Mar 31, 2018
To
The Members,
The Directors have pleasure in presenting their Thirtieth Annual Report and the Audited Financial Statements (standalone and consolidated) for the Financial Year ended March 31, 2018 together with the Independent Auditorsâ Report thereon.
1. FINANCIAL HIGHLIGHTS :
The standalone and consolidated financial highlights of your Company for the financial year ended March 31, 2018 are summarized below:
(Rs. in lakh) |
||||
STANDALONE |
CONSOLIDATED |
|||
March 31, 2018 |
March 31, 2017 |
March 31, 2018 |
March 31, 2017 |
|
Income from Operations |
34481 |
60304 |
56223 |
54250 |
Total Income |
60521 |
63421 |
85321 |
57540 |
Total Expenses |
58079 |
62187 |
87758 |
60125 |
Profit / (Loss) before Tax |
2442 |
1234 |
(2437) |
(2585) |
Profit / (Loss) for the year |
2654 |
654 |
(3049) |
(4074) |
Add : Other Comprehensive Income |
12 |
2 |
8 |
11 |
Total Comprehensive Income for the year |
2666 |
656 |
(3041) |
(4063) |
Less : Total Comprehensive Income attributable to Non-controlling Interest |
- |
- |
(19) |
(1www59) |
Total Comprehensive Income attributable to owners of the Company |
- |
- |
(3022) |
(3904) |
Balance brought forward from the Previous Year |
71837 |
71181 |
53186 |
57090 |
Balance carried to Balance Sheet |
74503 |
71837 |
49879 |
53186 |
Earnings per Share before Extraordinary Item (Rs.) (EPS) |
3.65 |
0.90 |
(4.2) |
(5.4) |
Earnings per Share after Extraordinary Item (Rs.) (EPS) |
3.65 |
0.90 |
(4.2) |
(5.4) |
2. PERFORMANCE REVIEW AND STATE OF AFFAIRS OF THE COMPANY :
Standalone and Consolidated Financials Standalone Financials
- Income from operations stood at Rs. 34481 lakh as against Rs. 60304 lakh in the previous year representing a decrease of 42.82% ;
- Total Income stood at Rs. 60521 lakh, lower by 4.57 % as against Rs. 63421 lakh in the previous year;
- Total Expenses stood at Rs. 58079 lakh as against Rs. 62187 lakh in the previous year ;
- Profit before Tax was Rs. 2442 lakh as against Rs. 1234 lakh in the previous year;
- Profit after Tax was Rs. 2654 lakh as against Rs. 654 lakh in the previous year;
- Earning per Share before and after Extraordinary Item was Rs. 3.65 as against Rs. 0.90 in the previous year ; and
- Networth of the Company stood at Rs. 175488 lakh as against Rs. 172822 lakh in the previous year.
Consolidated Financials :
- Income from operations stood at Rs. 56223 lakh as against Rs. 54250 lakh in the previous year representing an increase of 3.64 %;
- Total income stood at Rs. 85321 lakh as against Rs. 57540 lakh in the previous year representing an increase of 48.28 %;
- Total Expenses stood at Rs. 87758 lakh as against Rs. 60125 lakh in the previous year;
- Loss before Tax was Rs. (2437) lakh as against loss of Rs. (2585) lakh in the previous year;
- Loss after Tax, Minority Interest and Other Items was Rs. (3049) lakh as against loss of Rs. (4074) lakh in the previous year;
- Earning per Share before and after Extraordinary Item was Rs. (4.2) as against Rs. (5.4) in the previous year ; and
- Networth of the Company stood at Rs. 163990 lakh as against Rs. 167175 lakh in the previous year.
3. DIVIDEND :
In the long-term interest of all the stakeholders, the Board felt that the Company utilize the internal accruals on its projects rather than paying dividend to the shareholders. The Directors have, therefore, not recommended any dividend on the equity shares for the Financial Year ended March 31, 2018.
4. TRANSFER TO RESERVES :
No amount is proposed to be transferred to Reserves out of the profits earned during the Financial Year 2017-2018.
5. transfer to investor education and protection FUND:
Pursuant to the provisions of Section 124 of the Companies Act, 2013, the unclaimed dividend amount of Rs. 1,27,845/- for the Financial Year 2009-2010 was transferred to the Investor Education and Protection Fund (IEPF) after giving due notices to the members. During the Financial Year 2018-2019, the dividend declared by the Company for the Financial Year 2010-2011 remaining unclaimed in terms of Section 124 of the Companies Act, 2013 will be transferred to IEPF.
6. SHARE CAPITAL :
The paid-up equity share capital of the Company as on March 31, 2018 was Rs. 7273.59 Lakh. During the year under review, the Company has not issued any shares with differential voting rights and hence no information under the provisions of Rule 4 (4) of the Companies (Share Capital and Debentures) Rules, 2014 is furnished. Further, the Company has not issued any sweat equity shares during the year under review and hence no information under the provisions of Rule 8 (13) of the Companies (Share Capital and Debentures) Rules, 2014 is furnished.
Presently, the Company does not have any stock option scheme for its employees.
7. DEBENTURES :
During the year under review, the Company has not made any fresh issue of debentures.
8. revision of financial statements OR BOARDSâ REPORT :
During the year under review, no revision was made in the previous financial statements or the Boardâs Report.
9. DISCLOSURE IN RESPECT OF VOTING RIGHTS NOT DIRECTLY EXERCISED BY EMPLOYEES :
There are no shares held by trustees for the benefit of employees and hence no disclosure under Rule 16 (4) of the Companies (Share Capital and Debentures) Rules, 2014 has been furnished.
10. nature OF BUSINESS :
There has been no change in the nature of business of the Company during the year under review.
11. BUSINESS OVERVIEW :
Your Company is one of Indiaâs leading real estate companies, engaged in the business of execution and development of real estate projects and currently operates both - on its own and through its subsidiaries / joint ventures / associate companies, partnerships firms and public private partnerships encompassing the construction and development of Residential and Commercial Premises, and Build Operate Transfer (BOT) Projects.
The Company has a Western India focus with presence in major cities such as Mumbai, Thane, Pune, Ahmedabad, Surat, Vadodara and Mehsana.
OVERVIEW OF THE COMPANYâS PROJECTS
(includes projects being developed / to be developed through subsidiaries / associates / joint ventures / public-private partnerships) Residential:
Projects completed :
Hubtown Heaven - Matunga (East) âAâ and âBâ Wings |
Hubtown Sunstone - Bandra (East) - Phase - I |
Hubtown Gardenia - Mira Road |
Hubtown Sunmist - Andheri (East) âAâ Wing |
Hubtown Countrywoods Phase II , Phase III Buildings 4 and 5 -Kondhwa, Pune |
Hubtown Greenwoods - Thane Phase - I |
Hillcrest - Andheri (East) |
|
Hubtown Vedant - Sion (East) - Phase - I |
Ongoing Projects:
Hubtown Seasons - Chembur |
Hubtown Serene - Bandra (East) |
Hubtown Greenwoods - Thane Phase - II |
Hubtown Celeste - Worli |
Hubtown Heaven - Matunga (East) âCâ Wing |
Hubtown Premiere - Andheri (West) |
Hubtown Vedant - Sion (East) - Phase - II |
Rising City - Ghatkopar-Mankhurd Link Road |
Hubtown Sunstone - Bandra (East) - Phase - II |
Twenty Five South - Prabhadevi |
Hubtown Countrywoods Phase III - Kondhwa, Pune |
Future Projects
Hubtown Divinity - Thane ; Hubtown Square - Thane;
Commercial: Ongoing Projects
Hubtown Solaris Phase - II - Andheri (East) ; Joyos Hubtown - Surat
Joyos Hubtown - Ahmedabad ; Joyos Hubtown - Mehsana ; Joyos Hubtown - Vadodara
Hubtown Viva - Phase - II, Jogeshwari (East);
IT SEZ and Township:
Ongoing
Sunstream City Phase - I - Mulund-Thane
12. HUMAN RESOURCES :
The Company recognizes that its people are the key to the success of the organization and in meeting its business objectives. The Human Resources function endeavors to create a congenial work environment and synchronizes the working of all the departments of the organization to accomplish their respective objectives, which in turn helps the Company to build and achieve its goals and strategies. Employee relations during the year remained cordial. The Company had 132 employees on its payroll as on March 31, 2018.
13. INTERNAL FINANCIAL CONTROLS :
The Company has in place adequate internal financial controls with reference to the financial statements. Significant audit observations and follow-up action thereon are reported to the Audit and Compliance Committee.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors and the reviews performed by the Management, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the Financial Year 2017-2018.
14. DIRECTORS AND KEY MANAGERIAL PERSONNEL :
Directors :
Mr. Shirish Gajendragadkar, Independent Director resigned as Director of the Company with effect from September 13, 2017. The Board places on record its sincere appreciation for the invaluable contribution by Mr. Ganjedragadkar to the deliberations of the meetings of the Board and of the Committees of the Board of which he was a member, during his tenure as Director of the Company.
Mr. Shailesh Hingarh was appointed as an Additional and Independent Director in the Board meeting held on March 22, 2018, with effect from March 22, 2018. As per the provisions of Section 160 of the Companies Act, 2013 (the Act), the Company has received a notice in writing from a member specifying his intention to propose the appointment of Mr. Shailesh Hingarh as Director of the Company in the ensuing Annual General Meeting (AGM). Further, a specific resolution is included in the Notice of the AGM for the appointment of Mr. Shailesh Hingarh as an Independent Director for a period of 5 (five) years with effect from March 22, 2018. The terms and conditions of the appointment of the Independent Director are in accordance with Schedule IV to the said Act and the SEBI Listing Regulations.
In accordance with the provisions of Section 1 52 (6) (e) of the Companies Act, 201 3 and the Articles of Association of the Company, Mr. Vyomesh M. Shah (DIN : 00009596), Director of the Company, who retires by rotation, and being eligible, offers himself for reappointment. Mr. Vyomesh M. Shah is not disqualified from being reappointed as Director by virtue of the provisions of Section 164 of the Companies Act, 2013. The Notice convening the ensuing Annual General Meeting includes the proposal for reappointment of the aforesaid Director.
Brief resume of Mr. Shailesh Hingarh and Mr. Vyomesh M. Shah, as required under the SEBI Listing Regulations and Secretarial Standards - 2 on General Meetings, is provided in the Annexure to the Notice convening the AGM.
During the year under review, the Independent Directors and Non-Executive Director of the Company had no pecuniary relationship or transactions with the Company.
Except for the Executive Chairman and the Managing Director who are related to each other being brothers, none of the other Directors of the Company are inter-se related to each other.
15. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS :
In compliance with the requirements of the SEBI Listing Regulations, the Company has held familiarization programme for the Independent Directors to familiarize them with their role, rights and responsibility as Directors, the working of the Company, nature of the industry in which the Company operates, business model, corporate policies, etc. The details of familiarization programme have been disclosed on the website of the Company and is available at the link http://www.hubtown.co.in/investors/codesandpolicies.
16. PAYMENT OF REMUNERATION/COMMISSION TO EXECUTIVE DIRECTORS FROM SUBSIDIARY COMPANIES :
During the year under review, neither the Executive Chairman nor the Managing Director was in receipt of any remuneration/commission from any of the subsidiary companies of the Company.
17. DECLARATION BY INDEPENDENT DIRECTORS :
Pursuant to the provisions of Section 149 (7) of the Companies Act, 2013, the Company has received individual declarations from all the Independent Directors confirming that they meet the criteria of independence under Section 149 (6) of the said Act and Regulation 16 (1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and that there has been no change in the circumstances which may affect their status as Independent Directors during the year.
18. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS :
The Board of Directors met 11 times during the financial year ended March 31, 2018 in accordance with the provisions of the Companies Act, 2013 and the Rules made thereunder and Regulation 17 (2) of the SEBI Listing Regulations. Additionally, during the year ended March 31, 2018, the Independent Directors held a separate meeting in compliance with the requirements of Schedule VI to the Companies Act, 2013 and Regulation 25 (3) of the SEBI Listing Regulations. For details, kindly refer to the section on Corporate Governance forming part of this Annual Report.
19. COMMITTEES OF THE BOARD :
There are currently six Committees of the Board, as under :
- Audit and Compliance Committee
- Nomination and Remuneration Committee
- Corporate Social Responsibility Committee
- Stakeholdersâ Relationship Committee
- Risk Management Committee
- Committee of Directors
During the year under review, the Board of Directors has reconstituted the Audit and Compliance Committee, Nomination and Remuneration Committee, Stakeholdersâ Relationship Committee and the Risk Management Committee. Details of the aforesaid Committees including their composition, terms of reference and meetings held during the year under review, are provided in the section on Corporate Governance, which forms part of this Annual Report.
20. AUDIT AND COMPLIANCE COMMITTEE :
The Audit and Compliance Committee comprises of Mr. Abhijit Datta, Mr. Shailesh Hingarh, Mr. Sunil Shah and Mr. Vyomesh M. Shah. The Committee comprises of majority of Independent Directors with Mr. Datta being the Chairman. Kindly refer to the section on âCorporate Governanceâ under the heading âAudit and Compliance Committeeâ for details relating to terms of reference, meetings and functions of the said Committee.
21. AUDIT AND COMPLIANCE COMMITTEE RECOMMENDATIONS :
During the year under review, all the recommendations put forth by the Audit and Compliance Committee were duly considered and accepted by the Board of Directors.
22. ANNUAL EVALUATION OF PERFORMANCE :
The Board of Directors has carried out an annual evaluation of its own performance, its Committees and individual Directors pursuant to the requirements of the Companies Act, 2013 and the corporate governance requirements as prescribed by the SEBI Listing Regulations. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of criteria such as the board composition, information and functioning, etc. as provided in the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.
The Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as qualification, attendance at Board/Committee meetings, preparedness on the issues to be discussed, etc. Further, the Independent Directors at their separate meeting held during the year, reviewed the performance of the Board as a whole, its Chairman and Non-Executive Director and other items as stipulated under the SEBI Listing Regulations. Performance of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.
23. POLICY ON DIRECTORSâ APPOINTMENT AND REMUNERATION :
The Nomination and Remuneration Policy of the Company on Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under Section 178 (3) of the Companies Act, 2013 and Regulation 19 (4) (Part âDâ of Schedule II) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended as Annexure - âAâ to this Report.
24. DIRECTORSâ RESPONSIBILITY STATEMENT :
Pursuant to sub-section (3) (c) of Sections 134 (3) (c) and 134 (5) of the Companies Act, 2013, in relation to the annual financial statements of the Company for the year ended March 31, 2018, the Directors of your Company, to the best of their knowledge and belief and on the basis of the information and explanations received by them, hereby state and confirm that :
(i) in the preparation of the Annual Accounts for the year ended March 31, 2018, the applicable accounting standards read with the requirements under Schedule III to the said Act have been followed alongwith proper explanation relating to material departures, if any;
(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year on 31st March, 2018, and of the Profit of the Company for the year ended on that date;
(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) the annual accounts have been prepared on a âgoing concernâ basis;
(v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
25. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of the Companies Act, 2013 and Ind AS-110 - Consolidated Financial Statement read with Ind AS - 28 -Investments in Associates and Ind AS - 31 - Interests in Joint Ventures, the audited consolidated financial statements are annexed to this Report.
26. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES :
As on March 31, 2018, the Company had 20 subsidiaries, 4 associates and 8 joint venture companies. The Company did not have any material subsidiary company as on March 31, 2018. There has been no change in the nature of business of any of the said subsidiaries, associates and joint venture companies.
During the year under review, Giraffe Developers Private Limited again became an associate due to cancellation of the transaction for sale of the shares on account of non-fulfillment of the conditions of sale.
The Policy for determining âmaterial subsidiaryâ under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as approved is posted on the Companyâs website at the link: http://hubtown.co.in/investors/codeandpolicies.
In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company at the link: http://hubtown.co.in/investors/ codeandpolicies. Further, as per fourth proviso of the said Section, the audited annual accounts of subsidiaries have also been placed on the website of the Company at the link: http://hubtown.co.in/investors/codeandpolicies.
The Company will make available the financial statements of its subsidiaries, joint venture companies and associates (collectively referred to as âSubsidiariesâ) and the related information to any member of the Company who may be interested in obtaining the same. The financial statements of the Subsidiaries will also be available for inspection at the Registered Office of the Company between 11.00 a.m. and 1.00 p.m. on all working days. The Consolidated Financial Statements of the Company forming part of this Annual Report, include the financial statements of its subsidiaries.
During the financial year ended March 31, 2018, the Company was not required to appoint an Independent Director of the Company on the Board of any of its non-listed Indian subsidiaries under Regulation 24 (1) of the SEBI Listing Regulations.
Additional information as required under Schedule III to the Companies Act, 2013 in respect of entities consolidated as subsidiaries/associates/ jointly controlled entities is furnished in Note_to the consolidated financial statements.
27. REPORT ON THE PERFORMANCE AND THE FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES :
The statement pursuant to Section 129 (3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, containing the salient features of the performance and the financial statements of the subsidiaries, associates and joint venture companies for the financial year ended March 31, 2018 in the prescribed Form AOC 1 is appended to the consolidated financial statements as Schedule - I.
28. AUDITORS : STATUTORY AUDITORS :
Messrs M. H. Dalal & Associates, Chartered Accountants (Firm Registration No. 112449W) were appointed as Statutory Auditors of the Company for a term of 5 (five) consecutive years, at the 29th Annual General Meeting held on October 30, 2017. Messrs M. H. Dalal & Associates, Chartered Accountants have confirmed that they are not disqualified from continuing as Auditor of the Company, They have also confirmed that they meet the criteria for independence, eligibility and qualification as prescribed in Section 141 of the said Act and do not have any pecuniary interest in the Company or its subsidiaries, associates and joint venture companies.
In accordance with the Companies Amendment Act, 2017 notified on May 7, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting.
Further, the Directors of your Company confirm that no instances of fraud were reported by the Auditors under Section 143 (12) of the Companies Act, 2013 and the Rules made thereunder either to the Company or to the Central Government.
AUDITORSâ REPORT AND AUDIT OBSERVATIONS :
The Managementâs reply to the qualified opinion of the Statutory Auditors appearing in their Reports on the Standalone Financial Statements and the Consolidated Financial Statements for the year ended March 31, 2018 is as hereunder :
The Statutory Auditors have made observations under the headings âEmphasis of matterâ and âOther Mattersâ respectively in their Reports on the Standalone and Consolidated Financial Statements for the year ended March 31, 2018 which together with the relavant Notes are self explanatory and do not call for further information/clarification.
QUALIFICATION BY AUDITORS
The Notes to the Financial Statements forming part of the Balance Sheet as at March 31, 2018 and the Statement of Profit and Loss for the year ended on that date, referred to in the Auditorâs Report, are self explanatory and do not call for any further clarification /elaboration.
COST AUDITORS :
Based on the recommendation of the Audit and Compliance Committee, the Board has appointed Messrs D. C. Dave & Co., Cost Accountants (Firm Registration No. : 000611) as Cost Auditors to conduct audit of the cost records of the Company for the year ending March 31, 2019, subject to ratification of the remuneration payable to them by the members in the ensuing Annual General Meeting pursuant to Section 148 of the Companies Act, 2013. The resolution pertaining to ratification of the the remuneration payable to the Cost Auditor forms part of the Notice of the ensuing AGM.
COST AUDIT REPORT :
The Cost Audit Report for the Financial Year 2017-2018 pursuant to the Companies (Cost Accounting Records) Rules, 2011 will be filed within the period stipulated under the Companies Act, 2013.
SECRETARIAL AUDITOR :
Pursuant to the provisions of Section 204 (3) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed M/s. Ashish Bhatt & Associates, Practicing Company Secretary, to conduct the Secretarial Audit of the Company.
SECRETARIAL AUDIT REPORT :
The report on Secretarial Audit is appended as Annexure - âBâ to this Report. There are no qualifications, observations or adverse remarks in the Secretarial Audit Report.
Your Company is in compliance with the Secretarial Standards specified by the Institute of Company Secretaries of India.
29. EXTRACT OF ANNUAL RETURN :
Pursuant to the provisions of Section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual Return for the Financial Year ended March 31, 2017 made under the provisions of Section 92 (3) of the said Act in Form No. - MGT 9 is appended as Annexure - âCâ to this Report.
30. MATERIAL CHANGES AND COMMITMENTS :
There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and date of this Report.
31. DEPOSITS :
During the year under review, the Company neither accepted any public deposits nor there were any amounts outstanding at the beginning of the year which were classified as âDepositsâ in terms of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and hence, the requirement for furnishing of details of deposits which are not in compliance with Chapter V of the said Act is not applicable.
32. VIGIL MECHANISM :
Pursuant to Section 177 (9) and (10) of the Companies Act, 2013 and Regulation 22 read with Regulation 4 (2) (d) (iv) of the SEBI Listing Regulations, the Company has established a Whistle Blower Policy as the vigil mechanism for Directors and employees of the Company to report their genuine concerns, details of which have been given in the Corporate Governance Report appended to this Annual Report. During the year under review, no such incidence was reported and no personnel were denied access to the Chairman of the Audit and Compliance Committee.
The Whistle Blower Policy has been uploaded on the Company website at the link: http://hubtown.co.in/investors/codeandpolicies.
33. RISK MANAGEMENT :
Presently, the provisions of Regulation 21 of the SEBI Listing Regulations relating to the âRisk Management Committeeâ are not applicable to your Company. However, the Board of Directors had constituted a âRisk Management Committeeâ under Clause 49 of the erstwhile Listing Agreement and framed a âRisk Management Policyâ to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the functions are systematically addressed through mitigating actions on a continuing basis. The details of the Risk Management Committee are provided in the Section on âCorporate Governanceâ forming part of this Annual Report.
34. PARTICULARS OF LOANS, INVESTMENTS OR GUARANTEES UNDER SECTION 186 OF THE COMPANIES ACT, 2013 :
As the Company is engaged in the business of âreal estate developmentâ included in the term âInfrastructure Facilitiesâ as defined in Clause (8) (a) of Schedule VI to the Companies Act, 2013, the provisions of Section 186 of the said Act related to loans made, guarantees given or securities provided are not applicable to the Company. However, the details of the same are provided in the notes to the financial statements. Particulars of investments made under Section 186 of the said Act are provided in the standalone financial statements at Note 6.
35. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES :
All contracts / arrangements / transactions with related parties that were entered by the Company during the year under review were in the ordinary course of business and on an armâs length basis. All related party transactions are placed before the Audit and Compliance Committee and the Board on a quarterly basis for approval. Also, the Company has obtained prior omnibus approval for related party transactions which are of repetitive nature and/or entered into in the ordinary course of business at armâs length.
There were no materially significant related party transactions with the Companyâs Promoters, Directors, Key Managerial Personnel or their relatives which could have had a potential conflict with the interest of the Company at large..
Attention of the members is drawn to Note 33 to the standalone financial statements and Note 35 to the consolidated financial statements which sets out related party disclosures pursuant to Ind AS - 24.
The particulars of contracts/arrangements/transactions entered into by the Company during the year under review with its related parties which could be considered material under Section 188 of the Companies Act, 2013 and the Rules made thereunder are furnished in Form AOC - 2, which is appended as Annexure âDâ to this Report..
