
which is annexed to the Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the Shareholders is invited to a separate section titled
ÂReport on Corporate Governance'' which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan, a
Âpracticing company secretary'' on compliance with corporate governance
requirements of the Listing Agreement is annexed to this Report as
Annexure 4.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the Shareholders is also invited to a separate section
titled ÂManagement Discussion and Analysis Report'' which is annexed to
the Annual Accounts.
PUBLIC DEPOSITS
Your Company has not accepted deposits under Section 58A of the
Companies Act, 1956.
AUDITORS
The Company''s auditors, M/s. Natvarlal Vepari & Co. and M/s. S.
R.Batliboi & Co. LLP retire at the Annual General Meeting and being
eligible and willing to be re-appointed as Auditors of the Company,
have submitted their certificates to the effect that their
re-appointments, if made, will be within the limits prescribed under
Section 224 (1B) of the Companies Act, 1956.
The Board recommends their reappointment.
AUDITORS'' REPORT
The Auditors have in their CARO Report pointed out that the Company has
used short term funds to the tune of Rs. 203 crores approx. for
investment in long term assets. This was purely an interim measure as
the Company is actively pursuing measures to raise long term resources
by way of securitization of cash flows of some of the SPVs and sale,
part sale of some of the completed projects.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Abhijit Rajan Himanshu Parikh
K.K.Mohanty
Chairman & Managing Director
Vice Chairman Managing Director
Place: Mumbai
Date: August 09, 2013
Mar 31, 2012
To The Shareholders of Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their eleventh Annual Report
together with the Audited Accounts of the Company, for the period April
1, 2011 to March 31, 2012 (the "Period").
FINANCIAL HIGHLIGHTS
For a true assessment of your Company's strength, you are requested to
refer to the 'consolidated accounts' of the Company rather than the
'stand alone accounts'; Both of which are contained in this Annual
Report.
As per Consolidated Accounts: (Rs. in Lakhs)
Particulars March 31, 2012 March 31, 2011
Income 42,937.53 34,589.89
Earnings before interest, tax,
depreciation 22,277.32 21,301.43
and amortisation
Financial costs 15,565.94 10,090.46
Depreciation and amortisation 7,789.92 8,587.93
Tax expenses 1,152.56 462.51
Minority interest & share
of profit of 310.71 429.41
associates
Net profit (2,541.81) 1,716.86
As per Standalone Accounts: (Rs. in Lakhs)
Particulars March 31, 2012 March 31, 2011
Income 1,112.79 9,115.83
Earnings before interest, tax,
depreciation 6,440.29 5,776.00
and amortisation
Financial costs 2,226.51 985.10
Depreciation and amortisation 199.71 198.40
Tax expenses 720.06 1,019.48
Net profit 3,294.01 3,573.02
DIVIDEND
In view of the net loss at the consolidated level and the unfavorable
market conditions for raising long term financial resources to meet the
investment needs of the Company in the existing and newer projects, the
Directors have decided not to recommend any dividend for the Period.
COMPANY'S BUSINESS
Your Company is an infrastructure developer on public-private
participation basis ("PPP Basis"). The business of infrastructure
development on PPP Basis generally entails setting up special purpose
vehicles ("SPVs") which would construct the infrastructure projects
being privatized by the Government or Government / Semi-Government
agencies ("Authority") and operate and manage the same during the
concession/license period and finally at the end of such period
transfer the project to the Authority as a running project.
The Company has a basket of fourteen projects in the Road Sector, three
in the Port Sector and five in the Energy Sector, which are at various
stages of being constructed, operated and managed through various SPVs.
The SPVs in the Road Sector are: (a) Toll based projects:
(1) Cochin Bridge Infrastructure Company Ltd., the SPV which
constructed and been operating the New Mattancherry Bridge connecting
Fort Kochi with Willingdon Island in the Cochin Port Trust Area in the
State of Kerala since September, 2001.
(2) Mumbai Nasik Expressway Ltd., which four laned and been operating
the Vadape to Gonde stretch of National Highway 3 connecting Mumbai and
Nashik in the State of Maharashtra since May, 2011.
(3) Rajahmundry Godavari Bridge Ltd., which is constructing a four lane
bridge across the Godavari River linking Rajahmundry to Kovvur in the
State of Andhra Pradesh. Construction activity is in full swing at the
project site.
(4) Patna Buxar Highways Ltd., which is four laning the Patna to Buxar
stretch of National Highway 30 in the State of Bihar. The debt portion
of the project cost has already been underwritten.
(5) Vijayawada Gundugolanu Road Project Pvt. Ltd., which is six laning
(except for the four lane Greenfield Vijayawada Bypass) the Vijayawada
to Gundugolanu stretch of National Highway 5 in the State of Andhra
Pradesh. The debt portion of the project cost has already been
underwritten. The Company has received the approval of National
Highways Authority of India ("NHAI") for divesting upto 49% equity in
this SPV to Simplex Infrastructures Ltd.
(6) Yamunanagar Panchkula Highway Pvt. Ltd., which is four laning the
Uttar Pradesh/Haryana border to Panchkula stretch of National Highway
73 in the State of Haryana.
