Notes to Accounts of Allcargo Logistics Ltd.
Mar 31, 2023
Terms/ rights attached to equity shares
The Company has only one class of equity shares having par value of '' 2 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the 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 remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
Nature and purpose of reserves
a) Securities premium
Securities premium is used to record the premium on issue of shares and is utilised in accordance with the provisions of the Companies Act, 2013.
b) General reserve
General reserve is used from time to time to transfer profit from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to statement of profit and loss.
c) Capital redemption reserve
Capital redemption reserve represents amounts set aside on redemption of preference shares.
d) Retained earnings
Retained earnings represents all accumulated net income netted by all dividends paid to shareholders.
e) Remeasurements of gains / (losses) on defined benefit plans (OCI)
It comprises of actuarial gains and losses, differences between the return on plan assets and interest income on plan assets and changes in the asset ceiling (outside of any changes recorded as net interest).
f) Cash Flow Reserves (OCI)
The Company uses hedging instruments as part of its management of foreign currency risk and interest rate risk associated on borrowings. For hedging foreign currency and interest rate risk, the Company uses foreign currency forward contracts, cross currency swaps and interest rate swaps. To the extent these hedges are effective, the change in fair value of the hedging instrument is recognised in the effective portion of cash flow hedges. Amounts recognised in the effective portion of cash flow hedges is reclassified to the statement of profit and loss when the hedged item affects profit or loss (e.g. interest payments).
g) Tonnage Tax (utilised) and Tonnage Tax Reserve
These reserves are mandatory under the Income Tax Act, 1961 for companies who opt for the Tonnage Tax Scheme prescribed under the said Act.
h) Capital Reserve
Capital Reserve It represents excess of net assets of transferor company over the Investments made by the Company which got canceled in pursuance of scheme of amalgamation.
i) Adjustments to Reserves in accordance with demerger scheme
The net assets of divisions Transferred pursuant to demerger scheme has been adjusted against the securities premium, capital reserve and retained earnings as per the demerger scheme.
Term loans from banks (secured)
Rupee term loans from banks are secured against property, plant and equipment and certain immovable properties of the Company and carry interest of 6.80% p.a. (31 March 2022: 6.25% - 7.25% p.a.) and are repayable within a period ranging from 1-4 years.
*Consequent to Demerger Scheme the Axis Bank term loan has been allocated between the Company, TransIndia Reality and Logistics Parks Limited and Allcargo Terminals limited. As per the terms of borrowing it is secured against land and buildings of the Company, pursuant to demerger scheme, these assets have been transferred to TransIndia Reality and Logistics Parks Limited. Accordingly this borrowing is not secured by the Company Assets and secured by land and building of Transindia Reality Limited pursuant to demerger. The Borrowing is disclosed as secured.
Foreign Currency Term Loan (secured)
The Company has availed Foreign Currency Term Loan carrying interest rate of 3.40% and repayable over a period of 4 years. The Loan is secured against property, plant and equipment and certain immovable properties of the Company.
Vehicle finance loans (secured)
Vehicle finance loans are secured against vehicle financed by the Bank and carry interest ranging from 8.00% - 8.50% p.a. (31 March 2022: 8.00% - 8.50% p.a.) and repayable within the period ranging from 1-2 years
Working capital demand loan from banks (secured)
Working capital loan is secured with pari-passu charge on present and future movable assets, inventories and book debts and carry interest Nil (31 March 2022: 5% - 5.25% p.a.) and are repayable within a period of six months. During the year ended 31st March 2023, working capital demand loan have been repaid.
The Company has filed quarterly returns or statements with the banks in lieu of the sanctioned working capital facilities. The same are in agreement with books of account.
The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
Loan covenants
Term loans from banks, financial institutions and others (which are secured in nature) contain certain debt covenants to be maintained at a group level relating to limitation on indebtedness, debt-equity ratio, net borrowings to EBITDA ratio and debt service coverage ratio. The limitation on indebtedness covenant gets suspended if the Group meets certain prescribed criteria. The debt covenant related to limitation on indebtedness remained suspended as of the date of the authorisation of the financial statements. The Company has reasonably satisfied all debt covenants prescribed in the terms and conditions of sanction letter of bank loan. The loans which are unsecured in nature does not have any loan covenant attached.
The Company has not defaulted in any loans payable
25 Net employee defined benefit liabilities
(a) Defined Contributions Plans
For the Company, an amount of '' 648 lakhs (31 March 2022: '' 573 lakhs) contributed to provident and other funds (refer note 19 and 38D) is recognised by as an expense and included in "Contribution to Provident and other funds" under "Employee benefits expense" in the Statement of Profit and Loss.
(b) Defined Benefit Plans
As per the Payment of Gratuity Act, 1972, the Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on resignation or retirement at 15 days salary (last drawn salary) for each completed year of service.
The following table summaries the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the respective plans of the Company.
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26 Contingent liabilities ('' in Lakhs) |
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Particulars |
31 March 2023 |
31 March 2022 |
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a. Pending litigations |
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- Income Tax |
227 3,323 |
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- Customs |
9 9 |
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- Service Tax* |
- - |
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- Entry Tax |
41 41 |
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- Claims against the Company, not acknowledged as debt |
430 662 |
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* The Company has received various Show Cause Notices in respect of certain service tax matters amounting to '' 6,008 lakhs. The Company has evaluated the legal position in respect of the same and believes that it has a strong case hence no adjustments are required in the financial statements. b. Corporate guarantees given by the Holding Company on behalf of its subsidiaries 37,635 82,278 |
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c. Bank guarantees 2,305 4,800 |
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27 Commitments ('' in Lakhs) |
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Particulars |
31 March 2023 |
31 March 2022 |
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Estimated amount of contracts remaining to be executed on capital accounts (net of advances) and not provided for |
494 1,036 |
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Additional Investment in Haryana Orbital Rail Corporation Limited |
3,800 9,400 |
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28 Dues to Micro and small Suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from 02 October 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises. The information given is based on the information available with the Company and has been relied upon by the auditors.
31(a) Financial risk management objectives and policies
i) The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company''s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Company''s risk assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the policies and processes. Risk assessment and policies and processes are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Board of Directors and the management is responsible for overseeing the Company''s risk assessment and policies and processes.
ii) Market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long-term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk. Thus, the Company''s exposure to market risk is a function of investing and borrowing activities and it''s revenue generating and operating activities.
a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.
The Company''s policy is to keep maximum of its borrowings at fixed rates of interest. To manage this, the Company enters into interest rate swaps, in which it agrees to exchange, at specified intervals, the difference between fixed and variable rate interest amounts calculated by reference to an agreed-upon notional principal amount. At 31 March 2023, after taking into account the effect of interest rate swaps, 100% of the Company''s borrowings are at a fixed rate of interest (31 March 2022: 100%).
b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency) and the Company''s foreign currency borrowings.
When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency.
The Company hedges its exposure of net borrowings in foreign currencies by using foreign currency swaps and forwards. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 ''Financial Instruments'' in respect of combined hedging instrument, designated in a net investment hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to the net investment in foreign operations.
c) Unhedged foreign currency exposures
As at balance sheet date, the Company''s net foreign currency exposure Receivable / (payable) that is not hedged is '' 1,482 Lakhs (31 March 2022: '' 1,148 lakhs). Majority of this amount represents the amount payable to overseas subsidiary companies hence it remains manageable exposure within the group itself.
d) Foreign currency sensitivity
For the year ended 31 March 2023 and 31 March 2022, every 5% depreciation / appreciation in the exchange rate between the Indian rupee and U.S. dollar, would have affected the Company''s incremental operating margins by approximately '' 74 lakhs and '' 57 lakhs each (net). The Company''s exposure to foreign currency changes for all other currencies is not material.
The impact on the Company''s profit before tax is due to changes in the fair value of monetary assets and liabilities. The impact on the Group''s pre-tax equity is due to changes in the fair value of forward exchange contracts designated as cash flow hedges.
iii) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Trade receivables
Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. The Company has diversified customer base considering the nature and type of business.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 7.2. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
(iv) Liquidity risk
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts and bank loans. 31% of the Company''s borrowings including current maturities of non-current borrowings will mature in less than one year at 31 March 2023 (31 March 2022: 58%) based on the carrying value of borrowings including current maturities of non-current borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company''s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company''s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
(v) Capital management
The Company''s objective for Capital Management is to maximise shareholder''s value, support the strategic objectives of the Company. The Company determines the capital requirements based on its financial performance, operating and long term investment plans. The funding requirements are met through operating cash flows generated.
The Company''s business objective includes safe-guarding its earnings against adverse fluctuation in the movements of foreign exchange currency and interest rates. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 ''Financial Instruments'' in respect of combined hedging instrument, designated in a hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to highly probable forecast transactions.The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Cash Flow hedges for the following hedging instrument and hedged item:-
The risk management objective is to hedge the variability in cashflows arising from the Euro denominated receivables from customers and the annual dividend cash flows from wholly owned subsidiary Allcargo Belgium N.V. because of changes in EUR-INR exchange rate using fixed-to-fixed EUR-USD Cross Currency Interest Rate Swaps (CCIRS) and USD denominated Foreign Currency Term Loan availed by the Company.
The Company has created a ''pay EUR and receive INR hypothetical swap'' matching the specifications of underlying cash flows designated in the Hedge relationship as of inception date. The hypothetical derivative is constructed using the market-quoted foreign exchange rates and interest rate curves prevailing as of inception on the pay EUR leg and a computed fixed rate on the receive INR leg. The computed fixed rate is such that it makes the net present value of the hypothetical derivative zero as of inception date."
There is an economic relationship between the hedged items and the hedging instruments. The Company has established a hedge ratio of 1:1 for the hedging relationships. To test the hedge effectiveness, the Company uses the hypothetical derivative method and Dollar offset method.
The hedge ineffectiveness can arise from :-
(i) Differences in the timing of the cash flows.
(ii) Different indexes (and accordingly different curves).
(iii) The counterparties''credit risk differently impacting the fair value movements.
The company does not face a significant liquidity risk with regard to its lease liabilities as the current assets are sufficient to meet the obligations related to lease liabilities as and when they fall due.
(d) Lease payments for less than 1 year lease contracts as well as for low value items for the year ended March 31, 2023 is '' 78 lakhs (March 31, 2022: '' 137 lakhs) (refer note 21)
(e) Rental income given on operating leases to joint venture companies was '' 733 lakhs for the year ended March 31, 2023 (March 31, 2022: '' 439 lakhs).
(f) The Company had total cash flows for leases of '' 866 lakhs for the year ended March 31, 2023 (March 31, 2022: '' 1,265 lakhs). The Company does not have non-cash additions to right - of - use assets and lease liabilities for the year ended March 31, 2022. There are no future cash outflows relating to leases that have not yet commenced.
34 Other Statutory Information
i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Group for holding any Benami property.
ii) The Company has not advanced or loaned or invested funds to any other persons or entitities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
iii) The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,
iv) The Company has not enterted any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961
v) The Company do not have any transactions with companies struck off.
vi) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.
35 The Board of Directors at their meeting held on March 06, 2023 approved and declared an Interim Dividend of '' 3.25/- per equity share of face value '' 2/- each for the financial year 2022-23, aggregating upto '' 7,986 Lakhs.
36 Corporate social responsibility
As per section 135 of the Act, a CSR committee has been formed by the Company. The funds are utilised throughout the year on activities which are specified in Schedule VII of the Act. The utilisation is done either by way of direct contribution towards various activities or by way of contribution to a trust - Avvashya Foundation.
(a) Gross amount required to be spent by the Group during the year: '' 458 lakhs (previous year: '' 353 lakhs)
(c) Includes a sum of ''215 lakhs (previous year: ''200 lakhs) as contribution to a trust Avvashya Foundation, (where key managerial personnel and relatives are able to exercise significant influence) (refer note 29B)
(d) As per the rules contained and notified under Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 as at March 31, 2023 the Group do not have any unspent Corporate Social Responsibility amount which needs to be transferred to a separate account maintained with scheduled bank within a period of 30 days from the end of financial year.
39 On June 11, 2021, the Board of directors of the Company had approved and given its consent to the scheme of demerger under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 whereby the Contract Logistics business of its joint venture entity namely Avvashya CCI Logistics Private Limited ("ACCI") would be demerged from ACCI and transferred to Allcargo Supply Chain Private Limited (formerly known as Avvashya Supply Chain Private Limited) (ASCPL) a wholly owned subsidiary of the Company, on the going concern with effect from April 01, 2021 (appointed date) . The Hon''ble National Company Law Tribunal ("NCLT"), Mumbai Bench sanctioned the Scheme of Demerger and the Certified True Copy of the NCLT order was filed with the Registrar of the Companies on March 01, 2023. Further ASCPL has issued & allotted the shares as a consideration in accordance with the scheme.
40 During the year ended March 2022, the Company has entered into an agreement with Shareholders of Haryana Orbital Rail Corporation Limited (HORCL) to acquire 7.6% equity stake. Accordingly, during the year ended March 31, 2023, the Company has invested '' 5,600 Lakhs in equity of HORCL. The Total Investment in HORCL as on March 31, 2023 amounts to '' 7,600 Lakhs.
41 Further on May 17, 2023 Share Purchase Agreement ("SPA") has been executed between the Company, Allcargo Supply Chain Private Limited ("ASCPL") and JKS Group - shareholders of ASCPL for the purpose of acquisition of 8,90,69,138 (Eight Crores Ninety Lakhs Sixty Nine Thousand One Hundred and Thirty Eight) Equity Shares i.e. 38.87% stake by the Company from from JKS Group, for consideration of approx. ''16,305 Lakhs. Pursuant to said SPA, the Company has acquired 38.87% stake in ASCPL from JKS Group and ASCPL has become wholly owned subsidiary of the Company.
42 On March 27, 2023 a Share Purchase Agreement ("SPA") has been executed between The Company and Shareholders Gati-Kintetsu Express Private Limited ("GKEPL"), one of the subsidiaries for acquisition of 30% stake of GKEPL, for an aggregate consideration of '' 40,670 Lakhs.
43 On December 23, 2021, the Board of Directors of the Company considered and approved the restructuring of the business of the Company by way of a scheme of arrangements and demerger ("Scheme") whereby (l) Container Freight Station/lnland Container Depot businesses and ther related business as defined under scheme would be demerged into Allcargo Terminals Limited ("ATL"), wholly owned subsidiary WOS") of the Company; and (2) Construction & leasing of Logistics Parks, leasing of land & commercial properties, Engineering Solutions (hiring and leasing of equipment''s) business and other related business as defined under scheme would be demerged into Translndia Real Estate Limited (formerly known as Translndia Realty & Logistics Parks Limited) ("TRL") WOS of the Company, on a going concern basis. The Scheme was approved by BSE Limited ( "BSE") and National Stock Exchange of India Limited ("NSE"). The Hon''ble National Company Law Tribunal, Mumbai Bench ("NCLT"), approved the Scheme on January 05, 2023 and the Certified True Copy of the Order along with sanctioned Scheme was received on March 10, 2023. The Company filed the Certified True Copy of the Order with Registrar Of Companies (ROC) on April 01, 2023. As per the provisions of the Scheme, the demerger has been given effect from the Appointed Date of April 01, 2022. ATL and TRL have issued and allotted the shares to the shareholders of the Company as on the record date i.e. April 18, 2023 as a consideration in accordance with Scheme. ATL and TRL shares would be listed on BSE and NSE post necessary regulatory and other approvals.
As per the scheme, the following assets and liabilities pertaining to the transferor company have been transferred and vested to the company at their book values as on April 01, 2022, Further, as per the scheme, the difference between book values of assets, liabilities, reserves of Transferor company and cancellation of the Investments made by the company is adjusted against reserves and securities premium. The Total debit to reserves on account of the aforesaid demerger scheme is '' 1,01,781 Lakhs.
44 On May 17, 2023 Share Purchase Agreement ("SPA") has been entered into between the Company, ACCI and JKS Finance Limited and its affiliates ("JKS Group") - shareholders of ACCI for the sale of 16,00,994 (Sixteen Lakhs Nine Hundred Ninety Four) Equity Shares i.e. 61.13% stake held by Company in ACCI to JKS Group for consideration of approx. '' 3,923 Lakhs. Pursuant to said SPA, the Company has sold its stake to JKS Group in ACCI and ACCI has ceased to be Joint-Venture of the Company. Accordingly the Company''ss investment in ACCI of '' 2,401 Lakhs has been classified as Assets Held for Sale as of 31st March, 2023.
45 The Board of directors of the Company at its meeting held on February 11, 2022 has considered and approved the firm binding offer dated February 10, 2022 received from J M Baxi Heavy Private Limited for sale of Projects Logistics business through Business Transfer Agreement under slump sale basis for lumpsum consideration of ''98.64 Crores. The Business Transfer Agreement has been executed in this regard. Accordingly, Projects Logistics business has been disclosed as discontinued operations.The details for which are summarised below:
Previous year figures have been regrouped/reclassified, where necessary, to conform to this year''s classification.
Mar 31, 2022
Nature and purpose of reserves
a) Securities premium
Securities premium is used to record the premium on issue of shares and is utilised in accordance with the provisions of the Companies Act, 2013.
b) General reserve
General reserve is used from time to time to transfer profit from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to statement of profit and loss.
c) Capital redemption reserve
Capital redemption reserve represents amounts set aside on redemption of preference shares.
d) Retained earnings
Retained earnings represents all accumulated net income netted by all dividends paid to shareholders.
e) Remeasurements of gains / (losses) on defined benefit plans (OCI)
It comprises of actuarial gains and losses, differences between the return on plan assets and interest income on plan assets and changes in the asset ceiling (outside of any changes recorded as net interest).
f) Cash Flow Reserves (OCI)
The Company uses hedging instruments as part of its management of foreign currency risk and interest rate risk associated on borrowings. For hedging foreign currency and interest rate risk, the Company uses foreign currency forward contracts, cross currency swaps and interest rate swaps. To the extent these hedges are effective, the change in fair value of the hedging instrument is recognised in the effective portion of cash flow hedges. Amounts recognised in the effective portion of cash flow hedges is reclassified to the statement of profit and loss when the hedged item affects profit or loss (e.g. interest payments).
g) Tonnage Tax (utilised) and Tonnage Tax Reserve
These reserves are mandatory under the Income Tax Act, 1961 for companies who opt for the Tonnage Tax Scheme prescribed under the said Act.
h) Capital Reserve
It represents excess of net assets of transferor company over the Investments made by the Company which got cancelled in pursuance of scheme of amalgamation.
Term loans from banks (secured)
Rupee term loans from banks are secured against property, plant and equipment and certain immovable properties of the Company and carry interest ranging from 6.25% - 7.25% p.a. (31 March 2021: 7.15% - 8.25% p.a.) and are repayable within a period ranging from 2-5 years.
Foreign Currency Term Loan (secured)
The Company has availed Foreign Currency Term Loan carrying interest rate of 3.4% and repayable over a period of 5 years. The Loan is secured against property, plant and equipment and certain immovable properties of the company.
Vehicle finance loans (secured)
Vehicle finance loans are secured against vehicle financed by the Bank and carry interest ranging from 8.00% - 8.50% p.a. (31 March 2021: 8.00% - 8.50% p.a.) and repayable within the period ranging from 2-3 years.
Working capital demand loan from banks (secured)
Working capital loan is secured with pari-passu charge on present and future movable assets, inventories and book debts and carry interest @ 5% - 5.25% p.a. (31 March 2021:
4.90% - 6% p.a.) and are repayable within a period of six months.
The Company has filed quarterly returns or statements with the banks in lieu of the sanctioned working capital facilities, which are in agreement with books of account.
The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
Loan covenants
Term loans from banks, financial institutions and others (which are secured in nature) contain certain debt covenants to be maintained at a group level relating to limitation on indebtedness, debt-equity ratio, net borrowings to EBITDA ratio and debt service coverage ratio. The limitation on indebtedness covenant gets suspended if the Group meets certain prescribed criteria. The debt covenant related to limitation on indebtedness remained suspended as of the date of the authorisation of the financial statements. The
25 Net employee defined benefit liabilities
(a) Defined Contributions Plans
For the Company, an amount of '' 573 Lakhs (31 March 2021: '' 491 Lakhs) contributed to provident and other funds (refer note 19) is recognised by as an expense and included in "Contribution to Provident and other funds" under "Employee benefits expense" in the Statement of Profit and Loss.
(b) Defined Benefit Plans
As per the Payment of Gratuity Act, 1972, the Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on resignation or retirement at 15 days salary (last drawn salary) for each completed year of service.
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26 Contingent liabilities |
('' in Lakhs) |
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Particulars |
31 March 2022 | |
31 March 2021 |
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a. Pending litigations |
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- Income Tax |
3,323 |
193 |
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- Customs |
9 |
9 |
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- Service Tax1 |
- |
277 |
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- Entry Tax |
41 |
41 |
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- Claims against the Company, not acknowledged as debt |
662 |
219 |
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('' in Lakhs) |
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Particulars |
31 March 2022 |
31 March 2021 |
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b. Corporate guarantees given by the Holding Company on behalf of its subsidiaries |
82,278 54,462 |
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The Company has issued letters of undertakings to provide need based unconditional financial support to its following subsidiaries: |
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1. Allcargo Belgium NV |
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2. Transindia Logistics Park Private Limited |
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3. Allcargo Inland Park Private Limited |
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4. Allcargo Multimodal Private Limited |
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c. Bank guarantees |
4,800 6,135 |
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27 Commitments ('' in Lakhs) |
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Particulars |
31 March 2022 |
31 March 2021 |
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Estimated amount of contracts remaining to be executed on capital accounts (net of advances) and not provided for Additional investment in Haryana Orbital Rail Corporation Limited |
1,036 204 9,400 - |
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The management assessed that Investments, cash and cash equivalents, trade receivables, trade payables, short-term borrowings, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.
31(a) Financial risk management objectives and policies
i) The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company''s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Company''s risk assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the policies and processes. Risk assessment and policies and processes are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Board of Directors and the management is responsible for overseeing the Company''s risk assessment and policies and processes.
ii) Market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long-term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk. Thus, the Company''s exposure to market risk is a function of investing and borrowing activities and it''s revenue generating and operating activities.
a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.
The Company''s policy is to keep maximum of its borrowings at fixed rates of interest. To manage this, the Company enters into interest rate swaps, in which it agrees to exchange, at specified intervals, the difference between fixed and
variable rate interest amounts calculated by reference to an agreed-upon notional principal amount. At 31 March 2022, after taking into account the effect of interest rate swaps, 100% of the Company''s borrowings are at a fixed rate of interest (31 March 2021: 100%).
b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency) and the Company''s foreign currency borrowings.
When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency.
The Company hedges its exposure of net borrowings in foreign currencies by using foreign currency swaps and forwards. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 ''Financial Instruments'' in respect of combined hedging instrument, designated in a net investment hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to the net investment in foreign operations.
c) Unhedged foreign currency exposures
As at balance sheet date, the Company''s net foreign currency exposure Receivable / (payable) that is not hedged is '' 1,148 Lakhs (31 March 2021: '' (13,233) Lakhs). Majority of this amount represents the amount payable to overseas subsidiary companies hence it remains manageable exposure within the group itself.
d) Foreign currency sensitivity
For the year ended 31 March 2022 and 31 March 2021, every 5% depreciation / appreciation in the exchange rate between the Indian rupee and U.S. dollar, would have affected the Company''s incremental operating margins by approximately '' 57 Lakhs and '' 662 Lakhs each (net). The Company''s exposure to foreign currency changes for all other currencies is not material.
The impact on the Company''s profit before tax is due to changes in the fair value of monetary assets and liabilities. The impact on the Group''s pre-tax equity is due to changes in the fair value of forward exchange contracts designated as cash flow hedges.
iii) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Trade receivables
Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. The Company has diversified customer base considering the nature and type of business.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 7.2. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
(iv) Liquidity risk
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and commercial papers. 58% of the Company''s borrowings including current maturities of noncurrent borrowings will mature in less than one year at 31 March 2022 (31 March 2021: 65%) based on the carrying value of borrowings including current maturities of non-current borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company''s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company''s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
(v) Capital management
The Company''s objective for Capital Management is to maximise shareholder''s value, support the strategic objectives of the Company. The Company determines the capital requirements based on its financial performance, operating and long term investment plans. The funding requirements are met through operating cash flows generated.
The Company''s business objective includes safe-guarding its earnings against adverse fluctuation in the movements of foreign exchange currency and interest rates. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 ''Financial Instruments'' in respect of combined hedging instrument, designated in a hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to highly probable forecast transactions.The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Cash Flow hedges for the following hedging instrument and hedged item:-
The risk management objective is to hedge the variability in cashflows arising from the Euro denominated receivables from customers and the annual dividend cash flows from wholly owned subsidiary Allcargo Belgium N.V. because of changes in EUR-INR exchange rate using fixed-to-fixed EUR-USD Cross Currency Interest Rate Swaps (CCIRS) and USD denominated Foreign Currency Term Loan availed by the Company.
The Company has created a ''pay EUR and receive INR hypothetical swap'' matching the specifications of underlying cash flows designated in the Hedge relationship as of inception date. The hypothetical derivative is constructed using the market-quoted foreign exchange rates and interest rate curves prevailing as of inception on the pay EUR leg and a computed fixed rate on the receive INR leg. The computed fixed rate is such that it makes the net present value of the hypothetical derivative zero as of inception date.
There is an economic relationship between the hedged items and the hedging instruments. The Company has established a hedge ratio of 1:1 for the hedging relationships. To test the hedge effectiveness, the Company uses the hypothetical derivative method and Dollar offset method.
Lease payments for less than 1 year lease contracts as well as for low value items for the year ended March 31, 2022 is '' 137 Lakhs (March 31, 2021: '' 41 Lakhs) (Refer Note 22)
Rental income given on operating leases to joint venture companies was '' 428 Lakhs for the year ended March 31, 2022 (March 31, 2021: '' 428 Lakhs).
The Company had total cash flows for leases of '' 1,265 Lakhs for the year ended March 31, 2022 (March 31, 2021: '' 1,269 Lakhs. The Company does not have non-cash additions to right - of - use assets and lease liabilities for the year ended March 31, 2022. There are no future cash outflows relating to leases that have not yet commenced.
a) Temporary increase in Working Capital
b) Reduction in Net Debt during the year ended March 31, 2022
c) Variation in Coverage, turnover and other profitability ratios is primarily due to increase in turnover and profitability during the year ended March 31, 2022
d) The Major Part of Investement is made at the end of the year resulting in Lower Return on Investment for the year ended March 31, 2022
34 Other Statutory Information
i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Group for holding any Benami property.
ii) The Company has not advanced or loaned or invested funds to any other persons or entitities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
iii) The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Group shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,
iv) The Company has not enterted any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961
v) The Company do not have any transactions with companies struck off.
vi) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.
35 In regard to the initial public announcement dated July 21, 2021 made by Inga Ventures Private Limited, manager to the offer, on behalf of Mr Shashi Kiran Shetty, Talentos Entertainment Private Limited and Avashya Holdings Private Limited, members of the Promoter and the Promoter group company, wherein, they have expressed their intention to: (a) acquire all Equity Shares that are held by Public Shareholders, either individually/ collectively or together with other members of the Promoter Group, as the case may be; and (b) consequently voluntarily delist the Equity Shares from BSE Limited and the National Stock Exchange of India Limited ("Stock Exchanges"), in accordance with Delisting Regulations ("Delisting Proposal").
Subsequently, the board of directors of the Company in their meeting held on August 6, 2021, approved the Delisting Proposal. The Company also sought the approval of the shareholders of the Company for the Delisting Proposal by way of a special resolution through postal ballot by remote e-voting process vide a notice dated August 6, 2021.
The results of the postal ballot were announced on September 13, 2021, pursuant to Regulation 44(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. As set out therein, the number of votes cast in favour of the Delisting Proposal is sufficient for passing the resolution as a Special Resolution in terms of Section 114 of the Companies Act, 2013. However, in terms of Regulation 11(4) of the Delisting Regulations, the special resolution shall be acted upon only if the number of votes cast by the Public Shareholders in favour of the Delisting Proposal is at least two times the number of votes cast by the Public Shareholders against it. The votes cast by the Public Shareholders in favour of the Delisting Proposal (i.e. 44,66,241 votes) is less than two times the votes cast by the Public Shareholders against the Delisting Proposal (i.e. 3,39,03,284 votes).
Accordingly, in terms of Regulation 11(4) of the Delisting Regulations, the Acquirers are not able to proceed with the Delisting Proposal, and the Equity Shares of the Company shall continue to be listed on the Stock Exchanges and continue to be "Permitted to Trade" on the Metropolitan Stock Exchange of India Limited.
36 Corporate social responsibility
As per section 135 of the Act, a CSR committee has been formed by the Company. The funds are utilised throughout the year on activities which are specified in Schedule VII of the Act. The utilisation is done either by way of direct contribution towards various activities or by way of contribution to a trust - Avvashya Foundation.
(a) Gross amount required to be spent by the Company during the year: '' 353 Lakhs (31 March 2021: '' 287 Lakhs)
Disclosure of segment reporting as per the requirements of Ind AS 108 "Operating Segment" is reported in the consolidated financial statements of the Company. Therefore, the same has not been separately disclosed in the standalone financial statements in line with the requirement of Ind AS 108.
38 Amalgamation of Hindustan Cargo Limited
The Board of Directors in their meeting held on November 08, 2019, approved the Scheme of Amalgamation (merger by Absorption) under Sections 230 to 232 of The Companies Act, 2013 between Hindustan Cargo Limited (a wholly owned subsidiary of the Company) and the Company, subject to the approval of the National Company Law Tribunal ("NCLT") and other requisite approvals. The final hearing and approval of the said scheme by the Hon''ble NCLT was completed during year and upon receipt of the final order, the amalgamation has been accounted for in accordance with Appendix C of Ind AS 103 ''Business Combinations'' and accordingly, results of all the previous periods have been restated from April 01, 2020, i.e. beginning of the previous financial year.
As per the scheme, the following assets and liabilities pertaining to the transferor company have been transferred and vested to the company at their book values as on April 01, 2020, As per the scheme, the difference between book values of assets, liabilities, reserves of Transferor company and cancellation of the Investments made by the company is treated as ''capital reserves''. The Total impact to reserves on account of the aforesaid amalgamation is '' 50 Lakhs.
Also in the past Hindustan Cargo Limited (erstwhile subsidiary of the Company which got merged with the Company as per NCLT order dated August 26, 2021) has received order-in original w.r.t service tax matter relating to F.Y. 2012-13, 2013-14 & 201415. The order has confirmed the service tax liability of '' 17,200 Lakhs (March 31, 2018: '' 10,238 lahs (F.Y. 2007-08 to 2011-12)). The Company has filed an appeal against the above order-in-original before Mumbai CESTAT. Based on opinion of the Experts, the management of the Company has a reason to believe that the possibility of liability getting materialsed is very remote and hence in this case there will not be any outflow of resources and accordingly not classified as Contingent liabilities.
39 The Board of directors of the Company in its meeting held on June 11, 2021 has approved and given its consent to the scheme of demerger under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 whereby the contract logistics business of its joint venture entity namely Avvashya CCI Logistics Private Limited will get transferred to Avvashya Supply Chain Private Limited (formerly known as South Asia Terminals Private Limited) a wholly owned subsidiary of the Company, on the going concern basis with mirror shareholding, subject to the approval of the National Company Law Tribunal and other requisite approvals. The requisite approvals are awaited as at date.
40 (a) During the year ended March 31, 2020 the Board of Directors of the Company in their meeting held on November 8, 2019
have approved the restructuring involving transfer of warehouses and other assets of Logistics Park Business (''Business Undertaking'') of the Company to its wholly owned subsidiaries (''WOS''). The Company thereafter transferred the Business Undertakings under slump sale arrangement to four of its WOS namely Malur Logistics and Industrial Parks Private Limited, Allcargo Logistics & Industrial Park Private Limited, Madanahatti Logistics and Industrial Parks Private Limited and Venkatapura Logistics and Industrial Parks Private Limited under a Business Transfer Agreement (BTA). Thereafter the Company executed agreements with Malur Logistics and Industrial Parks Private Limited, Allcargo Logistics & Industrial Park Private Limited, Madanahatti Logistics and Industrial Parks Private Limited, Venkatapura Logistics and Industrial Parks Private Limited, Kalina Warehousing Private Limited, Panvel Warehousing Private Limited (together referred to as "Specified WOS") and BRE Asia Urban Holdings Ltd ("the Investor") for carrying out the business of warehousing. Pursuant to the agreements, the Investor made an initial investment of '' 22,839 Lakhs through debentures as well as Rs 893 Lakhs through equity acquisition in these Specified WOS except Venkatapura Logistics and Industrial Parks Private Limited. Accordingly from February 13, 2020, the Company divested its control in Madanahatti Logistics and Industrial Park Private Limited, Allcargo Logistics & Industrial Park Private Limited, Kalina Warehousing Private Limited and Panvel Warehousing Private Limited on a fully diluted basis and now retains a minority stake in these subsidiaries.
Also during the current year the Company has further received '' 10,047 Lakhs (31 March 2021: '' 6,050 Lakhs) from Malur Logistics and Industrial Parks Private Limited, Madnahatti Logistics and Industrial Park Private Limited, Venkatpura Logistics & Industrial Parks Private Limited and from Allcargo Logistics and Industrial Park Private Limited towards release of its previous held equity interests (which was held in the form of shareholders'' loan and which was converted in the form of debentures as per terms and conditions mentioned in the definitive transaction documents) in these companies.