The Policy for determining the materiality of related party transactions and dealing with related party transactions as approved by the Board is uploaded on the Companyâs website at the link: http://hubtown.co.in/investors/codeandpolicies.
36. CODE OF CONDUCT:
The Board of Directors has laid down a Code of Conduct for Board Members and Senior Management Personnel. The said Code has been posted on the Companyâs website : www.hubtown.co.in. As prescribed under Part âDâ of Schedule V read with Regulation 17 (5) of the SEBI Listing Regulations, a declaration signed by the Managing Director affirming compliance with the Code of Conduct by the Directors and Senior Management Personnel of the Company for the Financial Year 2017-2018 is appended to and forms part of the Corporate Governance Report.
37. DISCLOSURE OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL :
During the year under review, there were no significant or material orders passed by any regulatory / statutory authorities or courts / tribunals against the Company impacting its going concern status and the Companyâs operations in future.
38. CORPORATE SOCIAL RESPONSIBILITY (CSR) :
The Corporate Social Responsibility Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR) indicating the activities to be undertaken by the Company, which has been approved and adopted by the Board.
The annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in Annexure âEâ appended to this Report. Further, the CSR Policy has been uploaded on the Company website at the link : http://hubtown.co.in/investors/codeandpolicies.
39. DISCLOSURE UNDER âTHE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 :
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of âThe Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. The Company affirms that during the year under review, no complaints were received by the Committee for redressal.
40. CORPORATE GOVERNANCE:
The Report on Corporate Governance as stipulated under the SEBI Listing Regulations forms an integral part of this Annual Report. The requisite certificate from a practising company secretary confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V to the aforementioned Listing Regulations is appended to and forms part of the report on Corporate Governance.
41. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO ;
The nature of operations of the Company does not require disclosure of particulars relating to conservation of energy and technology absorption, as prescribed under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014. During the year under review, the Company had âNilâ foreign exchange earnings and had incurred an expenditure of Rs. 81.46 lakh in foreign exchange.
42. INSURANCE :
All the insurable interests of your Company including inventories, buildings and other assets are adequately insured.
43. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES :
The disclosure required under Section 197(12) of the Companies Act, 2013 read with the Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure - âFâ to this Report.
The statement containing names of top ten employees in terms of the remuneration drawn and the particulars of employees as required pursuant to Section 197 (12) of the Companies Act, 2013 read with Rules 5 (2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company are available at the Registered Office of the Company 21 days before the AGM, during business hours on working days of the Company upto the date of the ensuing AGM. Any member who is interested in obtaining a copy thereof, may write to the Company Secretary at the Registered Office of the Company. None of the employees listed in the aforesaid statement is a relative of any Director of the Company. None of the employees of the Company, employed throughout the financial year or part thereof, was in receipt of remuneration during the year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the Managing Director and holds by himself / herself or along with his/her spouse and dependent children more than two percent of the equity shares of the Company.
44. CORPORATE POLICIES :
In compliance with the provisions of the Companies Act, 2013 and the Rules made thereunder and the SEBI Listing Regulations, the Board of Directors of the Company have framed the following policies which are available on the website of the Company at the link http://hubtown.co.in/ investors/codeandpolicies :
- Code of Conduct and Ethics for Directors and Senior Management
- Code of Conduct for Regulating, Monitoring and Reporting of Trading by Insiders in terms of SEBI (Prohibition of Insider Trading) Regulations, 2015
- Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information
- Policy on Related Party Transactions
- Familiarization program for Independent Directors
- Policy for determining Material Subsidiaries
- Policy on Prevention of Sexual Harassment at Workplace
- Vigil Mechanism / Whistle Blower Policy
- Corporate Social Responsibility Policy
- Risk Management Policy
- Policy on Board Diversity
- Nomination and Remuneration Policy
- Policy on determining materiality of Events and Information
- Policy on preservation of Documents
- Policy on archival of Events and Information
45. CEO AND CFO CERTIFICATION :
A certificate from the Managing Director and the Chief Financial Officer, pursuant to Regulation 17 (8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the year under review was placed before the Board of Directors of the Company at its meeting held on May 29, 2018 which is appended to and forms part of the Corporate Governance Report.
46. APPRECIATION AND ACKNOWLEDGEMENTS :
Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The Directors also take this opportunity to thank all Investors, Suppliers, Vendors, Banks, Financial Institutions, Business Associates, Contractors, Government and Regulatory Authorities and Stock Exchanges for their continued support during the year.
Your Directors would also like to thank the members for reposing their confidence and faith in the Company and its management.
DISCLAIMER :
Certain statements made in the Directorsâ Report and the Management Discussion and Analysis may constitute âforward looking statementsâ within the meaning of applicable securities laws and regulations. Actual results could differ from those expressed or implied. Several factors could make significant difference to the Companyâs operations that include labour and material availability, and prices, cyclical demand and pricing in the Companyâs principal markets, changes in interest rates, changes in government regulations, tax regimes, economic development within India and other incidental factors. The Company does not undertake any obligation to publicly update any forward looking statements, whether as a result of new information, future events or otherwise.
For and on behalf of the Board
Hemant M. Shah
Executive Chairman
DIN :00009659
Place: Mumbai
Date: May 29, 2018
Mar 31, 2015
TO
THE MEMBERs
The Directors have pleasure in presenting their Twenty-seventh Annual
Report along with the Audited Accounts of your Company for the year
ended March 31, 2015.
FINANCIAL HIGHLIGHTs :
The financial performance of the Company for the year ended March 31,
2015 is summarized :
(Rs.in lac)
STANDALONE CONSOLIDATED
March 31, 2015 March 31,
2014 March 31,
2015 March 31,
2014
Revenue from
Operations 41146 47764 44326 47346
Other Income 4298 3924 9465 7338
Total Income 45444 51688 53791 54684
Operating Expenditure 11148 18783 11266 17369
Profit before
Depreciation /
Interest / Tax 34296 32905 42525 37315
Depreciation 403 557 980 985
Finance costs 32259 30465 40341 35673
Profit before Tax 1634 1883 1204 657
Add : Extraordinary
item 350 __ 350 __
Add / (Less) :
Provision for Tax (504) (118) (743) (149)
Excess / (Short)
provision for
taxation in respect
of 313 (520) 266 (694)
earlier years
Deferred Tax credit
/ (charge) (497) 2296 (501) 2323
Prior Period
Adjustments (net) (221) 3 (445) 22
Minority Interest /
Share of Profit /
(Loss) from
associates companies __ __ (74) 134
/ pre-acquisition
loss
Capital reserve
written back on
dilution __ __ 17 __
Net Profit for the
Year 1075 3544 74 2293
Balance Profit
brought forward from
Previous Year 68233 67843 60766 61628
Reversal of proposed
equity dividend
and tax thereon 850 696 850 696
Amount available
for appropriation 70158 72083 61690 64617
APPROPRIATIONs :
Debenture Redemption
Reserve __ 3000 __ 3000
Proposed Dividend __ 727 __ 727
Dividend
Distribution Tax __ 124 __ 124
General Reserves __ __ __ __
Balance carried to
Balance sheet 70158 68232 61690 60766
Earnings per share
before
Extraordinary Item
(`) (EPs) 1.00 4.87 0.10 3.15
Earnings per
share after
Extraordinary Item
(`) (EPs) 1.48 4.87 0.10 3.15
OPERATIONs OF THE COMPANY :
Your Company recorded a satisfactory performance during the year under
review, amidst weak economic conditions and poor investor / consumer
sentiments. The total revenue of the Company on a standalone basis
stood at Rs.45444 lacs, 12.08 percent lower than Rs.51688 lacs in the
previous year. Operational expenditure was lower by 40.65 percent at `
11148 lacs, as against Rs.18783 lacs in the previous year. The Operating
Profit (EBITDA) increased by 4.22 percent to Rs.34296 lacs from Rs.32905
lacs in the previous year. Profit after Tax for the year was lower by
69.66 percent at Rs.1075 lacs as against Rs.3544 lacs in the previous
year.
The consolidated turnover of the Company stood at Rs.53791 lacs, as
against Rs.54684 lacs in the previous year. The consolidated operational
expenditure was lower by 35.13 percent at Rs.11266 lacs as against `
17369 lacs in the previous year. The Consolidated Operating Proft
(EBITDA) increased by 13.96 percent percent to Rs.42525 lacs from `
37315 lacs in the previous year. Consolidated Proft after Tax for the
year was Rs.74 lacs, lower by 96 percent over Rs.2293 lacs in the
previous year.
During the year under review, your Company's performance was to a
greater extent impacted due to rising inflation, rupee depreciation,
increased cost of capital, increased cost of construction and
restrained demand from end-users. The operational cash flows were
adversely impacted for a major part of the year under review due to
lower than expected sales level, resulting in intense pressure on profit
margins.
DIVIDEND :
As a prudent economic measure and in order to conserve the scarce
liquid resources of the Company, the Directors do not recommend any
dividend on the equity shares for the year under review.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND:
Pursuant to the provisions of Section 124 of the Companies Act, 2013,
the unclaimed dividend amount of Rs.49,337/- being the dividend for the
year ended March 31, 2007 and the interim dividend amount of Rs.35,655/-
paid for the year ended March 31, 2008 were transferred to the Investor
Education and Protection Fund (IEPF) after giving due notices to the
members.
During the Financial Year 2015-2016, the dividend declared by the
Company for the Financial Year 2007-2008, remaining unclaimed in terms
of Section 124 of the Companies Act, 2013 will be transferred to IEPF.
RESERVES :
During the year under review, no amount was transferred to General
Reserve. An amount of Rs.4300.00 lacs has been transferred from
Debenture Redemption Reserve to General Reserve.
CHANGES IN SHARE CAPITAL :
There are no changes in the share capital of the Company. During the
year under review, the Company has not issued shares with differential
voting rights nor granted stock options nor sweat equity.
DEBENTURES :
During the year under review, the Company has :
i. fully redeemed three series of Secured Redeemable Non-Convertible
Debentures aggregating Rs.5200.32 lacs, Rs.211.85 lacs and Rs.2500 lacs
respectively outstanding at the beginning of the year; and
ii. raised funds through the issue of Secured Redeemable
Non-convertible Debentures aggregating Rs.2500 lacs on private placement
basis.
DIRECTORS :
In accordance with the provisions of the Companies Act, 2013 and the
Articles of Association of the Company, Mrs. Priti K. Shah, Director
(DIN : 01880436) of the Company, who retires by rotation, and being
eligible, offers herself for reappointment.
INDEPENDENT DIRECTORS :
At the Twenty-sixth Annual General Meeting of the Company held on
September 25, 2014, Mr. Arvind Kumar Joshi, Mr. Abhijit Datta and Mr.
Sunil C. Shah were appointed as Independent Directors under the
provisions of the Companies Act, 2013, each for a term of five
consecutive years with effect from September 25, 2014.
Pursuant to the requirement under Section 134 (3) of the Companies Act,
2013, with respect to statement on declaration by Independent Directors
under Section 149 (6) of the said Act, the Board hereby confirms that
all the Independent Directors of the Company have given a declaration
confirming that they meet the criteria of independence as laid down
under Section 149 (6) of the said Act and Clause 49 (II) (B) of the
Listing Agreement.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS :
The particulars of the meetings of the Board of Directors held during
the year under review have been provided in the Corporate Governance
Report, which forms part of this Annual Report.