(7) Birmitrapur Barkote Highway Pvt. Ltd., which is undertaking the
rehabilitation and upgradation of the Birmitrapur to Barkote section of
National Highway 23 in the State of Orissa.
(8) Sidhi Singrauli Road Project Ltd., which is four laning the Sidhi
to Singrauli section of the National Highway 75E in the State of Madhya
Pradesh.
(9) Maa Durga Expressways Pvt. Ltd., which is four laning the Mahulia
to Kharagpur section of the National Highway 6 in the States of
Jharkhand & West Bengal. NHAI has approved 49% equity participation of
the Company in this SPV promoted by Simplex Infrastructures Ltd.
(b) Annuity based projects:
(1) Rajahmundry Expressway Ltd., which four laned and been operating
the Rajahmundry to Dharmavaram stretch of National Highway 5 in the
State of Andhra Pradesh since September, 2004.
(2) Andhra Expressway Ltd., which four laned and been operating the
Dharmavaram to Tuni stretch of National Highway 5 in the State of
Andhra Pradesh since OCTober, 2004.
(3) Kosi Bridge Infrastructure Company Ltd., which has constructed a
four lane bridge across the Kosi River on National Highway 57 in the
State of Bihar, which received the provisional completion certificate
in February, 2012. The project has been in operation since then.
(4) Gorakhpur Infrastructure Company Ltd., which has constructed a four
lane bypass to Gorakhpur Town on National Highway 28 in the State of
Uttar Pradesh. The project is expected to receive the provisional
completion certificate in the near future.
(5) Patna Highway Projects Ltd., which is four laning the Patna to
Muzafarpur stretch of the National Highway 77 and constructing a bypass
to the Muzafarpur town in the State of Bihar. Construction is in full
swing at the project site.
The three SPVs in the Port Sector are:
(1) Vizag Seaport Pvt. Ltd., which constructed two multipurpose berths
in the inner harbor of the Visakhapatnam Port, capable of handling upto
9 MMTPA, of which the first berth became operational in July, 2004 and
the second in September, 2005.
(2) Indira Container Terminal Pvt. Ltd, which is constructing two
offshore container berths at the Mumbai harbor. Construction is in
full swing at the project site.
(3) Blue Water Iron Ore Terminal Pvt. Ltd., which signed a Concession
Agreement with the Paradip Port Trust (PPT) for developing a deep
draught iron ore berth at Paradip Port. Your Company is a minority
partner in the project. The project has suffered inordinate delay on
account of late receipt of the requisite forest clearance from the
concerned Government department. Your Directors' feel that the project
is not viable on the current financial terms and is in touch with PPT
on the issue.
The five SPVs in the Energy Sector are:
(1) Sikkim Hydro Power Ventures Ltd., which has started construction
activities for the 66 MW hydro electric project in West Sikkim on the
river Rimbhikhola, a tributary of river Rangit.
(2) Pravara Renewable Energy Ltd., which has started construction
activities for a 30 MW cogeneration power project at Pravaranagar in
Ahmednagar District of Maharashtra.
(3) Youngthang Power Ventures Ltd., which is currently in the process
of preparing the 'detailed project report' for a 261 MW power project
on the river Spiti in the State of Himachal Pradesh.
(4) Tidong Hydro Power Ltd., which has signed an agreement with the
State Government of Himachal Pradesh for setting up a 60 MW hydro
electric project on the Tidong River (tributary of Satluj) in the
Kinnaur district of Himachal Pradesh.
(5) Aparna Infraenergy India Pvt. Ltd. which is in the process of
completing the preliminary requirements for setting up a 250 MW thermal
power project in Chandrapur district of Maharashtra.
The Board has, however, decided not to pursue the projects to set up
seven biomass power projects in Haryana and Punjab with an aggregate
capacity to generate 66MW power.
OTHER SECTORS Special Economic Zones The SPVs are:
(1) SEZ Adityapur Ltd., which has entered into an agreement with
Adityapur Industrial Area Development Authority for developing an
auto-component SEZ over 90 acres of land at Adityapur in the State of
Jharkhand. The project has been unduly delayed for want of forest
clearance. Your Company is a minority partner in the project.
(2) The Company has, through its subsidiaries and associates, also
signed agreements for purchase of 801.76 acres of land at Tada in the
State of Andhra Pradesh to set up a multi-purpose 'special economic
zone'.
OTHER BUSINESS
In addition to undertaking infrastructure development through SPVs, the
Company also undertakes operation & maintenance of the five road
projects developed by Andhra Expressway Ltd., Rajahmundry Expressway
Ltd. Mumbai Nasik Expressway Ltd., Kosi Bridge Infrastructure Company
Ltd. and Gorakhpur Infrastructure Company Ltd.
WHAT LIES AHEAD
In view of the difficult investment and credit market conditions, the
Company's focus in the immediate future will be on achieving financial
closure of the remaining four road projects, the co-generation project
in Maharashtra and the hydro-electric project in Sikkim.
The Company and its 100% subsidiary Gammon Road Infrastructure Ltd.
("GRIL"), have been shortlisted to bid for 30 projects across sectors
such as roads, ports, power including transmission and urban infra
collectively having an estimated project cost of over rupees One Lakh
crores.