(b) As per the original understanding and as per the terms and conditions mentioned in the definitive transaction documents the transaction was expected to conclude in a phase wise manner within a period of 12 months, subject to the satisfaction of customary closing conditions and achievement of certain milestones (together the ''conditions precedent'') as prescribed in the agreements. But due to outbreak of Coronavirus (COVID-19) pandemic globally and in india the time limits earlier defined in the agreements have been further extended between the Company and the Investor by mutual agreement and consent. Hence as at March 31, 2022, the Company still holds controlling stake over Malur Logistics and Industrial Parks Private Limited and Venkatapura Logistics and Industrial Parks Private Limited.
(c) The aforesaid agreements with the Specified WOS states that if condition precedent specified therein are not satisfied within the period stipulated (including extensions obtained from Investor), the Company together with the Specified WOS shall acquire the debentures and equity held by the Investor in the specified WOS together with 16% interest in accordance with the terms and conditions of the agreements and in the event of failure of which the Investor will be entitled to exercise the Investor''s Put Option as set out therein. Initial recognition has been accounted for as investment in the Specified WOS with corresponding creation of financial liability. During the current year the management has re-assessed the investors put option valuation from independent valuer and it has been valued at '' 391 Lakhs, the difference between initial recognition and the value arrived at the end of current year has been routed through as FVTPL in the statement of profit and loss.
(d) The aforesaid agreements also states that if certain condition precedent as specified therein are not satisfied within the period stipulated (including extensions obtained from Investor) the Investor has a call option to buy stake in certain WOS of the Company as per the terms mentioned therein. Management believes that there has been substantial progress on the accomplishment of the conditions precedent and they will be able to achieve the completion of the same within the agreed timelines.
41 A Scheme of Arrangement was approved between two of the subsidiaries, Allcargo Inland Park Private Limited (Demerged company) and Allcargo Multimodal Private Limited (Resulting company), and their respective shareholders to demerge their warehousing business (the demerged undertaking.) The Application was filed with NCLT on February 2, 2021. Subsequent to that NCLT passed the interim order on 08th April, 2021 mentioning the further course of action to be followed by the applicant companies. The NCLT vide its final order dated 01st March 2022 approved the Scheme of Arrangement and the entire "Demerged Undertaking" of Allcargo Inland Park Private Limited has been merged with Allcargo Multimodal Private Limited, on a going concern basis along with all its rights, privileges and obligations. The said order stated that the appointed date for the said Arrangement to be April 01, 2021.
42 Estimation of uncertainties relating to Covid-19
The Company as at the date of approval of these financial results has made assessment of possible impacts that may result from the COVID -19 pandemic on the carrying value of current and non-current assets considering the internal and external information available as at the said date and to the extent possible. The Company, based on the above analysis and assumptions used, believes that the carrying value of these assets are recoverable and sufficient liquidity is available. The impact of COVID -19 may be different from the estimated as at the date of approval of these financial statements and the Company will continue to closely monitor any material changes to future economic conditions.
43 The Board of Directors of the Company at its meeting dated December 23, 2021 has considered and approved to restructuring of the business of the Company by way of a scheme of arrangements and demerger (""Scheme"") whereby (1) Container Freight Station/lnland Container Depots businesses of the Company ("Demerged Undertaking 1") will be demerged into Allcargo Terminals Limited (The members of Allcargo Terminals Private Limited had approved its conversion from private limited into public limited vide special resolution passed at its Extraordinary General Meeting dated December 10, 2021 for which necessary forms has been filed with Registrar of Companies, Mumbai and approval for the same was received on January 10, 2022) (the "Resulting Company 1" or "ATL"), Wholly Owned Subsidiary ("WOS") of the Company; and (2) Construction & leasing of Logistics Parks, leasing of land & commercial properties, Engineering Solutions (hiring and leasing of equipment''s) businesses of the Company (""Demerged Undertaking 2") will be demerged TransIndia Realty & Logistics Parks Limited (the "Resulting Company 2" or "TRLPL"), Wholly Owned Subsidiary (âWOS'') of the Company, on a going concern basis. As per the scheme, the demerger will be given effect from the Appointed Date of April 01, 2022.
The transaction is proposed through a Scheme of Arrangement and Demerger under Section 230 - 232 read with applicable provisions of the Companies Act, 2013 (the "Act"). The said Scheme would be subject to requisite approvals of the National Company Law Tribunal, BSE Limited ("BSE"), National Stock Exchange of India Limited ("NSE"), Securities and Exchange Board of India and other statutory / regulatory authorities, including those from the shareholders and creditors of the Company, Resulting Company 1 and Resulting Company 2, as may be applicable. The transaction is to be effected pursuant to the Scheme and is subject to receipt of regulatory and other approvals inter-alia approval from shareholders, creditors, NCLT etc as may be applicable, Resulting Company 1 and Resulting Company 2, Shall have mirror shareholding of the Company and shares of the Resulting Company 1 and Resulting Company 2 will be listed on BSE and NSE.
44 Pursuant to the approval of board of directors of the Company dated November 01, 2021 and post execution of Share Purchase Agreement dated November 30,2021, the Company through its Wholly owned subsidiary, Allcargo Terminals Limited has acquired 85% of equity stake in Speedy Multimodes Limited from Pirkon Properties Private Limited at a total consideration of '' 102 Crores.
45 The Board of directors of the Company at its meeting held on February 11, 2022 has considered and approved the firm binding offer dated February 10, 2022 received from J M Baxi Heavy Private Limited for sale of Projects Logistics business through Business Transfer Agreement under slump sale basis for lumpsum consideration of ''98.64 Crores. The Business Transfer Agreement has been executed in this regard. Accordingly, Projects Logistics business has been disclosed as discontinued operations.
Previous year figures have been regrouped/reclassified, where necessary, to conform to this year''s classification.
The Company has received various Show Cause Notices in respect of certain service tax matters amounting to '' 6,008 Lakhs. The Company has evaluated the legal position in respect of the same and believes that it has a strong case hence no adjustments are required in the financial statements.
Mar 31, 2021
a) Securities premium
Securities premium is used to record the premium on issue of shares and is utilised in accordance with the provisions of the Companies Act, 2013.
General reserve is used from time to time to transfer profit from retained earnings for appropriation purposes. As the general reserve is created by a transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to statement of profit and loss.
Capital redemption reserve represents amounts set aside on redemption of preference shares.
Retained earnings represents all accumulated net income netted by all dividends paid to shareholders.
e) Remeasurements of gains / (losses) on defined benefit plans (OCI)
It comprises of actuarial gains and losses, differences between the return on plan assets and interest income on plan assets and changes
in the asset ceiling (outside of any changes recorded as net interest).
The Group uses hedging instruments as part of its management of foreign currency risk and interest rate risk associated on borrowings. For hedging foreign currency and interest rate risk, the Group uses foreign currency forward contracts, cross currency swaps and interest rate swaps. To the extent these hedges are effective, the change in fair value of the hedging instrument is recognised in the effective portion of cash flow hedges. Amounts recognised in the effective portion of cash flow hedges is reclassified to the statement of profit and loss when the hedged item affects profit or loss (e.g. interest payments).
g) Tonnage Tax (utilised) and Tonnage Tax Reserve
These reserves are mandatory under the Income Tax Act, 1961 for companies who opt for the Tonnage Tax Scheme prescribed under the said Act.
I t represents excess of net assets of transferor company over the Investments made by the Company which got cancelled in pursuance of scheme of amalgamation.
Term loans from banks (secured)
Rupee term loans from banks are secured against property, plant and equipment and certain immovable properties of the Company and carry interest ranging from 3.4% - 8.25% p.a. (31 March 2020: 8.50% - 9.00% p.a.) and are repayable within a period ranging from 2-5 years. The Company has availed Foreign Currency Term Loan carrying interest rate of 3.4% & repayable over a period of 5 years.
Term loans from financial institutions and others (secured)
Rupee term loans from financial institution and others are secured against property, plant and equipments and certain immovable properties of the Company and carry 5% interest rate (31 March 2020: 9.50% - 11.00% p.a).
Vehicle finance loans (secured)
Vehicle finance loans are secured against vehicle financed by the Bank and carry interest ranging from 8.00% - 8.50%p.a. (31 March 2020: 8.00% - 8.50% p.a.) and repayable within the period ranging from 1-2 years.
Working capital demand loan from banks (secured)
Working capital loan is secured with pari-passu charge on present and future movable assets, inventories and book debts and carry interest @ 4.90% - 6% p.a. (31 March 2020: 8.20% - 8.25% p.a.) and are repayable within a period of six months.
Non Convertible Debentures subscribed by financial institution (secured)
âOn January 10, 2020, the Company has allotted 1,600 Senior, Rated, Secured, Listed, Redeemable, NonConvertible Debentures (NCDs) of face value Rs. 10 lakhs per debenture to The Hongkong and Shanghai Banking Corporation Limited, Foreign Portfolio Investor. These NCDs was listed on BSE Limited from January 20, 2020.
Total Non-Convertible Debentures of the Company outstanding as on 31 March 2020 are Rs 16,000 lakhs. The same was fully secured against property, plant and equipments and certain immovable properties of
the Company. The asset cover in respect of the nonconvertible debentures (NCDs) of the Company as on March 31, 2020 exceeds 1.10 times of the principal amount of the said listed secured non convertible debentures. The said NCDs had a maturity date of 10 January, 2023, however they were prepaid by the Company on 11 June, 2020.
Inter-corporate deposits (ICDs) from companies (unsecured)
ICDs carry interest rate of 13.00% p.a. (31 March 2020: 13%) and are repayable over a period of 2-3 months.
Working capital demand loan from financial institution (unsecured)
They carry interest rate of 5.00 % p.a. (31 March 2020: 8%) and repayable over the period of 3 months.
The Company has listed debt instruments - Commercial paper on NSE effective March 13, 2020 which are unsecured. The Company retained its Commercial paper ratings by CARE and India ratings as âA1 â. Commercial paper facilities carry interest ranging from
6.00% - 7.35% p.a. (31 March 2020: 6.75% - 8% p.a.) and are repayable over a period of 2-3 months and were repaid on 11 June 2020.
Term loans from banks, financial institutions and others (which are secured in nature) contain certain debt covenants to be maintained at a group level relating to limitation on indebtedness, debt-equity ratio, net borrowings to EBITDA ratio and debt service coverage ratio. The limitation on indebtedness covenant gets suspended if the Group meets certain prescribed criteria. The debt covenant related to limitation on indebtedness remained suspended as of the date of the authorisation of the financial statements. The Company has reasonably satisfied all debt covenants prescribed in the terms and conditions of sanction letter of bank loan except in case of certain covenants with respect to two borrowings. The Company has obtained the requisite communication from the lenders comforting subsequent issuance of waiver letters upon their annual review process and hence no adjustments are warranted in the financial statements. The loans which are unsecured in nature does not have any loan covenant attached..
25 Net employment defined benefit liabilities
(a) Defined Contributions Plans
For the Company, an amount of '' 520 lakhs (31 March 2020: '' 589 lakhs) contributed to provident and other funds (refer note 19) is recognised by as an expense and included in âContribution to Provident and other fundsâ under âEmployee benefits expenseâ in the Statement of Profit and Loss.
As per the Payment of Gratuity Act, 1972, the Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on resignation or retirement at 15 days salary (last drawn salary) for each completed year of service.
31(A) Financial risk management objectives and policies
i) The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company''s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Company''s risk assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the policies and processes. Risk assessment and policies and processes are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Board of Directors and the management is responsible for overseeing the Company''s risk assessment and policies and processes.
ii) Market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long-term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk. Thus, the Company''s exposure to market risk is a function of investing and borrowing activities and it''s revenue generating and operating activities.
a) Interest rate risk
I nterest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates.
The Company''s policy is to keep maximum of its borrowings at fixed rates of interest. To manage this, the Company enters into interest rate swaps, in which it agrees to exchange, at specified intervals, the difference between fixed and variable rate interest amounts calculated by reference to an agreed-upon notional principal amount. At 31 March 2021, after taking into account the effect of interest rate swaps, 100% of the Company''s borrowings are at a fixed rate of interest (31 March 2020: 100%).
b) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency) and the Company''s foreign currency borrowings.
When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency.
The Company hedges its exposure of net borrowings in foreign currencies by using foreign currency swaps and forwards. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 âFinancial Instruments'' in respect of combined hedging instrument, designated in a net investment hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to the net investment in foreign operations.
c) Unhedged foreign currency exposures
As at balance sheet date, the Company''s net foreign currency exposure (payable) that is not hedged is '' 13,233 lakhs (31 March 2020: '' 10,082 lakhs). Majority of this amount represents the amount payable to overseas subsidiary companies hence it remains manageable exposure within the group itself.
d) Foreign currency sensitivity
For the year ended 31 March 2021 and 31 March 2020, every 5% depreciation / appreciation in the exchange rate between the Indian rupee and U.S. dollar, would have affected the Company''s incremental operating margins by approximately '' 662 lakhs and '' 504 lakhs each (net). The Company''s exposure to foreign currency changes for all other currencies is not material.
The impact on the Company''s profit before tax is due to changes in the fair value of monetary assets and liabilities. The impact on the Group''s pre-tax equity is due to changes in the fair value of forward exchange contracts designated as cash flow hedges.
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Customer credit risk is managed by each business unit subject to the Company''s established policy,
procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. The Company has diversified customer base considering the nature and type of business.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 7.3. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and commercial papers. 65% of the Company''s borrowings including current maturities of noncurrent borrowings will mature in less than one year at 31 March 2021 (31 March 2020: 53%) based on the carrying value of borrowings including current maturities of non-current borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Company''s performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Company''s policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
The Company''s objective for Capital Management is to maximise shareholder''s value, support the strategic objectives of the Company. The Company determines the capital requirements based on its financial performance, operating and long term investment plans. The funding requirements are met through operating cash flows generated.
The Company''s business objective includes safeguarding its earnings against adverse fluctuation in the movements of foreign exchange currency and interest rates. The Company has applied the hedge accounting as per principles set out in Ind AS - 109 âFinancial Instruments'' in respect of combined hedging instrument, designated in a hedging relationship, used to hedge its risks associated with foreign currency fluctuations relating to highly probable forecast transactions.The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Cash
Flow hedges for the following hedging instrument and hedged item:-
Hedged instrument Hedged item
Foreign Currency Term The highly probable Loan of USD 260.69 Euro Receivable future (Amount in '' 19,111 cash flows in the form of lakhs) and Euro -USD receivables in Euro and the Cross currency Interest annual dividend receivable rate swap. from subsidiary.
The risk management objective is to hedge the variability in cashflows arising from the Euro denominated receivables from customers and the annual dividend cash flows from wholly owned subsidiary Allcargo Belgium N.V. because of changes in EUR-INR exchange rate using fixed-to-fixed EUR-USD Cross Currency Interest Rate Swaps (CCIRS) and USD denominated Foreign Currency Term Loan availed by the Company.
The Company has created a âpay EUR and receive INR hypothetical swap'' matching the specifications of underlying cash flows designated in the Hedge relationship as of inception date. The hypothetical derivative is constructed using the market-quoted foreign exchange rates and interest rate curves prevailing as of inception on the pay EUR leg and a computed fixed rate on the receive INR leg. The computed fixed rate is such that it makes the net present value of the hypothetical derivative zero as of inception date.
There is an economic relationship between the hedged items and the hedging instruments. The Company has established a hedge ratio of 1:1 for the hedging relationships. To test the hedge effectiveness, the Company uses the hypothetical derivative method and Dollar offset method.
The hedge ineffectiveness can arise from :-
(i) Differences in the timing of the cash flows.
(ii) Different indexes (and accordingly different curves).
(iii) The counterparties''credit risk differently impacting the fair value movements.
(c) The above includes a sum of '' 159 lakhs (previous year: '' 162 lakhs) as contribution to a trust Avvashya Foundation, (where key managerial personnel and relatives are able to exercise significant influence) (refer note 29B)
(d) As per the rules contained and notified under Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 as at March 31, 2021 the Company do not have any unspent Corporate Social Responsibility amount which needs to be transferred to a separate account maintained with scheduled bank within a period of 30 days from the end of financial year.
Disclosure of segment reporting as per the requirements of Ind AS 108 âOperating Segmentâ is reported in the consolidated financial statements of the Company. Therefore, the same has not been separately disclosed in the standalone financial statements in line with the requirement of Ind AS 108.
35 Amalgamation of Hindustan Cargo Limited
The Board of Directors in their meeting held on November 08, 2019, approved the Scheme of Amalgamation (Merger by Absorption) under the Sections 230 to 232 of the Companies Act, 2013 of Hindustan Cargo Limited (a wholly owned subsidiary of the Company) with the Company and their respective shareholders, subject to the approval of the Hon''ble National Company Law Tribunal (NCLT) and other requisite approvals. The final hearing and approval of the said Scheme is pending before the Hon''ble NCLT and accordingly, the merger has not been given effect
in the current financial statements.
36 Delisting of Allcargo Logistics Limited
The Company vide its letter dated August 24, 2020 has intimated BSE Limited and National Stock Exchange of India Limited (the âStock Exchangesâ) that it has received delisting proposal letter from Shashi Kiran Shetty and Talentos Entertainment Private Limited, members of the Promoter and the Promoter group company, wherein they have expressed the intention to, either individuaMy/coMectively or together with other members of the Promoter group, to acquire all the equity shares of the Company held by the public shareholders of the Company and voluntarily delist the equity shares of the Company from the Stock Exchanges, in terms of the applicable provisions of the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, as amended (the âSEBI Delisting Regulationsâ). Subsequently, the Board of Directors in their meeting held on September 5, 2020 and Shareholders vide postal ballot e-voting results dated October 21, 2020, have approved the delisting proposal. The floor price of the delisting Offer is ''92.58 per Equity Share which is determined in accordance with Regulation 15(2) of the SEBI Delisting Regulations read with Regulation 8 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.
37 Acquisition of Gati Limited
During the previous year ended March 31, 2020 the Company had acquired 20.83% stake for '' 19,449 lakhs in the equity of Gati Limited which had based on management assessment and legal opinion obtained,
been accounted as investment in associate as at March 31,2020. The Company had deposited '' 23,807 lakhs in open offer escrow account for open offer which was closed on March 27, 2020. On April 11, 2020, the Company acquired additional 3,17,42,615 equity shares tendered in open offer for consideration of '' 23,807 lakhs thereby increasing its stake in the equity of Gati Limited to 46.86%. Considering the widespread shareholding of Gati Limited read together with the substantive rights in the Share Purchase Agreement (SPA) and Share Subscription Agreement (SSA) entered into with the erstwhile promoter of Gati Limited, the Company had obtained control over Gati Limited and the same has been accounted for as investment in subsidiary.
38 Post closure of the financial year ended March 31, 2021, in accordance with approval of the Board of Directors of the Company in its meeting held on Friday, June 11, 2021, the Company has subscribed and Gati Limited has allotted 10,23,020 Equity Shares of face value of '' 2 each (âEquity Sharesâ) at a price of '' 97.75/- per Equity Share at a premium of '' 95.75/-per Equity Share, aggregating up to ''1,000 lakhs and 71,61,120 Equity Warrants at a Price of '' 97.75/- per Equity Warrants with the right to apply for and be allotted 1 (One) Equity Share of the face value of '' 2/- each of Gati Limited at a premium of '' 95.75/- per equity share for each Equity warrant within a period of 18 (Eighteen) months from the date of allotment of the warrants, aggregating up to '' 7,000 lakhs to the Company, being the Promoter of Gati Limited on Preferential issue basis in accordance with Chapter V of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 (âSEBI ICDR Regulationsâ), as amended, and in compliance with applicable laws and regulations.
39 As approved by the Board of directors in its meeting held on March 15, 2021, the Company is selling its 100% equity stake in its wholly owned subsidiary company namely Bantwal Warehousing Pvt Ltd for '' 169 lakhs. The definitive transaction documents i.e Share Purchase Agreement is yet to be executed as on the date of signing the accounts. It has been classified as asset held for sale in the financials as prescribed in Ind AS - 105 âNon-current Assets Held for Sale and Discontinued Operations.
40 The Board of directors of the Company in its meeting held on June 11, 2021 has approved and given its consent to the scheme of demerger under Sections
230 to 232 and other applicable provisions of the Companies Act, 2013 whereby the contract logistics business of its joint venture entity namely Avvashya CCI Logistics Private Limited will get transferred to Avvashya Supply Chain Private Limited (formerly known as South Asia Terminals Private Limited) a wholly owned subsidiary of the Company, on the going concern basis with mirror shareholding, subject to the approval of the National Company Law Tribunal and other requisite approvals .
41 (a) During the previous year ended March 31, 2020
the Board of Directors of the Company in their meeting held on November 8, 2019 has approved the restructuring involving transfer of warehouses and other assets of Logistics Park Business (âBusiness Undertaking'') of the Company to its wholly owned subsidiaries (âWOS''). The Company thereafter transferred the Business Undertakings under slump sale arrangement to four of its WOS namely Malur Logistics and Industrial Parks Private Limited, Allcargo Logistics & Industrial Park Private Limited, Madanahatti Logistics and Industrial Parks Private Limited and Venkatapura Logistics and Industrial Parks Private Limited under a Business Transfer Agreement (BTA). Thereafter the Company executed agreements with Malur Logistics and Industrial Parks Private Limited, Allcargo Logistics & Industrial Park Private Limited, Madanahatti Logistics and Industrial Parks Private Limited, Venkatapura Logistics and Industrial Parks Private Limited, Kalina Warehousing Private Limited, Panvel Warehousing Private Limited (together referred to as âSpecified WOSâ) and BRE Asia Urban Holdings Ltd (âthe Investorâ) for carrying out the business of warehousing. Pursuant to the agreements, the Investor made an initial investment of '' 22,839 lakhs through debentures as well as '' 893 lakhs through equity acquisition in these Specified WOS except Venkatapura Logistics and Industrial Parks Private Limited. Accordingly from February 13, 2020, the Company divested its control in Madanahatti Logistics and Industrial Park Private Limited, Allcargo Logistics & Industrial Park Private Limited, Kalina Warehousing Private Limited and Panvel Warehousing Private Limited on a fully diluted basis and now retains a minority stake in these subsidiaries.
Also during the current year the Company has further received '' 6,050 lakhs from Madnahatti
Logistics and Industrial Park Private Limited Venktpura Logistics & Industrial Parks Private Limited as well as from Allcargo Logistics and Industrial Park Private Limited towards release of its previous held equity interests (which was held in the form of shareholders'' loan and which was converted in the form of debentures as per terms and conditions mentioned in the definitive transaction documents) in these companies.
(b) As per the original understanding and as per the terms and conditions mentioned in the definitive transaction documents the transaction was expected to conclude in a phase wise manner within a period of 12 months, subject to the satisfaction of customary closing conditions and achievement of certain milestones (together the âconditions precedent'') as prescribed in the agreements. But due to outbreak of Coronavirus (COVID-19) pandemic globally and in india the time limits earlier defined in the agreements have been further extended between the Company and the Investor by mutual agreement and consent. Hence as at March 31, 2021, the Company still holds controlling stake over Malur Logistics and Industrial Parks Private Limited and Venkatapura Logistics and Industrial Parks Private Limited.
(c) The aforesaid agreements with the Specified WOS states that if condition precedent specified therein are not satisfied within the period stipulated (including extensions obtained from Investor), the Company together with the Specified WOS shall acquire the debentures and equity held by the Investor in the specified WOS together with 16% interest in accordance with the terms and conditions of the agreements and in the event of failure of which the Investor will be entitled to exercise the Investor''s Put Option as set out therein. During the previous year management has performed the investors put option valuation from an independent valuer and has assigned the appropriate probability to it as per its best estimate and has arrived at its value of '' 302 lakhs. Initial recognition has been accounted for as investment in the Specified WOS with corresponding creation of financial liability. During the current year the
management has re-assessed the investors put option valuation from independent valuer and it has been valued at '' 364 lakhs, the difference between initial recognition and the value arrived at the end of current year has been routed through as FVTPL in the statement of profit and loss.
(d) The aforesaid agreements also states that if certain condition precedent as specified therein are not satisfied within the period stipulated (including extensions obtained from Investor) the Investor has a call option to buy stake in certain WOS of the Company as per the terms mentioned therein. Management believes that there has been substantial progress on the accomplishment of the conditions precedent and they will be able to achieve the completion of the same within the agreed timelines.
On February 07, 2021, the Company experienced a cybersecurity incident related to ransomware. Certain online network systems relating to the Multimodal Transport Operation business of the Company and its overseas subsidiaries were impacted. The Company''s other business systems in India including Container Freight Station, Projects and Engineering, Warehouses and others were not affected. The Company could contain the incident in a timely basis and has also ensured that all traces of the infection are completely cleaned from the network. All affected systems were restored and brought back to normalcy closer to the year-end. Management have assessed the impact of the incident on the control environment and the financial statement process and conclude there was no material impact. Since then, the Company has also been focused on implementing significant improvements to its cyber and data security systems to safeguard from such risks in the future.
43 Estimation of uncertainties relating to Covid-19
(a) The Company as at the date of approval of these financial results has made assessment of possible impacts that may result from the COVID -19 pandemic on the carrying value of current and non-current assets considering the internal and external information
available as at the said date and to the extent possible. The Company, based on the above analysis and assumptions used, believes that the carrying value of these assets are recoverable and sufficient liquidity is available. The impact of COVID -19 may be different from the estimated as at the date of approval of these financial statements and the Company will continue to closely monitor any material changes to future economic conditions.
(b) The Company has received ground rent for the containers lying in its yard during the COVID-19 lockdown period in the earlier part of the current year.
The Company has deferred the recognition of the revenue in its statement of profit and loss account as the levy was challenged by way of a writ petition before the Delhi Court.
44 The Board of Directors in their meeting held on March 15, 2021 has declared Interim Dividend @ 100% i.e. ''2 per equity share of ''2 each.
Previous year figures have been regrouped/ reclassified, where necessary, to conform to this year''s classification.
Mar 31, 2018
1. Corporate Information
Allcargo Logistics Limited (the âCompanyâ) was incorporated on 18 August 1993 and is a leading multinational Company engaged in providing integrated logistics solutions and offers specialised logistics services across multimodal transport operations, inland container depot, container freight station operations, contract logistics operations and project and engineering solutions.
The Company is a public limited Company, domiciled in India and incorporated under the provisions of the Companies Act, 1956 and has its registered office at 6th floor, Avashya house, CST road, Kalina, Santacruz (east), Mumbai - 400098, Maharashtra, India. The Company is listed on BSE Limited and National Stock Exchange of India Limited.
The standalone financial statements were authorised for issue in accordance with a resolution of the directors on May 22, 2018.
2. Significant accounting policies
2.1 Basis of preparation
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (the âInd ASâ) notified under the Companies (Indian Accounting Standards) (Amendment) Rules, 2017 under the provisions of the Companies Act, 2013 (the âActâ) and subsequent amendments thereof. These financial statements are prepared under the historical cost convention on the accrual basis except for derivative financial instruments and certain other financial assets and liabilities which have been measured at fair value (refer accounting policy regarding financial instruments). The financial statements have been prepared on a going concern basis.
The financial statements are presented in INR and all values are rounded to the nearest lakhs (? 00,000) except when otherwise indicated.
Current versus non-current classification
The Company presents assets and liabilities in the balance sheet based on current / non-current classification.
An asset is treated as current when it is:
- expected to be realised in normal operating cycle or twelve months after reporting period,
- held primarily for the purpose of trading or
- cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period
All other assets are classified as non-current.
A liability is treated as current when it is:
- expected to be settled in normal operating cycle or within twelve months after reporting period,
- it is held primarily for the purpose of trading
- there is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period
All other liabilities as classified as non-current.
The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The Company has identified twelve months as its operating cycle.
Deferred tax assets and liabilities are classified as noncurrent assets and liabilities.
2.2 Significant accounting judgements, estimates and assumptions:
The preparation of the Companyâs financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Some of the significant accounting judgement and estimates are given below:
Revenue recognition
The Company uses percentage of completion method in accounting of revenue for project division which includes rendering of end to end logistics services comprising of activities related to consolidation of cargo, transportation, freight forwarding and customs clearance services. Use of the percentage of completion method requires the Company to estimate the efforts or costs expended to date as a proportion of the total efforts or costs to be expended. Percentage of completion is arrived at on the basis of proportionate costs incurred to date of total estimated costs, milestones agreed or any other suitable basis, provided there is a reasonable completion of activity and provision of services. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the expected contract estimates at the reporting date.
Operating lease commitments - Company as lessee
The Company has entered into commercial property leases for its offices and premises. The Company has determined, based on an evaluation of the terms and conditions of the arrangements, such as the lease term not constituting a major part of the economic life of the commercial property and the fair value of the asset, that it retains all the significant risks and rewards of ownership of these properties and accounts for the contracts as operating leases.
Defined benefit plans (gratuity benefits)
The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. All assumptions are reviewed at each reporting date.
The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries. The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes.
Fair value measurement of financial instruments
When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. See Note 32 for further disclosures.
Property, plant and equipment
Property, plant and equipment represent a significant proportion of the asset base of the Company. The charge in respect of periodic depreciation is derived after determining an estimate of an assetâs expected useful life and the expected residual value at the end of its life. The useful lives and residual values of Company assets are determined by management at the time the asset is acquired and reviewed periodically, including at each financial year end. The lives are based on historical experience with similar assets.
Taxes
MAT credit is earned by the Company when the normal tax payable as per taxable profit is less than the MAT payable as per book profits. MAT credit earned is the difference between the MAT paid and normal tax payable.
Significant judgement is required to check the utilization of the MAT credit based on the likely growth in profitability of the Company and the likely additions made to the property, plant and equipment upto the expiry of the MAT credit earned.
Provision for tax liabilities require judgements on the interpretation of tax legislation, developments in case law and the potential outcomes of tax audits and appeals which may be subject to significant uncertainty. Therefore the actual results may vary from expectations resulting in adjustments to provisions, the valuation of deferred tax assets, cash tax settlements and therefore the tax charge in the Statement of Profit or Loss
The underlying land plot is valued independently based on the sales comparison/ market survey of plots listed on the market for sale and building on the plot are valued for their depreciated construction cost.
In order to maximise use of relevant observable inputs and minimising use of unobservable inputs, Fair Value of the building is considered to be best reflected as a Summation of the Land Value estimated using Sales comparison approach and depreciated cost of improvements using the cost approach.
Terms/ rights attached to equity shares
The Company has only one class of equity shares having par value of Rs.2 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the 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 remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
The Board of Directors in its meeting held on 22 May 2018 proposed dividend of Rs.2 per equity share, subject to the approval of the shareholders in the ensuing Annual General Meeting.
Term loans from banks
Rupee term loans from banks are secured against property, plant and equipment and carry interest ranging from 8.00% - 9.10% p.a. (31 March 2017: 8.30% - 9.10% p.a.) and are repayable within a period ranging from 2-5 years.
Buyersâ Credit
Buyersâ credit is secured against heavy equipmentâs financed by the Bank and carry interest rate of 8.25% p.a. (31 March 2017: 8.25% p.a.) and are repayable within a period ranging from 2-3 years.
Vehicle finance loans
Vehicle finance loans are secured against vehicle financed by the Bank and carry interest ranging from 9.00% -9.50% p.a. (31 March 2017: 9.00% - 9.50% p.a.) and are repayable within a periods ranging from 3-5 years.
Cash credits from banks
Cash credit facilities from banks carried interest ranging from 10.00% - 11.00% p.a. (31 March 2017: Nil) computed on a monthly basis on the actual amount utilised, and are repayable on demand. These are secured against immovable property situated in Mumbai, pari pasu charge on present and future movable assets, inventories and book debts.
Commercial paper
Commercial paper facilities carry interest ranging from 6.42% - 7.60% p.a. (31 March 2017: 6.55% - 7.00%) p.a. and are repayable over a period of 60 to 363 days.
Loan covenants
Term loans from banks contain certain debt covenants to be maintained at a group level relating to limitation on indebtedness, debt-equity ratio, net borrowings to EBITDA ratio and debt service coverage ratio. The limitation on indebtedness covenant gets suspended if the Company meets certain prescribed criteria. The debt covenant related to limitation on indebtedness remained suspended as of the date of the authorisation of the financial statements. The Company has also satisfied all other debt covenants prescribed in the terms of bank loan. The other loans do not carry any debt covenant.
* No amount due and outstanding to be credited to Investor Education and Protection Fund.
** The Company entered into interest rate swap & foreign exchange forward contract with the intention of reducing the floating interest risk and foreign exchange risk on buyersâ credit. These contracts are not designated in hedge relationship and are measured at fair value through profit and loss.
Based on the conclusion of a strategic review of the portfolio businesses, the Company concluded that it had no immediate plans to pursue business in its two wholly owned subsidiaries, Transindia Logistic Park Private Ltd (âTLPPLâ) and South Asia Terminals Private Ltd (âSATPLâ). These companies have transferred their Container Freight Station CCFS1)/ Inland Container Depot (âICDâ) business to the Company in financial year 2016-17 and 2017-18, respectively. Accordingly, the Company has booked an impairment of Rs.4,847 lakhs on investment of TLPPL and Rs.608 lakhs on loan given to SATPL.