BOARD COMMITTEES :
During the year under review, the Board of Directors has :
i. reconstituted and enhanced the terms of reference of the Audit and
Compliance Committee;
ii. enhanced the terms of reference of the Remuneration Committee and
reconstituted and renamed the Committee as the 'Nomination and
Remuneration Committee' ;
iii. enhanced the terms of reference of the 'Shareholders'/Investors'
Grievance Committee', and reconstituted and renamed the Committee as
the 'Stakeholders Relationship Committee';
iv. constituted a 'Corporate Social Responsibility (CSR) Committee in
accordance with the provisions of Section 135 of the Companies Act,
2013 and the Companies (Corporate Social Responsibility Policy) Rules,
2014; and
v. constituted a 'Risk Management Committee' in accordance with the
provisions of Clause 49 (VI) of the Listing Agreement.
Details of the aforesaid Committees along with their respective
composition, terms of reference, meetings held during the year, are
provided in the 'Report on Corporate Governance' forming part of this
Annual Report.
PERFORMANCE EVALUATION :
Pursuant to the provisions of the Companies Act, 2013 and Clause 49
(II) (B) (5) of the Listing Agreement, evaluation of every Director's
performance was carried out by the Nomination and Remuneration
Committee. The performance of Non-Independent Directors and the Board
as a whole and the Committees thereof and the Chairman of the Company
was carried out by Independent Directors. Evaluation of Independent
Directors was carried out by the entire Board of Directors, excluding
the Director being evaluated.
The evaluation of the Board and its Committees was based on objective
and tangible criteria, including the performance of the Company,
accomplishment of long term strategic objectives, blending of ethics
and business and the development of management, etc.
The evaluation of individual director was based on the effective
contribution by the director concerned, the commitment to the role
including commitment of time for Board and Committee meetings and any
other duties.
COMPANY'S POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION :
The Policy of the Company on Directors' appointment and remuneration
including criteria for determining qualifications, positive attributes,
independence of a Director and other matters as provided under Section
178 (3) of the Companies Act, 2013 and Clause 49 (IV) (B) (1) of the
Listing Agreement is appended as Annexure  'A' to this Report.
DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to sub-section (3) (c) of Section 134 of the Companies Act,
2013, the Directors of your Company, to the best of their knowledge and
belief and on the basis of the information and explanations received by
them, hereby state and confirm that :
(i) in the preparation of the Annual Accounts for the year ended March
31, 2015, the applicable Accounting Standards read with the
requirements under Schedule III to the said Act have been followed and
there are no material departures from the same;
(ii) such accounting policies as mentioned in Note 2 of the Notes to
the Financial Statements have been selected and applied them
consistently and judgments and estimates have been made that are
reasonable and prudent, so as to give a true and fair view of the state
of affairs of the Company as at March 31, 2015 and of the profit of the
Company for the year ended on that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) the annual accounts have been prepared on a 'going concern' basis;
(v) proper internal financial controls are in place and that such
internal financial controls are adequate and are operating effectively;
and
(vi) proper systems to ensure compliance with the provisions of all
applicable laws are in place and are adequate and operating effectively.
SUBSIDIARIES, JOINT VENTURE COMPANIES AND ASSOCIATE COMPANIES :
As on March 31, 2015, the Company had 21 subsidiaries, 8 joint venture
companies and 6 associate companies. There has been no change in the
nature of business of the said subsidiaries, the said joint venture
companies and the said associate companies.
During the year under review :
i. Citywood Builders Private Limited (Citywood), which was an associate
became a subsidiary of the Company. Subsequent to the close of the
year, Citywood has become a wholly owned subsidiary of the Company;
ii. Citywood Builders Private Limited, Holiac Realty Private Limited,
and Harbinger Developers Private Limited ceased to be associates of the
Company;
iii. Shubhsiddhi Builders Private Limited became an associate of the
Company; and
iv. Adhivitiya Properties Limited, Arnav Gruh Limited, Heeler
Hospitality Private Limited, Merrygold Buildcon Private Limited and
Vishal Nirman (India) Limited ceased to be subsidiaries of the Company.
A statement pursuant to Section 129 (3) of the Companies Act, 2013 read
with Rule 5 of the Companies (Accounts) Rules, 2014, containing the
salient features of the performance and the financial statements of the
subsidiaries, joint venture companies and associates companies in the
prescribed Form AOC 1 is appended to the consolidated financial
statements as Schedule - I.
The Policy for determining 'material subsidiary' as approved is posted
on the Company's website at the link: http://www.hubtown.co.in/company
information/investors/policies/policyonsubsidiaries.pdf.
Additional information as required under Schedule III to the Companies
Act, 2013, in respect of entities consolidated as
subsidiaries/associates/joint ventures is furnished in Note '1' of
Notes to the consolidated financial statements.
In accordance with third proviso of Section 136(1) of the Companies
Act, 2013, the Annual Report of the Company, containing therein its
standalone and the consolidated financial statements has been placed on
the website of the Company at the link : http:/
www.hubtown.co.in/company-information/
investors/annual-reports/annual-report-2014-2015 /pdf. Further, as per
fourth proviso of the said Section, audited annual accounts of each of
the subsidiary companies have also been placed on the website of the
Company at the link :
http://www.hubtown.co.in/company-information/investors/
annual-reports/report-and-accounts-of-subsidiaries-2014-2015/pdf.
Shareholders interested in obtaining a copy of the audited annual
accounts of the subsidiary companies may write to the Company Secretary
at the Company's registered office. These documents will also be
available for inspection at the Registered Office of the Company during
the working hours up to the date of the Annual General Meeting.
PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, JOINT VENTURE
ENTITIES AND ASSOCIATES INCLUDED IN THE CONSOLIDATED FINANCIAL
STATEMENTS
A statement on the performance and financial position of each of the
subsidiaries, joint venture companies and associates companies included
in the consolidated financial statements is given as Schedule - I to the
consolidated financial statements and hence not repeated here for the
sake of brevity.
AUDITORs :
statutory Auditors :
M/s. Dalal Doshi & Associates (formerly Doshi Doshi & Associates),
Chartered Accountants, (Firm Registration No. : 121773W) were
reappointed as Statutory Auditors of the Company to hold office from the
conclusion of the 26th Annual General Meeting (AGM) held on September
25, 2014 until the conclusion of the third consecutive AGM of the
Company to be held in the year 2017 (subject to ratification of their
appointment by the members at every AGM held after the AGM held on
September 25, 2014).
As required under Section 139 (1) of the Companies Act, 2013, the
Company has obtained a written certificate from M/s. Dalal Doshi &
Associates to the effect that their reappointment, if made, would be in
accordance with the Companies Act, 2013 and the Rules framed there under
and that they satisfy the criteria provided in Section 141 of the
Companies Act, 2013.
The proposed reappointment would be subject to ratification by the
members in the ensuing Annual General Meeting in terms of the first
proviso to Section 139 (1) of the Companies Act, 2013.
As required under Clause 49 of the Listing Agreement, the Statutory
Auditors have confirmed that they hold a valid certificate issued by the
Peer Review Board of the Institute of Chartered Accountants of India.
A resolution seeking ratification of the appointment of M/s. Dalal Doshi
& Associates as the Statutory Auditors of the Company pursuant to
Section 139 of the Companies Act, 2013 forms part of the Notice.
Cost Auditors :
M/s. N. I. Mehta & Co., Cost Accountants (Firm Registration No. :
000023) have been appointed as Cost Auditors by the Board of Directors
to conduct audit of the cost records of the Company for the year ending
March 31, 2016. M/s. N. I. Mehta & Co. have confirmed that their
appointment is within the limits of Section 139 (9) read with Section
141 (3) (g) of the Companies Act, 2013 and have also certified that they
are free from any disqualifications specified under Section 141 (3) and
(4) read with proviso to Section 148 (3) of the said Act.
COST COMPLIANCE REPORT :
The Cost Compliance Report for the Financial Year 2013-2014 pursuant to
the Companies (Cost Accounting Records) Rules, 2011 was fled within the
due date.
secretarial Auditors :
Pursuant to the provisions of Section 204 (3) of the Companies Act,
2013 read with the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Board of Directors has appointed
M/s. Ashish Bhatt & Associates (CP No. : 2956), a firm of Company
Secretaries in Practice, to conduct the secretarial audit of the
Company.
In terms of Section 204 (1) of the Companies Act, 2013, the Report of
the Secretarial Auditor on the Company's Secretarial Audit is appended
as Annexure  'B' to this Report.
There are no qualifications or observations or adverse remarks made by
the Secretarial Auditor in his said Report.
AUDIT COMMITTEE AND AUDIT RECOMMENDATIONS :
The Audit Committee comprises of three Independent Directors namely Mr.
Abhijit Datta as Chairman, Mr. Arvind Kumar Joshi and Mr. Sunil C. Shah
and One Non-Independent Executive Director  Mr. Vyomesh M. Shah. The
Chairman, the Chief Financial Officer, the Internal Auditors and the
Statutory Auditors are permanent invitees to the Audit Committee
meetings. During the year under review, all the recommendations put
forth by the Audit Committee were duly considered and accepted by the
Board of Directors. There were no instances of non-acceptance of such
recommendations.
AUDITORS' REPORT AND AUDIT OBSERVATIONS :
The Statutory Auditors have : (i) stated an 'Emphasis of Matter' and
"Other Matters" and made certain observations in clauses (vii) (a) and
(ix) of the Annexure referred to in their Report on the Standalone
Financial Statements for the year ended March 31, 2015; (ii) stated an
'Emphasis of Matter' and "Other Matters" and made certain observations
in clauses (vii) (a) and (ix) of the Annexure referred to in their
Report on the Consolidated Financial Statements for the year ended
March 31, 2015 and the response of your Directors thereto is as
follows:
As regards "Emphasis of Matter" and "Other Matters", the Notes to the
Standalone Financial Statements and Consolidated Financial Statements
for the year ended March 31, 2015 respectively are self explanatory and
do not call for further clarification/elaboration.
As regards observations in clauses (vii) (a) and (ix) of the Annexure
referred to in the Auditors' Report on the Standalone Financial
Statements, and observation in clauses (vii) (a) and (ix) of the
Annexure referred to in the Auditors' Report on the Consolidated
Financial Statements, the Directors have to state that :
"The delays caused by the Company in making timely payment of the
statutory dues and payment of principal and interest on its borrowings
have been due to prolonged stagnation in demand in the real estate
sector accentuated by economic slowdown, inordinate delays in approval
process, inflationary pressures, volatility in foreign exchange,
liquidity crunch and costly debt. The Company is also facing lack of
adequate sources of finance to fund development of its real estate
projects resulting in delayed realisations from its customers and lower
availability of funds to discharge its liabilities. The Company is
exploring alternative sources of finance to generate adequate cash
infows for meeting these obligations and to overcome this temporary
liquidity shortage and is hopeful that these efforts will yield fruitful
results."
As regards observations in clause (ix) of the Annexure referred to in
the Auditors' Report on the Consolidated Financial Statements, the
Directors have to state that :
"The delays caused by the subsidiary companies and jointly controlled
entities in repayment of dues to banks, financial institutions and
debenture holders is purely temporary on account of cash flow mismatch
and efforts are being made and steps being taken to make good the delays
at earliest."
REPORTING OF FRAUD BY STATUTORY AUDITORS :
The Statutory Auditors have not reported any instance of fraud under
Section 143 (12) of the Companies Act, 2013.
VIGIL MECHANISM :
Pursuant to Section 177 (9) and (10) of the Companies Act, 2013, the
Company has established a Whistle Blower Policy as a vigil mechanism
for Directors and employees to report their genuine concerns, details
of which have been given in the Corporate Governance Report annexed to
this Annual Report. The Whiste Blower Policy has been uploaded on the
Company website at
http:/www.hubtown.co.in/companyinformation/investors/
policies/whistleblowerpolicy/pdf.