Further, the Company and GRIL have submitted pre-qualification
applications for 52 projects across various sectors, which have an
estimated aggregate project cost of over rupees sixty eight thousand
crores.
EQUITY CAPITAL
The paid up capital of the Company has increased from Rs. 1,465,582,824
to Rs. 1,465,629,736 during the Period on account of allotment of 23,456
equity shares of the Company to an employee who exercised the right to
apply for shares attached to the stock options.
The Company has received the final observation letter of the Securities
and Exchange Board of India for its intended rights issue of shares to
raise about Rs. 200 crores and shall await a suitable investment climate
for coming out with the issue.
EMPLOYEE STOCK OPTION SCHEME
Details of the 'employee stock options' already issued by the Company,
required to be stated in this Report as per SEBI Guidelines is annexed
to this Report as Annexure
1. Conservation of energy, technology absorption, foreign exchange
earnings and outgo.
The requirements of Section 217 (1) (e) of the Companies Act, 1956,
read with Rule 2(A) & 2(B) of the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 are not applicable to
the Company.
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to just over Rs. 9.35 lakhs
during the Period.
SUBSIDIARIES
During the Period, the Company incorporated two SPVs, Patna Buxar
Highways Ltd. and Vijayawada Gundugolanu Road Project Pvt. Ltd. for
implementing two road projects as outlined hereinabove as hundred
percent subsidiaries. The Company also registered the partnership firm
Aparna Infraenergy India as a limited liability company under chapter
ix of the Companies Act, 1956 in the name of Aparna Infraenergy India
Pvt. Ltd.
Further, during the Period, the name of Chitoor Infrastructure Projects
Pvt. Ltd. (formerly Satyavedu Infra Company Pvt. Ltd.) was changed to
Earthlink Infrastructure Projects Pvt. Ltd. and the name of Tada
Infrastructure Projects Pvt. Ltd. (formerly Tada SEZ Pvt. Ltd.) was
changed to Segue Infrastructure Projects Pvt. Ltd. Haryana Biomass
Power Ltd. has become a subsidiary of the Company consequent to the
buy-out of the erstwhile partner.
There are no other changes in the subsidiaries of the Company. A
statement u/s 212 of the Companies Act, 1956 relating to the
subsidiaries is attached to the Balance Sheet of the Company. The
Company has not attached the audited accounts of the subsidiaries to
the Audited Accounts of the Company. However, the effect of the same
has been brought out in the consolidated Audited Accounts of the
Company. The annual accounts of the subsidiaries and the related
information will be made available to the Company's and subsidiaries'
investors as and when required by them. These have also been kept for
inspection of the investors at the Registered Office of the Company and
of the concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 is annexed to this Report as Annexure 2.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm that:
a. the applicable accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b. the Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Period and of the profits of the Company
for the Period;
c. the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d. the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
As per Article 169 of the Articles of Association of your Company, Mr.
C.C.Dayal, Mr. Naresh Chandra and Mr. Sushil Chandra Tripathi are
liable to retire by rotation at the ensuing Annual General Meeting and
being eligible, have offered themselves for re-appointment.
Ms. Homai A. Daruwalla, joined the Board on November 11, 2011 as an
additional director and is due for appointment as a director liable to
retire by rotation at the ensuing Annual General Meeting.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
(i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
(ii) Shareholders/ Investors Grievance Committee to, inter-alia,
redress investor complaints;
(iii) Remuneration Committee to approve appointments and remuneration
of executive directors;
(iv) Compensation Committee to administer the 'Employee Stock Option
Scheme';
(v) Project Committee to, inter-alia, advice the Company on the
business opportunities that arise from time to time; and
(vi) Rights Issue Committee to oversee the rights issue of shares of
the Company.
The constitution of the various committees, its powers and duties have
been elaborated in greater detail in the 'Corporate Governance Report',
which is annexed to the Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the Shareholders is invited to a separate section titled
'Report on Corporate Governance' which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan, a
'practicing company secretary' on compliance with corporate governance
requirements of the Listing Agreement is annexed to this Report as
Annexure 3.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the Shareholders is also invited to a separate section
titled 'Management Discussion and Analysis Report' which is annexed to
the Annual Accounts.
PUBLIC DEPOSITS
Your Company has not accepted deposits under Section 58A of the
Companies Act, 1956.
AUDITORS
The Company's auditors, M/s. Natvarlal Vepari & Co. and M/s. S.
R.Batliboi& Co. retire at the Annual General Meeting and being willing
and eligible to be re-appointed as Auditors of the Company, have
submitted their certificates to the effect that their re-appointments,
if made, will be within the limits prescribed under Section 224 (1B) of
the Companies Act, 1956.
The Board recommends their reappointment.
AUDITORS' REPORT
Regarding the Auditors' observation in their report pursuant to the
Companies (Auditor's Report) Order (CARO), 2003 that short term funds
have been used for long term investments, the Board states that short
term funds have been used for meeting equity commitments in the SPVs in
line with the progress of the concerned projects as laid down in the
concerned concession agreements and term loan agreements and is only an
interim measure pending raising of long term resources by way of long
term loans, sale of equity stake in one or more of the projects and the
proposed right issue of shares for which final observations of SEBI was
received recently.