3 Net employment defined benefit liabilities
(a) Defined Contributions Plans
For the Company an amount of Rs.448 lakhs (31 March 2017: Rs.412 lakhs) contributed to provident funds (refer note 20) is recognised by as an expense and included in âContribution to Provident fundâ under âEmployee benefits expenseâ in the Statement of Profit and Loss.
(b) Defined Benefit Plans
As per the Payment of Gratuity Act, 1972, the Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on resignation or retirement at 15 days salary (last drawn salary) for each completed year of service.
The following tableâs summaries the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the respective plans of the Company.
4 Leases
Operating lease commitments - Company as lessee
The Company has taken certain commercial properties and equipments on non-cancellable operating lease. The lease agreement provides for an option to the Company to renew the lease period at the end of non-cancellable period.
The Company paid Rs.9 lakhs (31 March 2017: Rs.113 lakhs) during the year towards minimum lease payment.
There are no exceptional / restrictive covenants in the lease agreements.
Future minimum rentals payable under non-cancellable operating leases as at 31 March 2018 are as follows:
Operating lease commitments - Company as lessor
The Company has given certain warehouse and commercial properties on operating lease. However, the same is on cancellable leases, as both the party has an option to cancel by giving required notice period.
(i) Matters relating to section 80 IA (4) of the Income Tax Act, 1961 pending at Supreme Court
The Income Tax Department had issued assessment orders against the Company, whereby, the claim of deductions under section 80-IA (4) was disallowed from assessment years 2004-05 to 2009-10 and a demand of Rs.6,729 lakhs was raised on the Company. The Company thereby filed an appeal against the said assessment orders. The Income Tax Appellate Tribunal (âITAT) vide its order dated 05 December 2012 upheld the Companyâs position and accordingly the Company continued to claim deduction u/s 80 IA (4) of the Income Tax Act, 1961. Subsequently, on 31 May 2013, the Department filed an appeal with the Honâble Bombay High Court against the order of the ITAT. The Honâble Bombay High Court vide its order dated 21 April 2015 upheld the view taken by the ITAT and accordingly dismissed the appeals filed by the Revenue Authority and passed the order favouring the Company. On 16 October 2015, the Department has filed an appeal with the Honâble Supreme Court against the Bombay High Court order which got admitted in Supreme court on 14 November 2017.
Currently, the hearing proceedings are in process. Recently Honâble Supreme Court, in the similar case of Commissioner of income tax, Delhi-1 Vs M/s Container Corporation of India Ltd (âCCIâ) 2018-TIOL-170-SC-IT passed a judgment in favour of assesse stating that Inland Container Depotâ (ICD) / Container freight station (CFS) are included in the expression of âInland Portâ, hence eligible for deduction u/s 80-IA(4).
The Company has reviewed all its pending litigations and proceedings and has adequately created provisions wherever required and disclosed as contingent liability, where applicable in the financial statements. The Companyâs management does not reasonably expect that these legal actions, when ultimately concluded and determined, will have a material and adverse effect of the Companyâs results of operations or financial condition.
5 Dues to Micro and small Suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from 02 October 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises. The information given is based on the information available with the Company and has been relied upon by the auditors.
6 Related party disclosures
A Name of related parties
(i) Related parties where control exists - Subsidiaries (direct and indirect) Direct subsidiaries
Hindustan Cargo Limited
Contech Logistics Solutions Private Limited (formerly known as Contech Transport Services Private Limited)
Allcargo Inland Park Private Limited (formerly known as Transindia Inland Park Private Limited (formerly known as Ecu Line (India) Private Limited))
Allcargo Shipping Company Private Limited South Asia Terminals Private Limited AGL Warehousing Private Limited Ecu International (Asia) Private Limited Transindia Logistic Park Private Limited Combi Line Indian Agencies Private Limited Acex Logistics Limited
Allcargo Multimodal Private Limited (formerly known as Transindia Warehousing Private Limited) Allcargo Terminals Private Limited Altcargo Oil & Gas Private Limited Allcargo Belgium N.V.
Indirect subsidiaries
Comptech Solutions Private Limited Ecu-Line Algerie Sarl
Ecu Worldwide (Argentina) SA (formerly known as
Ecu Logistics SA)
Ecu Worldwide Australia Pty Limited (formerly known as Ecu-Line Australia Pty Limited)
Integrity Enterprises Pty Limited
Ecu Worldwide (Belgium) (formerly known as Ecu-
Line N.V)
Ecu-Logistics N.V.
FMA-Line Holding N. V. (formerly known Ecubro
N.V.)
Ecuhold N.V.
Ecu International N.V.
Ecu Global Services N.V.
HCL Logistics N.V.
European Customs Brokers N.V.
AGL N.V.
Ecu Worldwide Logistics do Brazil Ltda (formerly known as Ecu Logistics do Brasil Ltda.)
Ecu Worldwide (Canada) Inc. (formerly known as
Ecu-Line Canada Inc).
Ecu Worldwide (Chile) S.A (formerly known as Ecu-
Line Chile S.A)
Flamingo Line Chile S.A.
Ecu Worldwide (Guangzhou) Limited (formerly
known as Ecu-Line Guangzhou Limited)
China Consolidation Services Shipping Limited Ecu Worldwide China Limited (formerly known as China Consolidation Services Limited)
Ecu Worldwide (Colombia) S.A.S.(formerly known
as Ecu-Line de Colombia S.A.S)
Ecu Worldwide Costa Rica S.A.(formerly known as Conecli International S.A)
Ecu Worldwide (Cyprus) Limited (formerly known as Ecu-Line Mediterranean Limited)
ECU Worldwide (CZ) s.r.o. (formerly known as Ecu-
Line (CZ) s.r.o).
Ecu - Worldwide - (Ecuador) S.A.(formerly known as Ecu-Line del Ecuador S.A.)
Flamingo Line del Ecuador SA
Ecu World Wide Egypt Limited (formerly known as
Ecu Line Egypt Limited)
Ecu Worldwide (El Salvador) S.P. Z.o.o S.A. de CV (formerly known as Flamingo Line El Salvador SA
de CV)
ECU Worldwide (Germany) GmbH (formerly known
as Ecu-Line Germany GmbH)
ELWA Ghana Limited
Ecu Worldwide (Guatemala) S.A.(formerly known as Flamingo Line de Guatemala S.A.)
Ecu Worldwide (Hong Kong) Limited (formerly known as Ecu-Line Hong Kong Limited)
Ecu International Far East Limited
CCS Shipping Limited
PT Ecu Worldwide Indonesia
PT EKA Consol Utama Line
Ecu Worldwide Italy S.r.l. (formerly known as Ecu-Line Italia S.r.l.)
Eurocentre Milan S.r.l.
Ecu Worldwide (Cote dâIvoire) Sarl (formerly known as Ecu-Line Cote dâIvoire Sarl)
Ecu Worldwide (Japan) Limited (formerly known as
Ecu-Line Japan Limited)
Jordan Gulf for Freight Services and Agencies Company LLC
Ecu Worldwide (Kenya) Limited (formerly known as
Ecu-Line Kenya Limited)
Ecu Shipping Logistics (K) Limited
Ecu Worldwide (Malaysia) Sdn. Bhd. (formerly known as Ecu-Line Malaysia Sdn. Bhd.)
Ecu-Line Malta Limited
Ecu Worldwide (Mauritius) Limited (formerly known as Ecu-Line Mauritius Limited)
CELM Logistics SA de CV
Ecu Worldwide Mexico (formerly known as Ecu Logistics de Mexico SA de CV)
Ecu Worldwide Morocco (formerly known as Ecu-Line Maroc S.A.)
Ecu Worldwide (Netherlands) B.V.(Ecu-Line Rotterdam B.V.)
Rotterdam Freight Station B.V.
FCL Marine Agencies B.V.
Ecu Worldwide New Zealand Limited (formerly known as Ecu-Line NZ Limited)
Ecu Worldwide (Panama) S.A (formerly known as Ecu-Line de Panama S.A.)
Ecu-Line Paraguay S.A.
Flamingo Line del Peru S.A.
Ecu-Line Peru S.A.
Ecu Worldwide (Philippines) Inc.(formerly known as
Ecu-Line Philippines Inc.)
Ecu Worldwide (Poland) SP.Z.o.o. (formerly known
as Ecu-Line Polska SP. Z.o.o.)
Ecu-Line Doha W.L.L.
Ecu Worldwide Romania S.r.l. (formerly known as Ecu-Line Romania S.r.l.)
Ecu-Line Saudi Arabia LLC
Ecu - Worldwide (Singapore) Private Limited (formerly known as Ecu-Line Singapore Private Limited)
Ecu Worldwide (South Africa) Private Limited (formerly known as Ecu-Line (South Africa) Private Limited)
Ecu-Line Spain S.L.
Mediterranean Cargo Center S.L. (MCC)
ECU Worldwide Lanka (Private) Limited (formerly
known as Ecu Line Lanka (Private) Limited)
Ecu-Line Switzerland GmbH
Ecu Worldwide (Thailand) Company Limited
(formerly known as Ecu-Line (Thailand) Company
Limited)
Societe Ecu-Line Tunisie Sarl Ecu Worldwide Turkey Tajimacilik Limited §irketi (formerly known as Ecu Uluslarasi Tas. Ve Ticaret Ltd. Sti.)
Ecu-Line Middle East LLC Ecu-Line Abu Dhabi LLC Eurocentre FZCO
China Consolidated Company Limited
Star Express Company Limited
Ecu Worldwide (UK) Limited (formerly known as
Ecu-Line UK Limited)
Ecu Worldwide (Uruguay) S.A. (formerly known as DEOLIX S.A.)
CLD Compania Logistica de Distribucion SA
Guldary S.A.
PRISM GLOBAL, LLC
Econocaribe Consolidators, Inc.
Econoline Storage Corp.
ECI Customs Brokerage, Inc.
OTI Cargo, Inc.
Ports International, Inc.
Administradora House Line C.A.
Consolidadora Ecu-Line C.A.
Ecu Worldwide Vietnam Company Limited (formerly known as Ecu-Line Vietnam Company Limited)
Ocean House Ltd.
Ecu-Line Zimbabwe Private Limited Asia Line Limited
Contech Transport Services (Private) Limited Prism Global Limited (formerly known as Ecu Line Limited)
FMA-LINE France S.A.S.
Allcargo Logistics LLC
Eculine Worldwide Logistics Company Limited
FMA-LINE Nigeria Limited
Ecu Worldwide (Uganda) Limited
FMA Line Agencies Do Brasil Limited
FCL Marine Agencies Belgium B.V.B.A.
Centro Brasiliero de Armazenagem E Distribuigao Ltda (Bracenter)
Allcargo Hongkong Limited (formerly known as
Oconca Shipping (HK) Limited)
Oconca Container Line S.A. Limited General Export S.r.l.
Almacen y Maniobras LCL SA de CV
ECU WORLDWIDE SERVICIOS SA DE CV
Ecu Trucking Inc
ECU Worldwide CEE S.r.l.
FMA Line SA (Private) Limited
(ii) Other related parties
I. Associates (direct and indirect)
Direct associates -
Allcargo Logistics Lanka (Private) Limited
Indirect associates -
FCL Marine Agencies Gmbh (Hamburg)
FCL Marine Agencies Gmbh (Bermen)
II. Joint ventures (direct and indirect)
Direct joint venture -
Transnepal Freight Services Private Limited Avvashya CCI Logistics Private Limited (formerly known CCI Integrated Logistics Private Limited) Allcargo Logistic Park Private Limited Indirect joint venture -Fasder S.A.
Ecu Worldwide Peru S.A.C.(formerly known as Ecu
Logistics Peru SAC)
(iii) Entities over which key managerial personnel or their relatives exercises significant influence:
Allnet Infotech Private Limited
Panna Estates LLP
Sealand Crane Private Limited
Talentos (India) Private Limited
Maneksha & Sethna
Avashya Foundation Trust
Shloka Shetty Trust
Allcargo Movers (Bombay) LLP
Avadh Marketing LLP
Avash Builders and Infrastructure Private Limited
Contech Estate LLP
Transindia Freight LLP
Meridien Tradeplace Private Limited
Transindia Freight Services Private Limited
(iv) Key managerial personnel
Mr. Shashi Kiran Shetty*
Mr. Adarsh Hegde Mrs. Arathi Shetty Mr. Hari Mundra Mr. Keki Elavia Mr. Mohinder Pal Bansal
Mr. Kaiwan Kalyaniwalla (w.e.f. 10 August 2016) Prof. J.Ramachandran Mr. Jatin Chokshi
Mr. Shailesh Dholakia (upto 30 June 2016)
Ms. Shruta Sanghavi (w.e.f. 07 November 2016)
(v) Relatives of Key Management Personnel
Mr. Jatin Sanghavi Mr. Vaishnav Kiran Shetty Mr. Umesh Kumar Shetty Ms. Zarna Chokshi Ms.Usha Shetty Ms.Subhashini Shetty Ms.Shobha Shetty Ms.Bhavna Chokshi Ms.Asha Shetty
* Person having controlling interest in the entity.
Terms and conditions of trade transactions with related parties
The services provided to and services received from related parties are made on terms equivalent to those that prevail in armâs length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash.
7 Fair value hierarchy
The following table provides the fair value measurement hierarchy of the Companyâs financial assets and liabilities.
The management assessed that cash and cash equivalents, trade receivables, trade payables, shortterm borrowings, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.
8 Financial risk management objectives and policies
The Companyâs activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Companyâs primary risk management focus is to minimize potential adverse effects of market risk on its financial performance. The Companyâs risk assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the policies and processes. Risk assessment and policies and processes are reviewed regularly to reflect changes in market conditions and the Companyâs activities. The Board of Directors and the management is responsible for overseeing the Companyâs risk assessment and policies and processes.
Market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, all foreign currency receivables and payables and all short term and long-term debt. The Company is exposed to market risk primarily related to foreign exchange rate risk and interest rate risk. Thus, the Companyâs exposure to market risk is a function of investing and borrowing activities and itâs revenue generating and operating activities.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs long-term debt obligations with floating interest rates.
The Companyâs policy is to keep maximum of its borrowings at fixed rates of interest. To manage this, the Company enters into interest rate swaps, in which it agrees to exchange, at specified intervals, the difference between fixed and variable rate interest amounts calculated by reference to an agreed-upon notional principal amount. At 31 March 2018, after taking into account the effect of interest rate swaps, 100% of the Companyâs borrowings are at a fixed rate of interest (31 March 2017: 100%).
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates relates primarily to the Companyâs operating activities (when revenue or expense is denominated in a foreign currency) and the Companyâs foreign currency borrowings.
The Company hedges its exposure of net borrowings in foreign currencies by using foreign currency swaps and forwards. These foreign exchange forward contracts are not designated as cash flow hedges and are entered into for the periods consistent with the foreign currency exposure of the underlying transactions.
Unhedged foreign currency exposures
As at balance sheet date, the Companyâs net foreign currency exposure (payable) that is not hedged is Rs.190 lakhs (31 March 2017: Rs.366 lakhs).
Foreign currency sensitivity
For the year ended 31 March 2018 and 31 March 2017, every 5% depreciation / appreciation in the exchange rate between the Indian rupee and U.S. dollar, would have affected the Companyâs incremental operating margins by approximately Rs.18 lakhs and Rs.18 lakhs each (net). The Companyâs exposure to foreign currency changes for all other currencies is not material.
The impact on the Companyâs profit before tax is due to changes in the fair value of monetary assets and liabilities. There is no impact on the Companyâs pre-tax equity as there are no forward exchange contracts designated as cash flow hedges or net investment hedges.
Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Trade receivables
Customer credit risk is managed by each business unit subject to the Companyâs established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. The Company has diversified customer base considering the nature and type of business.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 7.3. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
Liquidity risk
The Companyâs objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and commercial papers. 48% of the Companyâs borrowing will mature in less than one year at 31 March 2018 (31 March 2017: 52%) based on the carrying value of borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Companyâs performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Companyâs policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
Capital management
The Companyâs objective for Capital Management is to maximise shareholderâs value, support the strategic objectives of the Company. The Company determines the capital requirements based on its financial performance, operating and long term investment plans. The funding requirements are met through operating cash flows generated.
9 Investment in joint venture
During the previous year ended 31 March 2017, the Company, Hindustan Cargo Limited (âHCLâ), a wholly owned subsidiary and Avvashya CCI Logistics Private Limited (âACCIâ) had entered into joint venture arrangement. Pursuant to the arrangement, the Company transferred with effect from 18 July, 2016, its contract logistics business with book value of Rs.2,045 lakhs to ACCI for 6.63% shares in ACCI and recorded loss of Rs.84 lakhs. Additionally, the Company acquired 43.93% shares in ACCI for a consideration of Rs.13,000 lakhs.
Further, HCL transferred with effect from 18 July, 2016, its freight forwarding business with book value of Rs.3,389 lakhs to ACCI for 10.57% shares in ACCI and recorded loss of Rs.260 lakhs. Post this transaction, the Company and HCL in aggregate owns 61.13% shares in ACCI.
10 Slump sale
In the previous year, on January 01, 2017, the Company and Transindia Logistic Park Private Limited (âTLPPLâ, a wholly owned subsidiary of the Company) completed transfer of Container Freight Station business undertaking of TLPPL situated at Nhavasheva, on slump sale, after completing all regulatory and other formalities. Book value of net assets transferred from TLPPL to the Company is Rs.8,050 lakhs.
11 Accounting pronouncements:
Ind AS 115 Revenue from Contracts with Customers
Ind AS 115 was notified on 28 March 2018 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.
The new revenue standard will supersede all current revenue recognition requirements under Ind AS. Either a full retrospective application or a modified retrospective application is required for annual periods beginning on or after 1 April 2018. The Company will adopt the new standard on the required effective date using the modified retrospective method. The Company has established an implementation team to implement Ind AS 115 related to the recognition of revenue from contracts with customers and it continues to evaluate the changes to accounting system and processes, and additional disclosure requirements that may be necessary. A reliable estimate of the quantitative impact of Ind AS 115 on the financial statements will only be possible once the implementation project has been completed.
12 Corporate social responsibility
As per section 135 of the Act, a CSR committee has been formed by the Company. The funds are utilised throughout the year on activities which are specified in Schedule VII of the Act. The utilisation is done either by way of direct contribution towards various activities or by way of contribution to a trust - Avvashya Foundation.
(a) Gross amount required to be spent by the Company during the year: Rs.281 lakhs (previous year: Rs.248 lakhs)
(b) The areas of CSR activities and contributions made thereto are as follows:
(c) The above includes a sum of Rs.168 lakhs (previous year: Rs.156 lakhs) as contribution to a trust Avvashya Foundation, (where key managerial personnel and relatives are able to exercise significant influence) (refer note 31)
13 Segment reporting
Disclosure of segment reporting as per the requirements of Ind AS 108 âOperating Segmentâ is reported in the consolidated financial statements of the Company. Therefore, the same has not been separately disclosed in the standalone financial statements in line with the requirement of Ind AS 108.
14 Events after reporting period
The Board at its meeting held on 02 May 2018, has approved development of the Logistics Park, at District Jhajjar, Haryana, subject to the requisite regulatory and other approvals. For this purpose, the Company through its wholly owned subsidiaries (âWOSâ), viz. Allcargo Multimodal Private Limited and Allcargo Inland Park Private Limited has acquired freehold land parcels admeasuring 93 acres for setting up warehouse(s) and Inland Container Depot(s). Further, lease hold land admeasuring 28 acres will be taken for rail link connectivity.
15 Previous year figures
Previous year figures have been regrouped/reclassified, where necessary, to conform to this yearâs classification.
Mar 31, 2017
1 Under the previous GAAP, the Company has created provision for impairment of receivables based on ageing analysis of receivables and specific identification of doubtful amounts. Under Ind AS 109, impairment allowance has been determined based on expected credit loss model (ECL).
2 Under previous GAAP, short-term investments were carried at cost. Under Ind AS, short-term investments are carried at fair value through profit and loss.
3 Under previous GAAP, proposed final dividend including DDT was recognized as liability in the period in which the dividend was proposed by the Board of Directors. Under Ind AS, this liability is recognized in the period in which the Companyâs shareholders ratify the proposal of the Board of Directorâs.
4 Under Ind AS, rent expenses on land taken on operating lease is recognized as an expenses on a straight - line basis over the lease term. Under previous GAAP, there was no requirement to straight-line the lease rentals on land.
5 Other adjustments mainly consists of amortization of deferred lease income / expense on security deposits given and accepted, adjustments on account of fair value of corporate guarantee fees for guarantees given on behalf of subsidiaries.
6 Adjustments to deferred taxes has been made in accordance with Ind AS, for the above mentioned line items.
7 Adjustments for prior period error in deferred tax computation.
8 Pursuant to the disclosure requirements as per Ind AS, the Company has re-classified certain assets and liabilities as at 01 April 2015 and 31 March 2016. Significant reclasses includes, reclassification between Deferred tax assets and Income tax assets, Non-current investment and Investment Property, Security deposits and prepayments, other current liabilities and financial liabilities.
9. Net employment defined benefit liabilities
10. Defined Contributions Plans
For the Company an amount of Rs.412 lakhs ( 31 March 2016: Rs.440 lakhs) contributed to provident funds (refer note 19) is recognized by as an expense and included in âContribution to Provident fundâ under âEmployee benefits expenseâ in the Statement of Profit and Loss.
11. Defined Benefit Plans
As per the Payment of Gratuity Act, 1972, the Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on resignation or retirement at 15 days salary (last drawn salary) for each completed year of service.
The following tableâs summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the respective plans of the Company.
12. During the year, the Company has issued letters of undertakings to provide need based unconditional financial support to its following subsidiaries/Joint Venture:
13. Combi Line Indian Agencies Private Limited
14. Ecu Line (India) Private Limited
15. South Asia Terminals Private Limited
The Company has reviewed all its pending litigations and proceedings and has adequately created provisions wherever required and disclosed as contingent liability, where applicable in the financial statements. The Companyâs management does not reasonably expect that these legal actions, when ultimately concluded and determined, will have a material and adverse effect of the Companyâs results of operations or financial condition.
16. Dues to Micro and small Suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from 02 October, 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises. The information given is based on the information available with the Company and has been relied upon by the auditors. (Rs.in lakhs)
17. Related party disclosures
A. Name of related parties
18. Related parties where control exists - Subsidiaries (direct and indirect)
Direct subsidiaries
Hindustan Cargo Limited Acex Logistics Limited
Contech Logistics Solutions Pvt. Ltd (formerly known as Contech Transport Services Private Limited)
Ecu Line (India) Private Limited Allcargo Shipping Co.Private Limited Southern Terminal and Trading Private Limited AGL Warehousing Private Limited Transindia Logistic Park Private Limited Combi Line Indian Agencies Private Limited Allcargo Logistics LLC Allcargo Belgium N.V.
Indirect subsidiaries
Comptech Solutions Private Limited Amfin Consulting Private Limited ECU International (Asia) Private Limited Ecu-Line Algerie sarl
Ecu Worldwide (Argentina) SA (formerly known as Ecu Logistics SA)
Ecu Worldwide (Belgium) (formerly known as Ecu-Line N.V).
Ecu-Logistics N.V.
FMA-Line Holding N. V. (formerly known as Ecubro N.V.)
Ecu-Tech bvba (Liquidated on 13 September, 2016) Ecuhold N.V.
Ecu International N.V.
Ecu Global Services n.v.
HCL Logistics N.V.
AGL N.V.
Ecu Worldwide Logistics do Brazil Ltda (formerly known as Ecu Logistics do Brasil Ltda.)
Ecu-Line Bulgaria EOOD (ceased w.e.f. 01 January, 2016)
Ecu Worldwide (Poland) Sp zoo (formerly known as Ecu-Line Polska SP Z.o.o.)
Ecu-Line Doha W.L.L.
Ecu Worldwide Romania SRL (formerly known as Ecu-Line Romania SRL)
Ecu - Worldwide (Singapore) Pte. Ltd (formerly known as Ecu-Line Singapore Pte. Ltd.)
Ecu Worldwide (South Africa) Pty Ltd (formerly known as Ecu-Line South Africa (Pty.) Ltd.)
Ecu-Line Spain S.L.
Mediterranean Cargo Center S.L. (MCC)
ECU Worldwide Lanka (Private) Ltd. (foremerly known as Ecu Line Lanka (Pvt) Ltd.)
Societe Ecu-Line Tunisie Sarl
Ecu Worldwide Turkey Tasimacilik Limited Sirketi (formerly known as Ecu Uluslarasi Tas. Ve Ticaret Limited Sti.)
China Consolidated Company Ltd.
Star Express Company Ltd
Ecu Worldwide (UK) Ltd (formerly known as Ecu-Line UK Ltd)
Ecu Worldwide (Uruguay) SA (formerly known as DEOLIX S.A.)
CLD Compania Logistica de Distribucion SA. Guldary S.A.
Administradora House Line C.A.
Ecu Worldwide (Mauritius) Ltd.(formerly known as Ecu-Line Mauritius Ltd.)
Asia Line Ltd
Consolidadora Ecu- Line C.A Ecu Shipping Logistics (K) Ltd.
Ecu-Line Middle East LLC
Ecu Worldwide (Malaysia) SDN. BHD. (formerly known as Ecu-Line Malaysia Sdn. Bhd.)
Eurocentre FZCO
Ecu-Line Hungary Kft. (liquidated on 08 December, 2016)
Ecu Worldwide (Kenya) Ltd (formerly known as Ecu-Line Kenya Ltd.)
Ecu-Line Abu Dhabi LLC
CCS Shipping Ltd.
Flamingo Line Del Peru SA
Ecu Worldwide (Chile) S.A (formerly known as Ecu-Line Chile S.A)
Flamingo Line Chile S.A.
Ecu Worldwide (Guangzhou) Ltd.(formerly known as Ecu-Line Guangzhou Ltd)
China Consolidation Services Shipping Ltd
Ecu Worldwide (CZ) s.r.o. (formerly known as Ecu-Line (CZ) s.r.o).
Ecu - Worldwide - (Ecuador) S.A.(formerly known as Ecu-Line del Ecuador S.A.)
Flamingo Line del Ecuador SA
Ecu World Wide Egypt Ltd (formerly known as Ecu Line Egypt Ltd.)
Ecu Worldwide (El Salvador) S.P Z.o.o S.A. de CV (formerly known as Flamingo Line El Salvador SA de CV)
Ecu Worldwide (Germany) GmbH (formerly known as Ecu-Line Germany GmbH)
ELWA Ghana Limited
Ecu Worldwide (Guatemala) S.A. (formerly Flamingo Line de Guatemala S.A.)
Ecu Worldwide (Hong Kong) Ltd.(formerly known as Ecu-Line Hong Kong Ltd.)
Ecu International Far East Ltd.
Contech Transport Services (Pvt) Limited
PT Ecu Worldwide Indonesia (formerly known as PT EKA Consol Utama Line)
Ecu Worldwide Italy S.r.l. (formerly known as Ecu-Line Italia srl.)
Eurocentre Milan srl.
Ecu Worldwide (Cote dâIvoire) sarl (formerly known as Ecu-Line Cote dâIvoire Sarl)
Jordan Gulf for Freight Services Agencies Co.LLC
Ecu-Line Malta Ltd.
CELM Logistics SA de CV
Ecu Worldwide Mexico (formerly known as Ecu Logistics de Mexico SAde CV)
Ecu Worldwide Morocco (formerly known as Ecu-Line Maroc S.A.)
Ecu Worldwide (Netherlands) B.V.(Ecu-Line Rotterdam BV)
Rotterdam Freight Station BV
Ecu Worldwide (Panama) SA (formerly Ecu-Line de Panama SA)
Ecu-Line Paraguay SA
Ecu Worldwide (Philippines) Inc. (formerly known as Ecu-Line Philippines Inc.)
Eculine Worldwide Logistics Co. Ltd. (Incorporated on 28 January, 2016)
Ecu Worldwide (Uganda) Limited (incorporated on 15 December, 2015)
Ecu-Line Zimbabwe (Pvt) Ltd.
Ecu-Line Peru SA
Ecu-Line Saudi Arabia LLC
Ecu Worldwide (Japan) Ltd. (formerly known as Ecu-Line Japan Ltd.)
S.H.E. Maritime Services Ltd. (Merged with ECU Worldwide (UK) Ltd. w.e.f. 01 May, 2015)
Ecu Worldwide Australia Pty Ltd (formerly known as Ecu-Line Australia Pty Ltd.)
Ecu Worldwide New Zealand Ltd (formerly known as Ecu-Line NZ Ltd.)
Ecu Worldwide (Thailand) Co. Ltd.(formerly known as Ecu-Line (Thailand) Co. Ltd.)
Ecu Worldwide (Cyprus) Ltd. (formerly known as Ecu-Line Mediterranean Ltd.)
Ecu Worldwide China (Shanghai) Ltd (formerly known as China Consolidation Services Ltd.)
Ecu-Line Switzerland GmbH
Ecu Worldwide Canada Inc (formerly known as Ecu-Line Canada Inc)
Cargo Freight Stations, SA
Ocean House Ltd.
Ecu Worldwide (Colombia) S.A.S.(formerly known as Ecu-Line de Colombia S.A.S)
Centro Brasiliero de Armazenagem E Distribuigao Ltda (Bracenter)
European Customs Broker N.V.
Ecu Worldwide Vietnam Co., Ltd.(formerly known as Ecu-Line Vietnam Co.Ltd)
Econocaribe Consolidators, Inc
OTI Cargo Inc
Ports International, Inc.
Econoline Storage Corp ECI Customs Brokerage, Inc Integrity Enterprises Pty Ltd PRISM Global, LLC FCL Marine Agencies B.V.
PRISM Global Ltd.
FMA-LINE France S.A.S.
Ecu Worldwide Costa Rica S.A.(formerly known as Conecli International S.A)
FMA-LINE Nigeria Ltd.(incorporated on 27 July, 2015)
FMA Line Agencies Do Brasil Ltda. (incorporated on 11 March, 2016)
FCL Marine Agencies Belgium bvba (subsidiary w.e.f. 07 September, 2016)
Oconca Shipping (HK) Ltd. (incorporated on 30 December, 2016)
Oconca Container Line S.A. Ltd. (incorporated on 30 December, 2016)
19. Other related parties
20. Associates (direct and indirect) Direct associates -
Allcargo Logistics Lanka (Private) Limited Indirect associates -
Gantoni General Enterprises Ltd.
FCL Marine Agencies Gmbh (Hamburg)
FCL Marine Agencies Gmbh (Bermen)
INEGA N.V OVCL Vietnam Ltd.
21. Joint ventures (direct and indirect)
Direct joint venture -
Transnepal Freight Services Private Limited
Avvashya CCI Logistics Private Limited (formerly known CCI Integrated Logistics Private Limited) (w.e.f. 29 June, 2016)
South Asia Terminals Private Limited Allcargo Logistic Park Private Limited
Indirect joint venture -
Fasder S.A.
Ecu Worldwide Peru S.A.C.(formerly known as Ecu Logistics Peru SAC)
22. Entities over which key managerial personnel or their relatives exercise significant influence:
Allnet Infotech Private Limited
Meridien Tradeplace Private Limited
Panna Estates LLP
Sealand Crane Private Limited
Talentos (India) Private Limited
Maneksha & Sethna
Avashaya Foundation Trust
23. Key managerial personnel Mr. Shashi Kiran Shetty*
Mr. Adarsh Hegde
Mrs. Arathi Shetty
Mr. Hari Mundra
Mr. Keki Elavia
Mr. Mohinder Pal Bansal
Mr. Kaiwan Kalyaniwalla (w.e.f 10 August, 2016)
Prof. J.Ramachandran Mr. Jatin Chokshi
Mr. Shailesh Dholakia (upto 30 June, 2016)
Ms. Shruta Sanghavi (w.e.f 07 November, 2016)
24. Relatives of Key Managerial Personnel
Mr. Jatin Sanghavi Mr. Vaishnav Kiran Shetty Mr. Umesh Kumar Shetty * Person having controlling interest in the entity.
25. Financial risk management objectives and policies
The Companyâs principal financial liabilities, other than derivatives, comprise of loans and borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to finance the Companyâs operations and to provide guarantees to support its operations. The Companyâs principal financial assets include loans, trade and other receivables, and cash and cash equivalents that derive directly from its operations. The Company also holds investments and enters into derivative transactions.
The Company is exposed to market risk, credit risk and liquidity risk. The Companyâs senior management oversees the management of these risks. The Companyâs senior management is supported by a financial risk committee that advises on financial risks and the appropriate financial risk governance framework for the Company. The financial risk committee provides assurance to the Companyâs senior management that the Companyâs financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companyâs policies and risk objectives. All derivative activities for risk management purposes are carried out by specialist teams that have the appropriate skills, experience and supervision. It is the Companyâs policy that no trading in derivatives for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.
Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments and derivative financial instruments.
The sensitivity analysis in the following sections relate to the position as at 31 March 2017 and 31 March 2016.
The sensitivity analysis have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant and on the basis of hedge designations in place at 31 March 2017.
The analysis exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions and the non-financial assets and liabilities.
The following assumptions have been made in calculating the sensitivity analysis:
- The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at 31 March 2017 and 31 March 2016.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs long-term debt obligations with floating interest rates.