RISK MANAGEMENT POLICY :
Risk evaluation and management is an ongoing process within the
organization. The Company has constituted a 'Risk Management Committee'
to identify, assess, monitor and mitigate various risks to key business
objectives. Major risks identified by the functions are systematically
addressed through mitigating actions on a continuing basis.
EXTRACT OF ANNUAL RETURN :
The details forming part of the extract of the Annual Return in Form
No. MGT - 9 is appended as Annexure  'C' to this Report.
MATERIAL CHANGEs AND COMMITMENTs :
No material changes or commitments affecting the financial position of
the Company have occurred between the end of the financial year of the
Company to which the financial statements relate and the date of this
Report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY'S
OPERATIONS IN FUTURE :
During the year under review, no significant and material orders were
passed by the regulators or courts or tribunals which would impact the
going concern status of the Company's operations in future.
INTERNAL FINANCIAL CONTROLs :
The Company's internal control systems are commensurate with the nature
of its business and the size and complexity of its operations. These
are routinely tested and certified by the Statutory as well as Internal
Auditors. Significant audit observations and follow-up action thereon
are reported to the Audit Committee. The Audit Committee reviews the
adequacy and effectiveness of the Company's internal control environment
and monitors the implementation of audit recommendations, including
those relating to strengthening of the Company's risk management
policies.
DEPOSITS :
With effect from April 1, 2014, the Company has stopped
accepting/renewing fixed deposits. All the deposits accepted by the
Company prior to April 1, 2014 have been refunded by the Company. There
were no deposits that remained unpaid or unclaimed as at March 31,
2015.
There are no deposits which are not in compliance with the provisions
of Chapter V (relating to acceptance of deposits by companies) of the
Companies Act, 2013.
PARTICULARS OF LOANS, INVESTMENTS OR GUARANTEES UNDER SECTION 186 OF
THE COMPANIES ACT, 2013
The provisions of Section 186 of the Companies Act, 2013 relating to
loans made, guarantees given or securities provided are not applicable
to the Company as it is engaged in the business of providing
infrastructural facilities as defined in Clause (8) of Schedule VI to
the Companies Act, 2013. However, particulars of loans given,
investment made, guarantees given and securities provided are disclosed
in the notes to the financial statements.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES :
All contracts / arrangements / transactions with related parties that
were entered into by the Company during the year under review were on
an arm's length basis and in the ordinary course of business. Hence no
particulars in Form AOC - 2 have been furnished. There were no
materially significant related party transactions with the Company's
Promoters, Directors, Key Managerial Personnel or their relatives which
could have had a potential conflict with the interest of the Company at
large. All related party transactions are placed before the Audit
Committee as also the Board for approval.
The Policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website at http : www.hubtown.co.in company
information / investors / policies / policy on related party
transactions / pdf.
Attention of the members is drawn to Note 33 to the standalone financial
statements and Note 31 to the consolidated financial statements which
sets out related party disclosures.
CONSOLIDATED FINANCIAL STATEMENTS :
The Consolidated Financial Statements of the Company which have been
prepared in accordance with the relevant Accounting Standards (AS) viz.
AS 21 Â 'Consolidated Financial Statements', AS 23 Â 'Accounting for
Investments in Associates' and AS 27 Â 'Financial Reporting of
interests in Joint Ventures' issued by the Institute of Chartered
Accountants of India form part of this Annual Report.
CODE OF CONDUCT :
As prescribed under Clause 49 (II) (E) of the Listing Agreement, a
declaration signed by the Managing Director affirming compliance with the
Code of Conduct by the Directors and Senior Management Personnel of the
Company for the Financial Year 2014-2015 is annexed to and forms part
of the Corporate Governance Report.
CORPORATE GOVERNANCE :
A separate report on 'Corporate Governance' is provided on Page No. 41
to 58 of this Annual Report together with a Certificate from a Company
Secretary in Practice regarding compliance with the conditions of
Corporate Governance as stipulated under Clause 49 of the Listing
Agreement. A certificate by the Managing Director and Chief Financial
Officer of the Company in terms of Clause 49 (IX) of the Listing
Agreement, inter-alia confirming the correctness of the financial
statements, adequacy of internal control measures and reporting of the
matters to the Audit Committee is also annexed.
DISCLOSURE UNDER 'THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013' :
The Company has in place an Anti Sexual Harassment Policy in line with
the requirements of 'The Sexual Harassment of Women at Work Place
(Prevention, Prohibition and Redressal) Act, 2013. An Internal
Complaints Committee has been set up to redress complaints received
regarding sexual harassment. The Company affirms that during the year
under review, no cases were fled under the said Act by any of its woman
employee before the Internal Complaints Committee.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO :
The nature of operations of the Company does not require disclosure of
particulars relating to conservation of energy and technology
absorption, as prescribed under Section 134 (3) (m) of the Companies
Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014.
During the year under review, the Company had 'Nil' foreign exchange
earnings and had incurred an expenditure of Rs.139.07 lacs in foreign
exchange.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
During the year under review, three (3) employees of the Company
employed for the full year received remuneration in excess of Rs.60 lacs
and 1 (one) employee employed for part of the year received
remuneration in excess of Rs.5 lacs per month.
In terms of the provisions of Section 197 (12) of the Companies Act,
2013 read with Rules 5 (2) and 5 (3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, a statement showing
the names and other particulars of the employees drawing remuneration
in excess of the limits set out in the said Rules is appended to this
Report.
In terms of the provisions of Section 136(1) of the Companies Act,
2013, the Directors' Report is being sent to the shareholders excluding
the aforesaid statement. Shareholders who are interested in obtaining a
copy of the said statement may write to the Company Secretary at the
Company's registered office. The aforesaid statement is also available
for inspection by the shareholders at the Registered Office of the
Company 21 days before the Twenty- seventh Annual General Meeting and
up to the date of the said Annual General Meeting during the business
hours on working days.
Disclosures pertaining to remuneration and other details as required
under Section 197 (12) of the said Act read with Rule 5 (1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, are provided in Annexure 'D' to this Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR) :
The Company has constituted a Corporate Social Responsibility Committee
in accordance with the provisions of Section 135 of the Companies Act,
2013 read with the Companies (Corporate Social Responsibility Policy)
Rules, 2014 (the Rules). The CSR Policy of the Company and the details
about the initiatives taken by the Company on Corporate Social
Responsibility during the year as per annexure attached to the Rules
have been appended as Annexure 'E' to this Report. Further, the CSR
Policy has been uploaded on the Company website at the link :
http://www.hubtown.
co.in/company-information/investors/policies/corporate-social-
responsibility-policy/pdf.
HUMAN RESOURCES :
The Company recognizes that its people are key to success of the
organization and in meeting its business objectives. The Human
Resources function endeavours to create a congenial work environment
and synchronizes the working of all the departments of the organization
to accomplish their respective objectives, which in turn helps the
Company to build and achieve its goals and strategies. Employee
relations during the year remained cordial.
The Company had 180 employees on its payroll as on March 31, 2015.
INSURANCE :
All the insurable interests of your Company including inventories,
buildings and other assets are adequately insured.
APPRECIATION AND ACKNOWLEDGEMENTS :
Your Directors place on record their deep appreciation to employees at
all levels for their hard work, dedication and commitment. The
Directors also take this opportunity to thank all Investors, Suppliers,
Vendors, Banks, Financial Institutions, Business Associates,
Contractors, Government & Regulatory Authorities and Stock Exchanges
for their continued support during the year.
DISCLAIMER :
Certain statements made in the Directors' Report and the Management
Discussion and Analysis may constitute 'forward looking statements'
within the meaning of applicable securities laws and regulations.
Actual results could differ from those expressed or implied. Several
factors could make significant difference to the Company's operations
that include labour and material availability, and prices, cyclical
demand and pricing in the Company's principal markets, changes in
interest rates, changes in government regulations, tax regimes,
economic development within India and other incidental factors. The
Company does not undertake any obligation to publicly update any
forward looking statements, whether as a result of new information,
future events or otherwise.
For and on behalf of the Board
Hemant M. shah
Executive Chairman
Mumbai, May 30, 2015. DIN : 00009659
Mar 31, 2014
THE MEMBERS
The Directors have pleasure in presenting the Twenty Sixth Annual
Report of your Company together with the Audited Accounts for the
financial year ended March 31, 2014.
FINANCIAL RESULTS :
The salient features of the Company''s standalone and consolidated
financial results for the year under review as compared to the previous
financial year are as follows:
(Rs. in lac)
STANDALONE CONSOLIDATED
March 31,
2014 March 31, 2013 March 31,
2014 March 31,
2013
Revenue from
Operations 47764 44972 47606 44106
Other Income 3924 8924 7338 12534
Total Income 51688 53896 54944 56640
Operating
Expenditure 18783 15535 17369 12612
Profit before
Depreciation /
Interest / Tax 32905 38361 37575 44028
Depreciation 557 573 985 1070
Interest and
Finance Charges 30465 35016 35673 43458
Profit / (Loss)
before Tax 1883 2772 917 (500)
Provision for Tax (118) Â (149) (10)
Add / (less):
Excess / (Short)
provision for
taxation in
respect of (520) (24) (694) (15)
earlier years
Deferred Tax
credit / (charge) 2296 310 2323 267
Prior Period
Adjustments (net) 3 8 22 (259)
Minority Interest /
Share of Profit /
(loss) of
Subsidiaries &
Associates   (126) 305
/ Others
Net Profit /
(Loss) for the
Year 3544 3066 2293 (212)
Balance Profit
brought forward from
Previous year 67843 65509 61628 62685
Tax Credit on
proposed dividend  114  Â
Amount available
for appropriation 71387 68689 63921 62473
APPROPRIATIONS
Debenture Redemption
Reserve 3000 Â 3000 Â
Proposed Dividend 727 727 727 727
Reversal of proposed
dividend and tax
thereon (696) Â (696) Â
Dividend
Distribution Tax 124 118 124 118
General Reserves    Â
Balance carried to
Balance sheet 68232 67844 60766 61628
Earnings per share
before Extraordinary
Item (Rs.) (EPs) 4.87 4.22 3.15 (0.29)
Earnings per share
after Extraordinary
Item (Rs.) (EPs) 4.87 4.22 3.15 (0.29)
FINANCIAL PERFORMANCE :
Consolidated Financials
During the year under review, your Company''s consolidated turnover was
lower by 2.99 % at Rs. 54944 lacs as compared to Rs. 56640 lacs for the
previous year. Profit before tax stood at Rs. 917 lacs for the year under
review as compared to loss of Rs. 500 lacs for the previous year. Profit
after tax stood at Rs. 2293 lacs as compared to loss of Rs. 212 lacs in the
previous year.
Standalone Financials
During the year under review, the turnover of the Company was lower by
4.09 % at Rs. 51688 lacs as compared to Rs. 53896 lacs in the previous
year. Profit before Tax was lower by 32.07 % at Rs. 1883 lacs as compared
to Rs. 2772 lacs for the previous year. Profit after Tax was higher by
15.59 % at Rs. 3544 lacs as compared to Rs. 3066 lacs in the previous year.
In view of the downturn in the economy during the year under review,
your Company''s performance as well as Profits were to a greater extent
impacted due to rising infation, rupee depreciation, increased cost of
capital, increased cost of construction and restrained demand from
end-users. The operational cashflows were adversely impacted for a
major part of the year under review due to lower than expected sales
level resulting in intense pressure on Profit margins.
APPROPRIATIONs :
Despite the challenging business environment, sluggish industry volumes
and increased costs, your Directors are pleased to recommend a dividend
of Rs. 1/- (10 %) (Previous year : Rs. 1.00 per share  10 %) per equity
share of the face value of Rs. 10 each for the year ended March 31, 2014,
aggregating Rs. 727 lacs (Previous year : Rs. 727 lacs) subject to the
approval of the members at the ensuing Annual General Meeting. The
dividend distribution tax to be borne by the Company amounts to Rs. 124
lacs (Previous year : Rs. 118 lacs). The dividend will be paid in
accordance with the applicable rules and regulations.