The other observations of the Auditors are self-explanatory or have
been clarified and explained in the relevant Notes forming part of the
Annual Accounts and do not need further clarifications.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Abhijit Rajan
Chairman & Managing Director
Himanshu Parikh
Vice Chairman
K.K.Mohanty
Managing Director
Place : Mumbai
Date : August 10, 2012
Mar 31, 2011
The Shareholders of
Gammon Infrastructure Projects Limited
The Directors have pleasure in submitting their tenth Annual Report
together with the Audited Accounts of the Company, for the period April
1, 2010 March 31, 2011 (the "Period").
FINANCIAL HIGHLIGHTS
For a true assessment of your Company's strength, you are requested to
refer to the 'consolidated accounts' of the Company rather than the
'stand alone accounts'; both of which are contained in this Annual
Report.
As per Consolidated Accounts:
(Rs. in Lakhs)
Particulars March 31, 2011 March 31,2010
Incorne 34.589.89 33,949.78
Profit before Interest, Depreciation /
amortisation and Taxation 21,301.43 15,017.53
Financial Costs 10,090.46 5,745.42
Depreciation and Amortisation 8,587.93 5,063.50
Tax Expense 462.51 1,050.63
Prior Period - 166.54
Minority Interest & share of (profit)/
loss from associates 429.41 429.18
Net Profit 1,716.86 2,562.27
Cash Profit (Net Profit Depreciation) 11,978.99 7,625.77
As per Standalone Accounts:
(Rs. in Lakhs)
Particulars March 31, 2011 March 31,2010
Income 9,115.83 12,291.68
Profit before Interest, Depreciation/
amortisation and Taxation 5,885.39 2,357.69
Financial Cost 1,019.55 112.64
Depreciation and Amortisation 198.40 198.91
Tax Expense 1,019.55 645.73
Net Profit 3,573.02 1,400.41
Cash Profit (Net Profits Depreciation) 3,771.42 1,599.32
DIVIDEND
In view of the unfavorable monetary situation for infrastructure
companies and with a view to conserve resources for further investments
in projects under implementation and new projects, the Directors have
decided not to recommend any Dividend for the Period.
COMPANY'S PROJECTS
The Company has a basket of eight projects in the Road Sector, three in
the Port Sector and three in the Energy Sector, which are under
operation/active development by or through special purpose vehicles
("SPVs").
Of the eight projects in the Road Sector:
(a) Three are toll based projects, namely:
- New Mattancherry Bridge project developed by an SPV, Cochin Bridge
Infrastructure Company Ltd., which has been in operation since
September, 2001.
- Vadape-Gonde project under development by an SPV, Mumbai Nasik
Expressway Ltd., in operation partly since end May, 2010 and has
completed the entire highway stretch from Vadape to Gonde by end May,
2011.
- Godavari Bridge project under development by an SPV, Rajahmundry
Godavari Bridge Ltd., is presently in construction stage.
(b) Five are annuity based projects, namely:
- Rajahmundry-Dharmavaram road project developed by an SPV, Rajahmundry
Expressway Ltd., which achieved commercial operations in September,
2004.
- Dharmavaram-Tuni road project developed by an SPV, Andhra Expressway
Ltd., which achieved commercial operations in October, 2004.
- Kosi Bridge project under development by an SPV, Kosi Bridge
Infrastructure Company Ltd., is presently in construction stage.
- Gorakhpur Bypass project under development by an SPV, Gorakhpur
Infrastructure Company Ltd., is presently in construction stage.
- Patna-Muzafarpur project under development by an SPV, Patna Highway
Projects Ltd., is presently in construction stage.
The Company is undertaking operation & maintenance in all the three
road projects in operation; viz. the Rajahmundry-Dharmavaram road
project, the Dharmavaram-Tuni road project and the Vadape-Gonde road
project.
The three projects in the Port Sector are:
- Visakhapatnam Port project, a project to develop two berths at
Visakhapatnam Port,
implemented by an SPV, Vizag Seaport Pvt. Ltd., of which the first
berth became operational in July, 2004 and the second in September,
2005.
- Mumbai Offshore Container Terminal, under development by an SPV,
Indira Container Terminal Pvt. Ltd, is presently in the construction
stage.
- Paradip Iron Ore Berth project, under development by an SPV, Blue
Water Iron Ore Terminal Pvt. Ltd. The project achieved financial
closure recently.
The three projects in the Energy Sector are:
- 66 MW Rangit II hydroelectric power project under development by an
SPV, Sikkim Hydro Power Ventures Ltd., which is now in the process of
finalizing the construction contractor.
- 30 MW Pravara cogeneration power project under development by an SPV,
Pravara Renewable Energy Ltd.
- 261 MW Youngthangkhab hydroelectric project under development by an
SPV, Youngthang Power Ventures Ltd.
