Mar 31, 2015
1. CORPORATE INFORMATION
Inox Wind Limited (the "Company") is engaged in the business of manufacture of Wind Turbine Generators ("'WTGs") and also provides Erection, Procurement & Commissioning ("EPC") services for WTGs.The area of operations of the Company is within India. The Company is a subsidiary of Gujarat Fluorochemicals Limited. The Company has made an Initial Public Offer during the year and shares of the Company were listed on the Bombay Stock Exchange and the National Stock Exchange of India on 9th April, 2015
2. BASIS OF PREPARATION:
These financial statements have been prepared in accordance with the generally accepted accounting principles in India, under the historical cost convention and on accrual basis. These financial statements comply in all material respects with the applicable accounting standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
Figures of the previous year have been regrouped or reclassified, wherever necessary, to confirm to current year presentation.
3. Terms/rights attached to equity shares
The Company has only one class of equity shares having par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company the holders of equity shares will be entitled to receive the remaining assets of the Company, in proportion of their shareholding.
Pursuant to the Initial Public Offer, some of the equity shares of the Company are locked in from the date of allotment of fresh shares in the IPO viz.from 30th March 2015, as under:
(a) 14,56,16,354 shares held by the promoter and promoter group, for a period of one year.
(b) 4,43,83,646 shares held by the holding company, for a period of three years.
(c) 94,25,467 equity shares alloted to anchor investors as part of IPO, for a period of thirty days.
e) During the year ended 31st March 2014, the Company has allotted 16,00,00,000 fully paid equity shares as bonus shares in the ratio of 4:1 by utilisation of surplus in the statement of Profit and Loss.
4. : INITIAL PUBLIC OFFER
During the year, the Company has made an Initial Public Offer (IPO) for 3,19,18,226 equity shares of Rs. 10 each, comprising of 2,19,18,226 fresh issue of equity shares by the Company and 1,00,00,000 equity shares offered for sale by Gujarat Fluorochemicals Limited (GFL), the holding company. The equity shares were issued at a price of Rs. 325 per share (including premium of Rs. 315 per share) subject to discount of Rs. 15 per share to the eligible employees of the Company and retail investors. Out of the total proceeds from the IPO of Rs. 102,053.45 Lakh, the Company's share is Rs. 70,000 Lakh from the fresh issue of 2,19,18,226 equity shares. The total expenses in connection with the IPO are shared between the Company and GFL in the proportion of the amount received from the IPO proceeds. Accordingly amount of Rs. 3,222.15 Lakh, being share of the Company in the IPO expenses, is adjusted against the securities premium account.
Fresh equity shares were allotted by the Company on 30th March 2015 and these shares rank pari-passu with the existing shares. The shares of the Company were listed on the stock exchanges on 9th April 2015.
5. CHANGE IN THE ESTIMATE OF USEFUL LIFE OF FIXED ASSETS
a) Company has adopted the useful lives of various fixed assets as specified in Schedule II of the Companies Act, 2013, with effect from April 1,2014, as against the useful lives adopted earlier as per Schedule XIV to the Companies Act, 1956. The carrying amount of fxed assets, where the remaining useful life as at 1st April 2014 as per Schedule II is Nil, aggregating to Rs. 8.61 Lakh (net of deferred tax credit of Rs. 3.15 Lakh), is recognized in the opening balance of retained earnings. Further, the carrying amount of fxed assets as at 1st April 2014 is being depreciated over the revised remaining useful life of the assets. Consequently, depreciation charge for the year is higher by Rs. 542.62 Lakh.
(b) In accordance with Accounting Standard (AS) 22:Taxes on Income, the deferred tax liability on account of timing difference in depreciation, to the extent reversing during the tax holiday period, is not recognized. Consequent to the above change in the estimated useful life of fxed assets, such timing difference reversing during the tax holiday period is recomputed. Consequently, there is reduction in the deferred tax liability of Rs. 130.17 Lakh and the same is included in the amount of deferred tax credit in the Statement of Proft and Loss for the year ended 31st March 2015.