MANAGEMENT DISCUSSION AND ANALYSIS (MD&A)
This Report includes MD&A at appropriate places so that repetition and
overlap between Directors'' Report and MD&A is avoided.
THE BUSINESS :
your Company is one of the leading real estate development companies in
India and currently operates both - on its own and through its
subsidiaries / joint ventures / associate companies, partnerships firms
and public private partnerships encompassing the construction and
development of Residential and Commercial Premises, SEZs, IT Park,
Biotech Park and Build Operate Transfer (BOT) Projects. Operations of
the Company include identifcation of projects, acquisition of land /
development rights, architectural and engineering designing, project
management including obtaining necessary approvals, planning, execution
and marketing of the projects.
The Company has a Western India focus with presence in major cities
such as Mumbai, Thane, Pune, Surat, Ahmedabad, Vadodara, and Mehsana.
The Company''s presence in Mumbai is well distributed amongst western
suburbs, eastern suburbs, the island city and Mumbai Metropolitan
Region (MMR).
The construction and development of projects at various locations is
currently in progress.
your Company has already initiated steps for sustaining growth through
cost optimization, process improvement and efcient management of
working capital. Tools of innovation are employed for all new projects
/ marketing initiatives, the purpose being to constantly stay ahead in
terms of ideas.
OVERVIEW OF THE COMPANY''S PROJECTS
(includes projects being developed / to be developed through
subsidiaries / associates / joint ventures / public-private
partnerships.)
Residential: Ongoing Projects:
Hubtown Sunmist - Andheri (East)
Hubtown Countrywoods Phase I Â Kondhwa, Pune
Hubtown Shikhar  Andheri (East)
Hubtown Gardenia  Mira Road
Hubtown Greenwoods  Thane
Hubtown Jewell  Andheri (West)
Hubtown Vedant  Sion (East)
Hubtown Season  Chembur
Hubtown Sunstone  Bandra (East)
Hubtown Serene  Bandra (East)
Hubtown Mont Metro  Peddar Road
Hubtown Celesté  Worli
Hubtown Grove  Andheri (West)
Rising City  Ghatkopar Mankhurd link Road
Commercial: Ongoing Projects
Hubtown Solaris  Andheri (East) Hubtown Viva  Andheri (East) Hubtown
Central  Surat Hubtown Central  Ahmedabad Hubtown Central  Mehsana
Hubtown Central  Vadodara
IT SEZ and Township Ongoing
Sunstream City Phase  I - Mulund-Thane
AUDITORS :
M/s. Doshi Doshi & Associates (Firm Registration No. 121773W),
Chartered Accountants, Statutory Auditors of the Company retire at the
conclusion of the ensuing Annual General Meeting (AGM) in accordance
with the provisions of the Companies Act, 1956 and being eligible ofer
themselves for reappointment. In terms of Section 139 of the Companies
Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014,
M/s. Doshi Doshi & Associates are eligible to be reappointed for a
period of 3 (three) years subject to ratifcation in every AGM by the
members.
The Board of Directors, upon the recommendation of the Audit and
Compliance Committee, proposes the reappointment of M/s. Doshi Doshi &
Associates as Statutory Auditors of the Company for a period of 3
(three) years from the conclusion of the ensuing AGM until the
conclusion of the AGM to be held for the year 2017, subject to
ratifcation at every AGM held after the ensuing AGM.
M/s. Doshi Doshi & Associates, the retiring Auditors, have confirmed
that their reappointment, if made, would be in conformity with the
provisions of Section 139 (1) of the Companies Act, 2013 and that they
are not disqualified for reappointment within the meaning of Section 141
of the said Act read with Rule 4 of the Companies (Audit and Auditors)
Rules, 2014. The necessary resolution is included in the Notice of the
ensuing Annual General Meeting.
AUDITORS'' REPORT :
The Notes forming part of the Financial Statements (Balance Sheet and
the Statement of Profit and loss) for the year ended March 31, 2014,
referred to in the Auditors'' Report are self explanatory.
In terms of sub-section (3) of Section 217 of the Companies Act, 1956,
the Management''s replies to ''Emphasis of Matter'' and ''Other matters''
reported by the Statutory Auditors in their Audit Reports to the
members on the financial statements for the year ended March 31, 2014
are as hereunder :
Emphasis of Matter :
a. Note 2 (III) (A) (ii) and (iii) to standalone financial statements
and Note 3 (III) (A) (ii) and (iii) to consolidated financial statements
:
The emphasis of matters included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarifcation.
b. Footnote ''d'' to Note ''4'' to standalone financial statements and
footnote ''c'' to Note ''5'' to consolidated financial statements :
The management is confdent of obtaining the requisite consent of the
Debentureholders prior to the Annual General Meeting so as to
facilitate the declaration of dividend at the ensuing Annual General
Meeting and distribution thereafter to the shareholders.
c. Footnote ''e'' to Note ''4'' to standalone financial statements and
footnote ''d'' to Note ''5'' to consolidated financial statements :
Due to paucity of liquid funds, the Company was not able to make the
requisite investment / deposit in terms of Circular No. 11/02/2012-Cl-V
(A) /04/2013 dated February 11, 2013 issued by the Ministry of
Corporate Afairs. The Company is exploring alternative sources of
finance for meeting this statutory obligation and is hopeful of meeting
with the statutory requirement during the current year.
d. Footnote (''j'') to Note 5 to standalone financial statements and
footnote ''k'' to Note 6 to consolidated financial statements :
The emphasis of matters included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarification.
e. Footnote ''b'' to Note 12 to consolidated financial statements :
The emphasis of matters included by the Statutory Auditors in their
Report are self explanatory and require no further clarifcation.
f. Footnote ''c'' to Note ''13'' to standalone financial statements and
foot note ''b'' to Note ''14'' to consolidated financial statements :
The emphasis of matter included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarifcation.
g. Footnote to Note 18 to standalone financial statements and footnote
to Note 19 to consolidated financial statements:
The emphasis of matter included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarifcation.
h. Footnote (d) to Note 13 to standalone financial statements and
clause (g) to Auditors'' Report on consolidated financial statements :
The emphasis of matter included by the Statutory Auditors in their
respective reports are self explanatory and require no further
clarifcation.
i. Footnote to Note 28 to consolidated financial statements:
The emphasis of matter with respect to footnote to Note 28 to
consolidated financial statement is self explanatory and requires no
further clarifcation.
j. Note 33 (B) to standalone financial statements and Note 36 (B) to
consolidated financial statements :
and
Footnote to Note ''33'' to standalone financial statements and footnote to
Note ''36'' to consolidated financial statements:
The corporate guarantees have been given by the Company on behalf of
other entities which are having projects located at prime locations and
such projects are in various stages of construction/development. All
these projects when completed will have net realizable value which will
be in excess of the amount of corporate guarantees given by the
Company. The management is confdent that there will not be any financial
liability on the Company on account of any default by any of the
entities on whose behalf the corporate guarantees have been given.
The emphasis of matter with respect to footnote to Note 33 to
standalone financial statements and footnote to Note 36 to consolidated
financial statements are self explanatory and require no further
clarification.
k. Clause ''a'' Â ''Other matters'' in Auditors'' Report on standalone
financial statements :
The observations of the Auditors are self explanatory and do not
require any further clarifcation.
l. Clause ''k'' in Auditors'' Report on consolidated financial statements
:
Effects on the consolidated financial statements of the Group have been
given based on the audited separate financial statements of the said six
joint ventures and an associate. The management is of the view that,
even after the inclusion of audited consolidated financial statements of
the said joint ventures and the associate, there would not be any
material impact on the reported consolidated financial statements of the
Group.
Annexure to Auditors'' Report (standalone Financial statements) : Clause
(ix) (a) of the Annexure referred to in the Auditors'' Report on
standalone financial statements :
and
Clause (xi) of the Annexure referred to in the Auditors'' Report on
standalone financial statements :
The delays caused by the Company in discharging its statutory
liabilities and in making timely payment of principal and interest on
its borrowings have been due to prolonged stagnation in demand in the
real estate sector accentuated by economic slowdown, inordinate delays
in approval process, infationary pressures, volatility in foreign
exchange and stock market, liquidity crunch and costly debt. The
Company is also facing lack of adequate sources of finance to fund
development of its real estate projects resulting in delayed
realisations from its customers and lower availability of funds to
discharge its liabilities.The Company is exploring alternative sources
of finance for meeting these obligations and to overcome the temporary
liquidity shortage and is hopeful that these eforts would yield
fruitful results.
CONSOLIDATED ACCOUNTS :
In terms of Clause 41 of the listing Agreement executed with the Stock
Exchanges, the Consolidated Financial Statements which have been
prepared in accordance with Accounting Standards  AS-21 on
''Consolidated Financial Statements'' read with AS-23 on ''Accounting for
Investments in Associates'' in Consolidated Financial Statements and
AS-27 on ''Financial Reporting of Interests in Joint Ventures'' as issued
by the Institute of Chartered Accountants of India, are annexed to and
form part of this Annual Report.
COST AUDITORS :
Pursuant to Section 148 and other applicable provisions, if any, of the
Companies Act, 2013 read with the Companies (Cost Records and Audit)
Rules, 2014, the Board of Directors in its meeting held on August 14,
2014, based on the recommendation of the Audit and Compliance
Committee, appointed M/s. N. I. Mehta & Co., Cost Accountants (Firm
Registration No. 000023) as Cost Auditors of the Company for conducting
the audit of the cost accounting records of the Company for the
Financial year ending March 31, 2015. The remuneration proposed to be
paid to the Cost Auditors is upto Rs. 5,00,000/- (Rupees Five lacs only)
plus reimbursement of service tax and out-of-pocket expenses, if any,
subject to ratifcation by the members at the ensuing Annual General
Meeting vide resolution no. 9 of the Notice of the AGM.
M/s. N. I. Mehta & Co. have confirmed that their appointment is within
the limits of Section 139 (9) read with Section 141 (3) (g) of the
Companies Act, 2013 and have also certified that they are free from any
disQualifications specified under Sections 141 (3) and 141 (4) read with
proviso to Section 148 (3) of the said Act.
COST COMPLIANCE REPORT :
The Cost Compliance Report for the Financial year 2012-2013 pursuant to
the Companies (Cost Accounting Records) Rules, 2011 was fled within the
due date. The due date for submission of the Cost Compliance Report for
the Financial year 2013-2014 is 180 days from March 31, 2014 i.e. on or
before September 30, 2014.
FIXED DEPOSITS :
Total amount of deposits outstanding as on March 31, 2014 was Rs. 1040.83
lacs. There were no unclaimed/unpaid deposits as at the year end.
INSURANCE :
All the insurable interests of your Company including inventories,
buildings are adequately insured.
INFORMATION TECHNOLOGY :
During the year under review, the Company undertook an extensive
exercise to upgrade its Oracle system to the latest version of Oracle
i.e. 12.1.3. The upgradation has been successfully completed.
During the current year, the Company plans to initiate and develop
Customer Facing Portals which would act as a single point of contact
providing all the related information to the customers. The Company
also plans to digitalize rehab unit information which would enhance and
streamline Business Processes.
TRANsFER OF AMOUNTs TO INVEsTOR EDUCATION AND PROTECTION FUND :
The unpaid dividend amount pertaining to the Financial year 2006-2007
will be transferred to the Investor Education and Protection Fund
during the current year pursuant to the provisions of Sections 124 (5)
and 125 of the Companies Act, 2013 (corresponding to Section 205A and
205C of the erstwhile Companies Act, 1956).