Recently, after the Period undRs.r report, the Company has sold its 50%
stake in the 12MW operational biomass power plant of Punjab Biomass
Power Ltd. at Ghanour to its joint venture partner for a cash
consideration. Further, the Company has sold its 50% stake in seven
other biomass power projects in Punjab to its joint venture partner and
has in turn bought an additional 50% stake in six biomass power
projects in Haryana and one in Punjab from the joint venture partner.
As a result, the Company will have 100% slake in biomass projects to
generate 66MW power.
Besides the above named projects under operation/active development,
the Company also has two other power projects under its umbrella; |i)
the 60 MW Tidong r II hydroelectric power project in Himachal Pradesh,
the award of which has recently been upheld by the Supreme Court; and
(ii| a 250 MW thermal power project in Chandrapur district of
Maharashtra, for which the required land is being acquired.
The other projects
The Company is also participating in the development of two special
economic zones [SEZ] in India; (i) an auto-component SEZ over 90 acres
of land at Adityapur, Jharkhand, for which forest clearance is pending
and (ii) a multi-purpose SEZ at Tada in Andhra Pradesh for which
necessary land is being acquired.
We request you to refer to the 'Management Discussion and Analysis
Report' annexed to this Report for details of the operational
performance of the SPVs.
WHAT LIES AHEAD
The Company expects to achieve financial closure for Pravara
co-generation power project and Rangit II hydroelectric power project
in the next financial year.
The Company has been shortlisted to bid for 40 Projects across sectors
such as roads, ports, power, transmission, urban infra etc.
collectively having an estimated project cost Rs. 52,000 crores. In
addition to this, the Company has submitted pre-qualification
applications for 70 projects, across various sectors, which have an
estimated aggregate project cost of Rs. 67,000 crores. The Company is
also exploring various opportunities in some other emerging economies
to establish its footprint overseas.
EQUITY CAPITAL
The paid up capital of the Company has increased from Rs.
1,448,879,500/- to Rs. 1,457,480,324/- during the Period on account of
allotment of equity shares to the employees who exercised their rights
attached to stock options.
The Company intends to raise about Rs. 200 crores by way of a rights
issue of shares to raise additional resources to fulfill its equity
commitment to various projects under implementation.
EMPLOYEE STOCK OPTION SCHEME
Details of the 'employee stock options' already issued by the Company,
required to be stated in this Report as per SEBI Guidelines is annexed
to this Report as Annexure 1.
PARTICULARS UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF THE BOARD OF DIRECTORS) RULES, 1988
(A) Conservation of Energy
The disclosure required under the said heading is not applicable to
your Company.
(B) Technology Absorption
The disclosure required under the said heading is not applicable to
your Company.
(C) Foreign Exchange Earnings & Outgo
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to Rs. 26.7 Lakhs during
the Period.
SUBSIDIARIES
Andhra Expressway Ltd., Cochin Bridge Infrastructure Company Ltd.,
Gammon Logistics Ltd., Gammon Projects Developers Ltd., Gammon
Renewable Energy Infrastructure Ltd., Gammon Road Infrastructure Ltd.,
Gammon Seaport Infrastructure Ltd., Gorakhpur Infrastructure Company
Ltd., Jaguar Projects Developers Ltd., Kosi Bridge Infrastructure
Company Ltd., Marine Projects Services Ltd., Mumbai Nasik Expressway
Ltd., Pataliputra Highway Ltd., Patna Highway Projects Ltd., Pravara
Renewable Energy Ltd., Rajahmundry Expressway Ltd., Rajahmundry
Godavari Bridge Ltd., Ras Cities and Townships Pvt. Ltd., Sikkim Hydro
Power Ventures Ltd., Tada Infra Development Company Ltd., Tidong Hydro
Power Ltd., Vizag Seaport Pvt. Ltd. and Youngthang Power Ventures Ltd.
remain subsidiaries of the Company.
Lilac Infraprojects Developers Ltd., Chitoor Infra Company Pvt. Ltd.,
Chitoor Infrastructure Projects Pvt. Ltd. (formerly Satyavedu Infra
Company Pvt. Ltd.) and Tada Infrastructure Projects Pvt. Ltd.
(formerlyTatla SEZ Pvt. Ltd.) were incorporated / have become
subsidiaries of the Company during the Period.
A statement u/s 212 of the Companies Act, 1956 relating to the
subsidiaries is attached to the Balance Sheet of the Company for the
Period. The Company has not attached the audited accounts of the
subsidiaries to the Audited Accounts of the Company for the Period.
However, the effect of the same has been brought out in the
consolidated Audited Accounts of the Company. The annual accounts of
the subsidiaries and the related information will be made available to
the Company's and subsidiaries' investors at any point of time. These
have also been kept for inspection of the investors at the Registered
Office of the Company and of the concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 is annexed to this Report as Annexure 2.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm:
a) The applicable Accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b) that the Directors have selected accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Period and of the profits of the
Company for the Period;
cj that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d) that the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
As per Article 169 of the Articles of Association of your Company, Mr.
Himanshu Parikh and Mr. Sanjay Sachdev are liable to retire by rotation
at the ensuing Annual General Meeting and being eligible, have offered
themselves for re-appointment. Your Directors recommend their re-
appointment.