6. In March 2014 a fre broke out in the Company's factory at Rohika, Gujarat. The Company had lodged a claim with the insurance company towards the loss on account of fre. The claim lodged with the insurance company included, inter-alia, claim towards loss of materials and fxed assets, expenditure on carrying out repairs and loss of proft. During the year ended 31st March 2014, the cost of materials and written down value of fxed assets destroyed in fre was estimated at Rs. 2,023.01 Lakh by the management. Pending the settlement of claim, amount of Rs. 83.68 Lakh, being estimated amount of reduction in the claim, was charged to the statement of proft and loss as "loss by fre" and the balance amount of Rs. 1939.33 Lakh was included in 'Insurance claims lodged' in Other current assets. During the current year, after considering the expenditure incurred on repairs to plant and equipment of Rs. 648.57 Lakh, repairs to buildings of Rs. 455.75 Lakh and other expenses, net of realization from sale of scrap, the amount on account of fre loss stood at Rs. 3,021.76 lakhs. The Company has received fnal settlement claim amount of Rs. 2,987.09 Lakh, excluding the claim on account of loss of proft. The loss of Rs. 34.67 Lakh on fnal settlement of the claim is charged to the statement of proft and loss as "loss by fre'.'
7. Earnings in foreign Exchange - Rs. Nil (previous year - Rs. Nil)
8. GONTINGENT LiABiLiTIES
In respect of VAT matters - Rs. 59.09 Lakh (previous year Rs. 93.39 Lakh)
The Company had received Himachal Pradesh VAT orders for the financial years 2012-13 and 2013-14 levying penalty for delayed payment of VAT aggregating to Rs. 112.87 Lakh. The Company had filed appeals before the first appellate authority During the current year, the Company has received appellate order for the year 2013-14 confirming the levy of penalty and the Company is in the process of filing further appeal against the said order. However, the Company has estimated the amount of penalty which may be ultimately sustained at Rs. 53.78 and provision for the same is made during the current year. After adjusting the amount of Rs. 23.35 Lakh paid against the demands, the balance amount of Rs. 30.43 Lakh is carried forward as "Provision for sales tax dispute" in note no. 13.
(a) Estimated amounts of contracts remaining to be executed on capital account, net of advances - Rs. 9,486.70 Lakh (previous year Rs. 1,078.81 Lakh)
(b) Amount of customs duty exemption availed under EPCG Scheme for which export obligations are reguired to be fulfilled within stipulated period - Rs. 1,997.83 Lakh (previous year Rs. 1,212.64 Lakh)
10. During the previous year, the Income-tax authorities have carried out survey proceedings u/s 133A of the Income-tax Act, 1961 at the Company's corporate office and factory premises. The Company had made detailed submissions on various issues raised during the course of survey proceedings and does not expect any material demand in this connection.
11. The Company's significant leasing arrangements are in respect of operating lease for office / residential premises. The lease agreements are for a period of 11 to 60 months. The aggregate lease rentals are charged as "Rent" in the Statement of Profit and Loss.
12. The Company is engaged in the business of manufacture of Wind Turbine Generators ("WTGs") and also provides related erection & commissioning services, which is considered as a single business segment. Further, all the activities of the company are in India and hence there is a single geographical segment.
13. EMPLOYEE BENEFITS
a) Defined Contribution Plans: Contribution to Provident fund & Other funds of Rs. 126.62 Lacs (Previous year 111.37 Lacs) is recognized as an expense and included in 'Contribution to Provident & Other Funds' in the Statement of Profit and Loss.
14. RELATED PARTY DiSGLOSURES
(i) Where control exists :
Gujarat Fluorochemicals Limited (GFL) - Holding Company Inox Leasing & Finance Limited - Ultimate Holding Company Inox Wind Infrastructure Services Limited(IWISL) - Subsidiary Company Marut Shakti Energy India Limited- Subsidiary of IWISL (w.e.f. 13/09/2013)
(ii) other Related parties with whom there are transactions during the year
Key Management personnel (KMp)
Mr. Devansh Jain - Whole-time director
Mr. Rajeev Gupta - Whole-time director
Inox Renewables Limited (IRL) - subsidiary of GFL Inox Renewables (Jaisalmer) Limited- subsidiary of IRL Inox Leisure Limited(ILL) - subsidiary of GFL Satyam Cineplexes Limited- subsidiary of ILL