Pursuant to the provisions of Investor Education and Protection Fund
(Uploading of Information regarding unpaid and unclaimed amount lying
with companies) Rules, 2012, the Company has uploaded the details of
unpaid and unclaimed amounts lying with the Company as on September 30,
2013 (date of last Annual General Meeting) on the Company''s website
(www.hubtown.co.in) and on the Ministry of Corporate Afairs'' website
(www.mca.gov.in).
DILUTION OF PROMOTER''S SHAREHOLDING :
Subsequent to the close of the year under review, the Promoter Group of
your Company diluted its shareholding in the Company by an Ofer for
Sale (OFS) through the stock exchange mechanism in order to increase
the minimum level of public shareholding in the Company to 25 % of the
total paid-up share capital of the Company as mandated by Securities
and Exchange Board of India. Post OFS, the public shareholding is 25.02
% and the Promoter group shareholding is 74.98 %.
Your Company is in compliance with the provisions of Securities
Contracts (Regulation) Rules, 1957 and Clause 40A of the listing
Agreement relating to minimum level of public shareholding.
CORPORATE GOVERNANCE :
A separate section on Corporate Governance, forming part of the
Directors'' Report and a certifcate from a company secretary in
wholetime practice confirming compliance with the Corporate Governance
norms, as prescribed under Clause 49 of the listing Agreement has been
annexed hereto as part of this Annual Report.
In terms of sub-clause (v) of Clause 49 of the listing Agreement, a
certifcate from the Managing Director and the Chief Financial officer,
inter alia, confirming the correctness of the financial statements,
adequacy of internal control measures and reporting of matters to the
Audit and Compliance Committee in terms of the said Clause, is also
annexed as a part of this Annual Report.
CODE OF CONDUCT :
Pursuant to Clause 49 of the listing Agreement, the declaration signed
by the Managing Director afrming compliance of the Code of Conduct by
the Directors and Senior Management Personnel for the year under review
is annexed to and forms part of the Corporate Governance Report.
SUBSIDIARIES :
The Company has in all 25 subsidiaries. All the subsidiary companies
are non-material, non-listed subsidiary companies as Defined under
Clause 49 of the listing Agreement. There has been no material change
in the nature of the business of the subsidiaries during the year under
review.
The Audit and Compliance Committee reviews the financial statements of
the subsidiaries. The minutes of the meetings of the Board of Directors
of the respective subsidiaries are also placed before the meetings of
the Board of Directors of the Company.
In terms of the general exemption under Section 212 (8) of the
Companies Act, 1956 granted by the Ministry of Corporate Afairs (MCA)
vide General Circular No. 2/2011 dated February 8, 2011 and in
compliance with the conditions enlisted therein, the Audited Statement
of Accounts and the Auditors'' Report thereon for the financial year
ended March 31, 2014 along with the Reports of the Board of Directors
of the subsidiary companies have not been annexed to this Annual
Report. However, as directed by the aforesaid MCA Circular, the
summarized financials of the subsidiary companies have been disclosed in
the consolidated balance sheet under the heading ''Summary of Financial
Statements of Subsidiary Companies'' which forms part of this Annual
Report.
The annual accounts and the related detailed information of the
subsidiary companies shall be made available to any member of the
Company and its subsidiaries seeking such information at any point of
time. Further, the annual accounts of the subsidiary companies will
also be kept for inspection by any member of the Company/its
subsidiaries at the registered office of the Company and that of the
respective subsidiary companies during working hours between 11.00 a.m.
and 1.00 p.m. upto the date of the ensuing Annual General Meeting.
DIRECTORS :
Mr. Vyomesh M. Shah, Managing Director of the Company retires by
rotation, and being eligible, ofers himself for reappointment at the
ensuing Annual General Meeting (AGM).
The Board of Directors of the Company in its meeting held on August 14,
2014, appointed Mr. Sunil C. Shah and Mrs. Priti K. Shah as Additional
Directors of the Company who will hold office upto the date of the
ensuing AGM and are eligible for reappointment. Under the existing
Clause 49 of the listing Agreement, Mr. Sunil C. Shah and Mrs. Priti K.
Shah are designated as Non-Executive, Independent Directors.
In view of the provisions of Section 149 of the Companies Act, 2013 and
the amended Clause 49 of the listing Agreement, the Board of your
Company has proposed the appointment of Mr. Arvind Kumar Joshi, Mr.
Abhijit Datta and Mr. Sunil C. Shah as Independent Directors at the
ensuing Annual General Meeting. Pursuant to Section 160 of the
Companies Act, 2013, the Board has also proposed the appointment of
Mrs. Priti K. Shah as a Non-Executive Director of the Company liable to
retire by rotation.
The Company has received the requisite Notices in writing proposing the
appointment of Mr. Arvind Kumar Joshi, Mr. Abhijit Datta and Mr. Sunil
C. Shah as Independent Directors and Mrs. Priti K. Shah as a
Non-Executive Director.
Appropriate resolutions for the reappointment/appointment of Directors
are being placed before you for your approval at the ensuing Annual
General Meeting. The brief profle of the aforesaid Directors and other
information have been detailed in the Section on ''Corporate Governance''
which forms part of this Annual Report.
BOARD COMMITTEES :
Subsequent to the close of the year under review and pursuant to the
applicable provisions of the Companies Act, 2013, the Rules made
thereunder and Revised Clause 49 of the listing Agreement:
i. the Audit and Compliance Committee was reconstituted and the terms
of reference were revised;
ii. the ''Investors''/Shareholders Grievance Committee'' was reconstituted
and renamed as the ''Stakeholders Relationship Committee'' and the terms
of reference were revised;
iii. the Remuneration Committee was reconstituted and renamed as the
''Nomination and Remuneration Committee'' and the terms of reference were
revised; and
iv. two new Committees of the Board were constituted namely the
''Corporate Social Responsibility Committee'' and the ''Risk Management
Committee''.
A detailed note on the Committees of the Board of Directors is given in
the Section on Corporate Governance Report forming part of the Annual
Report.
DIRECTORS'' RESPONSIBILITY STATEMENT :
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Directors of your Company, to the best of their knowledge and
belief and on the basis of the information and explanations received by
them, hereby state and confirm that :
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
(ii) they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent, so as to give a true and fair view of the state of afairs of
the Company as at March 31, 2014 and of the Profit of the Company for
the year ended on that date;
(iii) they have taken proper and sufcient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they have prepared the annual accounts on a ''going concern'' basis.
STATUTORY INFORMATION :
Since the Company is not engaged in any manufacturing activity, there
is nothing to report on particulars relating to conservation of energy
and technology absorption as stipulated in the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules, 1998.
Expenditure incurred in foreign currency amounted to Rs. 43.04 lacs.
There was no earning in foreign exchange during the year under review.
PARTICULARS OF EMPLOYEES :
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the annexure to the Directors'' Report. However, having regard to
the provisions of Section 219(1)(b)(iv) of the said Act, the Annual
Report excluding the aforesaid statement is being sent to all the
members of the Company and others entitled thereto. Any member
interested in obtaining such particulars may write to the Company
Secretary at the Registered office of the Company.
APPRECIATION :
your Directors take the opportunity to express their deep sense of
gratitude to bankers, government authorities, financial institutions,
business associates, suppliers, consultants, customers and contractors
and other stakeholders at large for the valuable co-operation and
support received during the year under review and look forward to the
same in greater measure in the coming years.
Your Directors would also like to thank the members for reposing their
faith and confdence in the Company and its Management.
Your Directors also wish to place on record their appreciation for the
hard work and eforts put in by the employees at all levels of the
Company.
Your Directors look forward to the long term future with confdence.
For and on behalf of the Board
Hemant M. shah
Executive
Chairman
Mumbai, August 14, 2014. DIN : 00009659
Mar 31, 2013
TO THE MEMBERS
The Directors have pleasure in presenting their Twenty Fifth Annual
Report of the Company together with the Audited Accounts for the year
ended March 31, 2013.
FINANCIAL RESULTS :
The salient features of the Company''s standalone and consolidated
fnancial results for the year under review are as follows :
(Rs.in lacs)
STANDALONE CONSOLIDATED
31 March
2013 31 March
2012 31 March
2013 31 March
2012
Net Sales /
Income from
Operations 34691 26044 39179 43491
Other Income 19205 17234 17461 15558
Total Income 53896 43278 56640 59049
Operating Expenditure 17107 10586 14184 21881
Proft before
Depreciation /
Interest / Tax 36789 32692 42456 37168
Depreciation 573 703 1070 2179
Interest and
Finance Charges 33444 28710 41886 33503
Proft / (Loss)
before Extraordinary
Item and Tax 2772 3279 (500) 1486
Extraordinary Item (350) (353)
Proft / (Loss) before Tax 2772 2929 (500) 1133
Provision for Tax (10) (493)
Add / (Less): Excess/
(Short) provision for
taxation in respect of (25) 1246 (15) 1714
earlier years
Deferred Tax credit/
(charge) 311 415 267 341
Prior Period
Adjustments (net) 8 (605) (259) (596)
Minority Interest/
Share of Proft/
(Loss) of Subsidiaries & 305 271
Associates / Others
Net Proft / (Loss)
for the Year 3066 3985 (213) 2370
Balance Proft
brought forward
from Previous Year 65509 65369 2686 65611
Tax Credit on
proposed dividend 114
Amount available
for appropriation 68689 69354 62473 67981
APPROPRIATIONS
Debenture Redemption
Reserve 3000 4450
Proposed Dividend 727 727 727 727
Dividend Distribution Tax 118 118 118 118
General Reserves
Balance carried to
Balance Sheet 67844 65509 61628 62686
Earnings per
Share before
Extraordinary
Item (Rs.) (EPS) 4.22 5.96 (0.29) 3.74
Earnings per Share
after Extraordinary
Item (Rs.) (EPS) 4.22 5.48 (0.29) 3.26
FINANCIAL PERFORMANCE :
Consolidated Financials
During the year under review, the consolidated turnover of the Company
was lower by 4.08 % at Rs. 56640 lacs as against Rs. 59049 lacs in the
previous year. The Company incurred a net loss of Rs. 213 lacs for the
year under review as compared to net proft of Rs. 2370 lacs earned in the
previous year.
Standalone Financials
During the year under review, the turnover of the Company was higher by
24.53 % at Rs. 53896 lacs as against Rs. 43278 lacs in the previous year.
Proft before Tax stood at Rs. 2772 lacs as compared to Rs. 2929 lacs for
the previous year, representing a decline of 5.36 %. Proft after Tax
stood at Rs. 3066 lacs as compared to Rs. 3985 lacs for the previous year,
representing a decline of 23.06 %.
In view of the downturn in the economy during the year under review,
your Company''s performance as well as profts were to a greater extent
impacted due to rising infation, rupee depreciation, increased cost of
capital, increased cost of construction and restrained demand from
end-users. The operational cashfows were adversely impacted for a major
part of the year under review due to lower than expected sales level
resulting in intense pressure on proft margins.
APPROPRIATIONS :
Despite the diffcult economic environment in which the Company operated
during the year under review, your Directors have recommended a
dividend of Rs. 1/- (10 %) (Previous Year : Rs. 1.00 per share  10 %) per
equity share of the face value of Rs. 10 each for the year ended March
31, 2013, aggregating Rs. 727 lacs (Previous Year : Rs. 727 lacs) subject
to the approval of the members at the ensuing Annual General Meeting.
The dividend distribution tax to be borne by the Company amounts to Rs.
118 lacs (Previous Year : Rs. 118 lacs).
FINANCE :
Issue of Debentures :
During the year under review, the Company issued Secured, Redeemable,
Non-convertible, Taxable Debentures amounting to Rs. 25 crores on private
placement basis.