The Company manages its interest rate risk by having a portfolio of fixed and variable rate loans and borrowings. The Companyâs policy is to keep maximum of its borrowings at fixed rates of interest. To manage this, the Company enters into interest rate swaps, in which it agrees to exchange, at specified intervals, the difference between fixed and variable rate interest amounts calculated by
Unhedged foreign currency exposures
As at balance sheet date, the Companyâs net foreign currency exposure (payable) that is not hedged is Rs.366 lakhs (31 March 2016: Rs.506 lakhs).
Foreign currency sensitivity
For the year ended 31 March 2017 and 31 March 2016, every 5% depreciation / appreciation in the exchange rate between the Indian rupee and U.S. dollar, would have affected the Companyâs incremental operating margins by approximately Rs.18 lakhs and Rs.25 lakhs each (net). The Companyâs exposure to foreign currency changes for all other currencies is not material.
The impact on the Companyâs profit before tax is due to changes in the fair value of monetary assets and liabilities. There is no impact on the Companyâs pre-tax equity as there are no forward exchange contracts designated as cash flow hedges or net investment hedges.
Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer reference to an agreed-upon notional principal amount. At 31 March 2017, after taking into account the effect of interest rate swaps, 100% of the Companyâs borrowings are at a fixed rate of interest (31 March 2016: 100%).
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates relates primarily to the Companyâs operating activities (when revenue or expense is denominated in a foreign currency) and the Companyâs foreign currency borrowings.
The Company hedges its exposure of net borrowings in foreign currencies by using foreign currency swaps and forwards. These foreign exchange forward contracts are not designated as cash flow hedges and are entered into for the periods consistent with the foreign currency exposure of the underlying transactions.
Particular of derivative contract outstanding as at the balance sheet date: contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.
Trade receivables
Customer credit risk is managed by each business unit subject to the Companyâs established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored. The Company has diversified customer base considering the nature and type of business.
An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 7.3. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.
Liquidity risk
The Companyâs objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans and commercial papers. 52% of the
Excessive risk concentration
Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Companyâs performance to developments affecting a particular industry.
In order to avoid excessive concentrations of risk, the Companyâs policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
Capital management
For the purpose of the Companyâs capital management, capital includes issued equity capital, share premium
Companyâs borrowing will mature in less than one year at 31 March 2017 (31 March 2016: 99%; 01 April 2015: 29%) based on the carrying value of borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and debt maturing within 12 months can be rolled over with existing lenders.
The table below provides details regarding the contractual maturities of significant financial liabilities as at 31 March 2017. and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Companyâs capital management is to maximize the shareholder value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Companyâs policy is to keep the gearing ratio between 15% and 30%. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations.
In order to achieve this overall objective, the Groupâs capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March, 2017 and 31 March, 2016.
26 Investment in joint venture
The Company, Hindustan Cargo Limited (âHCLâ), a wholly owned subsidiary and Avvashya CCI Logistics Private Limited (âACCIâ) has entered into joint venture arrangement. Pursuant to the arrangement, the Company transferred with effect from 18 July, 2016, its contract logistics business with book value of Rs.2,045 lakhs to ACCI for 6.63% shares in ACCI and recorded loss of Rs.84 lakhs. Additionally, the Company acquired 43.93% shares in ACCI for a consideration of Rs.13,000 lakhs.
Further, HCL transferred with effect from 18 July, 2016, its freight forwarding business with book value of Rs.3,389 lakhs to ACCI for 10.57% shares in ACCI and recorded loss of Rs.260 lakhs. Post this transaction, the Company and HCL in aggregate owns 61.13% shares in ACCI.
27. Slump sale
On 01 January 2017, the Company and Transindia Logistics Park Private Limited (âTLPPLâ, a wholly owned subsidiary of the Company) completed transfer of Container Freight Station business undertaking of TLPPL situated at Nhavaseva, on slump sale, after completing all regulatory and other formalities. Book value of net assets transferred from TLPPL to the Company is Rs.8,050 lakhs.
28. Specified Bank Notes
During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(âE) dated 31 March 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from 08 November 2016 to 30 December 2016, the denomination wise SBNs and other notes as per the notification is given below:
29. Corporate social responsibility
As per section 135 of the Act, a CSR committee has been formed by the Company. The funds are utilized throughout the year on activities which are specified in Schedule VII of the Act. The utilization is done either by way of direct contribution towards various activities or by way of contribution to a trust - Avashya Foundation.
30. Gross amount required to be spent by the Company during the year: Rs.248 lakhs (previous year: Rs.238 lakhs)
31. Segment reporting
Disclosure of segment reporting as per the requirements of Ind AS 108 âOperating Segmentâ is reported in the consolidated financial statements of the Company. Therefore, the same has not been separately disclosed in the standalone financial statements in line with the requirement of Ind AS 108.
32. Events after reporting period
On 01 April 2017, the Company acquired remaining 49% stake in South Asia Terminals Private Limited (âSATPLâ presently a joint venture of the Company).
Mar 31, 2016
1. Dues to micro and small suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED) which came into force from 02 October 2006, certain disclosures are required to be made relating to MSME. On the basis of the information and records available with the Company, the following disclosures are made for the amounts due to the Micro and Small Enterprises.
2. Segment reporting
Disclosure of segment reporting as per the requirements of Account Standard (AS) 17 âSegment Reportingâ is reported in the consolidated financial statements of the Company. Therefore, the same has not been separately disclosed in the standalone financial statements in line with the requirements of AS - 17.
3. Leases
Operating leases as lessee
a. The Company has taken commercial properties on non-cancellable operating lease. The lease agreement provides for an option to the Company to renew the lease period at the end of non-cancellable period.
b. Lease payments recognized for the year are Rs, 1,366 (previous year: Rs, 1,091).
c. There are no exceptional/restrictive covenants in the lease agreements.
Operating leases as less or
a. The Company has given warehouse and commercial properties on non-cancellable operating lease. The lease agreement provides for an option to the Company to renew the lease period at the end of non-cancellable period.
b. Lease income recognized for the year are Rs, 764 (previous year: Rs, 425).
c. There are no exceptional/restrictive covenants in the lease agreements.
4. Employee Benefits
i) Defined Contribution Plans
Amount of Rs, 440 lakhs (previous year : Rs, 374 lakhs) contributed to Provident Fund, ESIC and other funds (refer note 25) is recognized as an expense and included in âContribution to provident fundsâ under âEmployee benefits expenseâ in the Statement of Profit and Loss.
ii) Defined Benefit Plans
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on death or resignation or retirement at 15 days salary (last drawn salary) for each completed year of service subject to a maximum payment of Rs, 10 lakhs.
5. Related party disclosures
A Name of related parties:
i) Related parties where control exists - Subsidiaries (direct and indirect)
Direct Subsidiaries
1 Hindustan Cargo Limited
2 Acex Logistics Limited
3 Asia Line Ltd
4 Contech Transport Services Private Limited
5 Allcargo Logistics LLC
6 Allcargo Belgium N.V
7 Ecu Line (India) Private Limited
8 Allcargo Shipping Co.Private Limited
9 South Asia Terminals Private Limited
10 Southern Terminal & Trading Private Limited
11 AGL Warehousing Private Limited
12 Allcargo Logistic Park Private Limited
13 Combiline Indian Agencies Private Limited
14 Transindia Logistic Park Private Limited Indirect Subsidiaries
15 Credo Shipping Agencies (I) Private Limited (ceased w.e.f.24 January 2016)
16 Amfin Consulting Private Limited
17 Comptech Solutions Private Limited
18 ECU International (Asia) Private Limited
19 Ecu-Line Algerie sarl
20 Ecu Logistics SA
21 Ecu-Line N.V.
22 Ecu-Logistics N.V.
23 FMA-Line Holding N. V.
24 Ecu-Tech BVBA
25 Ecuhold N.V.
26 Ecu International N.V.
27 Ecu Global Services n.v.
28 HCL Logistics N.V.
29 AGL N.V.
30 Ecu Logistics do Brasil Ltda.
31 Ecu-Line Bulgaria EOOD
32 Ecu-Line Polska SP. Z.o.o.
33 Ecu-Line Doha W.L.L.
34 Ecu-Line Romania SRL
35 Ecu-Line Singapore Pte. Ltd.
36 Ecu-Line South Africa (Pty.) Ltd.
37 Ecu-Line Spain S.L.
38 Mediterranean Cargo Center S.L. (MCC)
39 Ecu Line Lanka (Pvt) Ltd.
40 Societe Ecu-Line Tunisie Sarl
41 Ecu Uluslarasi Tas. Ve Ticaret Ltd. Sti.
42 Star Express Company Ltd.
43 China Consolidated Company Ltd.
44 Ecu-Line UK Ltd.
45 DEOLIX S.A.
A Name of related parties (Continued):
i) Related parties where control exists - Subsidiaries (direct and indirect) (Continued)
46 CLD Compania Logistica de Distribucion SA.
47 Guldary S.A.
48 Administradora House Line C.A.
49 Ecu-Line Mauritius Ltd.
50 FMA-LINE Nigeria Ltd.(Incorporated on 27 July 2015)
51 Consolidadora Ecu- Line C.A
52 Ecu Shipping Logistics (K) Ltd.
53 Ecu-Line Middle East LLC
54 Ecu-Line Malaysia Sdn. Bhd.
55 Eurocentre FZCO
56 Ecu-Line Hungary Kft.
57 Ecu-Line Kenya Ltd.
58 Ecu-Line Abu Dhabi LLC
59 CCS Shipping Ltd.
60 Flamingo Line Del Peru SA
61 Ecu-Line Chile S.A.
62 Flamingo Line Chile S.A.
63 Ecu-Line Guangzhou Ltd
64 China Consolidation Services Shipping Ltd
65 Ecu-Line (CZ) s.r.o.
66 Ecu-Line del Ecuador S.A.
67 Flamingo Line del Ecuador SA
68 Ecu Line Egypt Ltd.
69 Flamingo Line El Salvador SA de CV
70 Ecu-Line Germany GmbH
71 ELWA Ghana Limited
72 Flamingo Line de Guatemala S.A.
73 Ecu-Line Hong Kong Ltd.
74 Ecu International Far East Ltd.
75 Contech Transport Services (Pvt) Limited
76 PT EKA Consol Utama Line
77 Ecu-Line Italia srl.
78 Eurocentre Milan srl.
79 Ecu-Line Cote dâIvoire Sarl
80 Jordan Gulf for Freight Services Agencies Co.LLC
81 Ecu-Line Malta Ltd.
82 CELM Logistics SA de CV
83 Ecu Logistics de Mexico SA de CV
84 Ecu-Line Maroc S.A.
85 Ecu-Line Rotterdam BV
86 Rotterdam Freight Station BV
87 Ecu-Line de Panama SA
88 Ecu-Line Paraguay SA
89 Ecu-Line Philippines Inc.
90 Eculine Worldwide Logistics Co. Ltd. (Incorporated on 28 January 2016)
91 Ecu Worldwide (Uganda) (Incorporated on 15 December 2015)
92 Ecu-Line Zimbabwe (Pvt) Ltd.
93 Ecu-Line Peru SA
94 Ecu-Line Saudi Arabia LLC
95 Ecu-Line Japan Ltd.
A Name of related parties (Continued):
i) Related parties where control exists - Subsidiaries (direct and indirect) (Continued)
96 S.H.E. Maritime Services Ltd.
97 Ecu-Line Australia Pty Ltd.
98 Ecu-Line NZ Ltd.
99 Ecu-Line (Thailand) Co. Ltd.
100 Ecu-Line Mediterranean Ltd.
101 China Consolidation Services Ltd.
102 Ecu-Line Switzerland GmbH
103 Ecu-Line Canada Inc
104 Cargo Freight Stations, SA
105 Ocean House Ltd.
106 Ecu-Line de Colombia S.A.S
107 Centro Brasiliero de Armazenagem E Distribuigao Ltda (Bracenter)
108 European Customs Broker N.V.
109 Ecu-Line Vietnam Co.Ltd
110 Econocaribe Consolidators, Inc
111 OTI cargo Inc
112 Port International Inc
113 Econoline Storage Corp
114 ECI Customs Brokerage, Inc
115 Integrity Enterprises Pty Ltd
116 PRISM Global, LLC
117 FCL Marine Agencies B.V
118 PRISM Global Ltd.
119 FMA-LINE France S.A.S.
120 Conecli International S.A
ii) Other related parties
I. Associates (direct and indirect)
Direct Associate -
Allcargo Logistics Lanka (Private) Limited (w.e.f 02 March 2015)
Indirect Associate -
Gantoni General Enterprises Ltd.
FCL Marine Agencies Gmbh (Hamburg) (w.e.f 03 September 2014)
FCL Marine Agencies Gmbh (Bermen) (w.e.f 03 September 2014)
IN EGA N.V.
FCL Marine Agencies Belgium bvba (w.e.f 19 March 2014)
OVCL Vietnam
II. Joint Ventures (direct and indirect)
Direct Joint Venture -
Transnepal Freight Services Private Limited
Indirect Joint Venture -
Fasder S.A.( w.e.f 05 August 2014)
Ecu Logistics Peru SAC (w.e.f 29 December 2014)
III. Entities over which key managerial personnel or their relativeâs exercises significant influence:
Allcargo Movers (Bombay) Private Limited (upto 14 December 2015)
Allcargo Movers (Bombay) LLP (w.e.f 15 December 2015)
Allcargo Shipping Services Private Limited Allnet Infotech Private Limited Avadh Marketing LLP
Avash Builders And Infrastructure Private Limited
Contech Estate LLP
N.R. Holdings Private Limited
Sealand Crane Private Limited
Talentos (India) Private Limited
Transindia Freight Private Limited
Transindia Freight Services Private Limited
Poorn Buildcon Pvt. Ltd (upto 15 November 2015)
Poorn Buildcon LLP (w.e.f 16 November 2015)
Panna Estates LLP Avvashya Foundation Trust
IV. Key Managerial Personnel
Shashi Kiran Shetty
Umesh Shetty (till 6 November 2014)
Adarsh Hegde
V. Relatives of Key Management Personnel
Arathi Shetty
Umesh Shetty (from 7 November 2014)
6 (e). Dividend remittances in foreign currency:
The Company has not remitted any amount in foreign currencies on account of dividends during the year and does not have information as to the extent to whichremittances, if any, in foreign currencies on account of dividends have been made by / on behalf of non-resident shareholders. The particulars of dividends paid to nonresident shareholders which were declared during the year, are as under:
The interest in the joint ventures are reported as long-term investments (refer note 14) and stated at cost. However, the Companyâs share of each of the assets, liabilities, income and expenses etc. related to its interest in the joint ventures, based on unaudited financial statement is:
7. Transfer pricing
international and Specified domestic transactions with related parties
The Companyâs international and specified domestic transactions with related parties are at armâs length as per the independent accountants report for the year ended 31 March 2015. Management believes that the Companyâs international and specified domestic transactions with related parties post 31 March 2015 continue to be at armâs length and that the transfer pricing legislation will not have any impact on these financial statements, particularly on amount of tax expense and that of provision for taxation.
8. Derivative instruments
The Company uses derivative and forward contracts to hedge its risks associated with foreign currency fluctuations. Such transactions are governed by thestrategy approved by the Board of Directors which provides principles on the use of these instruments consistent with the Companyâs Risk Management Policy. The Company does not use these contracts for trading or speculative purposes. The Company has marked to market the derivative contracts outstanding as at 31 March2016 which has resulted in a net gain to the Company. The Company has not recognized the resulted gain of '' Nil (previous year: '' 94 lakhs), on prudent basis which is notional in nature.
The Company uses derivative financial instruments such as forward exchange contracts, swaps and options to hedge its risks associated with foreign currency and interest rate fluctuations on buyerâs credit. Accounting policy for the same is based on AS 1 Disclosure of Accounting Policies read with AS 11 The Effects of Changes in Foreign Exchange Rates.
9. Disclosure under section 186 of the Companies Act 2013
The operations of the Company are classified as âinfrastructure facilitiesâ as defined under Schedule VI to the Act. Accordingly, the disclosure requirements specified in sub-section 4 of Section 186 of the Act in respect of loans given, investment made or guarantee given or security provided and the related disclosures on purposes/ utilization by recipient companies, are not applicable to the Company.
10. Corporate social responsibility
As per Section 135 of the Act, a CSR committee has been formed by the Company. The funds are utilized throughout the year on the activities which are specified in Schedule VII of the Act. The utilization is done either by way of direct contribution towards various activities or by way of contribution to a trust - Avvashya Foundation.
(a) Gross amount required to be spent by the Company during the year: '' 238 Lakhs (previous year: '' 310 lakhs)
11. Proposed slump sale
The Board of Directors has given its in-principal approval for acquisition of Container Freight Station (CFS) business of Transindia Logistic Park Pvt. Ltd., a wholly owned subsidiary of the Company, through slump sale subject to determination of valuation by an independent valuer and receipt of requisite statutory and regulatory approvals.
12. The Board at its meeting held on 20 May, 2016 granted its approval to sale and transfer its Contract Logistics Business to Avvashya CCI Logistics Private Limited (ACCI) (formerly known as CCI Integrated Logistics Private Limited) as a going concern on a slump sale basis for a total consideration of Rs, 1,962 Lakhs. The sales consideration shall be discharged by ACCI by issue of further equity shares resulting to 6.63% of the expanded capital. In order to gain controlling stake of ACCI, the Board of Directors further approved acquisition of additional 43.93% stake from the Promoter Shareholders of ACCI for an aggregate consideration of Rs, 130 Crore.
13. Prior year comparatives
Previous yearâs figure has been regrouped where necessary to this yearâs classification.
As per our report of even date attached.
Statement of significant related party transactions (as defined by the Audit Committee), submitted by the management;
Leadership and Motivation;
Mar 31, 2015
1 Company overview
Allcargo Logistics Limited (''the Company'') was incorporated on 18
August 1993 and is a leading multinational company engaged in providing
integrated logistics solutions and offers specialised logistics
services across Multimodal Transport Operations, Inland Container
Depot, Container Freight Station Operations, Contract Logistics
Operations and Project and Engineering Solutions. The Company is listed
on Bombay Stock Exchange Limited and National Stock Exchange of India
Limited.
2 Rights, preferences and restrictions attached to equity shares
The Company has a single class of equity shares. Accordingly, all
equity shares rank equally with regard to dividends and share in the
Company''s residual assets. The equity shares are entitled to receive
dividend as declared from time to time. During the year ended 31 March
2015, the Company has paid an interim dividend of 0.60 per equity share
(previous year: dividend of RS. Nil per share) and also proposed final
dividend of Rs. 1.40 per equity share (previous year: dividend of Rs.
1.50 per equity share). The voting rights of an equity shareholder on a
poll (not on show of hands) are in proportion to its share of the
paid-up equity capital of the Company.
On winding up of the Company, the holders of equity shares will be
entitled to receive the residual assets of the Company, remaining after
distribution of all preferential amounts in proportion to the number of
equity shares held.
Employee stock options
Terms attached to stock options granted to employees are described in
note 44 regarding employee share based payments.
2 (A) Nature of the security
(i) Rupee term loans from banks are secured against equipments.
(ii) Buyers'' credit is secured against equipment financed by the Bank.
(iii) Vehicle finance loans are secured against vehicle financed by the
Bank.
3 Long-term loans and advances (Continued)
Long-term loans and advances during the previous year ended 31 March
2014 includes the recoverables acquired from MHTC Logistics Private
Limited, taken over pursuant to the scheme of amalgamation (refer note
46).
Security deposits (unsecured, considered good) of Rs. 594 lakhs
(previous year : Rs. 2,467 lakhs) are placed with firms and private
companies (either severally or jointly with any other person), in which
any director is a partner or a director or member.
4 Contingent liabilities and commitments (Rs. in Lakhs)
Particulars 31 March 2015 31 March 2014
Contingent liabilities:
a. Disputed liabilities in Appeal
* Income Tax (refer note 1 below) - 6,729
* IncomeTax (refer note 2 below) 1,520 1,520
* Customs 211 211
* Service Tax 374 1,048
* Entry Tax 67 72
* Stamp duty 422 -
* Electricity dues 33 33
b. Corporate Guarantees given by the
Company on behalf of its subsidiaries 24,223 42,728
c. Bank guarantees 19,758 28,489
Commitments:
d. Estimated amount of contracts 558 315
remaining to be executed
on capital accounts (net of advances)
and not provided for
e. During the year, the Company has
issued letters of undertakings to
provide need based unconditional
financial support to its following
subsidiaries:
1. South Asia Terminals
Private Limited
2. Combiline Indian Agencies
Private Limited
3. Ecu Line (India) Private
Limited
Litigations:
f. Claims against the Company, not
acknowledged as debts(Refer note 3 below) 232 357
Note 1 : The Income Tax Department had issued assessment orders against
the Company, whereby, the claim of deduction by the Company under
section 80-IA (4) was disallowed from assessment years 2004-05 to
2009-10 and raised demand of Rs. .6729 lakhs on the Company. The
Company had filed an appeal against the said assessment orders. The
Special Bench of Income Tax Appellate Tribunal vide its order dated
July 6, 2012 and Divisional Bench of Income Tax Appellate Tribunal vide
its order dated December 5, 2012 upheld the Company''s plea and
accordingly the Company has continued to claim deduction u/s 80 IA (4)
of the Income Tax Act, 1961. The Department has filed an appeal on May
31, 2013 with the Hon''ble Bombay High Court against the said order of
the Divisional Bench of Income Tax Appellate Tribunal.
The Hon''ble Bombay High Court vide its order dated April 21, 2015
upheld the view taken by the Divisional Bench of Income Tax Appellate
Tribunal and accordingly dismissed the appeals filed by the Revenue
Authority and passed the order favouring the Company.
Note 2: Further, the Income tax department has issued assessment order
for A.Y 2010-11 against the Company, whereby in addition to other
matters, the claim of deduction made by the Company u/s 80-IA(4) of
Income tax Act, 1961 was disallowed and a demand of Rs. 1,520 lakhs has
been raised. The Company has filed an appeal CIT (A) level against the
order.
Note 3: In addition, the Company is subject to legal proceedings and
claims,which have arisen in the ordinary course of business. The
Company has reviewed all its pending litigations and proceedings and
has adequately provided for where provisions are required and disclosed
as contingent liability, where applicable in its financial statements.
The Company''s management does not reasonably expect that these legal
actions, when ultimately concluded and determined, will have a material
and adverse effect of the Company''s results of operations or financial
condition.
5 Dues to micro and small suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006
(MSMED) which came into force from 02 October 2006, certain disclosures
are required to be made relating to MSME. On the basis of the
information and records available with the Company, the following
disclosures are made for the amounts due to the Micro and Small
Enterprises.
6 Segment reporting
Disclosure of segment reporting as per the requirements of Account
Standard (AS) 17 "Segment Reporting" is reported in the consolidated
financial statements of the Company. Therefore, the same has not been
separately disclosed in the standalone financial statements in line
with the requirements of AS - 17.
7 Leases
Operating leases as lessee
The Company has taken commercial properties on non-cancellable
operating lease. The lease agreement provides for an option to the
Company to renew the lease period at the end of non-cancellable period.
There are no exceptional/ restrictive covenants in the lease
agreements. The future minimum lease payments in respect of lease
property as at 31 March 2015.
8 Disclosure pursuant to Accounting Standard 15 (Revised) "Employee
Benefits"
i. Defined Contribution Plans:
Contribution to Provident Fund and ESIC
Amount of Rs. 374 lakhs (previous year : Rs. 340 lakhs) contributed to
Provident Fund, ESIC and other funds (refer note 25) is recognised as
an expense and included in ''Contribution to provident and other funds''
under "Employee benefits expense" in the statement of profit and loss.
ii. Defined Benefit Plans
The Company has a defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on death or
resignation or retirement at 15 days salary (last drawn salary) for
each completed year of service subject to a maximum payment of RS. 10
lakhs.
9 Related party disclosures
A Name of related parties where control exists:
I. Subsidiaries (direct and indirect)
Hindustan Cargo Limited
Acex Logistics Limited (formerly known as HC Logistics Limited)
Credo Shipping Agencies (I) Private Limited
Contech Transport Services Private Limited
Comptech Solutions Private Limited
Amfin Consulting Private Limited
Ecu Line (India) Private Limited
Allcargo Shipping Co.Private Limited
South Asia Terminals Private Limited
Southern Terminal & Trading Private Limited
AGL Warehousing Private Limited
Allcargo Logistic Park Private Limited
Transindia Logistic Park Private Limited
ECU International (Asia) Private Limited
Combiline Indian Agencies Private Limited
Ecu-Line Algerie sarl
Ecu Logistics SA
Ecu-Line N.V.
Ecu-Logistics N.V.
FMA-LINe Holding N. V. (formerely known as Ecubro N.V.)
Ecu-Tech BVBA
Ecuhold N.V.
Ecu International N.V.
Ecu Global Services n.v.
HCL Logistics nv AGL N.V.
Allcargo Belgium N.V.
Ecu Logistics do Brasil Ltda.
Ecu-Line Bulgaria EOOD Ecu-Line Chile S.A.
Flamingo Line Chile S.A.
Ecu-Line Guangzhou Ltd
China Consolidation Services Shipping Ltd
Ecu-Line (CZ) s.r.o.
Ecu-Line del Ecuador S.A.
Flamingo Line del Ecuador SA
Ecu Line Egypt Ltd.
Flamingo Line El Salvador SA de CV
Ecu-Line Germany GmbH
ELWA Ghana Limited
Flamingo Line de Guatemala S.A.
Ecu-Line Hong Kong Ltd.
Ecu International Far East Ltd.
PT EKA Consol Utama Line
Ecu-Line Italia srl.
Eurocentre Milan srl.
Ecu-Line Cote d''Ivoire Sarl
Jordan Gulf for Freight Services Agencies Co.LLC
Ecu-Line Malta Ltd.
CELM Logistics SA de CV
Ecu Logistics de Mexico SA de CV
Ecu-Line Maroc S.A.
Ecu-Line Rotterdam BV
Rotterdam Freight Station BV
Ecu-Line de Panama SA
Ecu-Line Paraguay SA
Ecu-Line Philippines Inc.
Ecu-Line Polska SP Z.o.o.
Ecu-Line Doha W.L.L.
Ecu-Line Romania SRL
Ecu-Line Singapore Pte. Ltd.
Ecu-Line South Africa (Pty.) Ltd.
Ecu-Line Spain S.L.
Mediterranean Cargo Center S.L. (MCC)
Ecu Line Lanka (Pvt) Ltd.
Societe Ecu-Line Tunisie Sarl
Ecu Uluslarasi Tas. Ve Ticaret Ltd. Sti.
China Consolidated Company Ltd.
Star Express Company Ltd.
Ecu-Line UK Ltd.
DEOLIX S.A.
DLC
Guldary S.A.
Administradora House Line C.A.
Ecu-Line Mauritius Ltd. (formerly known as a Ecu Line (Indian Ocean
Island) Ltd.
Asia Line Ltd
Consolidadora Ecu- Line C.A
Ecu Shipping Logistics (K) Ltd.
Ecu-Line Middle East LLC
Ecu-Line Malaysia Sdn. Bhd. (Formerly known as Ecu-Line (Johor Bahru)
Sdn. Bhd.)
Eurocentre FZCO
Ecu-Line Hungary Kft.
Ecu-Line Kenya Ltd.
Ecu-Line Abu Dhabi LLC
CCS Shipping Ltd.
Flamingo Line del Peru SA
Ecu-Line Peru SA
Ecu-Line Saudi Arabia LLC
Ecu-Line Zimbabwe (Pvt) Ltd.
Ecu-Line Japan Ltd.
S.H.E. Maritime Services Ltd.
Ecu-Line Australia Pty Ltd.
Ecu-Line NZ Ltd.
Ecu-Line (Thailand) Co. Ltd.
Ecu-Line Mediterranean Ltd.
China Consolidation Services Ltd.
Ecu-Line Switzerland GmbH
Ecu-Line Canada Inc
Cargo Freight Stations, SA
Ocean House Ltd.
Ecu-Line de Colombia S.A
Conecli International S.A
European Customs Broker NV
Ecu-Line Vietnam Co.Ltd
Econocaribe Consolidators, Inc
OTI cargo Inc
Port International Inc
Ecoline Storage Corp
ECI Customs Brokerage, Inc
Integrity Enterprises Pty Ltd
PRISM Global, LLC
FCL Marine Agencies B.V
PRISM Global Ltd.(formerly known as Ecu Line Ltd)
FMA-LINE France S.A.S.
Centro Brasiliero de Armazenagem E Distribuigao Ltda
Allcargo Logistics LLC (w.e.f 19 October 2014)
II. Associates (direct and indirect)
Transworld Logistics & Shipping Services Inc. (ceased to be an
Associate w.e.f 15 August 2013)
Sealand Warehousing Private Limited (ceased to be Associate w.e.f 29
November, 2013)
Gujarat Integrated Maritime Complex Pvt. Ltd (ceased to be Associate
w.e.f 29 November, 2013)
FCL Marine Agencies Gmbh (Hamburg) (w.e.f 03 September 2014)
FCL Marine Agencies Gmbh (Bermen) (w.e.f 03 September 2014)
International Negotiation Associates N.V
FCL Marine Agencies Belgium bvba (w.e.f 19 March 2014)
Love All sports Holdings FZE (w.e.f 12 October 2014)
III. Joint Ventures (direct and indirect)
Transnepal Freight Services Private Limited Fasder S.A.(w.e.f 05 August
2014)
Ecu Logistics Peru SAC (w.e.f 29 December 2014
IV. Entities over which key managerial personnel or their relatives
exercises significant influence:
Allcargo Movers (Bombay) Private Limited
Allcargo Shipping Services Private Limited
Allnet Infotech Private Limited
Alltrans Logistics Private Limited
Alltrans Port Management Private Limited
Avadh Marketing LLP
Avash Builders And Infrastructure Private Limited
Avashya Corporation Pvt.Ltd
FTL (India) Pvt.Ltd (formerly known as Avashya Enterprises Private
Limited)
Avashya Holdings Pvt.Ltd
Contech Estate LLP
Indport Maritime Agencies Pvt.Ltd.
Jupiter Precious Gems and Jewellery Private Limited (formerly known as
Jupiter Machines Pvt. Ltd.)
N.R. Holdings Private Limited
Poorn Estates Private Limited
Prominent Estate Holdings Private Limited
Sealand Crane Private Limited
SKS Netgate LLP
SKS Realty LLP
SKS Ventures Private Limited
Talentos (India) Private Limited
Talentos Entertainment Private Limited
Transindia Freight Private Limited
Transindia Freight Services Private Limited
Sealand Holdings Pvt. Ltd
Meridien Tradeplace Pvt.Ltd
Poorn Buildcon Pvt. Ltd
Panna Estates LLP
Black Soil Realty Investment advisors LLP
Container Freight Station Associations of India (upto 13 January 2014)
Panna Infracon Projects LLP
Avvashya Foundation
V. Key Managerial Personnel
Shashi Kiran Shetty
Umesh Shetty (till 6 November 2014)
Adarsh Hegde
VI. Relatives of Key Management Personnel
Arathi Shetty
Umesh Shetty (from 7 November 2014)
10 Dividend remittances in foreign currency:
The Company has not remitted any amount in foreign currencies on
account of dividends during the year and does not have information as
to the extent to which remittances, if any, in foreign currencies on
account of dividends have been made by / on behalf of non-resident
shareholders. The particulars of dividends paid to non-resident
shareholders which were declared during the year.
11 Investment in joint ventures
(A) The Company had entered into a share purchase agreement on 20 June
2012 with IL&FS Maritime Infrastructure Company Limited (IMICL) for
sale of its 45% stake (representing 45,000 equity shares of RS. 10
each) in Gujarat Integrated Maritime Complex Private Limited (GIMCO)
and 50% stake (representing 4,674,807 equity shares of RS. 10 each) in
Sealand Warehousing Private Limited (SWPL). Accordingly, during the
year ended 31 March 2013, the Company on fulfilment of certain terms
and conditions contained in aforesaid agreement transferred 19,000
equity shares of GIMCO and 2,243,907 equity shares of SWPL to IMICL
against agreed consideration.
During the previous year ended 31 March 2014, on fulfilment of all the
contractual obligation and on receipt of the balance agreed
consideration the Company has transferred the balance 26,000 equity
shares of GIMCO and 2,430,900 equity shares of SWPL to IMICIL. The net
income booked for the previous year was Rs. 27 lakhs.
The Company''s interest in joint ventures is accounted, in accordance
with the principles and procedures set out in AS - 27, ''Financial
Reporting of Interests in Joint Ventures'' specified in the Companies
(Accounting Standards) Rules, 2006, which continue to apply under
Section 133 of the Companies Act, 2013 read with rule 7 of the
Companies (Accounts) Rules, 2014.
12 Transfer pricing
international and Specified domestic transactions with related parties
The Company''s international and specified domestic transactions with
related parties are at arm''s length as per the independent accountants
report for the year ended 31 March 2014. Management believes that the
Company''s international and specified domestic transactions with
related parties post 31 March 2014 continue to be at arm''s length and
that the transfer pricing legislation will not have any impact on these
financial statements, particularly on amount of tax expense and that of
provision for taxation.