Mr. Rajeevkumar Malhotra joined the Board on February 11, 2011 and has
been made a 'Whole-Time Director' of the Company with effect from April
1, 2011. Mr. Kishor Kumar Mohanty joined the Board on April 12, 2011 as
Managing Director of the Company. Mr. Kunal Shroff joined the Board on
April 12, 2011. Your Directors recommend their appointment on the
Board.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
ii] Shareholders/Investors Grievance Committee to, inter-alia, redress
investor complaints;
iii] Remuneration Committee to approve appointments and remuneration of
Executive Directors;
iv) Compensation Committee to administer the 'Employee Stock Option
Scheme';
v) Project Committee to, inter-alia, advice the Company on the business
opportunities that arise from time to time; and
vi] Rights Issue Committee to oversee the rights issue of shares of the
Company.
The constitution of the various committees, its powers and duties have
been elaborated in greater detail in the 'Corporate Governance Report',
which is annexed to the Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the Shareholders is invited to a separate section titled
'Report on Corporate Governance' which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan,
a 'practicing company secretary' on compliance with corporate
governance requirements of the Listing Agreement is annexed to this
Report as Annexure 3.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the Shareholders is also invited to a separate section
titled 'Management Discussion and Analysis Report' which is annexed to
the Annual Accounts.
PUBLIC DEPOSITS
Your Company has not accepted deposits under Section 58A of the
Companies Act, 1956.
AUDITORS
The Company's auditors, M/s. Natvarlal Vepari & Co. and M/s. S. R.
Batliboi & Co. retire at the Annual General Meeting and being willing
and eligible to be re-appointed as Auditors of the Company, have
submitted their certificates to the effect that their re-appointments,
if made, would be within the limits prescribed under Section 224 (1B]
of the Companies Act, 1956.
The Board recommends their reappointment.
AUDITORS" REPORT
Regardirig the Auditors' observation in their report pursuant to the
Companies (Auditor's Report) Order (CARO), 2003 that short term funds
amounting to Rs. 5,746.4-8 Lakhs have been used for long term
investments, the Board states that short term funds have been used for
meeting equity commitments only as an interim measure pending raising
of long term resources byway of long term loans, sale of equity stake
in one or more of the projects and right issue of shares to
shareholders.
The other observations of the Auditors are self explanatory or have
been clarified and explained in the relevant Notes forming part of the
Annual Accounts and do not need further clarifications.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Abhijit Rajan Himanshu Parikh K.K.Mohanty
Chairman & Vice Chairman Managing Director
Managing Director
Place: Mumbai
Date: August 11,2011
Mar 31, 2010
The Directors have pleasure in submitting their Nineth Annual Report
together with the Audited Accounts of the Company, for the period 1st
April, 2009 to 31st March, 2010 (the "eriod").
FINANCIAL HIGHLIGHTS
As has been stressed even in earlier years, your Companys strength
lies in the investments it holds in the special purpose vehicles (SPV)
promoted by it for implementing public private partnership (PPP)
infrastructure projects. Consequently, to get a full insight into the
financial position of the Company you are advised to refer to the
consolidated accounts of the Company rather than the stand alone
accounts; both of which are contained in this Annual Report.
As per Consolidated Accounts: (Rupees in Lacs)
March 31, 2010
Particulars March 31, 2009
Income 33,949.78 21,338.54
Profit before Interest , Depreciation /
amortisation and 15017.53 13623.50
Taxation
Financial Costs 5745.42 5120.01
Depreciation and Amortisation 5063.50 4341.21
Tax Expense 1,050.63 548.67
Prior Period 166.54 60.21
Minority Interest & share of (profit)/
loss from associates 429.18 287.82
Net Profit 2,562.27 3,265.57
Cash Profit (Net Profit+ Depreciation) 7625.77 7606.78
As per Standalone Accounts: (Rupees in Lacs)
March 31, 2010
Particulars March 31, 2009
Income 12291.68 4,796.37
Profit before Interest, Depreciation/
amortisation and 2357.69 2,282.89
Taxation
Financial Costs 112.64 93.28
Depreciation and Amortisation 198.91 195.08
Tax Expense 645.73 632.53
Net Profit 1400.41 1,361.98
Cash Profit (Net Profit+ Depreciation) 1599.32 1557.06
DIVIDEND
In view of the continuous requirement for funds for investment in
projects under implementation, the Directors have decided not to
recommend any Dividend for the Period.
Your Directors believe that the value of your investment in the Company
can be enhanced better by investing the Companys available funds in
the Companys projects, rather than by declaring dividends.
COMPANYS PROJECTS
The Company has a basket of eight projects in the Road Sector, three in
the Port Sector and four in the Energy Sector, which are under
operation/active development.
Of the eight projects in the Road Sector:
(a) Three are toll based projects, namely:
(1) New Mattancherry Bridge project, developed by an SPV, Cochin Bridge
Infrastructure Company Ltd., which has been in operation since
September, 2001.
(2) Vadape-Gonde project, under development by an SPV, Mumbai Nasik
Expressway Ltd., which commenced commercial operations
on a 64 km stretch of the National Highway 3 in May, 2010.
(3) Godavari Bridge project, under development by an SPV, Rajahmundry
Godavari Bridge Ltd.