13 Employee stock options
a. In 2006, the Company had instituted an ''Allcargo Employee Stock
Option Plan 2006'' (ESOS 2006) to attract, retain, motivate and reward
its employees and to enable them to participate in the growth,
development and success of the Company. The compensation/remuneration
committee of the Board evaluates the performance and other criteria of
employees and approves the grant of options. The employees are granted
an option to purchase shares of the Company at the respective exercise
price, subject to the requirements of vesting conditions. These options
generally vest over a period of 24 to 48 months from the date of grant.
Upon vesting, the employees can acquire one equity share for each
option. The maximum contractual term for these stock option plan is
generally 7 years. The Company granted stock options to be adjusted for
subsequent bonus issue prior to its Initial Public Offering of equity
shares, to its permanent employees and to few of the permanent
employees of its foreign subsidiaries at varying numbers depending upon
their grade.
b. The stock compensation cost is computed under the intrinsic value
method and amortised on a straight line basis over the vesting period
of 7 years.
c. The particulars of options granted under the said ESOS 2006 plans
are tabulated
14 Derivative instruments
The Company uses derivative and forward contracts to hedge its risks
associated with foreign currency fluctuations. Such transactions are
governed by the strategy approved by the Board of Directors which
provides principles on the use of these instruments consistent with the
Company''s Risk Management Policy. The Company does not use these
contracts for trading or speculative purposes. The Company has marked
to market the derivative contracts outstanding as at 31 March 2015
which has resulted in a net gain to the Company. The Company has not
recognised the resulted gain of Rs.94 lakhs (previous year: Rs. 2,111
lakhs), on prudent basis which is notional in nature.
15 Amalgamation of MHTC Logistics Private Limited with the Company
Scheme of Arrangement between MHTC Logistics Private Limited and the
Company taken place during the previous year ended 31 March 2014:-
During the previous year ended 31 March 2014, MHTC logistics Private
Limited (hereinafter referred to as "MHTC"), a wholly owned subsidiary
of the Company, incorporated with the main object to do Project
Logistics as well as Freight forwarding business, was amalgamated into
the Company pursuant to the Scheme of Amalgamation (hereinafter
referred to as "Scheme"), as on and from 01 April 2012, being the
appointed date pursuant to the approval of Board of Directors of the
Company and sanctioned by the Honourable High Court of Bombay vide its
order dated 06 December 2013 which was filed with Registrar of
Companies on 24 January 2014.
The Company has carried out the accounting treatment prescribed in the
Scheme as approved by the Honourable High Court of Bombay. The required
disclosures for accounting of Scheme as per the "Pooling of Interest
Method" as given under Accounting Standard 14 (AS - 14) "Accounting for
Amalgamations" as prescribed under the Companies (Accounting Standards)
Rules 2006 have been provided.
Hence, in accordance with the Scheme:
i. The Company has taken over all the assets aggregating to RS. 3,539
lakhs and liabilities aggregating to Rs. 2,081 lakhs at their
respective book values. Also, as per the Scheme, the identity of
reserves of MHTC is required to be maintained by the Company as on the
appointed date which was aggregating to Rs. 1,438 lakhs. On
cancellation of investments made by the Company in MHTC against their
share capital as on the appointed date, there was a deficit of Rs.
3,410 lakhs. As per the Scheme approved by the Honourable High Court of
Bombay, such deficit is required to be debited to the "Goodwill
Account" of the Company.
ii. No consideration is payable or receivable on implementation of the
Scheme as the Scheme involves a wholly owned Subsidiary.
iii. Prior to appointed date, MHTC was holding 373,491 equity shares of
the Company. As a consequence of and as per the Scheme the aforesaid
investment of MHTC in the Company has been cancelled and accordingly
the share capital of the Company stands reduced by Rs. 7 lakhs and the
Securities Premium Account of the Company stands reduced by Rs. 635
lakhs.
iv. Had the Scheme not prescribed the aforementioned mentioned
accounting treatment and the Company had followed the accounting
treatment prescribed under AS 14, there would not have been any
Goodwill on Merger arising out of deficit arising against cancellation
of Investment against share capital of the amalgamating company, as
mentioned in point no. (i) above and the General Reserves of the
Company would have been lower by Rs. 3,410 lakhs.
In terms of the Scheme, the appointed date of the amalgamation being 1
April 2012, the net loss of MHTC for the financial year 2012-13
aggregating to RS. 88 lakhs has been adjusted in the surplus in
statement of profit and loss under Reserves and Surplus.
16 Disclosure under section 186 of the Companies Act 2013
The operations of the Company are classified as ''infrastructure
facilities '' as defined under Schedule VI to the Act. Accordingly, the
disclosure requirements specified in sub-section 4 of Section 186 of
the Act in respect of loans given, investment made or guarantee given
or security provided and the related disclosures on purposes/
utilization by recipient companies, are not applicable to the Company.
17 Corporate social responsibility
As per Section 135 of the Act, a CSR committee has been formed by the
Company. The funds are utilised throughout the year on the activities
which are specified in Schedule VII of the Act. The utilisation is done
either by way of direct contribution towards various activities or by
way of contribution to a trust - Avvashya Foundation.
(a) Gross amount required to be spent by the Company during the year:
RS. 310 Lakhs
18 Prior year comparatives
The figures for the previous year have been regrouped/ rearranged as
necessary to confirm to the current year''s presentation.
Mar 31, 2014
1. Contingent liabilities and commitments
(to the extent not provided for) (Rs. in Lakhs)
Particulars March 31, 2014 March 31, 2013
Contingent liabilities:
a. Disputed liabilities in Appeal
Income Tax (refer note 1 below) 6,729 6,729
Income Tax (AY 10-11) 1,520 -
Customs 211 181
Service Tax 1,048 1,138
Entry Tax 72 -
b. Claims against the Company,
not acknowledged as debts 357 132
c. Corporate guarantees given
by the Company on behalf of its
subsidiaries 42,728 18,139
d. Bank guarantees 28,489 7,960
Commitments:
a. Estimated amount of contracts
remaining to be executed
on capital accounts 315 901
(net of advances) and
not provided for
Note 1: Disputed income tax liabilities in Appeal include one matter
where the Income Tax Department had issued assessment orders against
the Company, whereby, the claim of deduction by the Company under
Section 80-IA (4) of The Income Tax Act, 1961 was disallowed from the
assessment years 2004-05 to 2009-10 and raised a demand of Rs. 6,729
Lakhs on the Company. The Company had filed an appeal against the said
assessment orders.
2. Contingencies and commitments (Continued)
The special bench of Income Tax Appellate Tribunal vide its order dated
July 06, 2012 and divisional bench of Income Tax Appellate Tribunal
vide its order dated December 05, 2012 upheld the Company''s plea and
accordingly the Company has continued to claim deduction under Section
80IA (4) of the Income Tax Act, 1961.
In view of the foregoing, the Company continues to provide Current tax
under the provisions of Minimum Alternate Tax. The Department has filed
an appeal on May 31, 2013 with the High Court of Bombay against the
said order of the Divisional Bench of Income Tax Appellate Tribunal.
3. Dues to micro and small suppliers
Under the Micro, Small and Medium Enterprises Development Act, 2006
(MSMED) which came into force from Octoberr 02, 2006, certain
disclosures are required to be made relating to MSME. On the basis of
the information and records available with the Company, the following
disclosures are made for the amounts due to the Micro and Small
Enterprises.
4. Segment reporting
Disclosure as per Account Standard (AS) 17 Segment Reporting is
reported in consolidated financial statements of the Company. Therefore,
the same has not been separately disclosed in line with the provision
of AS 17.
5. Disclosure pursuant to Accounting Standard - 15 (Revised) ''Employee
Benefits''
i) Defined Contribution Plans:
Contribution to Provident Fund and ESIC
Amount of Rs. 340 Lakhs (previous year : Rs. 338 Lakhs) contributed to
Provident Fund, ESIC and other funds (refer note 25) is recognised as
an expense and included in "Contribution to Provident & Other Funds''
under ''Employee benefits in the statement of Profit and loss.
ii) Defined Benefit Plans
The Company has a defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on death or
resignation or retirement at 15 days salary (last drawn salary) for
each completed year of service subject to a maximum payment of Rs. 10
Lakhs.
Assumptions regarding future mortality are based on published
statistics and mortality tables. The calculation of the defined benefit
obligation is sensitive to the mortality assumptions.
The Company continues to fund the trust in next year by reimbursing the
actual payout.
iii) Compensated leave absences-
Following amounts are recognized in respect of unfunded obligations
towards compensated leave absences:
6. Related party disclosures
A Name of related parties where control exists:
I. Subsidiaries
Hindustan Cargo Ltd
HC Logistics Ltd
Credo Shipping Agencies (I) Private Limited
Contech Transport Services Private Limited
Comptech Solutions Private Limited
Amfn Consulting Private Limited
Ecu Line (India) Private Limited
Allcargo Shipping Co.Private Limited
South Asia Terminals Pvt. Ltd.
Southern Terminals & Trading Private Limited
AGL Warehousing Private Limited
Allcargo Logistic Park Private Limited
Transindia Logistic Park Private Limited
ECU International (Asia) Private Limited
Combiline Indian Agencies Private Limited
Ecu-Line Algerie sarl
Ecu Logistics SA
Ecu-Line N.V.
Ecu-Logistics N.V.
Ecubro N.V.
Ecu-Tech BVBA
Ecuhold N.V.
Ecu International N.V.
Ecu Global Services N.V.
HCL Logistics N.V.
AGL N.V.
Allcargo Belgium N.V.
Ecu Logistics do Brasil Ltd.a
Flamingo Line do Brasil Ltd.a
Ecu-Line Bulgaria EOOD
Ecu-Line Chile S.A.
Flamingo Line Chile S.A.
Ecu-Line Guangzhou Ltd
China Consolidation Services Shipping Ltd
Ecu-Line (CZ) s.r.o.
Ecu-Line del Ecuador S.A.
Flamingo Line del Ecuador SA
Ecu Line Egypt Ltd.
Flamingo Line El Salvador SA de CV
Ecu-Line Germany GmbH
ELWA Ghana Limited
Flamingo Line de Guatemala S.A.
Ecu-Line Hong Kong Ltd.
Ecu International Far East Ltd.
CCS China Consolidation Services Company Ltd.
PT EKA Consol Utama Line
Ecu-Line Italia srl.
Eurocentre Milan srl.
Ecu-Line Côte d''Ivoire Sarl
Jordan Gulf for Freight Services Agencies Co.LLC
Ecu-Line Malta Ltd.
CELM Logistics SA de CV
Ecu Logistics de Mexico SA de CV
Ecu-Line Maroc S.A.
Ecu-Line Rotterdam BV
Rotterdam Freight Station BV
Ecu-Line de Panama S.A.
Ecu-Line Paraguay S.A.
Ecu-Line Philippines Inc.
Ecu-Line Polska SP Z.o.o.
Ecu-Line Doha W.L.L.
Ecu-Line Romania SRL
Ecu-Line Singapore Pte. Ltd.
Ecu-Line South Africa (Pty) Ltd.
Ecu-Line Spain S.L.
Mediterranean Cargo Center S.L. (MCC)
Ecu Line Lanka (Pvt) Ltd.
Société Ecu-Line Tunisie Sarl
Ecu Uluslarasi Tas. Ve Ticaret Ltd. Sti.
China Consolidated Company Ltd.
Star Express Company Ltd.
Ecu-Line UK Ltd.
DEOLIX S.A.
DLC
Guldary S.A.
ELV Multimodal C.A.
Administradora House Line C.A.
aEcu-Line (Indian Ocean Islands) Ltd.
Asia Line Ltd
Consolidadora Ecu- Line C.A
Ecu Shipping Logistics (K) Ltd.
Ecu-Line Middle East LLC
Ecu-Line (Johor Bahru) Snd. Bhd.
Eurocentre FZCO
Ecu-Line Kenya Ltd.
Ecu-Line Abu Dhabi LLC
CCS Shipping Ltd.
Flamingo Line del Peru S.A.
Ecu-Line Peru S.A.
Ecu-Line Saudi Arabia LLC
Ecu-Line Zimbabwe (Pvt) Ltd.
Ecu-Line Japan Ltd.
S.H.E. Maritime Services Ltd.
Translogistik Internationale Spedition GmbH
Ecu-Line Australia Pty Ltd.
Ecu-Line NZ Ltd.
Ecu-Line (Thailand) Co. Ltd.
Ecu-Line Mediterranean Ltd.
China Consolidation Services Ltd.
Ecu-Line Switzerland GmbH
Ecu-Line Canada Inc
Cargo Freight Stations, S.A.
Ocean House Ltd.
Ecu-Line de Colombia S.A
Conecli International S.A.
European Customs Broker NV
Ecu-Line Vietnam Co.Ltd
Econocaribe Consolidators, Inc
OTI cargo Inc
Port International Inc
Ecoline Storage Corp
ECI Customs Brokerage, Inc
Integrity Enterprises Pty Ltd
PRISM Global, LLC
FCL Marine Agencies B.V.
II. Associates
Transworld Logistics & Shipping Services Inc. (ceased to be an
Associate w.e.f August 15, 2013) Sealand Warehousing Private Limited
(ceased to be Associate w.e.f November 29, 2013) Gujarat Integrated
Maritime Complex Pvt. Ltd (ceased to be Associate w.e.f November 29,
2013)
III. Joint Ventures
Transnepal Freight Services Private Limited
IV. Entities over which key managerial personnel or their relatives
exercises significant infuence:
Allcargo Movers (Bombay) Private Limited
Allcargo Shipping Services Private Limited
Allnet Infotech Private Limited
Alltrans Logistics Private Limited
Alltrans Port Management Private Limited
Avadh Marketing LLP
Avash Builders And Infrastructure Private Limited
Avashya Corporation Pvt.Ltd
FTL (India) Pvt.Ltd (formerly known as Avashya Enterprises Private
Limited)
Avashya Holdings Pvt.Ltd
Contech Estate LLP
Indport Maritime Agencies Pvt.Ltd.
Jupiter Precious Gems and Jewellery Private Limited (formerly Jupiter
Machines Pvt. Ltd.)
N.R. Holdings Private Limited
Poorn Estates Private Limited
Prominent Estate Holdings Private Limited
Sealand Crane Private Limited
SKS Netgate LLP
SKS Realty LLP
SKS Ventures Private Limited
Talentos (India) Private Limited
Talentos Entertainment Private Limited
Transindia Freight Private Limited
Transindia Freight Services Private Limited
Sealand Holdings Pvt. Ltd
Meridien Tradeplace Pvt.Ltd
Poorn Buildcon Pvt. Ltd
Panna Estates LLP
Black Soil Realty Investment advisors LLP
Container Freight Station Associations of India (upto 13 January 2014)
Panna Infracon Projects LLP
V. Key Managerial Personnel
Shashi Kiran Shetty
Umesh Shetty
Adarsh Hegde
VI. Relatives of Key Management Personnel
Arathi Shetty
Details of material related party transactions which are more than 10 %
of the total transactions of the same type with a related party during
the year ended March 31, 2014
1. Multimodal transport income includes income from Allcargo Belgium
NV Group Rs. 5,131 Lakhs (Multimodal transport income during the previous
year includes income earned from Allcargo Belgium NV group Rs. 5,645
Lakhs)
2. Project and Engineering Solution Income includes South Asia
Terminals Pvt. Ltd. Rs. 1,429 Lakhs, Hindustan Cargo Limited Rs. 19
Lakhs, Asia Lines Limited Rs. 1 lakh
(Project and Engineering Solution Income during the previous year
includes income from South Asia Terminals Pvt. Ltd. Rs. 1,878 Lakhs,
Hindustan Cargo Limited Rs. 135 Lakhs, Asia Lines Limited Rs. 892 Lakhs)
3. Container Freight Station income includes income from Hindustan
Cargo Limited Rs. 224 Lakhs, Transindia Logistic Park Private Limited Rs.
236 Lakhs
(Container Freight Station income during the previous year includes
income from Hindustan Cargo Limited Rs. 125 Lakhs, Transindia Logistic
Park Private Limited Rs. 59 Lakhs)
4. Third Party Logistics Income includes income from Hindustan Cargo
Limited Rs. 133 Lakhs
(Third Party Logistics Income includes income from Hindustan Cargo
Limited Rs. 109 Lakhs)
5. Management Fees received includes amount received from Allcargo
Belgium NV Group Rs. 123 Lakhs
(Management Fees received during the previous year includes amount
received from Allcargo Belgium NV Group Rs. 105 Lakhs)
6. Business Support Charges received includes amount received from ECU
International Far East Private Limited Rs. 810 Lakhs
(Business Support Charges received during the previous year includes
amount received from ECU International Far East Private Limited Rs. 493
Lakhs)
7. Corporate guarantee fees received includes amount received from
Allcargo Belgium NV Group Rs. 689 Lakhs , ECU Hold NV Rs. 139 Lakhs
(Corporate guarantee fees received during the previous year Rs. Nil).
8. a) Interest received on Loans include income from South Asia
Terminals Pvt Ltd Rs. 75 Lakhs, Transindia Logistic Park Private Limited
Rs. 37 Lakhs, Allcargo Logistics Park Pvt. Ltd. Rs. 18 Lakhs, AGL
Warehousing Private Limited Rs. 2 Lakhs, Asia Line Ltd Rs. Nil)
(Interest received during the previous year includes income from South
Asia Terminals Pvt. Ltd Rs. 77 Lakhs, Transindia Logistic Park Private
Limited Rs. Nil, Allcargo Logistics Park Pvt Ltd Rs. 22 Lakhs, AGL
Warehousing Private Limited Rs. 40 Lakhs, Asia Line Ltd Rs. 40 Lakhs)
b) Interest received on Advances include income from AGL Warehousing
Private Limited Rs. 4 Lakhs, Transindia Logistic Park Private Limited
Rs. 3 Lakhs, Allcargo Shipping Co. Pvt Ltd Rs. 3 Lakhs.
(Interest received on Advances previous year include income from AGL
Warehousing Private Limited Rs. Nil, Transindia Logistic Park Private
Limited Rs. Nil, Allcargo Shipping Co. Pvt Ltd Rs. Nil.)
9. Multimodal transport operation expenses includes expenses
paid/payable to Allcargo Belgium NV Group Rs. 5,902 Lakhs, Tran world
Logistics & Shipping Services Inc Rs. 110 Lakhs
(Multimodal transport operation expenses during the previous year
includes Allcargo Belgium NV Group Rs. 5,754 Lakhs, Tran world Logistics
& Shipping Services Inc Rs. 742 lakh)
10. Project and Engineering Solution Expense includes expenses
paid/payable to Hindustan Cargo Limited Rs. 2089 Lakhs, Allcargo Belgium
NV Group Rs. 202 Lakhs, MHTC Logistics Private Limited Rs. Nil
(Project and Engineering Solution Expense during the previous year
includes expenses paid to Hindustan Cargo Limited Rs. 973 Lakhs, Allcargo
Belgium NV Group Rs. 214 Lakhs, MHTC Logistics Private Limited Rs. 420
Lakhs)
11. Container freight station expense includes expenses paid/payable
to South Asia Terminals Pvt. Ltd. Rs. 2,590 Lakhs
(Container freight station expense during the previous year includes
South Asia Terminals Pvt. Ltd. Rs. 2,998 Lakhs)
12. Third Party Logistics Expense includes expenses paid/payable to
Hindustan Cargo Limited Rs. 1 lakh,
(Third Party Logistics Expense during the previous year includes
Hindustan Cargo Ltd Rs. Nil)
13. Remuneration to Directors includes Mr.Shashi Kiran Shetty Rs. 310
Lakhs, Mr.Umesh Shetty Rs. 164 Lakhs, Mr.Adarsh Hegde Rs. 134 Lakhs)
(Remuneration to Directors during the previous year includes Mr. Shashi
Kiran ShettyRs. 313 Lakhs, Mr.Umesh Shetty Rs. 126 Lakhs, Mr. Adarsh
Hegde Rs. 117 Lakhs,)
14. Commission to Directors includes Mr. Shashi Kiran Shetty Rs. 150
Lakhs, Mr.Umesh Shetty Rs. 75 Lakhs, Mr. Adarsh Hegde Rs. 75 Lakhs,
Mrs.Arathi Shetty Rs. Nil)
(Commission to Directors during the previous year includes Mr. Shashi
Kiran ShettyRs. 338 Lakhs, Mr.Umesh Shetty Rs. 225 Lakhs, Mr. Adarsh Hegde
Rs. 225 Lakhs, Mrs. Arathi Shetty Rs. 5 Lakhs)
15. Salary Paid Nil
[Salary Paid during the previous year includes payment made to Mr.
Umesh Shetty till May 30, 2012 Rs. 21 Lakhs. (With effect from June 01,
2012 Board of Directors has appointed Mr.Umesh Shetty as a Whole time
Director and the remuneration paid/payable to them Rs. 126 Lakhs)]
16. Rent Paid includes expenses paid to Avash Builders and
Infrastructure Pvt Ltd Rs. 196 Lakhs, Sealand Cranes Private Limited Rs.
102 Lakhs, Allnet Infotech Private Limited Rs. 94 Lakhs, Talentos (India)
Private Limited Rs. 191 Lakhs, Mr. Shashi Kiran Shetty Rs. Nil
(Rent Paid during the previous year includes rent paid Avash Builders
and Infrastructure Pvt Ltd Rs. 262 Lakhs, Sealand Cranes Private Limited
Rs. 136 Lakhs, Allnet Infotech Private Limited Rs. 126 Lakhs, Talentos
(India) Private Limited Rs. 14 Lakhs, Mr. Shashi Kiran Shetty Rs. 24 Lakhs)
17. Dividend paid during the year to Mr. Shashi Kiran Shetty Rs. 1,224
Lakhs, MHTC Logistics Private Limited Rs. Nil.
(Dividend Paid during the previous year includes payment made to Mr.
Shashi Kiran Shetty Rs. 408 Lakhs, MHTC Logistics Private Limited Rs. 2
Lakhs).
18. Car hire charges include expense paid during the year Rs. Nil
(Car hire charges during the previous year includes Transindia Freight
Services Private Limited Rs. 6 Lakhs).
19. Professional fees include expense paid during the year Rs. Nil
(Professional fees during the previous year includes Mrs.Shobha Shetty
Rs. 7 Lakhs).
20. a) Loans given includes amount paid to Transindia Logistic Park
Pvt Ltd Rs. 1,532 Lakhs, Hindustan Cargo Ltd Rs. 400 Lakhs, MHTC
Logistics Private Limited Rs. Nil, Allcargo Logistics Park Pvt. Ltd.
Rs. Nil, Allcargo Belgium NV Rs. Nil)
(Loans given during the previous year includes amount paid to
Transindia Logistics Park Private Limited Nil, Hindustan Cargo Limited
Nil, MHTC Logistics Private LimitedRs. 750 Lakhs, Allcargo Logistics Park
Pvt. Ltd. Rs. 20 Lakhs, Allcargo Belgium NV Rs. 10 Lakhs)
b) Loans received back includes amount received from Hindustan Cargo
Ltd Rs. 400 Lakhs,Allcargo Belgium NV Rs. 10 Lakhs, Allcargo Logistics
Park Pvt. Ltd. Rs. 125 Lakhs
(Loans received back during the previous year includes amount received
from Hindustan Cargo Limited Rs. Nil, Allcargo Belgium NVRs. 5,078 Lakhs,
Allcargo Logistic Park Private Limited Rs. 7 Lakhs)
c) Loans adjusted on account of amalgamation scheme of arrangement-
MHTC Logistics Private Limited of Rs. 734 Lakhs.
d) Loans converted into Preference shares during the year Nil
(Loans converted into Preference shares during the previous year
includes Contech Transport Services Pvt Ltd. Rs. 1,505 Lakhs)
e) Closing Balance of Loan includes Transindia Logistics Park Pvt Ltd Rs.
1,532 Lakhs, South Asia Terminals Pvt. Ltd. Rs. 846 Lakhs, Allcargo
Logistics Park Pvt. Ltd. Rs. 50 Lakhs, MHTC Logistics Private LimitedRs.
Nil, Allcargo Belgium NV Rs. Nil
(Closing Balance of Loan during the previous year includes Transindia
Logistics Park Pvt Ltd Rs. Nil, South Asia Terminals Pvt. Ltd. Rs. 846
Lakhs, Allcargo Logistics Park Pvt Ltd. Rs. 188 Lakhs, MHTC Logistics
Private Limited Rs. 734 Lakhs, Allcargo Belgium N.VRs. 10 Lakhs)
21. a) Advances given includes amount paid to Allcargo Belgium NV
Group Rs. 867 Lakhs, Allcargo Shipping Co. Pvt Ltd Rs. 122 Lakhs,
Transindia Logistic Park Pvt Ltd Rs. 84 Lakhs.
(Advances given during the previous year includes amount paid to
Allcargo Belgium NV Group Rs. 861 Lakhs, Allcargo Shipping Co. Pvt Ltd
Rs. 669 Lakhs, Transindia Logistic Park Pvt Ltd Rs. 366 Lakhs)
b) Advance received back includes amount received from Allcargo Belgium
NV Group Rs. 1,027 Lakhs, Allcargo Shipping Co. Pvt Ltd Rs. 220 Lakhs,
Transindia Logistic Park Pvt Ltd Rs. 79 Lakhs.
(Advance received back during the previous year includes amount
received from Allcargo Belgium NV Group Rs. 661 Lakhs, Allcargo Shipping
Co. Pvt Ltd Rs. 573 Lakhs, Transindia Logistic Park Pvt Ltd. Rs. 353 Lakhs)
c) Advances converted into Preference shares during the year includes Rs.
Nil
(Advances converted into Preference shares during the previous year
includes Hindustan Cargo Ltd Rs. 100 Lakhs)
d) Advances converted into Preference Share Application money includes
Rs. Nil
(Advances converted into Preference Share Application money during the
previous year includes Contech transport Services Pvt. Ltd. Rs. 81 Lakhs)
e) Advances closing balance includes Allcargo Belgium NV Group Rs. 159
Lakhs, AGL Warehousing Private Limited Rs. 34 Lakhs and Transindia
Logistic Park Pvt Ltd Rs. 29 Lakhs, Allcargo Shipping Co. Pvt Ltd Rs. 18
Lakhs, South Asia Terminals Pvt Ltd Rs. 4 Lakhs
(Advances closing balance during the previous year includes Allcargo
Belgium NV Group Rs. 318 Lakhs, AGL Warehousing Private Limited Rs. 53
Lakhs, Transindia Logistic Park Pvt Ltd Rs. 17 Lakhs, Allcargo Shipping
Co. Pvt Ltd Rs. 116 Lakhs, South Asia Terminals Pvt. Ltd. Rs. 97 Lakhs)
22. a) Interest charged on loan given includes South Asia Terminals
Pvt Ltd Rs. 70 Lakhs, Transindia Logistics Park Pvt Ltd Rs. 33 Lakhs,
Allcargo Logistics Park Pvt Ltd Rs. 16 Lakhs.
(Interest charged on loan given to Allcargo Logistics Park Pvt Ltd in
previous year is Rs. 20 Lakhs)
b) Interest receivable on loan received back includes amount received
from South Asia Terminals Pvt Ltd Rs. 66 Lakhs, Allcargo Logistics Park
Pvt Ltd Rs. 28 Lakhs, Transindia Logistics Park Pvt Ltd Rs. 23 Lakhs.
(Interest receivable on loan received from Allcargo Logistics Park Pvt
Ltd during previous year is Rs. 7 Lakhs)
c) Interest receivable on loan closing balance includes Transindia
Logistics Park Pvt Ltd Rs. 10 Lakhs, Hindustan Cargo Ltd Rs. 6 Lakhs and
South Asia Terminals Pvt Ltd Rs. 4 Lakhs
(Interest receivable on loan closing balance from Allcargo Logistics
Park Pvt Ltd during previous year isRs. 13 Lakhs)
23. a) Interest charged on advances given includes AGL Warehousing
Private Limited Rs. 4 Lakhs, Transindia Logistics Park Pvt Ltd
Rs. 3 Lakhs, Allcargo Shipping Co. Pvt Ltd Rs. 3 Lakhs.
(Interest charged on advances given to South Asia Terminals Pvt Ltd
during previous year is Rs. 70 Lakhs)
b) Interest charged on advances received back includes amount received
from South Asia Terminals Pvt Ltd Rs. 70 Lakhs
(Interest charged on advances received back during previous year is
Nil)
c) Interest charged on advances closing balance includes Allcargo
Shipping Co. Pvt Ltd Rs. 3 Lakhs, Transindia Logistics Park Pvt Ltd Rs. 3
Lakhs, AGL Warehousing Private Limited Rs. 4 Lakhs
(Interest charged on advances closing balance given to South Asia
Terminals Pvt Ltd during previous year is Rs. 70 Lakhs)
24. a) Deposit given includes amount paid to Adarsh Hegde Rs. 5 Lakhs,
Panna Estates LLP Rs. 5 Lakhs, SKS Netgate LLP Rs. Nil)
(Deposit given during the previous year includes amount paid to Adarsh
Hegde Rs. Nil, SKS Netgate LLP Rs. 38,000)
b) Deposits received back during the year includes Comptech Solutions
Pvt Ltd Rs. 112 Lakhs, Mr.Shashi Kiran Shetty Rs. Nil
(Deposits received back during the previous year includes Mr.Shashi
Kiran Shetty Rs. 300 Lakhs)
c) Deposit receivables includes deposit paid to Avash Builders and
Infrastructure Private Limited Rs. 720 Lakhs, Talentos (India) Private
Limited Rs. 701 Lakhs, Sealand Cranes Private Limited Rs. 374 Lakhs,
Allnet Infotech Private Limited Rs. 346 Lakhs
(Deposit receivables during the previous year includes deposit paid to
Avash Builders and Infrastructure Private Limited Rs. 720 Lakhs, Talentos
(India) Private Limited Rs. 701 Lakhs, Sealand Cranes Private Limited Rs.
374 Lakhs, Allnet Infotech Private Limited Rs. 346 Lakhs)
25. Share application money pending allotment includes Contech
Transport Services Pvt Ltd Rs. 81 Lakhs, Transindia Logistic Park
Private Limited Rs. Nil
(Share application money pending Allotment during the previous year
includes Contech Transport Services Pvt Ltd Rs. Nil, Transindia Logistic
Park Private Limited Rs. 1,540 Lakhs)
26. Share application money given during the year includes Transindia
Logistics Park Pvt Ltd Rs. 140 Lakhs
(Share application money given during previous year is Rs. Nil)
27. Share application money refund received during the year includes
Prominent Estate Holdings Pvt Ltd Rs. 35 Lakhs.
(Share application money refund during previous year is Rs. Nil)
28. Share application money converted into preference shares during
the year includes Transindia Logistic Park Private Limited Rs. 1,680
Lakhs, Allcargo Shipping Co Pvt. Ltd Rs. Nil
(Share application money converted into preference shares during the
previous year includes Transindia Logistic Park Private Limited Rs. 1,540
Lakhs, Allcargo Shipping Co Pvt. Ltd Rs. 3,370 Lakhs)
29. a) Investments-Equity shares includes Allcargo Belgium NV Group Rs.
6,848 Lakhs, Transindia Logistic Park Private Limited Rs. 5,552 Lakhs,
MHTC Logistics Private Limited Rs. Nil, Gujarat Integrated Maritime
Complex Private Limited Rs. Nil.
(Investments-Equity shares during the previous year includes Allcargo
Belgium NV Group Rs. 6,848 Lakhs, Transindia Logistic Park Private
Limited Rs. 5,552 Lakhs, MHTC Logistics Private Limited Rs. 3,430 Lakhs,
Gujarat Integrated Maritime Complex Private Limited Rs. 3,062 Lakhs)
b) Investments-Preference shares includes Allcargo Shipping Co. Private
Limited Rs. 7,067 Lakhs, AGL Warehousing Private Limited Rs. 3,736 Lakhs,
Hindustan Cargo Limited Rs. 2,320 Lakhs
(Investments-Preference shares during the previous year includes
Allcargo Shipping Co. Private Limited Rs. 7,067 Lakhs, AGL Warehousing
Private Limited Rs. 3,736 Lakhs, Hindustan Cargo Limited Rs. 2,320 Lakhs)
30. Trade advances received during the year includes Allcargo Belgium
NV Group Rs. 447 Lakhs
(Trade advances received during the previous year includes Allcargo
Belgium NV Group Rs. 4,295 Lakhs)
31. Corporate Guarantees given includes Transindia Logistic Park
Private Limited Rs. 8,874 Lakhs, Allcargo Belgium NV Rs. 30,504 Lakhs
(Corporate Guarantees given during the previous year includes
Transindia Logistic Park Private Limited Rs. 9,500 Lakhs, Allcargo
Belgium NV Rs. 7,472 Lakhs)
32. a) Trade Receivables includes Allcargo Belgium NV Group Rs. 428
Lakhs, Contech Transport Services Pvt Ltd Rs. 217 Lakhs, ECU
International Far East Private Limited Rs. 213 Lakhs, South Asia
Terminals Pvt. Ltd. Rs. 159 Lakhs, Hindustan Cargo Limited Rs. 57 Lakhs,
Asia Line Limited Rs. 20 Lakhs.
(Trade Receivables during the previous year includes Allcargo Belgium
NV Group Rs. 771 Lakhs, Contech Transport Services Pvt Ltd Rs. 143 Lakhs,
ECU International Far East Private Limited Rs. 171 Lakhs, South Asia
Terminals Pvt. Ltd. Rs. 85 Lakhs, Hindustan Cargo Limited Rs. 326 Lakhs,
Asia Line Limited Rs. 476 Lakhs)
b) Advance to supplier includes Allcargo Belgium NV Group Rs. 11 Lakhs,
Hindustan Cargo Ltd Rs. 49 Lakhs Advance to Supplier includes during
previous year is Nil
33. a) Trade Payables includes Allcargo Belgium NV Group Rs. 486 Lakhs,
South Asia Terminals Pvt Ltd Rs. 251 Lakhs, MHTC Logistics Private
Limited Rs. Nil, Hindustan Cargo Limited Rs. 38 Lakhs
(Trade Payables during the previous year includes Allcargo Belgium NV
Group Rs. 372 Lakhs, South Asia Terminals Pvt Ltd Rs. 239 Lakhs, MHTC
Logistics Private Limited Rs. 515 Lakhs, Hindustan Cargo Limited Rs. 179
Lakhs)
b) Directors commission payable includes Mr. Shashi Kiran Shetty Rs. 150
Lakhs, Mr. Adarsh Hegde Rs. 75 Lakhs, Mr. Umesh Shetty Rs. 75 Lakhs
(Directors commission payable during the previous year includes Mr.
Shashi Kiran Shetty Rs. 338 Lakhs, Mr. Adarsh Hegde Rs. 225 Lakhs, Mr
Umesh Shetty Rs. 225 Lakhs)
c) Deposit payable includes South Asia Terminals Pvt. Ltd. Rs. 51 Lakhs
(Deposit payable during the previous year includes South Asia Terminals
Pvt. Ltd. Rs. 134 Lakhs)
34. Fixed Assets sold to Transindia Logistic Park Private Limited Rs. 91
Lakhs
(Fixed Assets sold during previous year is Nil)
35. Fixed Assets purchase from Hindustan Cargo Limited Rs. 1 Lakh
(Fixed Assets Purchase during previous year is Nil)
36. Investment in joint ventures
The Company has entered into a share purchase agreement on June 20,
2012 with IL&FS Maritime Infrastructure Company Limited (IMICL) for
sale of its 45% stake (representing 45,000 equity shares of Rs. 10 each)
in Gujarat Integrated Maritime Complex Private Limited (GIMCO) and 50%
stake (representing 4,674,807 equity shares of Rs. 10 each) in Sealand
Warehousing Private Limited (SWPL). During previous period, the Company
has, in accordance with the provisions of the said Agreement and on
fulfilment of certain terms and conditions, transferred 19,000 equity
shares of GIMCO and 2,243,907 equity shares of SWPL to IMICL against
agreed consideration. W.e.f June 21, 2012 post sale and transfer of
equity shares as aforesaid, the Company was holding 26% stake in GIMCO
and SWPL and accordingly the interests in the joint ventures are
reported as non-current investments (refer note 15) and stated at cost.
(A) During the current year, on fulfilment of all the contractual
obligation and on receipt of the balance agreed consideration the
Company has transferred the balance 26,000 equity shares of GIMCO and
2,430,900 equity shares of SWPL to IMICIL. The net income booked for
the current year is Rs. 27 Lakhs (previous year: Rs. 20 Lakhs)
The Company''s interests in joint ventures is accounted, in accordance
with the principles and procedures set out in AS - 27, ''Financial
Reporting of Interests in Joint Ventures'' specified in the Companies
(Accounting Standards) Rules, 2006.
37. Transfer pricing
International and Specified domestic transactions with related parties
The Company''s international and Specified domestic transactions with
related parties are at arm''s length as per the independent accountants
report for the year ended March 31, 2013. Management believes that the
Company''s international and Specified domestic transactions with related
parties post March 31, 2013 continue to be at arm''s length and that the
transfer pricing legislation will not have any impact on these financial
statements, particularly on amount of tax expense and that of provision
for taxation.
38. Employee stock options
a) In 2006, the Company had instituted an ''Allcargo Employee Stock
Option Plan 2006'' (ESOS 2006) to attract, retain, motivate and reward
its employees and to enable them to participate in the growth,
development and success of the Company. The compensation/remuneration
committee of the Board evaluates the performance and other criteria of
employees and approves the grant of options. The employees are granted
an option to purchase shares of the Company at the respective exercise
price, subject to the requirements of vesting conditions. These options
generally vest over a period of 24 to 48 months from the date of grant.
Upon vesting, the employees can acquire one equity share for each
option. The maximum contractual term for these stock option plan is
generally 7 years. The Company granted stock options to be adjusted for
subsequent bonus issue prior to its Initial Public Offering of equity
shares, to its permanent employees and to few of the permanent
employees of its foreign subsidiaries at varying numbers depending upon
their grade.
b) The stock compensation cost is computed under the intrinsic value
method and amortised on a straight line basis over the vesting period
of 7 years.
39. Amalgamation of MHTC Logistics Private Limited with the Company
Scheme of Arrangement between MHTC Logistics Private Limited and the
Company:-
During the year, MHTC logistics Private Limited (hereinafter referred
to as "MHTCÂ), a wholly owned subsidiary of the Company, incorporated
with the main object to do Project Logistics as well as Freight
forwarding business, was amalgamated into the Company pursuant to the
Scheme of Amalgamation (hereinafter referred to as "SchemeÂ), as on and
from April 01, 2012, being the appointed date pursuant to the approval
of Board of Directors and shareholders of the Company and sanctioned by
the Honourable High Court of Bombay vide its order dated December 06,
2013 which was filed with Registrar of Companies on January 24, 2014.
The Company has carried out the accounting treatment prescribed in the
Scheme as approved by the Honourable High Court of Bombay. The required
disclosures for accounting of Scheme as per the "Pooling of Interest
Method as given under Accounting Standard 14 (AS 14) "Accounting for
Amalgamations as prescribed under the Companies (Accounting Standards)
Rules 2006 have been provided.
Hence, in accordance with the Scheme:
i. The Company has taken over all the assets aggregating to Rs. 3,539
Lakhs and liabilities aggregating to Rs. 2,081 Lakhs at their respective
book values. Also, as per the Scheme, the identity of reserves of MHTC
is required to be maintained by the Company as on the appointed date
which was aggregating to Rs. 1,438 Lakhs. On cancellation of investments
made by the Company in MHTC against their share capital as on the
appointed date, there was a deficit of Rs. 3,410 Lakhs. As per the Scheme
approved by the Honourable High Court of Bombay, such deficit is
required to be debited to the "Goodwill Account of the Company.
ii. No consideration is payable or receivable on implementation of the
Scheme as the Scheme involves a wholly owned Subsidiary.
iii. Prior to appointed date, MHTC was holding 373,491 equity shares of
the Company. As a consequence of and as per the Scheme the aforesaid
investment of MHTC in the Company has been cancelled and accordingly
the share capital of the Company stands reduced by Rs. 7 Lakhs and the
Securities Premium Account of the Company stands reduced by Rs. 635
Lakhs.
Had the Scheme not prescribed the aforementioned accounting treatment
and the Company had followed the accounting treatment prescribed under
AS 14, there would not have been any Goodwill on Merger arising out of
deficit arising against cancellation of Investment against share capital
of the amalgamating company, as mentioned in point no. (i) above and
the General Reserves of the Company would have been lower by Rs. 3,410
Lakhs.
In terms of the Scheme, the appointed date of the amalgamation being
April 01, 2012, the net loss of MHTC for the financial year 2012-13
aggregating to Rs. 88 Lakhs has been adjusted in the surplus in Statement
of Profit and loss under Reserves and Surplus.
During the year, as MHTC carried on its existing business in trust for
and on behalf of the Company, all vouchers, documents etc. for the year
are in the name of MHTC Logistics Private Limited. Further, the title
deeds for the immovable properties pertaining to amalgamating company
are pending conveyance in the name of the Company.
The Goodwill arising on account of merger amounting to Rs. 3,410 Lakhs
has been fully amortised by the Company during the current year.
40. Buy back of shares
The Board of Directors of the Company in its meeting held on June 20,
2012 approved the buyback of 5,263,158 equity shares of Rs. 2 each fully
paid at prices not exceeding Rs. 142.50 per equity shares payable in
cash, up to an aggregate amount not exceeding Rs. 7,500 Lakhs from the
open market through stock exchange(s).
During the previous year, the Company has bought back and extinguished
4,136,449 equity shares at an average price of Rs. 139.69 per equity
share for an aggregate amount of Rs. 5,817 Lakhs (inclusive of
transaction cost). Since the Company had completed 78% of the buyback
offer within a period of 8 months, the Company has announced closure of
buyback of its shares with effect from March 04, 2013.
During the previous year, pursuant to the buy back of shares as
aforesaid, the issued, subscribed and paid up capital of the Company
reduced from Rs. 2,604 Lakhs comprising of 130,173,831 equity shares
of Rs. 2 each fully paid-up to Rs. 2,521 Lakhs comprising of 126,037,382
shares of Rs. 2 each fully paid-up.
41. a) Loans and advances include Rs. 2,668 Lakhs (previous year: Rs.
1,343 Lakhs) due by directors or other officers of the company or any of
them either severally or jointly with any other persons or amounts due
by firms or private companies respectively in which any director is a
partner or a director or a member should be separately stated.
42. The Ministry of Corporate Affairs, Government of India, vide
General Circular No.2 and 3 dated February 08, 2011 and February 21,
2011 respectively has granted a general exemption from compliance with
Section 212 of the Act, subject to fulfilment of conditions stipulated
in the circular. The Company has satisfied the conditions stipulated in
the circular and hence is entitled to the exemption. Necessary
information relating to the subsidiaries has been included in the
Consolidated Financial Statements.
43. Prior year comparatives
Pursuant to the amalgamation of MHTC Logistics Private Limited, the
figures for the current year are not strictly comparable to those of the
previous year.
Mar 31, 2013
1. Company overview
Allcargo Logistics Limited(''the Company'') was incorporated on 18 August
1993 and is a leading multinational company engaged in providing
integrated logistics solutions and offers specialised logistics
services across Multimodal Transport Operations, Inland Container
Depot, Container Freight Station Operations, Third Party Logistics
Operations and Project and Engineering Solutions. The Company is listed
on Bombay Stock Exchange Limited and National Stock Exchange of India
Limited.
2. Changes in accounting policies
Exchange differences on long term foreign currency monetary items
Pursuant to the notifcation dated 29 December 2011, issued by the
Ministry of Corporate Affairs inserting the paragraph 46A of the AS 11
''The Effects of Changes in Foreign Exchange Rates'', notifed under the
Companies (Accounting Standards) Rules, 2006, the Company opted to
record, from the current period foreign exchange transaction for all
long term monetary liabilities, as per paragraph 46 A of AS -11. As a
result, exchange difference on long term monetary liabilities arising
subsequent to April 01, 2011 is restated as per paragraph 46A.
The change has resulted in increase of depreciation of Rs. 91 lakhs,
reduction in the fnance charge of Rs. 820 lakhs and increase in proft
after tax of Rs. 747 lakhs for the year ended March 31, 2013.
The above adjustment includes interest reversal of Rs. 820 lakhs and
incremental depreciation of Rs. 28 lakhs for the period ended March 31,
2012.
3. Dues to micro and small suppliers
Under the Micro, Small and Medium Enterprises Development Act,2006
(MSMED) which came into force from 02 October 2006, certain disclosures
are required to be made relating to MSME. On the basis of the
information and records available with the Company, the following
disclosures are made for the amounts due to the Micro and Small
Enterprises.
4. Segment reporting
Disclosure as per Account Standard (AS) 17" Segment reporting" is
reported in Consolidated Accounts of the Company. Therefore, the same
has not been separately disclosed in line with the provision of AS.
5. Leases
Operating leases as lessee
The Company has taken a commercial property on non-cancellable
operating lease. The lease agreement provides for an option to the
Company to renew the lease period at the end of non-cancellable period.
There are no exceptional/restrictive covenants in the lease agreements.
The future minimum lease payments in respect of lease property as at 31
March 2013 is as follows:
6. Disclosure pursuant to Accounting Standard -15 (Revised) ''Employee
Benefts''
i) Defned Contribution Plans:
Contribution to Provident Fund and ESIC
Amount of Rs. 338 lakhs (previous period : Rs. 350 lakhs) contributed to
Provident Fund, ESIC and other funds (refer note 26) is recognised as
an expense and included in "Contribution to Provident & Other Funds''
under ''Employee benefts" in the statement of proft and loss.
ii) Defned Beneft Plans
The Company has a defned beneft gratuity plan. Every employee who has
completed fve years or more of service gets a gratuity on death or
resignation or retirement at 15 days salary (last drawn salary) for
each completed year of service subject to a maximum payment of Rs. 10
lakhs.
7. Related party disclosures
A Name of related parties where control exists: I. subsidiaries
Hindustan Cargo Ltd.
Contech Transport Services Pvt. Ltd.
Ecu Line (India) Pvt. Ltd.
Allcargo Shipping Co.Pvt.Ltd.
South Asia Terminals Pvt.Ltd.
Southern Terminals & Trading Pvt. Ltd.
AGL Warehousing Pvt. Ltd.
Allcargo Logistics Park Pvt.Ltd.
Ecu International (Asia) Pvt. Ltd.
Comptech Solutions Pvt.Ltd.
Amfn Consulting Pvt. Ltd.
Transindia Logistic Park Pvt Ltd.
MHTC Logistics Pvt. Ltd.
Combi Line Indian Agencies Pvt. Ltd.
HC Logistics Ltd.
Credo Shipping Agencies (I) Pvt. Ltd.
Ecu Line Abu Dhabi LLC
Ecu-Line Algerie sarl
Ecu Logistics SA
Ecu-Line Australia Pty.Ltd.
Ecuhold NV
Allcargo Belgium N.V.
Ecubro N.V.
Ecu International N.V.
Ecu-Tech BVBA
Ecu-Line N.V.
Ecu-Logistics N.V.
AGL N.V
HCL Logistics nv
Ecu Global Services NV
Ecu Logistics do Brasil Ltd.a
Flamingo Line do Brazil Ltd.a
Ecu Line Bulgaria EOOD
Ecu-Line Canada Inc.
Ecu Line Chile S.A.
Cargo Freight Station S.A.
Flamingo Line Chile S.A
Ecu Line Guangzhou Ltd.
Ecu Line De Colombia S.A.
Conecli International S.A.
Ecu Line Middleeast LLC
Eurocentre FZCO
Ecu Line Del Ecuador S.A.
Flamingo Line del Ecuador S.A.
Ecu Line Egypt Ltd.
Flamingo Line El Salvador SA de CV
Ecu-Line Germany GmbH
ELWA (Ghana) Ltd.
Flamingo Line Guatemala S.A.
Ecu-Line Hong Kong Ltd.
Ecu International Far East Ltd.
Ecu Line Italia srl
Ecu Line Cote d''lvoire Sarl
Ecu Line Japan Ltd.
Jordan Gulf for Freight Services
Ecu Line Kenya Ltd.
Ecu Shipping Logistic (K) Ltd.
Ecu-Line (Johar Bahora) Sdn Bhd
Ecu-Line Malta Ltd.
aEcu-Line (Indian Ocean Islands) Ltd.
Ecu Line Meditterranean Ltd.
CELM Logistics S.A. De C.V.
Ecu Logistics de Mexico SA de CV
Ecu Line Maroc S.A.
Ecu-Line Rotterdam BV
Ecu Line NZ Ltd.
Ecu-Line de Panama S.A.
Ecu-Line Paraguay S.A.
Ecu-Line Peru S.A.
Flamingo Line Peru S.A
Ecu Line Philippines Inc.
Ecu-Line Polska Sp. z.o.o.
Ecu Line Doha W.L.L.
Ecu-Line Romania SRL
Rotterdam Freight Station BV
Ecu Line Singapore Pte. Ltd.
Ecu Line South Africa (Pty.) Ltd.
Ecu Line Spain S.L.
Mediterranean Cargo Centers S.L.
Ecu Line (Thailand) Co.Ltd.
Société Ecu-Line Tunisie Sarl
Ecu Uluslarasi Tas. Ve Ticaret Ltd. Sti.
Ecu-Line UK Ltd.
Deolix SA
DLC
ELV Multimodal C.A.
Administradora House Line C.A.
Consolidadora Ecu Line CA
Ecu-Line Vietnam Co., Ltd.
Ecu Line Zimbabwe (Pty.) Ltd.
Ecu Line China Ltd.
Eurocentre Milan SRL
Ecu Line Switzerland GmBH
Guldary s.a.
S.H.E. Maritime Services Ltd.
CCC Ltd.
Star Express Company Ltd.
CCS Shipping Ltd.
CCSS Ltd.
Ecu Line Lanka (Pvt.) Ltd.
PT Eka Consol Utama Line
Ecu Line Czeche s.r.o
Ecu Line Hungary Kft
Translogistik International Spedition GmbH
European Customs Brokers N.V.
Contech Transport Services (Pvt) Ltd.
Ecu-Line Saudi Arabia LLC
Asia Line Ltd.
Ocean House Ltd.
II. associates
Transworld Logistics & Shipping Services Inc.
Sealand Warehousing Private Limited (w.e.f 21 June 2012)
Gujarat Integrated Maritime Complex Pvt. Ltd (w.e.f 21 June 2012)
III Joint Venturers
Sealand Warehousing Private Limited (ceased to be Joint Venturer w.e.f
20 June 2012) Gujarat Integrated Maritime Complex Pvt. Ltd (ceased to
be Joint Venturer w.e.f 20 June 2012)
IV. Entities over which key managerial personnel or their relatives
exercises signifcant infuence:
Allcargo Movers (Bombay) Private Limited
Allcargo Shipping Services Private Limited
Allnet Infotech Private Limited
Alltrans Logistics Private Limited
Alltrans Port Management Private Limited
Avadh Marketing LLP
Avash Builders And Infrastructure Private Limited
Avash Logistic Park Private Limited (upto 20 June 2012)
Avashya Corproation Pvt.Ltd
Avashya Enterprises Pvt.Ltd
Avashya Holdings Pvt.Ltd
Contech Estate LLP
India Tourist And Heritage Village Private Limited (upto 20 June 2012)
Indport Maritime Agencies Pvt.Ltd.
Jupiter Precious Gems and Jewellery Private Limited (formerly Jupiter
Machines Pvt. Ltd.)
N.R. Holdings Private Limited
Panna Estates Private Limited (Converted into Panna Estates LLP w.e.f
01 December 2011)
Poorn Estates Private Limited
Prominent Estate Holdings Private Limited
Sealand Crane Private Limited
Sealand Ports Private Limited (upto 20 June 2012)
SKS Netgate LLP
SKS Realty LLP
SKS Ventures Private Limited
Talentos (India) Private Limited
Talentos Entertainment Private Limited
Transindia Freight Private Limited
Transindia Freight Services Private Limited
Sealand Holdings Pvt. Ltd
Meridien Tradeplace Pvt.Ltd
Poorn Buildcon Pvt. Ltd
Beyond Properties Pvt.Ltd
Panna Infracon Projects LLP V.
V. Key Managerial Personnel
Shashi Kiran Shetty
Umesh Shetty (Appointed as a Whole time Director w.e.f 01 June 2012)
Adarsh Hegde
VI. Relatives of Key Management Personnel
Shobha Shetty
Arathi Shetty (Executive Director till March 31, 2012)
Details of material related party transactions which are more than 10 %
of the total transactions of the same type with a related party during
the year ended March 31, 2013
1. MTO income includes income from Allcargo Belgium NV Group Rs. 5,645
lakhs
(MTO income during the previous period includes income earned from
Allcargo Belgium NV group Rs. 7,738 lakhs)
2. Project and Engineering Solution Income includes South Asia
Terminals Private Limited Rs. 1,878 lakhs, asia Lines Limited Rs. 892
lakhs, hindustan cargo ltd Rs. 135 lakhs
(Project and Engineering Solution Income during the previous period
includes income from South Asia Terminals Private Limited Rs. 1,505
lakhs, Asia Lines Limited Rs. 526 lakhs, Hindustan Cargo Limited Rs.
397 lakhs)
3. Container Freight Station income includes income from Hindustan
Cargo Limited Rs. 125 lakhs, transindia logistic Park Pvt. ltd.Rs. 59
lakhs
(Container Freight Station income during the previous period includes
income from Hindustan Cargo Limited Rs. 53 lakhs, Transindia Logistic
Park Pvt. Ltd.Rs. 1 lakh )
4. Third Party Logistics Income includes income from Hindustan Cargo
Limited Rs. 109 lakhs, Allcargo Belgium NV Group Rs. 50 lakhs,
(Third Party Logistics Income includes income from Hindustan Cargo
Limited Rs. 143 lakhs, Allcargo Belgium NV Group Rs. Nil)
5. Management Fees received includes amount received from Allcargo
Belgium NV Group Rs. 105 lakhs, Gujarat Integrated Maritime Complex
Private Limited Rs. Nil, Sealand Warehousing Pvt Limited Rs. nil
(Management Fees received during the previous period includes amount
received from Allcargo Belgium NV Group Rs. 123 lakhs, Gujarat
Integrated Maritime Complex Private Limited Rs. 400 lakhs , Sealand
Warehousing Pvt Limited Rs. 300 lakhs)
6. Business Support Charges received includes amount received from
Allcargo Belgium NV Group Rs. 493 lakhs
(Business Support Charges received during the previous period includes
amount received from Allcargo Belgium NV Group Rs. 394 lakhs)
7. Interest received include income from South Asia Terminals Pvt Ltd
Rs. 77 lakhs, aGl warehousing Private Limited Rs. 40 lakhs, asia line
ltd Rs. 40 lakhs, allcargo logistics Park Pvt. ltd. Rs. 22 lakhs,
Allcargo Shipping Co. Pvt. ltd Rs. nil, hindustan cargo ltd Rs. nil)
(Interest received during the previous period includes income from
South Asia Terminals Pvt. Ltd Rs. Nil, AGL Warehousing Private Limited
Rs. 274 lakhs, Asia Line Ltd Rs.1 L, Allcargo Logistics Park Pvt.Ltd
Rs.12 lakhs, Allcargo Shipping Co. Private Limited Rs. 366 lakhs,
Hindustan Cargo Limited Rs. 217 lakhs)
8. MTO Operation Expenses includes expenses paid/payable to Allcargo
Belgium NV Group Rs. 5,754 lakhs, Transworld Logistics & Shipping
Services Inc Rs. 742 lakh
(MTO Operation Expenses during the previous period includes Allcargo
Belgium NV Group Rs. 9,591 lakhs, Transworld Logistics & Shipping
Services Inc Rs. 745 lakh)
9. Project and Engineering Solution Expense includes expenses
paid/payable to MHTC Logistics Private Limited Rs. 420 lakhs, Hindustan
Cargo Limited Rs. 335 lakhs, Allcargo Belgium NV Group Rs. 106 lakhs
(Project and Engineering Solution Expense during the previous period
includes expenses paid to MHTC Logistics Private Limited Rs. 568 lakhs,
Hindustan Cargo Limited Rs. 384 lakhs, Allcargo Belgium NV Group Rs.
Nil)
10. Container freight station expense includes expenses paid/payable
to South Asia Terminal Private Limited Rs. 2,998 lakhs
(Container freight station expense during the previous period includes
South Asia Terminal Private Limited Rs. 1,893 lakhs)
11. Third Party Logistics Expense includes expenses paid/payable to
Hindustan Cargo Limited Rs. 638 lakhs, Allcargo Belgium NV Group Rs.
108 lakhs.
(Third Party Logistics Expense during the previous period includes
Hindustan Cargo Ltd Rs. 694 lakhs, Allcargo Belgium NV Group Rs. 63
lakhs)
12. Remuneration to Directors includes Mr.Shashi Kiran Shetty Rs. 313
lakhs, Mr.Umesh Shetty Rs. 126 lakhs, Mr. adarsh hegde Rs. 117 lakhs, ,
Mrs.arathi shetty Rs. nil)
(Remuneration to Directors during the previous period includes Mr.
Shashi Kiran Shetty Rs. 374 lakhs, Mr.Umesh Shetty Rs. Nil, Mr. Adarsh
Hegde Rs. 146 lakhs, Mrs. Arathi Shetty(Executive Director till March
31, 2012) Rs. 25 lakhs)
13. Commission to Directors includes Mr. Shashi Kiran Shetty Rs. 338
lakhs, Mr.Umesh Shetty Rs. 225 lakhs, Mr. adarsh hegde Rs. 225 lakhs,
Mrs.arathi shetty Rs. 5 lakhs)
(Commission to Directors during the previous period includes Mr. Shashi
Kiran Shetty Rs. 264 lakhs, Mr.Umesh Shetty Rs. Nil, Mr. Adarsh Hegde
Rs. 231 lakhs, Mrs. Arathi Shetty(Executive Director till March 31,
2012) Rs. 198 lakhs)
14. Salary Paid includes payment made to Mr. Umesh Shetty till 30 May
2012 Rs. 21 lakhs. (With effect from 01 June 2012 Board of Directors
has appointed Mr.Umesh Shetty as a Whole time Director and the
remuneration paid/ payable to them Rs. 126 lakhs)
(Salary Paid during the previous period includes Mr.Umesh Shetty Rs.
355 lakhs)
15. Rent Paid includes expenses paid/payable to Avash Builders and
Infrastructure Pvt Ltd Rs. 262 lakhs, sealand Cranes Private Limited
Rs. 136 lakhs, Allnet Infotech Private Limited Rs. 126 lakhs, Mr.
shashi Kiran shetty Rs. 24 lakhs.
(Rent Paid during the previous period includes rent paid Avash Builders
and Infrastructure Pvt Ltd Rs. Nil, Sealand Cranes Private Limited Rs.
159 lakhs, Allnet Infotech Private Limited Rs. 147 lakhs, Mr. Shashi
Kiran Shetty Rs. 54 lakhs)
16. Professional Fees Paid includes Mrs. shobha shetty Rs. 7 lakhs
(Professional Fees Paid during the previous period includes Mrs. Shobha
Shetty Rs. 9 lakhs)
17. Dividend Paid includes payment made to MHTC Logistics Private
Limited Rs. 2 lakhs
(Dividend Paid during the previous period includes payment made to MHTC
Logistics Private Limited Rs. 13 lakhs)
18. Car hire Charge includes expenses paid/payable to Transindia
Freight Services Private Limited Rs. 6 lakhs (Car hire Charges during
the previous period includes Transindia Freight Services Private
Limited Rs. 8 lakhs)
19. Reimbursement of Expenses includes amount received from Transnepal
Freight Services Private Limited Rs. nil
(Reimbursement of Expenses during the previous period includes
Transnepal Freight Services Private Limited Rs. 5 lakhs)
20. Loans given includes amount paid to MHTC Logistics Pvt Ltd. Rs.
750 lakhs, allcargo logistics Park Pvt ltd Rs. 20 lakhs, Allcargo
Belgium NV Rs. 10 lakhs, Allcargo Shipping Company Private Limited Rs.
Nil, Contech Transport Services Private Limited Rs. nil (Loans given
during the previous period includes amount paid to MHTC Logistics Pvt.
Ltd Rs. 350 lakhs, Allcargo Logistics Park Private Limited Rs. 1,445
lakhs, Allcargo Belgium NV Rs. 5,207 lakhs, , Allcargo Shipping Company
Private Limited Rs. 1,876 lakhs, Contech Transport Services Private
Limited Rs. 1,676 lakhs,)
20 a. Loans received back includes amount received from Allcargo
Belgium NV Rs. 5,078 lakhs , allcargo logistics Park Pvt.ltd Rs. 7
lakhs, Allcargo Shipping Co. Private Limited Rs. Nil, Contech Transport
Services Private Limited Rs. nil (Loans received back during the
previous period includes amount received from Allcargo Belgium NV Rs.
6,044 lakhs, Allcargo Logistic Park Private Limited Rs. 1,270 lakhs,
Allcargo Shipping Co. Private Limited Rs. 1,890 lakhs, Contech
Transport Services Private Limited Rs. 1,394 lakhs)
20 b. Loans converted into Preference shares during the year includes
Contech Transport Services Pvt ltd. Rs. 1,505 lakhs, AGL Warehousing
Private Limited Rs. Nil, Allcargo Shipping Co. Private Limited Rs. Nil,
Hindustan Cargo Limited Rs. nil (Loans converted into Preference shares
during the previous period includes Contech Transport Services Pvt Ltd.
Rs. Nil, AGL Warehousing Private Limited Rs. 3,670 lakhs, Allcargo
Shipping Co. Private Limited Rs. 3,661 lakhs, Hindustan Cargo Limited
Rs. 2,220 lakhs)
20 c. Closing Balance of Loan includes balance outstanding South Asia
Terminal Private Limited Rs. 846 lakhs, MHTC Logistics Private Limited
Rs. 734 lakhs, allcargo logistics Park Pvt ltd. Rs. 188 lakhs,
Allcargo Belgium N.V Rs. 10 lakhs, Contech Transport Services Private
Limited Rs. nil (Closing Balance of Loan during the previous period
includes South Asia Terminal Private Limited Rs. 896 lakhs, MHTC
Logistics Private Limited Rs. 350 lakhs, Allcargo Logistics Park Pvt
Ltd.Rs. 175 lakhs, Allcargo Belgium N.V Rs. 5,078 lakhs, Contech
Transport Services Private Limited Rs. 1,505 lakhs,)
21. Advances given includes amount paid to Allcargo Belgium NV Group
Rs. 861 lakhs, Allcargo Shipping Co Pvt. ltd. Rs. 669 lakhs,
transindia logistic Park Pvt ltd. Rs. 366 lakhs
(Advances given during the previous period includes amount paid to
Allcargo Belgium NV Group Rs. 1,811 lakhs, Allcargo Shipping Company
Pvt Ltd Rs. 20 lakhs, Transindia Logistic Park Pvt Ltd Rs. 33 lakhs)
21 a. Advance received back includes amount received from Allcargo
Belgium NV Group Rs. 661 lakhs, Allcargo Shipping Co Pvt. Ltd.Rs. 573
lakhs, transindia logistic Park Pvt ltd. Rs. 353 lakhs (Advance
received back during the previous period includes amount received from
Allcargo Belgium NV Group Rs. 1,878 lakhs, Allcargo Shipping Co Pvt.
Ltd. Rs. Nil, Transindia Logistic Park Pvt Ltd. Rs. 21 lakhs)
21 b. advances converted into Preference shares during the year
includes hindustan cargo ltd Rs. 100 lakhs (Advances converted into
Preference shares during the previous period includes Hindustan Cargo
Ltd Rs. Nil, AGL Warehousing Private Limited Rs. 66 lakhs, Allcargo
Shipping Company Private Limited Rs. 36 lakhs)
21 c. Advances converted into Preference Share Application money
includes Contech transport Services Pvt. ltd. Rs. 81 lakhs (Advances
converted into Preference Share Application money during the previous
period includes Contech transport Services Pvt. Ltd. Rs. Nil)
21 d. Advances Closing balance includes Allcargo Belgium NV Group Rs.
318 lakhs, Allcargo Shipping Co Pvt ltd. Rs. 116 lakhs, South Asia
Termials Private Limited Rs. 97 lakhs, Contech Transport services
Private Limited Rs. Nil, Hindustan Cargo Limited Rs. 36 lakhs (Advances
Closing balance during the previous period includes Allcargo Belgium NV
Group Rs. 119 lakhs, Allcargo Shipping Co Pvt Ltd Rs. 20 lakhs, South
Asia Terminals Private Limited Rs. 123 lakhs, Contech Transport
services Private Limited Rs. 78 lakhs, Hindustan Cargo Limited Rs. 97
lakhs,)
22. Deposit given includes amount paid to SKS Netgate LLP Rs. 38,000,
avash Builders and Infrastructure Private Limited Rs. Nil, Talentos
(India) Private Limited Rs. nil
(Deposit given during the previous period includes amount paid to SKS
Netgate LLP Rs. Nil, Avash Builders and Infrastructure Private Limited
Rs. 720 lakhs, Talentos (India) Private Limited Rs. 701 lakhs,)
22 a. Deposits received back during the year includes Mr. Shashi Kiran
Shetty Rs. 300 lakhs.