(b) Five are annuity based projects, namely:
(1) Rajahmundry-Dharmavaram road project, developed by an SPV,
Rajahmundry Expressway Ltd., which achieved its commercial operations
date in September, 2004.
(2) Dharmavaram-Tuni road project, developed by an SPV, Andhra
Expressway Ltd., which achieved its commercial operations date in
October, 2004.
(3) Kosi Bridge project, under development by an SPV, Kosi Bridge
Infrastructure Company Ltd.
(4) Gorakhpur Bypass project, under development by an SPV, Gorakhpur
Infrastructure Company Ltd.
(5) Patna-Muzafarpur project, under development by an SPV, Patna
Highway Projects Ltd.
(2) Mumbai Offshore Container Terminal, under development by an SPV,
Indira Container Terminal Pvt. Ltd.
(3) Paradip Iron Ore Berth project, under development by an SPV, Blue
Water Iron Ore Terminal Pvt. Ltd.
The four projects in the Energy Sector are:
(1) 66 MW Rangit II hydroelectric project, under development by an SPV,
Sikkim Hydro Power Ventures Limited.
(2) Biomass-based power plants of 12 MW each in Punjab, under
development by an SPV, Punjab Biomass Power Ltd., of which the first
Plant at Bhagaura in Patiala District commenced commercial operation in
June, 2010.
(3) 30 MW Pravara Co-generation power project, under development by an
SPV, Pravara Renewable Energy Ltd.
(4) 261 MW Youngthangkhab hydroelectric project, under development by
an SPV, Youngthang Power Ventures Ltd.
Besides the above named projects under operation/ active development,
the Company also has three other power projects under development; (i)
the Tidong à II hydroelectric power project in Himachal Pradesh, which
is under litigation; (ii) six biomass- based power projects of 12 MW
each in Haryana and (iii) thermal power generation project in interior
Maharashtra.
The Company is also participating in the development of two special
economic zones (SEZ) in India; (i) an auto-component SEZ over 90 acres
of land at Adityapur, Jharkhand, for which forest clearance is pending
and (ii) a multi-purpose SEZ at Tada in Andhra Pradesh for which
necessary land is being acquired.
Besides the twenty projects outlined above, the Company is also
undertaking operation & maintenance of the Rajahmundry-Dharmavaram road
project, the Dharmavaram-Tuni road project and the Vadape-Gonde road
project.
In view of the low margins in the air cargo business, Gammon Logistics
Limited will focus its energies on asset based business like cold
chains, warehousing, custom clearance centers etc.
We request you to refer to the Management Discussion and Analysis
Report annexed to this Report for details of the operational
performance of the Company and the SPVs.
WHAT LIES AHEAD
The Company is hopeful of achieving commercial operation of the entire
stretch of the Vadape-Gonde project by December, 2010.
The Company hopes to announce the financial closure of Patna-Muzafarpur
project and Paradip Iron Ore Berth project shortly. The Pravara
Co-generation power project and Rangit II Hydro Power Project are also
expected to achieve financial closure during the year 2010-11.
The Company has been qualified to submit financial bid for 19 projects
with an aggregate capitalization of Rs.18,000 crores in various
sectors.
EQUITY CAPITAL
During the Period, the Company forfeited 1,62,050 equity shares (of
Rs.10/- each) for non-payment of calls in arrears.
The Company also sub-divided the face value of its equity shares from
Rs.10/- to Rs.2/- during the Period. Further, the Company allotted
25,00,000 equity shares of the Company of the face value of Rs.2/- each
to employees who exercised their rights attached to stock options.
EMPLOYEE STOCK OPTION SCHEME
The Company has not issued any fresh employee stock options during
the year, though, during the Period, the Company had taken the
shareholders approval for the issue of upto 1,40,00,000 (One Crore
Forty Lacs) stock options of the Company carrying a right to apply for
one share each of the face value of Rs.2/- (Rupees Two only).
Details of the employee stock options already issued by the Company,
required to be stated in this Report as per SEBI Guidelines is annexed
to this Report.
PARTICULARS UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF THE BOARD OF DIRECTORS) RULES, 1988
(A) Conservation of Energy
The disclosure required under the said heading is not applicable to
your Company.
(B) Technology Absorption
The disclosure required under the said heading is not applicable to
your Company.
(C) Foreign Exchange Earnings & Outgo
The Company did not earn any foreign exchange during the Period. The
Company expended foreign exchange equivalent to Rs.31.30 lacs during
the Period.
SUBSIDIARIES
Andhra Expressway Ltd., Cochin Bridge Infrastructure Company Ltd.,
Gammon Logistics Ltd., Gammon Projects Developers Ltd., Gorakhpur
Infrastructure Company Ltd., Jaguar Projects Developers Ltd., Kosi
Bridge Infrastructure Company Ltd., Marine Projects Services Ltd,
Mumbai Nasik Expressway Ltd., Pataliputra Highway Ltd. (erstwhile
Gammon Metro Transport Ltd.), Pravara Renewable Energy Ltd.
Rajahmundry Expressway Ltd., Rajahmundry Godavari Bridge Ltd., Ras
Cities and Townships Pvt. Ltd., Sikkim Hydro Power Ventures Ltd., Tada
Infra Development Company Ltd. (erstwhile Gammon Hospitality Ltd.),
Tidong Hydro Power Ltd. and Youngthang Power Ventures Ltd. remain
subsidiaries of the Company.
Blue Water Iron Ore Terminal Private Ltd. has ceased to be a subsidiary
of the Company during the year. Vizag Seaport Pvt. Ltd. became a
subsidiary of the Company during the year. Patna Highway Projects Ltd.,
Gammon Seaport Infrastructure Ltd., Gammon Renewable Energy
Infrastructure Ltd., Gammon Road Infrastructure Ltd. were incorporated
during the year as hundred percent subsidiaries of the Company.
Pursuant to the approval of the Central Government, the Company has not
attached the audited accounts of the subsidiaries to the Audited
Accounts of the Company for the Period. However, the effect of the same
has been brought out in the consolidated Audited Accounts of the
Company. The annual accounts of the subsidiaries and the related
information will be made available to the Companys and subsidiaries
investors at any point of time. These have also been kept for
inspection of the investors at the Registered Office of the Company and
of the concerned subsidiaries.
PARTICULARS OF EMPLOYEES
Particulars of employees required under Section 217(2A) of the
Companies Act, 1956 forms a part of this Report. However, as per
Section 219(1)(b)(iv) of the Companies Act, 1956 read with Circular No.
SEBI/ CFD/DIL/LA/2/2007/26/4 dated 26th April, 2007 issued by the
Securities and Exchange Board of India, the report and accounts are
being sent to the shareholders of the Company without the particulars
of employees
under Section 217 (2A) of the Act. Any shareholder interested in
obtaining a copy of the said statement may write to the Company
Secretary at the Registered Office of the Company.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217 (2AA) of the Companies Act,
1956, the Directors hereby confirm:
a. The applicable accounting Standards along with proper explanation
relating to material departures have been followed by the Company in
preparation of the Annual Accounts for the Period;
b. that the Directors have selected accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Period and of the profits of the
Company for the Period;
c. that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
d. that the annual accounts are prepared on a going concern basis.
BOARD OF DIRECTORS
As per Article 169 of the Articles of Association of your Company, Mr.
Parvez Umrigar and Mr. S.C.Tripathi are liable to retire by rotation
at the ensuing Annual General Meeting and being eligible, have offered
themselves for re-appointment. Your Directors recommend their
re-appointment.
Mr.Parvez Umrigar resigned his position as the Managing Director of the
Company with effect from July 3, 2010. The Board appointed Mr.Himanshu
Parikh as the Executive Vice Chairman of the Company with effect from
the same date.
BOARD COMMITTEES
The Board has presently the following committees to assist it in its
work:
(i) Audit Committee to, inter-alia, oversee and review the financial
reporting system and disclosures made in its financial results;
(ii) Accounts Committee for review and approval of quarterly financial
results;
(iii) Shareholders/Investors Grievance Committee to, inter-alia,
redress investor complaints;
(iv) Remuneration Committee to approve appointments and remuneration of
executive directors;
(v) Compensation Committee to administer the Employee Stock Option
Scheme;
(vi) Project Committee to, inter-alia, advice the Company on the
business opportunities that arise from time to time.
The constitution of the various committees, its powers and duties have
been elaborated in greater detail in the Corporate Governance Report,
which is annexed to the Annual Accounts.
REPORT ON CORPORATE GOVERNANCE
Attention of the Shareholders is invited to a separate section titled
Report on Corporate Governance which is annexed to the Annual
Accounts. A certificate of compliance issued by Mr. N. Veeraraghavan, a
practicing company secretary on compliance with corporate governance
requirements of the Listing Agreement is annexed to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Attention of the Shareholders is also invited to a separate section
titled Management Discussion and Analysis Report which is annexed to
the Annual Accounts.
PUBLIC DEPOSITS
Your Company has not accepted deposits under Section 58A of the
Companies Act, 1956.
AUDITORS
The Companys auditors, M/s. Natvarlal Vepari & Co. and M/s. S.
R.Batliboi & Co. retire at the Annual General Meeting and being willing
and eligible to be re-appointed as Auditors of the Company, have
submitted their certificates to the effect that their re-appointments,
if made, would be within the limits prescribed under Section 224 (1B)
of the Companies Act, 1956.
The Board recommends their reappointment.
AUDITORS REPORT
Observations made by the Auditors in their Audit Report have been duly
clarified and explained in the relevant Notes forming part of the
Annual Accounts, which are self explanatory and do not need any further
clarifications.
ACKNOWLEDGEMENTS
The Board wishes to place on record their appreciation of the support
received by the Company from its shareholders and employees. The
Directors also wish to acknowledge the co-operation and assistance
received by the Company from its business partners, bankers, financial
institutions and various Government, Semi Government and Local
Authorities.
For and on behalf of the Board of,
Gammon Infrastructure Projects Limited
Abhijit Rajan
Chairman & Managing Director
Himanshu Parikh
Director Executive Vice Chairman
Place: Mumbai
Date: 06.08.10
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