(Deposits received back during the previous period includes Mr.Shashi
Kiran Shetty Rs. 300 lakhs)
22 b. Deposit Receivables includes deposit paid to Avash Builders and
Infrastructure Private Limited Rs. 720 lakhs, Talentos (India) Private
Limited Rs. 701 lakhs, Sealand Cranes Private Limited Rs. 374 lakhs,
allnet Infotech Private Limited Rs. 346 lakhs, Mr.shashi Kiran shetty
Rs. nil
(Deposit Receivables during the previous period includes deposit paid
to Avash Builders and Infrastructure Private Limited Rs. 720 lakhs,
Talentos (India) Private Limited Rs. 701 lakhs, Sealand Cranes Private
Limited Rs. 374 lakhs, Allnet Infotech Private Limited Rs. 346 lakhs,
Mr. Shashi Kiran Shetty Rs. 300 lakhs)
23. Share Application Money Pending Allotment includes Transindia
Logistic Park Pvt Ltd Rs. 1,540 lakhs, Gujarat Integrated Maritime
Complex private Limited Rs. nil
(Share Application Money Pending Allotment during the previous period
includes Transindia Logistic Park Private Limited Rs. 1,540 lakhs,
Gujarat Integrated Maritime Complex Private Limited Rs. 785 lakhs)
24. Share application money converted into preference shares during
the year includes Allcargo Shipping Co Pvt. ltd. Rs. 3,370 lakhs,
transindia logistic Park Pvt ltd. Rs. 1,540 lakhs,
(Share application money converted into preference shares during the
previous period includes Allcargo Shipping Co Pvt. Ltd Rs. Nil,
Transindia Logistic Park Private Limited Rs. Nil)
25. Investments during the year includes Gujarat Integrated Maritime
Complex Private Limited Rs. nil, Mhtc Logistics Private Limited Rs.
nil, transindia logistic Park Pvt ltd. Rs. nil
(Investments during the previous period includes Gujarat Integrated
Maritime Complex Private Limited Rs. 5,300 lakhs, MHTC Logistics
Private Limited Rs. 3,430 lakhs, Transindia Logistic Park Private
Limited Rs. 5,552 lakhs)
26. Trade Advances Received during the year includes Allcargo Belgium
NV Group Rs. 4,295 lakhs (Trade Advances Received during the previous
period includes Allcargo Belgium NV Group Rs. Nil)
27. Corporate Guarantees given includes Transindia Logistic Park
Private Limited  Rs. 9,500 lakhs, allcargo Belgium NV Rs. 7,472 lakhs
(Corporate Guarantees given during the previous period includes
Transindia Logistic Park Private Limited Rs. 9,500 lakhs, Allcargo
Belgium NV Rs. 11,543 lakhs,)
28. Trade Receivables includes Allcargo Belgium NV Group Rs. 942
lakhs, Asia Line Limited Rs. 476 lakhs, hindustan Cargo Limited Rs. 326
lakhs, South Asia Terminal Private Limited Rs. 85 lakhs, Gujarat
Integrated Maritime Complex Private Limited Rs. nil
(Trade Receivables during the previous period includes Allcargo Belgium
NV Group Rs. 150 lakhs Asia Line Limited Rs. 346 lakhs, Hindustan Cargo
Limited Rs. 210 lakhs, South Asia Terminal Private Limited Rs. 145
lakhs, Gujarat Integrated Maritime Complex Private Limited Rs. 397
lakhs)
29. Trade Payables includes MHTC Logistics Private Limited Rs. 515
lakhs, Allcargo Belgium NV Group Rs. 372 lakhs, South Asia Terminals
Pvt Ltd Rs. 239 lakhs, Hindustan Cargo Limited Rs. 179 lakhs
(Trade Payables during the previous period includes MHTC Logistics
Private Limited Rs. 423 lakhs, Allcargo Belgium NV Group Rs. Nil, South
Asia Terminals Pvt Ltd Rs. Nil, Hindustan Cargo Limited Rs. Nil)
29 a. Directors commission payable includes Mr.Shashi Kiran Shetty Rs.
338 lakhs, Mr. adarsh hegde Rs. 225 lakhs, Mr Umesh Shetty Rs. 225
lakhs, Mrs. arathi shetty Rs. nil
(Directors commission payable during the previous period includes Mr.
Shashi Kiran Shetty Rs. 264 lakhs, Mr. Adarsh Hegde Rs. 231 lakhs, Mr
Umesh Shetty Rs. Nil, Mrs. Arathi Shetty Rs. 198 lakhs)
29 b. Deposit payable includes South Asia Terminals Private Limited
Rs. 134 lakhs
(Deposit payable during the previous period includes South Asia
Terminals Private Limited Rs. 204 lakhs)
29 c. Investments-Equity shares includes Allcargo Belgium NV Group Rs.
6,848 lakhs, transindia logistic Park Private Limited Rs. 5,552 lakhs,
MHTC Logistics Private Limited Rs. 3,430 lakhs, Gujarat Integrated
Maritime Complex Private Limited Rs. 3,062 lakhs
(Investments-Equity shares during the previous period includes Allcargo
Belgium NV Group Rs. 6,848 lakhs, Transindia Logistic Park Private
Limited Rs. 5,552 lakhs, MHTC Logistics Private Limited Rs. 3,430
lakhs, Gujarat Integrated Maritime Complex Private Limited Rs. 5,300
lakhs)
29 d. Investments-Preference shares includes Allcargo Shipping Company
Private Limited Rs. 7,067 lakhs, AGL Warehousing Private Limited Rs.
3,736 lakhs, Hindustan Cargo Limited Rs. 2,320 lakhs
(Investments-Preference shares during the previous period includes
Allcargo Shipping Company Private Limited Rs. 3,697 lakhs, AGL
Warehousing Private Limited Rs. 3,736 lakhs, Hindustan Cargo Limited
Rs. 2,220 lakhs)
8. Dividend remittances in foreign currency :
The Company has not remitted any amount in foreign currencies on
account of dividends during the year and does not have information as
to the extent to which remittances, if any, in foreign currencies on
account of dividends have been made by / on behalf of non-resident
shareholders. The particulars of dividends paid to non-resident
shareholders which were declared during the year/period, are as under :
9. Investment in joint ventures
The Company has entered into a Share Purchase Agreement on 20 June 2012
with IL&FS Maritime Infrastructure Company Limited (IMICL) for sale of
its 45% stake (representing 45,000 equity shares of Rs. 10 each) in
Gujarat Integrated Maritime Complex Private Limited (GIMCO) and 50%
stake (representing 4,674,807 equity shares of Rs. 10 each) in Sealand
Warehousing Private Limited (SWPL). The sale of stake in GIMCO and SWPL
are subject to fulfllment of certain terms and conditions by the
Company as stipulated in the aforesaid agreement. During the year, the
Company has, in accordance with the provisions of the said Agreement
and on fulfllment of certain terms and conditions, transferred 19,000
equity shares of GIMCO and 2,243,907 equity shares of SWPL to IMICL
against agreed consideration. Post sale and transfer of equity shares
as aforesaid, the Company holds 26% stake in GIMCO and SWPL.
Till the previous period ended March 31, 2012, the Company''s interests
in joint ventures have been accounted for in accordance with the
principles and procedures set out in AS Â 27, Financial Reporting of
Interests in Joint Ventures specifed in the Companies (Accounting
Standards) Rules, 2006.
10. Transfer pricing
a) International Transaction with related parties
The Company''s international transactions with related parties are at
arm''s length as per the independent accountants report for the year
ended March 31, 2012. Management believes that the Company''s
international transactions with related parties post March 31, 2012
continue to be at arm''s length and that the transfer pricing
legislation will not have any impact on these fnancial statements,
particularly on amount of tax expense and that of provision for
taxation.
b) Specifed Domestic Transactions with related parties
The Transfer Pricing amendments which are applicable from April 01,
2012 cover specifed domestic transactions. Accordingly, transactions
between the Company with its various group companies will be covered
under the above regulations with effect from April 01, 2012.
Management believes that the Company''s transactions with domestic
related parties during the year are at arms length and that the
Transfer Pricing legislation will not have any impact on the fnancial
statements, particularly on amount of tax expense and that of provision
of taxation.
11. Employee stock options
a) In 2006, the Company had instituted an ''Allcargo Employee Stock
Option Plan 2006'' (ESOS 2006) to attract, retain, motivate and reward
its employees and to enable them to participate in the growth,
development and success of the Company. The compensation/remuneration
committee of the Board evaluates the performance and other criteria of
employees and approves the grant of options .The employees are granted
an option to purchase shares of the Company at the respective exercise
price, subject to the requirements of vesting conditions. These options
generally vest over a period of 24 to 48 months from the date of grant.
Upon vesting, the employees can acquire one equity share for each
option. The maximum contractual term for these stock option plan is
generally 7 years. The Company granted stock options to be adjusted for
subsequent bonus issue prior to its Initial Public Offering of equity
shares, to its permanent employees and to few of the permanent
employees of its foreign subsidiaries at varying numbers depending upon
their grades.
b) The stock compensation cost is computed under the intrinsic value
method and amortised on a straight line basis over the vesting period
of 7 years.
As permitted by the SEBI (Employee Stock Option Scheme and Employee
Stock Purchase Scheme) Guidelines, 1999 (''SEBI guidelines'') as well as
by the guidance note on the subject issued by the Institute of
Chartered Accounts of India, the Company has elected to account for
stock options based on their intrinsic value (i.e. the excess of quoted
market price of the underlying share over the exercise price) at the
grant date rather than their fair value at that date. Had the
compensation cost for employee stock options been determined on the
basis of the fair value approach as described in the SEBI guidelines
(and ICAI guidance note), the Company''s net proft after tax and basic
and diluted earnings per share would have been as per the proforma
amounts shown below:
12. Derivative instruments
The Company uses derivative and forward contracts to hedge its risks
associated with foreign currency fuctuations. Such transactions are
governed by the strategy approved by the Board of Directors which
provides principles on the use of these instruments consistent with the
Company''s Risk Management Policy. The Company does not use these
contracts for trading or speculative purposes. The Company has marked
to market the derivative contract outstanding as at March 31, 2013
which has resulted in a net gain to the Company. The Company has not
recognised the resulted gain on prudent basis.
13. Buy back of shares
The Board of Directors of the Company in its meeting held on 20 June
2012 approved the buyback of 5,263,158 equity shares of Rs. 2 each
fully paid at prices not exceeding Rs. 142.50 per equity shares payable
in cash, up to an aggregate amount not exceeding Rs. 7,500 lakhs from
the open market through stock exchange(s).
During the year, the Company has bought back and extinguished 4,136,449
equity shares at an average price of Rs. 139.69 per equity share for an
aggregate amount of Rs. 5,817 lakhs (inclusive of transaction cost).
Since the Company had completed 78% of the buyback offer within a
period of 8 months, the Company has announced closure of buyback of its
shares with effect from 04 March 2013.
Pursuant to the buy back of shares as aforesaid, the issued, subscribed
and paid up capital of the Company reduced from Rs. 2,610 lakhs
comprising of 130,547,322 equity shares of Rs. 2 each fully paid to Rs.
2,528 lakhs comprising of 126,410,873 shares of Rs. 2 each fully paid.
14. Proposed amalgamation of MHTC Logistics Private Limited with the
Company
The Board of Directors at its meeting held on 14 February 2012 had
approved de-merger of the Project Division of MHTC Logistics Pvt.Ltd.,
the wholly owned subsidiary of the Company, with the Company effective
from April 01, 2012, subject to obtaining necessary approvals of the
stake holders and the Hon''ble Bombay High Court. The Board of Directors
of the Company at its meeting held on 07 August 2012 reconsidered its
decision and approved amalgamation of MHTC Logistics Pvt. Ltd. under
Sections 391 to 394 read with sections 78, 100 to 103 of the Companies
Act, 1956 with the Company effective from April 01, 2012 ("the
appointed Date"), subject to necessary approvals of the stake holders
and the Hon''ble Bombay High Court.
The Company has obtained the consent of the Shareholders of the Company
to the proposed amalgamation of MHTC Logistics Pvt.Ltd. with the
Company at their meeting convened on 25 February 2013 pursuant to
directions of the Hon''ble Bombay High Court. Pending the approval of
the Hon''ble Bombay High Court and other statutory and regulatory
authorities, no impact of the amalgamation is given in the fnancial
statements of the Company for the year ended March 31, 2013.
15. The Ministry of Corporate Affairs, Government of India, vide
General Circular No.2 and 3 dated 08 February 2011 and 21 February 2011
respectively has granted a general exemption from compliance with
section 212 of the Companies Act, 1956 subject to fulfllment of
conditions stipulated in the circular. The Company has satisfed the
conditions stipulated in the circular and hence is entitled to the
exemption. Necessary information relating to the subsidiaries has been
included in the Consolidated Financial Statements.
16. Prior year comparatives
The previous period fnancials were for the period January 01, 2011 to
March 31, 2012. As such, the previous period fnancials are not strictly
comparable with those of the current year fnancial statements.
Mar 31, 2012
BACKGROUND
The Company was incorporated on August 18, 1993 as a private company
under the name of All Cargo Movers (India) Private Limited under the
Companies Act, 1956. Subsequently the name of the Company was changed
to All cargo Movers (India) Private Limited on June 25, 2004.
Thereafter, on December 8, 2005, the name of the Company changed to
All cargo Global Logistics Private Limited and on January 17, 2006, the
Company was converted into a public limited company. The Company is a
leading multinational company engaged in providing integrated logistics
solutions and offers specialized logistics services across Multimodal
Transport Operations, Inland Container Depot & Container Freight
Station Operations and Project & Engineering Solutions. The Company is
listed on BSE Limited and National Stock Exchange of India Limited On
May 2, 2008, pursuant to a Scheme of Arrangement as approved by the
Hon'ble Bombay High Court, the project and equipment division of
Transindia Freight Services Private Limited ('TFSPL'), were
transferred to the Company.
On September 30, 2010, pursuant to a Scheme of Arrangement as approved
by the Hon'ble Bombay High Court, the assets, liabilities and reserves
of Sealand Terminals Private Limited, wholly owned subsidiary of the
Company, were transferred to the Company.
During the period ended March 31, 2012, the name of the Company was
changed from All cargo Global Logistics Limited to All cargo Logistics
Limited The fresh certificate of incorporation with the current name
was issued on July 29, 2011 by the Registrar of Companies, Maharashtra,
Mumbai.
1 CONTINGENCIES AND COMMITMENTS
(Rs. in 000's)
March 31, December 31,
2012 2010
a Estimated Amount of contracts
remaining to be executed on capital
accounts 105,587 148,275
(Net of Advances) and not provided for
b Disputed Liabilities in Appeal
Income Tax (Refer Note 1 below) 672,860 672,860
Customs 18,300 -
Service Tax 114,202 113,985
c Claims against the Company, not
acknowledged as debts 55,241 82,184
d Corporate Guarantees given by the
Company on behalf of its subsidiaries 2,322,744 1,832,637
e Bank Guarantees 812,888 451,838
f Continuity Bond executed in favor
of the President of India through
the 4,577,030 3,927,000
Commissioner of Customs in respect of its Container Freight Station
operations
A One 1:The Income Tax Department issued assessment orders against the
Company, whereby, the claim of deduction by the Company under Section
80 - IA (4) was disallowed from the assessment years 2004 - 05 to 2009
- 10. The Company has filed an appeal against the assessment orders.
Accordingly, the Income Tax liability of the Company pending in Appeal
and not provided for is Rs. 672,860 thousand (Previous Year Rs. 672,860) .
The Company is advised that it has a strong case for claiming deduction
under Section 80 IA (4) of the Income Tax Act,1961. Company's appeal
was heard by the Tribunal and order is pending. Recently, the Delhi
High Court has ruled in one of the similar case that Inland Container
Depots (ICD) and Container Freight Stations (CFS) are eligible for
deduction under Section 80 IA as these are 'Inland Ports'. Based on
this decision, the Company is confident of favorable decision. In view
of the foregoing, the Company has continue to provide Current Tax under
the provisions of Minimum Alternate Tax.
2 SEGMENT REPORTING
The Company has identified four reporting segments viz. Multimodal
Transport Operations, Container Freight Station, Project & Engineering
Solutions Division and Others. The segments have been identified and
reported taking into account the nature of services provided, the
differing risks and returns and the internal business reporting
systems, in terms to the information required by the Accounting
Standard 17 on 'Segment Reporting'. The accounting policies adopted
for segment reporting are in line with the accounting policy of the
Company with following additional policies for segment reporting:
a) Revenue and expenses have been identified to a segment on the basis
of relationship to operating activities of the segment. Revenue and
expenses, which relate to the enterprise as a whole and are not
allocable to a segment on reasonable basis have been disclosed as
"Unallowable".
b) Segment assets and liabilities represent the assets and liabilities
in respective segments. Tax related assets and other assets and
liabilities that cannot be allocated to a segment on reasonable basis
have been disclosed as "Unallowable".
3.1 Remuneration to relatives of Directors
Mr. Umesh Shetty, who is relative of Mr. Shashi Kiran Shetty and Mrs.
Arathi Shetty, Directors of the Company, has been appointed as Chief
Executive Officer of Equipment Hiring Division of the Company for a
period of 3 years commencing from January 1, 2009 on the terms and
conditions and remuneration approved by the Members of the Company at
the 16th Annual General Meeting held on June 12, 2009. The position
occupied by Mr. Umesh Shetty is a place of profit as prescribed under
Section 314(1 B) of the Companies Act, 1956 and the same is subject to
approval by Central Government.
Considering the contribution made by Mr. Umesh Shetty in achieving the
phenomenal growth by Equipment Hiring Division vis - a - vis
performance and growth achieved by the Company during his tenure, the
Company has, subject to Central Government's approval, re - appointed
Mr. Umesh Shetty as Chief Executive Officer of the Project &
Engineering Solutions Division of the Company for a further period of 3
years effective from January 1, 2012 on the same terms & conditions and
remuneration as recommended by the Compensation / Remuneration
Committee, Board of Directors and approved by the Members of the
Company by Postal Ballot voting. Further, with a view to broad - base
the Board composition and to optimize and further enhance the existing
corporate governance practices of the Company and considering the
growth oriented performance and contribution made by Mr. Umesh Shetty,
the Board of Directors has, subject to approval by the Members of the
Company at the ensuing Annual General Meeting, appointed Mr. Umesh
Shetty as Whole Time Director of the Company for a period of 5 years
commencing from June 1, 2012 on the terms and condition and
remuneration as recommended by the Compensation / Remuneration
Committee.
Also, during the period under review, the Company has, subject to
Central Governments approval, appointed Mr. Armin Kalyaniwalla, a
relative of a Director, as Chief Executive Officer - Project Division
of the Company, for a period of 3 years commencing from January 1, 2012
on the terms & conditions and remuneration as recommended by the
Compensation / Remuneration Committee, Board of Directors and approved
by the Members of the Company by Postal Ballot voting.
The Company has made necessary applications to the Central Government
seeking approval for the said appointment of Mr. Umesh Shetty and Mr.
Armin Kalyaniwalla under Section 314 of the Companies Act, 1956 and the
same are under consideration. Pending the Central Government approvals,
the Company has paid remuneration aggregating to Rs. 37,726 thousand
(Previous Year Rs. 24,340 thousand) to the appointees as approved by the
Members and the Board of Directors of the Company with a condition that
such remuneration or part thereof shall be refunded if the Central
Government declines to approve or modifies the remuneration payable to
them.
4 Leases
Operating Lease
The Company has taken a commercial property on non - cancellable
operating lease. The lease agreement provides for an option to the
Company to renew the lease period at the end of non-cancellable period.
There are no exceptional/ restrictive covenants in the lease
agreements. The future minimum lease payments in respect of lease
property as at March 31, 2012 is as follows:
5 disclosure pursuant to accounting standard - 15 (revised) 'employee
benefits'
a) Defined Contribution Plans:
Contribution to Provident Fund and ESIC
Amount of Rs. 34,816 thousand (Previous Year Rs. 18,631 thousand)
contributed to Provident Funds, ESIC and other funds (Refer Schedule
17) is recognized as an expense and included in "Contribution to
Provident & Other Funds' under 'Employee Cost" in the Profit and
Loss account. .
6 RELATED PARTY DISCLOSURES
A Parties Where Control Exists:
I. Subsidiaries
Hindustan Cargo Limited HC Logistics Limited
Credo Shipping Agencies (I) Private Limited Contech Transport Services
Private Limited Comptech Solutions Private Limited Amfin Consulting
Private Limited Ecu Line (India) Private Limited
All cargo Shipping Co.Private Limited (Formerly known as AGL Ports
Private Limited)
South Asia Terminals Private Limited
Southern Terminal & Trading Private Limited (Formerly known as AGL
Terminals Private Limited)
AGL Warehousing Private Limited All cargo Logistics Park Private Limited
Ecu International (Asia) Private Limited
Transindia Logistic Park Private Limited (Formerly known as Universal
Container Freight Station Private Limited)
MHTC Logistics Private Limited
Combiline Indain Agencies Private Limited
Ecu-Line Algerie sarl
Ecu Logistics SA
Ecu-Line N.V.
Ecu-Logistics N.V Ecubro N.V Ecu-Tech BVBA Ecuhold N.V Ecu
International N.V Ecu Global Services N.V HCL Logistics N.V. AGL N.V
Allcargo Belgium N.V Ecu Logistics do Brasil Ltda Flamingo Line do
Brasil Ltda Ecu-Line Bulgaria EOOD Ecu-Line Chile S.A.
Flamingo Line Chile S.A.
Ecu-Line Guangzhou Limited CCSS Limited CCS Limited
Ecu-Line de Colombia S.A.S.
Conecli International S.A.
Ecu-Line (CZ) s.r.o.
Ecu-Line del Ecuador S.A.
Flamingo Line del Ecuador SA Ecu Line Egypt Limited Ecu-Line Canada
Inc.
Flamingo Line El Salvador SA de CV Ecu-Line Germany GmbH ELWA Ghana
Limited Flamingo Line de Guatemala S.A.
Ecu-Line Hong Kong Limited Ecu International Far East Limited CCS
Limited
PT EKA Consol Utama Line Ecu-Line Italia srl.
Eurocentre Milan srl.
Ecu-Line Cote d'Ivoire Sarl Jordan Gulf for Freight Services Ecu-Line
Malta Limited CELM Logistics SA de CV Ecu Logistics de Mexico SA de CV
Ecu-Line Maroc S.A.
Ecu-Line Rotterdam BV Rotterdam Freight Station BV
Ecu-Line de Panama SA Ecu-Line Paraguay SA Ecu-Line Philippines Inc.
Ecu-Line Polska SP. Z.o.o.
Ecu-Line Doha W.L.L.
Ecu-Line Romania SRL Ecu-Line Singapore Pte. Limited Ecu-Line South
Africa (Pty.) Limited Ecu-Line Spain S.L.
Mediterranean Cargo Center S.L. (MCC)
Ecu Line Lanka (Pvt) Limited Society Ecu-Line Tunisie Sarl Ecu
Uluslarasi Tas. Ve Ticaret Limited Sti.
CCC Limited
Star Express Company Limited Ecu-Line UK Limited DEOLIX S.A.
DLC
Guldary S.A.
ELV Multimodal C.A.
Administrator House Line C.A.
Consolidator Ecu-Line C.A. aEcu-Line (Indian Ocean Islands) Limited
Asia Line Limited Ecu Heavylift WLL
Contech Transport Services (Pvt) Limited Ecu Shipping Logistics (K)
Limited Ecu-Line Middle East LLC Ecu-Line (Johor Bahru) Snd. Bhd.
Eurocentre FZCO
Ecu-Line Kenya Limited
Ecu-Line Abu Dhabi LLC
SSCC Limited
Flamingo Line del Peru SA
Ecu-Line Peru SA
Ecu-Line Saudi Arabia LLC
Ecu-Line Zimbabwe (Pvt) Limited
Ecu-Line Japan Limited
S.H.E. Maritime Services Limited
Translogistik Internationale Spedition GmbH
Ecu-Line Australia Pty Limited
Ecu-Line New Zealand Limited
Ecu-Line (Thailand) Co. Limited
Ecu-Line Mediterranean Limited
Ecu-Line China Limited
Ecu-Line Hungary Kft
Ecu-Line Switzerland GmbH
Ecu Line Vietnam Joint Venture Company Limited
Ocean House Limited
Transnepal Freight Services Private Limited
II. Associates
Transworld Logistics & Shipping Services Inc.
III. Joint Venturers
Sealand Warehousing Private Limited
Gujarat Integrated Maritime Complex Private Limited
IV. Entities over which key managerial personnel or their relatives
exercises significant influence:
Allcargo Movers (Bombay) Private Limited Allcargo Shipping Services
Private Limited Allnet Infotech Private Limited Alltrans Logistics
Private Limited Alltrans Port Management Private Limited
Avadh Marketing Private Limited (Converted into Avadh Marketing LLP
w.e.f. December 30, 2011)
Avash Builders And Infrastructure Private Limited
Avash Builders Private Limited (Amalgamated with SKS Netgate Private
Limited w.e.f. April 1, 2010)
Avash Logistic Park Private Limited Avashya Corproation Private Limited
Avashya Enterprises Private Limited Avashya Holdings Private Limited
Conserve Infratech Private Limited (Formerly known as Nature care
Properties Private Limited) - Resigned w.e.f. January 30, 2011)
Contech Estate Private Limited (Converted into Contech Estate LLP
w.e.f. December 5, 2011)
Energy Health Spas Private Limited (Amalgamated with SKS Netgate
Private Limited w.e.f. April 1, 2010)
India Tourist And Heritage Village Private Limited Import Maritime
Egencies Private Limited
Jupiter Precious Gems and Jewellery Private Limited (Formerly known as
Jupiter Machines Private Limited) N.R. Holdings Private Limited
Panna Estates Private Limited (Converted into Panna Estates LLP w.e.f.
December 1, 2011)
Poorn Estates Private Limited Prominent Estate Holdings Private Limited
Sealand Crane Private Limited Sealand Ports Private Limited
SKS Netgate Private Limited (Converted into SKS Netgate LLP w.e.f.
August 1, 2011)
SKS Realty Private Limited (Converted into SKS Realty LLP w.e.f.
December 1, 2011)
SKS Ventures Private Limited Talentos (India) Private Limited Talentos
Entertainment Private Limited Transindia Freight Private Limited
Transindia Freight Services Private Limited
V. Key Managerial Personnel
Shashi Kiran Shetty Arathi Shetty Adarsh Hegde
VI. Relatives of Key Management Personnel
Umesh Shetty Shobha Shetty
7 RELATED PARTY Disclosures (CoNTINuED)
Details of material related party transactions which are more than 10%
of the total transactions of the same type with a related party during
the period ended March 31, 2012
I. Interest received include income from Hindustan Cargo Limited Rs
21,670 thousand, All cargo Shipping Co. Private Limited - Rs 36,609
thousand, AGL Warehousing Private Limited Rs 27,386 thousand.
(Interest received during previous year includes income from Hindustan
Cargo Limited Rs 8,637 thousand, All cargo Shipping Co. Private Limited Rs
10,837 thousand, AGL Warehousing Private Limited Rs 20,323 thousand,
All cargo Belgium NV Rs. 7,602 thousand)
II. MTO income includes income from All cargo Belgium NV group - Rs
773,791 thousand (MTO income during the previous year includes income
earned from All cargo Belgium NV group Rs 482,892 thousand)
III. Container Freight Station Income includes income from Hindustan
Cargo Limited Rs 5,316 thousand.
IV. Warehousing Income includes income from Hindustan Cargo Limited Rs
14,348 thousand.
V. Project and Engineering Solutions income includes income from South
Asia Terminals Private Limited - Rs 150,463 thousand, Hindustan Cargo
Limited - Rs 39,737 thousand, Asia Line Limited Rs 52,645 thousand
(Project and Engineering Solutions income during the previous year
includes South Asia Terminals Private Limited Rs 12,053 thousand)
VI. Project and Engineering Solutions expense includes expenses
paid/payable to MHTC Logistics Private Limited - Rs 56,780 thousand,
Hindustan Cargo Limited - Rs 107,821 thousand
VII. Rent Paid includes expenses paid/payable to Mr. Shashi Kiran
Shetty - Rs. 5,400 thousand, Sealand Cranes Private Limited - Rs 15,860
thousand, Allnet InfoTech Private Limited - Rs 14,679 thousand
(Rent Paid during the previous year includes rent paid to Mr. Shashi
Kiran Shetty - Rs 7,200 thousand, Sealand Cranes Private Limited - Rs.
12,084 thousand, Allnet InfoTech Pvt Limited - Rs. 11,184 thousand)
VIII. Remuneration to Directors includes payment made to Mrs. Arathi
Shetty - Rs 22,342 thousand, Mr. Adarsh Hegde - Rs 37,711 thousand, Mr.
Shashi Kiran Shetty - Rs 63,820 thousand (Remuneration to Directors
during the previous year includes Mrs. Arathi Shetty - Rs 17,016
thousand, Mr. Adarsh Hegde - Rs 26,062 thousand, Mr. Shashi Kiran Shetty
- Rs 40,817 thousand)
IX. Salary Paid includes payment made to Mr. Umesh Shetty - Rs 35,477
thousand.
(Salary Paid during the previous year includes Mr.Umesh Shetty - Rs
24,340 thousand)
X. Car hire Charge includes expenses paid/payable to Transindia
Freight Services Private Limited - Rs 750 thousand (Car hire Charges
during the previous year includes Transindia Freight Services Private
Limited - Rs 600 thousand)
XI. MTO Operation Expenses includes expenses paid/payable to Allcargo
Belgium NV Group - Rs 959,064 thousand
(MTO Operation Expenses during the previous year includes Allcargo
Belgium NV Group - Rs 405,406 thousand, Hindustan Cargo Limited - Rs
81,053 thousand)
XII. Container Freight Station Expenses includes expenses paid/payable
to South Asia Terminal Private Limited - Rs 189,337 thousand
(Container Freight Station Expenses during the previous year includes
South Asia Terminal Private Limited - Rs 55,204 thousand)
XIII. Dividend Paid includes payment made to MHTC Logistics Private
Limited - Rs 1,307 thousand
XIV. Loans received back includes amount received from All cargo Belgium
NV - Rs. 604,387 thousand, All cargo Logistic Park Private Limited - Rs.
127,000 thousand, All cargo Shipping Co. Private Limited - Rs. 188,955
thousand, Contech Transport Services Private Limited - Rs. 139,418
thousand
(Loans received back during the previous year includes amount received
from Hindustan Cargo Limited - Rs. 60,708 thousand, South Asia Terminals
Pvt. Limited - Rs. 138,201 thousand)
XV. Advance received back includes amount received from ECU
International Far East Private Limited - Rs. 168,230 thousand.
(Advance received back during the previous year includes amount
received from All cargo Shipping Co. Private Limited - Rs. 7,455 thousand,
All cargo Belgium N.V Group. - Rs. 13,388 thousand, Asia Line Pty Limited
- Rs. 10,140 thousand)
XVI. Loans given includes amount paid to All cargo Belgium NV - Rs.
520,746 thousand, All cargo Logistics Park Private Limited - Rs. 144,500
thousand, All cargo Shipping Co. Private Limited - Rs. 187,637 thousand,
Contech Transport Services Private Limited - Rs. 167,583 thousand.
(Loans given during the previous year includes amount paid to All cargo
Belgium NV group -Rs. 598,132 thousand, All cargo Shipping Co. Private
Limited - Rs. 367,403 thousand, AGL Warehousing Private Limited - Rs.
270,184 thousand)
XVII. Advances given includes amount paid to ECU International Far
East Private Limited - Rs. 175,127 thousand
(Advances given during the previous year includes amount paid to
All cargo Belgium N.V Group - Rs. 30,883 thousand, Allcargo Shipping Co.
Private Limited - Rs. 11,019 thousand, Contac Transport Services Private
Limited - Rs. 9,070 thousand, AGL Warehousing Private Limited - Rs. 8,605
thousand)
XVIII. Deposit Receivables includes deposit received from Allnet
Infotech Private Limited - Rs. 34,601 thousand, Avash Builders and
Infrastructure Private Limited - Rs. 71,985 thousand, Sealand Cranes
Private Limited - Rs. 37,385 thousand, Mr. Shashi Kiran Shetty - Rs. 30,000
thousand, Talentos (India) Private Limited - Rs. 70,129 thousand
(Deposit Receivables during the previous year includes deposit received
from Allnet InfoTech Private Limited - Rs. 30,756 thousand, Sealand
Cranes Private Limited - Rs. 33,231 thousand, Mr. Shashi Kiran Shetty - Rs.
60,000 thousand)
XIX. Deposit given includes amount paid to Avash Builders and
Infrastructure Private Limited - Rs. 71,985 thousand, Talentos (India)
Private Limited - Rs. 70,129 thousand
(Deposit given during the previous year includes amount paid to
Coptic Solutions Private Limited Rs. 11,200 thousand)
XX. Share Application Money Pending Allotment includes Gujarat
Integrated Maritime Complex Private Limited - Rs. 78,500 thousand,
Transindia Logistic Park Private Limited - Rs. 154,000 thousand.
(Share Application Money Pending Allotment during the previous year
includes Gujarat Integrated Maritime Complex Private Limited Rs. 530,000
thousand)
XXI. Investments during the year includes investment made in Gujarat
Integrated Maritime Complex Private Limited - Rs. 530,000 thousand, MHTC
Logistics Private Limited - Rs. 343,000 thousand, Transindia Logistic
Park Private Limited - Rs. 555,240 thousand
XXII. Management Fees received includes amount received from ECU
International Far East Private Limited - Rs. 12,331 thousand, Gujarat
Integrated Maritime Complex Private Limited - Rs. 40,000 thousand ,
Sealand Warehousing Pvt Limited - Rs. 30,000 thousand
(Management Fees received during the previous year includes amount
received from ECU International Far East Private Limited - Rs. 9,036
thousand, Sealand Warehousing Private Limited - Rs. 40,000 thousand)
XXIII. Business Support Charges received includes amount received from
Ecu International Far East Private Limited - Rs. 39,388 thousand
(Business Support Charges received during the previous year includes
amount received from Ecu international Far East Private Limited - Rs.
15,617 thousand)
XXIV. Reimbursement of Expenses includes amount received from
Transnepal Freight Services Private Limited - Rs. 548 thousand.
(Reimbursement of Expenses includes received during the previous year
includes amount received from South Asia Terminals Private Limited - Rs.
1,285 thousand)
XXV. Professional Fees Paid Mrs. Shobha Shetty - Rs. 900 thousand
(Professional Fees Paid during the previous year includes Mrs. Shobha
Shetty - Rs. 720 thousand)
XXVI. Trade Debtors includes Gujarat Integrated Maritime Complex
Private Limited - Rs. 39,708 thousand, Asia Line Limited - Rs. 34,632
thousand, South Asia Terminal Private Limited Rs. 14,542 thousand,
Hindustan Cargo Limited
- Rs. 20,964 thousand
(Trade Debtors during the previous year includes Allcargo Belgium N.V
Group - Rs. 97,992 thousand)
XXVII. Trade Payables includes MHTC Logistics Private Limited - Rs.
42,276 thousand.
(Trade payables during the previous year includes amount received from
South Asia Terminals Private Limited - Rs. 8,293 thousand)
XXVIII. Loans Converted into Preference shares during the year
includes AGL Warehousing Private Limited - Rs. 366,969 thousand, Allcargo
Shipping Co. Private Limited - Rs. 366,085 thousand, Hindustan Cargo
Limited - Rs. 221,963 thousand.
XXIX. Advances Converted into Preference shares during the year
includes AGL Warehousing Private Limited - Rs. 6,581 thousand, All cargo
Shipping Co. Private Limited - Rs. 3,565 thousand.
XXX. Closing Balance of Loan includes balance outstanding from All cargo
Belgium N.V - Rs. 507,799 thousand, Contech Transport Services Private
Limited - Rs. 150,489 thousand, South Asia Terminal Private Limited - Rs.
89,611 thousand.
(Closing Balance of Loan during the previous year includes All cargo
Belgium NV -Rs. 591,440 thousand, All cargo Shipping Co. Private Limited -
Rs. 367,403 thousand, AGL Warehousing Private Limited - Rs. 342,322
thousand)
XXXI. Advances Closing balance includes Contech Transport services
Private Limited - Rs. 7,820 thousand, Ecu International Far East Private
Limited - Rs. 11,749 thousand, South Asia Terminals Private Limited - Rs.
12,265 thousand, Hindustan Cargo Limited - Rs. 9,652 thousand.
(Advances Closing balance during the previous year includes All cargo
Shipping Private Limited - Rs. 3,565 thousand, Ecu international Far East
Private Limited - Rs. 18,542 thousand, AGL Warehousing Private Limited -
Rs. 6,552 thousand)
XXXII. Deposit Repaid back during the year includes Mr. Shashi Kiran
Shetty - Rs. 30,000 thousand.
XXXIII. Corporate Guarantees given includes All cargo Belgium NV - Rs.
1,154,336 thousand, Transindia Logistic Park Private Limited - Rs.
950,000 thousand
(Corporate Guarantees given during the previous year includes Allcargo
Belgium NV - Rs. 1,832,637 thousand)
XXXIV. Deposit payable includes South Asia Terminals Private Limited -
Rs. 20,431 thousand.
(Deposit payable during the previous year includes South Asia Terminals
Private Limited - Rs. 30,008 thousand)
XXXV. Remuneration payable includes Mrs. Arathi Shetty - Rs. 19,822
thousand , Mr. Adarsh Hegde - Rs. 23,125 thousand ,Mr. Shashi Kiran
Shetty - Rs. 26,428 thousand
(Remuneration payable during the previous year includes Mrs. Arathi
Shetty - Rs. 15,000 thousand, Mr. Adarsh Hegde - Rs. 17,500 thousand, Mr.
Shashi Kiran Shetty - Rs. 20,000 thousand)
8 quantitative information
The activities of the Company are not capable of being expressed in any
generic unit and hence, it is not possible to give the quantitative
details required under paragraphs 3, 4C and 4D of Part II of Schedule
VI to the Act.
9 REMITTANCE IN FOREIGN CURRENCIES FOR DIVIDENDS
The Company has not remitted any amount in foreign currencies on
account of dividends during the period and does not have information as
to the extent to which remittances, if any, in foreign currencies on
account of dividends have been made by / on behalf of non - resident
shareholders. The particulars of dividends paid to non - resident
shareholders which were declared during the period, are as under:
The interests in the joint ventures are reported as long - term
investments (Refer Schedule 6) and stated at cost. However, the
Company's share of each of the assets, liabilities, income and
expenses, etc. (each without elimination of the effect of transactions
between the Company and the joint venture) related to its interests in
the joint ventures, based on audited financial statements, is;
10 TRANSFER PRICING
The Company's international transactions with related parties are at
arm's length as per the independent accountants report for the year
ended March 31, 2011. Management believes that the Company's
international transactions with related parties post March 31, 2011
continue to be at arm's length and that the transfer pricing
legislation will not have any impact on these financial statements,
particularly on amount of tax expense and that of provision for
taxation.
11 EMPLOYEE STOCK OPTIONS
a) In 2006, the Company had instituted an 'All cargo Employee Stock
Option Plan 2006' (ESOS 2006) to attract, retain, motivate and reward
its employees and to enable them to participate in the growth,
development and success of the Company. The compensation/remuneration
committee of the Board evaluates the performance and other criteria of
employees and approves the grant of options .The employees are granted
an option to purchase shares of the Company at the respective exercise
price, subject to the requirements of vesting conditions. These options
generally vest over a period of 24 to 48 months from the date of grant.
Upon vesting, the employees can acquire one equity share for each
option. The maximum contractual term for these stock option plan is
generally 7 years. The Company granted stock options to be adjusted
for subsequent bonus issue prior to its Initial Public Offering of
equity shares, to its permanent employees at varying numbers depending
upon their grades.
b) The stock compensation cost is computed under the intrinsic value
method and amortized on a straight line basis over the vesting period
of 7 years.
c) The particulars of options granted under the said ESOS 2006 plans
are tabulated below:
As permitted by the SEBI (Employee Stock Option Scheme and Employee
Stock Purchase Scheme) Guidelines, 1999 ('SEBI guidelines') as well
as by the guidance note on the subject issued by the Institute of
Chartered Accounts of India, the Company has elected to account for
stock options based on their intrinsic value (i.e. the excess of quoted
market price of the underlying share over the exercise price) at the
grant date rather than their fair value at that date. Had the
compensation cost for employee stock options been determined on the
basis of the fair value approach as described in the SEBI guidelines
(and ICAI guidance note), the Company's net profit after tax and basic
and diluted earnings per share would have been as per the proforma
amounts shown below:
12 SCHEME OF ARRANGEMENT OF THE EARLIER YEAR
During previous year ended December 31, 2010, pursuant to the Scheme of
Arrangement ("the scheme") under sections 391 to 394 of the Companies
Act, 1956 sanctioned by the Hon'ble Bombay High Court vide order
dated September 30, 2010 and filed with the Registrar of Companies
(RoC) on October 25, 2010, Sealand Terminals Private Limited, the
wholly owned subsidiary of the Company, engaged in construction,
development, maintenance of the Container Freight Stations, has been
amalgamated into the Company with effect from the Appointed Date as on
April 1, 2009. The amalgamation has been accounted as "Amalgamation in
the nature of Merge".
The financial statements presented to Members of the Company comprise
of the financials of Sealand Terminals Private Limited. The deficit of
assets over liabilities of Sealand Terminals Private Limited amounting
to Rs 33 thousand has been adjusted against the General Reserve of the
Company. The net profit earned by Sealand Terminals Private Limited
during the period from April 1, 2009 to December 31, 2009 amounting to
Rs 123,807 thousand is recognized as earlier year Profit of merged
entity in Profit & Loss Account. As envisaged in the Scheme, the
Company did not issue any equity shares to the Members of Sealand
Terminals Private Limited i.e. Contech Transport Services Private
Limited, the wholly owned subsidiary of the Company.
13 PARTICULARS OF DERIVATIVE INSTRUMENTS
The Company uses derivative and forward contracts to hedge its risks
associated with foreign currency fluctuations. Such transactions are
governed by the strategy approved by the Board of Directors which
provides principles on the use of these instruments consistent with the
Company's Risk Management Policy. The Company does not use these
contracts for speculative purposes.
14 During the previous year, the Company has re - assessed the
estimated useful life of cranes from January 1, 2010. If the Company
had continued with the old estimate of useful life of cranes, the
depreciation and the profit before tax and exceptional items for the
previous year would have been Rs. 648,380 thousand and Rs. 1,202,731
thousand respectively.
15 In April 8, 2011, one of the office premises of the Company,
located on the 5th and 6th floors of Diamond Square, Kalina, Santacruz
East was damaged by fire. The Company had filed a claim with the
insurers, who have appointed surveyors to assess the extent of damage /
loss to the assets located in the premises damaged by the fire. The
claim is under process and accordingly pending finalization of the
claim amount, the loss incurred on account of the fire in the current
year aggregating to Rs. 1,005 thousand has been charged to the Profit and
Loss Account.
16 a) Proposed Merger of MHTC Logistics Private Limited with the
Company:
The Company acquired 100% equity stake of MHTC Logistics Private
Limited ('MHTC') during the period under review. MHTC is engaged in
the business of Project Logistics and Freight Forwarding. Considering
the business synergy existing in the Project Logistics business of the
Company and MHTC, the Board of Directors of both the companies thought
it prudent in the best interest of both the companies to de - merge the
Project Logistics business of MHTC in favour of the Company.
Accordingly, the Board of Directors of the Company at its meeting held
on February 14, 2012 approved de-merger of the Project Logistics
business of MHTC in favour of the Company with effect from April 1,
2012 in accordance with provisions of Section 391 to 394 read with
Section 78, 100 to 103 of the Companies Act, 1956.
The Scheme of Arrangement comprising of de-merger of the Project
Logistics business duly approved by the Board of Directors of both the
companies shall be subject to further approval by the Members and
Creditors of both the companies and the approval by the Hon'ble Bombay
High Court, as such, no impact of the merger is given in the above
financial statements.
b) Proposed Demerger of NVOCC Business:
In the meeting held during February 14, 2012, the Board of Directors of
the Company has discussed the de-merger of the NVOCC business of the
Company and has constituted a Committee of Directors to advise the
Board of Directors on determination of the valuation of the said
business and suggest share entitlement ratio, formulation of scheme of
the arrangements and matters incidental or related thereto. The said
committee till date has not concluded on the valuation of the business
and resulting scheme of de-merger, as such, no impact of the same is
given in the above financial statements.
17 prior year comparatives
The figures for the previous year (12 months) are strictly not
comparable to those of the current period, which comprises 15 months
and have been regrouped/ rearranged as necessary to conform to current
period's presentation.
Dec 31, 2010
1. Figures in rupees have been rounded off to the nearest thousands.
2. Previous period figures are regrouped wherever necessary to confirm
to this years classification.
3. Pursuant to the resolution passed by the members of the Company at
the Extra Ordinary General Meeting held on November 30, 2009 and the
provisions of Section 81 (I A) and other applicable provisions of the
Companies Act, 1956 and the Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009, the
Company has issued 5,663,105 Equity Shares of Til- each at a premium
ofRs. 182.80 per share aggregating to 11,046,542 thousand to Qualified
Institutional Buyers (QIBs).
4. Contingent Liabilities not provided for:
i) Counter Guarantees to Banks against guarantees issued by themRs.
445,136 thousand (RYRs.470,129 thousand).
ii) Continuity Bond executed in favour of The President of India
through the Commissioner of Customs Rs.3,927,000 thousand (RYRs.3,295,000
thousand).
iii) Guarantees issued to Bankers in respect of Nepal Intermodal
Transport Development Board equivalent to Rs.6,702 thousand (RYRs.6,636
thousand).
iv) Guarantees issued to Bankers and outstanding in respect of Allcargo
Belgium NY ECU International NV and ECU Hold NV equivalent to Rs.
1,363,129 thousand, Rs.299,050 thousand and Rs. 170,458 thousand
respectively (RY Rs.458,160, Rs.332,000 and Rs.Nil respectively).
v) Suits filed against the Company towards operational claims Rs.82,184
thousand (RY Rs.34,013 thousand).
vi) Income Tax demand for the AY 2003-04 upto AY 2009-10 against which
the Company has preferred an appeal is Rs.547,859 thousand (RYRs.650,000
thousand)aftersettingoffthenetAdvanceTaxof Rs. 177,641 thousand(RY
Rs.52,641 thousands).
5. The Company has re-assessed the estimated useful life of Cranes
from January 1, 2010. If the Company had continued with the old
estimate of useful life of Cranes, the Depreciation and Profit Before
Tax and Exceptional Items would have been Rs.648,380 thousand and Rs.
1,202,73 I thousand respectivelyforthe year ended December3 1,2010.
6. Amounts due to Micro, Small and Medium Enterprises:
i) The names of the Micro, Small and Medium Enterprises suppliers
defined under "The Micro, Small and Medium Enterprises Development Act,
2006" could not be identified, as the necessary evidence is not in the
possession of the Company.
ii) The names of the Small Scale Undertakings to whom the Company owes
a sum exceeding Rs. 100 thousand which is outstanding for more than 30
days could not be identified, as the necessary information is not in
the possession of the Company.
7. In the opinion of the management and to the best of its knowledge
and belief, the Current Assets and Loans and Advances have a value on
realisation in the ordinary course of business at least equal to the
amount at which they are stated in the Balance Sheet.
8. Segment Reporting
Information about Business Segments (Information provided in respect of
revenue items for the year ended December 3 1,2010 and in respect of
assets/liabilities as at December 3 1,2010):
9. RELATED PARTY DISCLOSURES
List of Related Parties and Relationships
(A) Relationships:
I) Subsidiary Companies:
Contech Transport Services Pvt Ltd
Comptech Solutions Pvt. Ltd.
Allcargo Belgium N.V
Hindustan Cargo Ltd.
ECU Line (India) Pvt. Ltd.
Allcargo Shipping Co. Pvt. Ltd. (Formerly known as AGL Ports Pvt Ltd)
South Asia Terminals Pvt. Ltd.
Southern Terminals & Trading Pvt. Ltd. (Formerly known as AGL
Terminals Pvt. Ltd.)
AGL Warehousing Pvt. Ltd.
Allcargo Logistics Park Pvt. Ltd.
Asia Line Ltd.
ECU International (Asia) Pvt. Ltd.
ECU Line Abu Dhabi LLC
ECU Line Algerie
Ecu Logistics S.A.
Ecu-Line Australia Pty.Ltd.
ECUHOLD N.V
Ecu Bro N.V
ECU International N.V
ECU-TECH BVBA
ECU-LINE N.V
ECU-LOGISTICS N.V
ECU-TRANS N.V
D&ETransportN.V
AGL N.V (Formerly known as RMK N.V)
ECU Air N.V
Ecu Global Services N.V (formerly known as IPTS)
ECU Logistics do brasil Ltda
Flamingo Line do Brazil Ltda
Ecu Line Bulgaria EOOD
ECU-Line Canada Inc.
ECU Line Chile S.A.
Container Freight Station S.A.
Flamingo Line Chile S.A.
ECU Line Guangzhou Ltd.
ECU Line De Columbia S.A.
Conecli International S.A.
ECU Line Middleeast LLC
Euro Centre - Dubai
ECU Heavy Lift, VV.L.L.
ECU Line Del Ecuador S.A.
Flamingo Line Ecuador
ECU Line Egypt Ltd.
Flamingo Line El Salvador S.A. de C.V
ECU-Line (Germany) GmbH
ELWA(GH)Ltd.
ECU Line Guatemala
ECU-Line Hong Kong Ltd.
ECU International Far East Ltd.
ECU Line Italia srl
ECU Line Italy TRC srl
ECU Line Cote dlvoire Sari
ECU Line Japan Ltd.
ECU Line Jordan
ECU Line Kenya Ltd.
Ecu Shipping Logistic (K) Ltd.
ECU Line Malaysia ECU-Line (JB) SDN BHD
ECU-Line Malta Ltd.
ECU-Line (Indian Ocean Islands) Ltd.
AMI Ventures Ltd.
ECU Line Meditterranean Ltd.
CELM Logistics S.A. De C.V
Ecu Logistics de Mexico S.A. de C.V
ECU Line Maroc S.A.
ECU LINE Rotterdam
ECU Line New Zealand Ltd.
ECU-Line de Panama S.A.
ECU-Line Paraguay S.A.
ECU-Line Peru S.A.
Fiamingo Line Peru S.A.
ECU Line Philippines Inc.
ECU-Line Polska Sp. z.o.o. UL
ECU Line Doha W.L.L.
ECU-Line Romania SRL
Rotterdam Freight Station BV
ECU Line Singapore Pte. Ltd.
ECU LINE SA(Pty) Ltd.
ECU Line Spain S.L.Barcelona
Mediterranean Cargo Centers S.L. (MCC)
ECU Line (Thailand) Co. Ltd.
ECU Line Tunisie sari
ECU Line Turkey
ECU-Line UK Ltd.
ECU-Line Uruguay (Deolix SA)
DLC
ELV Multimodal C.A.
Venezuela - AHL
Consolidadora Ecu Line CA
Ecu Line Vietnam
ECU Line Zimbabwe (Pty.) Ltd.
Ecu Line China Ltd
Ecu Line Switzerland GmBH
Ecurocentre Milan SRL
Guldary S.A.
Ecu line Lanka Pvt. Ltd.
S.H.E Maritime services Ltd.
CCC Ltd.
Star Express Company Ltd.
CCSS Ltd.
SSCC Ltd.
PT Eka Consol Utama Line
Ecu Line Czeche s.r.o
Ecu Line Hungary Kft
Translogistik International Spedition GMBH
2) Joint Venture Companies:
Transworld Logistics & Shipping Services Inc.
Sealand Warehousing Pvt. Ltd.
3) Associate Company :
Transnepal Freight Services Pvt. Ltd.
4) Key Management Personnel :
1) Mr. Shashi Kiran Shetty
2) Mrs. Arathi Shetty
3) Mr. Adarsh Hegde
5) Relatives of Key Management Personnel:
1) Mr. Umesh Shetty
2) Mrs. Shobha Shetty
6) Enterprises owned or significantly influenced by its key management
personnel or their relatives :
Allcargo Shipping Services (P) Ltd.
Avadh Marketing (P) Ltd.
N.R.Holdings(P)Ltd.
Transindia Freight (P) Ltd.
Allcargo Movers (Bombay) (P) Ltd.
Allnet Infotech (P) Ltd.
Prominent Estate Holdings (P) Ltd.
Transindia Freight Services (P) Ltd.
Jupiter Machines (P) Ltd.
Sealand Cranes (P) Ltd.
Contech Estate (P) Ltd.
Alltrans Logistics Pvt. Ltd.
Alltrans Port Management Pvt. Ltd.
Logical Hotels Pvt. Ltd.
Indport Maritime Agencies Pvt. Ltd.
SKS Netgate Pvt. Ltd.
Avash Builders Pvt. Ltd.
Energy Health Spas Pvt. Ltd.
SKS Realty Pvt. Ltd.
India Tourist And Heritage Village Pvt. Ltd.
SKS Ventures Pvt. Ltd.
Talentos (India) Pvt. Ltd.
Talentos Entertainment Pvt. Ltd.
Sealand Holdings Pvt. Ltd.
Avash Builders And Infrastructure Pvt. Ltd.
Avash Logistic Park Pvt. Ltd.
Sealand Ports Pvt. Ltd.
Gujarat Integrated Maritime Complex Pvt. Ltd.
10. As the Company is not engaged in manufacturing, trading or
processing activities, Quantitative information required by paras - 3
and 4c of part II of Schedule VI of the Companies Act, 1956 is not
given.
11. Value of Imports calculated on QF basis in respect of Capital
Goods is Rs.2,539,252 thousand (RY Rs.596,282 thousand)
12. Disclosure for lease
Companys lease agreements are mainly in respect of operating leases
taken for offices, residential premises, warehouse, commercial vehicles
and equipment. The lease agreements are for a period ranging from
eleven months to nine years. The lease agreements are cancellable at
the option of either party by giving one month to six months notice.
The Company has given refundable interest free security deposits for
certain agreements. Certain agreements provide for increase in Lease
rent. Some of the agreements provide for renewal of lease by mutual
consent. Lease payments recognised in the Profit and Loss Account are
Rs.56,939 thousand (RY. Rs.49,953 thousand). The Company has leased out
Cranes & Equipments and office premises. The Lease rental income
recognised in the Profit and Loss Account is Rs. 852,905 thousand (RY
Rs.536,467 thousand). The gross value of the Assets Leased out is
Rs.4,I4I,I49 thousand (RY Rs.2,006,726 thousand). Accummulated Depreciation
of the Asset Leased out is Rs.694,342 thousand (RY Rs.502,849 thousand).
The depreciation recognised in the statement of Profit and Loss Account
for the Assets Leased out during the year is Rs.240,185 thousand (RY
Rs.239,883 thousand).
13. EmployeesStock Options Plan
In 2006, the Company had instituted an Employees Stock Options Plan
(ESOP 2006) to attract, retain, motivate and reward its employees and
to enable them to participate in the growth, development and success of
the Company. The Company granted stock options to be adjusted for the
subsequent bonus issue prior to its Initial Public Offering of equity
shares, to its permanent employees and to few of the permanent
employees of its foreign subsidiaries at varying numbers depending upon
their grades.
14. MAT Entitlement
During the year, the Company has made provision for Minimum Alternate
Tax (MAT) of Rs.283,600 thousand (RY. Rs. 168,730 thousand). Considering
the future expected benefits, the Company has recognized Rs.265,277
thousand (RY Rs. 153,538 thousand) as MAT entitlement credit representing
excess of MAT provision over Current Tax.
Accordingly and based on the legal opinion the Company has retained the
MAT entitlement claim ofRs.288,700thousand uptotheAY2010-201 I.
15. Scheme of Arrangement
Pursuant to the Scheme of Arrangement approved by the Honble Bombay
High Court vide order dated September 30, 2010, Sealand Terminals
Private Limited, the wholly owned subsidiary of Contech Transport
Services Pvt. Ltd, which is the wholly owned subsidiary of the Company,
has been merged with the Company w.e.f. April 1, 2009, the Appointed
Date. The amalgamation has been accounted as Amalgamation in the nature
of Merger".
The financial statements presented to Members of the Company comprise
of the financial of Sealand Terminals Private Limited. The deficit of
assets over liabilities of Sealand Terminals Private Limited
amountingto R.s.33 thousand has been adjusted against the General
Reserve of the Company. The Profit earned by Sealand Terminals Private
Limited during the period from April 1,2009 to December 3 1,2009 is
recognised as Earlier year Profit of merged entity in Profit and Loss
Account.
As envisaged in the Scheme, the Company did not issue any equity shares
to the Members of Sealand Terminals Private Limited i.e. Contech
Transport Services Private Limited, the wholly owned subsidiary ofthe
Company.
Dec 31, 2009
1. Figures in rupees have been rounded off to the nearest thousands.
2. Previous period figures are regrouped wherever necessary to confirm
to this yearÃs classification.
3. Conversion of Securities issued on Preferential basis
During March 2008, the Company had issued and allotted 1,081,081 Fully
and Compulsorily Convertible Debentures (FCCD) of Rs.934 each and
1,513,514 Optionally Convertible Warrants of Rs.10 each, convertible
into equal number of equity shares of the Company on / before
completion of period of 18 months from the date of their respective
allotment. Accordingly, the Company had received Rs.1,009,730 thousands
on allotment of FCCDs and Rs. 293,620 thousands on allotment of
Warrants in March 2008.
On September 29, 2009, 1,081,081 FCCD of Rs.934 were converted into
equal number of equity shares of Rs.10 each at a premium of Rs.924 per
equity share.
On October 22, 2009, 1,513,514 Warrants of 10 each were converted into
equal number of equity shares of Rs.10 each at a premium of Rs.924 per
equity share.
The Warrant conversion price was linked to the performance of the
Company for the financial year 2008 and according to this, the Company
was entitled to receive Rs.1,284 per equity share. This price was
revised to Rs.934 per equity share, being the minimum price approved by
the Members of the Company at their Extraordinary General Meeting held
on February 19, 2008.
4. Contingent Liabilities not provided for :
i) Counter Guarantees to Banks against guarantees issued by them Rs.
470,129 thousand (PY Rs 349,275 thousand)
ii) Continuity Bond executed in favour of The President of India
through the Commissioner of Customs Rs. 3,295,000 thousand. (PY Rs.
3,245,000 thousand)
iii) Guarantees issued to Bankers in respect of Nepal Intermodal
Transport Development Board equivalent to Rs. 6,636 thousand (PY Rs
6,998 thousand)
iv) Guarantees issued to Bankers and outstanding in respect of Allcargo
Belgium NV and ECU International NV equivalent to Rs 458,160 thousands
and Rs 332,000 thousand respectively (PY Rs 469,855 and Rs 340,475
respectively)
v) Custom Duty payable on Import of equipment under EPCG Scheme if the
Company is not able to fulfill its Export Obligation, Rs. Nil (PY Rs
52,957 thousand)
vi) Suits filed against the Company towards operational claims
Rs.34,013 thousand (PY Rs 30,338 thousand).
vii) Income Ta x demand for the AY 2003-04 upto AY 2009-10 against
which the Company has preferred an appeal is Rs. 650,000 thousand (PY
Rs 4,932 thousand) after setting off the net Advance Ta x of Rs 52,641
thousands.
5. Amounts due to Micro, Small and Medium Enterprises:
i) The names of the Micro, Small and Medium Enterprises suppliers
defined under ÃThe Micro, Small and Medium Enterprises Development Act,
2006Ã could not be identified, as the necessary evidence is not in the
possession of the Company.
ii) The names of the Small Scale Undertakings to whom the Company owes
a sum exceeding Rs.100,000 which is outstanding for more than 30 days
could not be identified, as the necessary information is not in the
possession of the Company.
6. In the opinion of the management and to the best of its knowledge
and belief, the Current Assets and Loans and advances have a value on
realisation in the ordinary course of business at least equal to the
amount at which they are stated in the balance sheet.
7. Sub-division of equity shares from Rs.10 per equity share to Rs.2
per equity share
During November 2009, the Company sub-divided the face value of its
equity shares from Rs. 10 per equity share to Rs. 2 per equity share
pursuant to approval of the Members sought through postal ballot
voting. Accordingly, the issued, subscribed and paid up share capital
of the Company as on December 31, 2009 after sub-division was
Rs.249,622,530 divided into 124,811,265 equity shares of Rs.2 each.
8. RELATED PARTY DISCLOSURES
List of Related Parties and Relationships
(A) Relationships :
1) Subsidiary Companies :
Contech Transport Services Pvt Ltd
Allcargo Belgium N.V.
Hindustan Cargo Ltd.
ECU Line (India) Pvt Ltd
AGL Ports Pvt Ltd
South Asia Terminals Pvt Ltd
AGL Terminal Pvt Ltd
AGL Warehousing Pvt Ltd
Allcargo Logistics Park Pvt Ltd
Asia Lines Limited
Sealand Terminals Private Limited
ECU International (Asia) Pvt. Ltd.
ECU Line Abu Dhabi LLC
ECU Line Algerie
Ecu Logistics SA
Ecu-Line Australia Pty.Ltd.
ECUHOLD N.V.
Ecu Bro N.V.
ECU International N.V.
ECU-TECH BVBA
ECU-LINE N.V.
ECU-LOGISTICS N.V.
ECU-TRANS N.V.
D & E Transport NV
AGL N.V (Formerly known as RMK N.V)
ECU Air NV
Ecu Global Services NV (formerly known as IPTS)
ECU Logistics do brasil Ltda
Flamingo Line do Brazil Ltda
Ecu Line Bulgaria EOOD
ECU-Line Canada Inc.
ECU Line Chile S.A.
Container Freight Station S.A.
Flamingo Line Chile S.A
ECU Line Guangzhou Ltd
ECU Line De Columbia S.A.
Conecli International S.A
ECU Line Middleeast LLC
Euro Centre - Dubai
ECU Heavy Lift, W.L.L.
ECU Line Del Ecuador S.A.
Flamingo Line Ecuador
ECU Line Egypt Ltd
Flamingo Line El Salvador SA de CV
ECU-Line (Germany) GmbH
ELWA (GH) Ltd.
ECU Line Guatemala
ECU-Line Hong Kong Ltd.
ECU International Far East Ltd
ECU Line Italia srl
ECU Line Italy TRC srl
ECU Line Cote dlvoire Sarl
ECU Line Japan Ltd.
ECU Line Jordan
ECU Line Kenya Ltd
Ecu Shipping Logistic (K) Ltd
ECU Line Malaysia ECU-Line (JB) SDN BHD
ECU-Line Malta Ltd.
ECU-Line (Indian Ocean Islands) Ltd.
AMI Ventures Ltd
ECU Line Meditterranean Ltd
CELM Logistics S.A. De C.V.
Ecu Logistics de Mexico SA de CV
ECU Line Maroc S.A.
ECU LINE Rotterdam
ECU Line New Zealand Ltd.
ECU-Line de Panama S.A.
ECU-Line Paraguay S.A.
ECU-Line Peru S.A.
Flamingo Line Peru S.A
ECU Line Philippines Inc.
ECU-Line Polska Sp. z.o.o. UL
ECU Line Doha W.L.L.
ECU-Line Romania SRL
Rotterdam Freight Station BV
ECU Line Singapore Pte. Ltd.
ECU LINE SA (Pty.) Ltd.
ECU Line Spain S.L.Barcelona
Mediterranean Cargo Centers S.L. (MCC)
ECU Line (Thailand) Co.Ltd
ECU Line Tunisie sarl
ECU Line Turkey
ECU Line Xiamen
ECU-Line UK Ltd.
ECU-Line Uruguay (Deolix SA)
DLC
ELV Multimodal C.A.
Venezuela - AHL
Consolidadora Ecu Line CA
Ecu Line Vietnam
ECU Line Zimbabwe (Pty.) Ltd.
Ecu Line China Ltd
Ecu Line Switzerland GmBH
Ecurocentre Milan SRL
Guldary S.A.
2) Joint Venture Company :
Transworld Logistics & Shipping Services Inc.
Sealand Warehousing Pvt Ltd
3) Associate Company : Transnepal Freight Services Pvt Ltd
4) Key Management Personnel :
1) Mr. Shashi Kiran Shetty
2) Mrs. Arathi Shetty
3) Mr. Adarsh Hegde
5) Relatives of Key Management Personnel
1) Mr. Umesh Shetty
2) Mrs. Shobha Shetty
6) Enterprises owned or significantly influenced by its key management
personnel or their relatives :
Allcargo Shipping Services (P) Ltd
Avadh Marketing (P) Ltd
N.R.Holdings (P) Ltd
Transindia Freight (P) Ltd
Allcargo Movers (Bombay) (P) Ltd
Allnet Infotech (P) Ltd
Prominent Estate Holdings (P) Ltd
Transindia Freight Services (P) Ltd
Jupiter Machines (P) Ltd
Sealand Cranes (P) Ltd
Contech Estate (P) Ltd
Alltrans Logistics Private Limited
Alltrans Port Management Pvt Ltd
Logical Hotels Private Limited
Indport Maritime Agencies Pvt. Ltd.
SKS Netgate Pvt. Ltd.
Avash Builders Pvt Ltd.
Energy Health Spas Pvt Ltd.
SKS Realty Pvt. Ltd
India Tourist And Heritage Village Private Limited
SKS Ventures Private Limited
Talentos (India) Private Limited
Talentos Entertainment Private Limited
Sealand Holdings Private Limited
Avash Builders And Infrastructure Private Limited
Avash Logistic Park Private Limited
Sealand Ports Private Limited
Gujarat Integrated Maritime Complex Pvt. Ltd.
9. MAT Entitlement
During the year, the Company has made provision for Minimum Alternate
Ta x (MAT) of Rs. 168,730 thousand (PY Rs 123,916 thousand).
Considering the future expected benefits, the Company has recognised
Rs.153,538 thousand (PY Rs 67,143 thousand) as MAT entitlement credit
representing excess of MAT provision over Current Tax.
Accordingly and based on the legal opinion the Company has retained the
MAT entitlement claim of Rs 128,254 thousand upto the AY 2009-2010.
10. Scheme of Arrangement
The Board of Directors of the Company at its meeting held on January
25, 2010 had approved amalgamation of Sealand Terminals Pvt. Ltd., the
wholly owned subsidiary of Contech Transport Services Pvt. Ltd., which
is the wholly owned subsidiary of the Company, with the Company from
April 1, 2009 (The Appointed Date). The Scheme of Arrangement made
u/s 391 to 394 of the Companies Act, 1956 (Ãthe SchemeÃ) for such
amalgamation has been filed with the HonÃble Bombay High Court for
necessary directions and approval. As envisaged under the Scheme,
there will be no issue and allotment of shares to Contech Transport
Services Private Limited in consideration of amalgamation of Sealand
Terminals Pvt. Ltd, as Contech Transport Services Private Limited,
being the wholly owned subsidiary of the Company, cannot hold shares in
the Company and the said Contech Transport Services Private Limited has
waived its right to be allotted and receive any shares of the Company
arising on amalgamation.
The Scheme will be subject to all necessary statutory approvals and
assent of HonÃble Bombay High Court. The effect of the Scheme on the
financial results of the Company will be given upon the Scheme becoming
effective.
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