AUDITORS :
M/s. Doshi Doshi & Associates, Chartered Accountants and M/s.
Haribhakti & Co., Chartered Accountants, Joint Statutory Auditors of
the Company retire at the conclusion of this Annual General Meeting.
M/s. Doshi Doshi & Associates, being eligible have offered themselves
for reappointment. The other frm of Statutory Auditors M/s. Haribhakti
& Co., have expressed their desire not to seek reappointment in view of
their heavy prior professional commitments. The Board of Directors,
upon the recommendations of the Audit and Compliance Committee,
proposes the reappointment of M/s. Doshi Doshi & Associates as
Statutory Auditors of the Company for conducting the audit of the
accounts of the Company for the year ending March 31, 2014.
M/s. Doshi Doshi & Associates have forwarded their certifcate to the
Company, stating that their appointment if made, would be within the
limits specifed in that behalf under Section 224 (1) (b) of the
Companies Act, 1956. The necessary resolution is included in the Notice
of the ensuing Annual General Meeting.
AUDITORS'' REPORT :
The Notes forming part of the Financial Statements (Balance Sheet and
the Statement of Proft and Loss) for the year ended March 31, 2013,
referred to in the Auditors'' Report are self explanatory. In terms of
sub-section (3) of Section 217 of the Companies Act, 1956, the
Management''s replies to certain observations/qualifcations of the
Statutory Auditors in their Audit Reports on the fnancial statements
for the year ended March 31, 2013 are as hereunder :
Basis of Qualifed opinion :
a. Note Â29'' to the standalone fnancial statements and Note Â30'' to
the consolidated fnancial statements:
The observation of the Auditors read with Note Â29'' and Note Â30'' are
self explanatory and require no further clarifcation.
Emphasis of Matter :
a. Note 2 (III) (A) (ii) and (iii) to standalone fnancial statements
and Note 3 (III) (A) (ii) and (iii) to the consolidated fnancial
statements :
The emphasis of matters included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarifcation.
b. Footnote Âc'' to Note Â4'' to standalone fnancial statements and
footnote Âb'' to Note ''5'' to consolidated fnancial statements :
Regulation 16 (2) of SEBI (Issue and Listing of Debt Securities)
Regulations, 2008 read with Clause 36.1.5 of the Debenture Trust Deed
dated February 24, 2011 executed by the Company with the Trustees for
Debentureholders provides that in case of any defaults in payment of
interest on debt securities or redemption thereof, any declaration or
distribution/payment of dividend to the shareholders shall require
approval of the Debenture Trustees. The management is confdent of
obtaining the requisite consent of the Debenture Trustees prior to the
Annual General Meeting so as to facilitate the declaration of dividend
at the ensuing Annual General Meeting and distribution thereafter to
the shareholders.
c. Footnote Âd'' to Note Â4'' to standalone fnancial statements and
footnote Âc'' to Note Â5'' to consolidated fnancial statements :
Due to the prevailing economic scenario, the Company was not able to
make requisite investment /deposit in terms of Circular No.
11/02/2012-CL-V (A) /04/2013 dated February 11, 2013 issued by the
Ministry of Corporate Affairs. The Company will meet with the
requirements of the said Circular during the current fnancial year.
d. Footnote Âc'' to Note Â13'' to standalone fnancial statements and
foot note Âb'' to Note Â14'' to consolidated fnancial statements :
The emphasis of matter included by the Statutory Auditors in their
respective Reports are self explanatory and require no further
clarifcation.
e. Note Â13'' (F) and (G), Note 17 and Note Â10'' to standalone fnancial
statements :
The emphasis of matter included in the Auditors'' Report read with Note
Â13'' (F) and (G), Note 17 and Note Â10'' to the standalone fnancial
statements are self explanatory and require no further clarifcation.
f. Footnote Âe'' to Note Â13'' to standalone fnancial statements :
The emphasis of matter included in the Auditors'' Report read with
footnote Âe'' to Note Â13'' to the standalone fnancial statements is self
explanatory and requires no further clarifcation.
g. footnote Âb'' to Note Â18'' to standalone fnancial statements and
footnote to Note Â19'' to consolidated fnancial statements :
The emphasis of matter included by the Statutory Auditors in their
respective Reports read with footnote Âb'' to Note Â18'' to standalone
fnancial statements and footnote to Note Â19'' to consolidated fnancial
statements are self explanatory and require no further clarifcation.
h. Footnote to Note Â22'' to standalone fnancial statements and
footnote to Note Â23'' to consolidated fnancial statements :
The emphasis of matter included by the Statutory Auditors in their
respective Reports read with footnote to Note Â22'' to standalone
fnancial statements and footnote to Note Â23'' to consolidated fnancial
statements are self explanatory and require no further clarifcation.
i. Note Â34'' (B) to standalone fnancial statements and Note Â38'' to
consolidated fnancial statements : and
Footnote to Note Â34'' to standalone fnancial statements and footnote to
Note Â38'' to consolidated fnancial statements:
The corporate guarantees have been given by the Company on behalf of
other entities which are having projects located at prime locations and
such projects are in various stages of construction/development. All
these projects when completed will have net realizable value which will
be in excess of the amount of corporate guarantees given by the
Company. The management is confdent that there will not be any fnancial
liability on the Company on account of any default by any of the
entities on whose behalf the corporate guarantees have been given.
The emphasis of matter with respect to footnote to Note Â34'' to
standalone fnancial statements and Note Â38'' to consolidated fnancial
statement are self explanatory and require no further clarifcation.
j. Emphasis of matter  item (i) of the Auditors'' Report on
Consolidated Financial Statements :
Effects on the consolidated fnancial statements of the group have been
given based on the audited separate fnancial statements of the said
four Subsidiaries, the said Joint Venture and an Associate. The
management is of the view that, even after the inclusion of audited
consolidated fnancial statements of the said subsidiaries and the said
joint venture, there would not be any material impact on the reported
consolidated fnancial statements of the group.
In case of the associate having two step down subsidiaries, the share
of loss of the said associate has already been accounted for while
preparing the consolidated fnancial statements of the Company. The
management is of the view that there would not be any material change
in the reported fgures in the consolidated fnancial statement even
after completion of audit of the consolidated fnancial statements of
the said associate.
Annexure to Auditors'' Report (Standalone Financial Statements) :
Clause (ix) (a) of the Annexure referred to in the Auditors'' Report on
standalone fnancial statements :
As explained in the operational highlights in the Directors'' Report,
the then prevailing adverse economic conditions during the year under
review resulted in some delays in the payment of certain statutory
dues. The Company is making good the delays at the earliest.
Clause (xi) of the Annexure referred to in the Auditors'' Report on
standalone fnancial statements :
Due to the then prevailing adverse economic conditions during the year
under review, the Company faced diffculties in making timely payments
of its dues to the debentureholders. The Company has initiated steps
for resolving the matter with the debentureholders.
CONSOLIDATED ACCOUNTS :
In terms of Clause 41 of the Listing Agreement executed with the Stock
Exchanges, the Consolidated Financial Statements which have been
prepared in accordance with Accounting Standards - AS-21, AS-23 and
AS-27 as issued by the Institute of Chartered Accountants of India, are
annexed to and form part of the Annual Report.
FIXED DEPOSITS :
Total amount of deposits outstanding as on March 31, 2013 was Rs. 1163.83
lacs. There were no unclaimed / unpaid deposits as at the year end.
INSURANCE :
All the insurable interests of your Company including inventories,
buildings are adequately insured.
INFORMATION TECHNOLOGY :
The Company uses Information Technology to provide reliable,
contemporary and integrated business processes which enables it to
improve all round operational effciencies.
During the year under review, your Company initiated steps to implement
Oracle ERP across its various Group Companies including subsidiaries,
associates and joint ventures. This will result in the Company''s
processes integrating into one single system, avoidance of duplication
of work, increased effciency, improved management information systems
and better management control of operations and activities. The
Company''s IT systems are periodically audited to ensure the adequacy of
the information systems control, information security and privacy
aspects.
During the current fscal, the Company plans to undertake a major
exercise of upgrading Oracle ERP to latest version.
CORPORATE SOCIAL RESPONSIBILITY :
As part of corporate social responsibility, your Company has
wholeheartedly supported the circulars on Green Initiative in the
Corporate Governance issued by the Ministry of Corporate Affairs
allowing paperless compliances by companies by service of notices
/documents to the members through electronic mode. Recognising the
spirit of the said circular, the Company has forwarded this annual
report in electronic form to those members who have registered their
e-mail addresses with the Depositories through their respective
Depository Participants.
CORPORATE GOVERNANCE :
A separate section on Corporate Governance, forming part of the
Directors'' Report and a certifcate from a company secretary in
wholetime practice confrming compliance with Corporate Governance
norms, as prescribed under Clause 49 of the Listing Agreement has been
annexed hereto as part of this Annual Report.
In terms of sub-clause (v) of Clause 49 of the Listing Agreement, a
certifcate from the Managing Director and the Chief Financial Offcer,
inter alia, confrming the correctness of the fnancial statements,
adequacy of internal control measures and reporting of matters to the
Audit and Compliance Committee in terms of the said Clause, is also
annexed as a part of this Annual Report.
CORPORATE GOVERNANCE Â VOLUNTARY GUIDELINES 2009
The Ministry of Corporate Affairs has issued a set of Voluntary
Guidelines on ÂCorporate Governance'' and ÂCorporate Social
Responsibility'' in December 2009. These guidelines are expected to
serve as a benchmark for the Corporate Sector and also help them in
achieving the highest standard of corporate governance. Although these
guidelines are recommendatory in nature, the Board recognizes the
importance and need to constantly assess governance practices thereby
ensuring a sustainable business environment that generates long-term
value to all key stakeholders. The Board has adopted several provisions
of the said guidelines.
SUBSIDIARIES :
During the year under review, Joynest Premises Private Limited became a
subsidiary and Holiac Realty Private Limited and Pushpak Healthcare
Services Private Limited ceased to be subsidiaries of your Company.
Holiac Realty Private Limited has instead, become an associate. The
total number of subsidiaries as on March 31, 2013 were 25.
There has been no material change in the nature of the business of the
subsidiaries. All the subsidiary companies are non-material, non-listed
subsidiary companies as defned under Clause 49 of the Listing
Agreements entered into with the Stock Exchanges.
In terms of the general exemption under Section 212 (8) of the
Companies Act, 1956 granted by the Ministry of Corporate Affairs (MCA)
vide it General Circular No.2/2011 dated February 8, 2011 and in
compliance with the conditions enlisted therein, the Audited Statement
of Accounts and the Auditors'' Report thereon for the fnancial year
ended March 31, 2013 along with the Reports of the Board of Directors
of the subsidiary companies have not been annexed to this Annual
Report. However, as directed by the aforesaid MCA Circular, the
summarized fnancials of the subsidiary companies have been disclosed in
the consolidated balance sheet under the heading ÂSummary of Financial
Statements of Subsidiary Companies'' which forms part of this Annual
Report.
The annual accounts and the related detailed information of the
subsidiary companies will be made available to any member of the
Company/its subsidiaries seeking such information at any point of time
and will also be kept for inspection by any member of the Company/its
subsidiaries at the registered offce of the Company and that of the
respective subsidiary companies during working hours between 11.00 a.m.
and 1.00 p.m. upto the date of the Annual General Meeting.
DIRECTORS :
Mr. Madhukar B. Chobe ceased to be an Executive Director of the Company
upon expiry of his term of offce on December 31, 2012. Subsequently,
Mr. Chobe stepped down from the Board of Directors of the Company
effective January 1, 2013. Mr. P. H. Ravikumar who was appointed as an
Additional Director of the Company effective March 8, 2013 stepped down
from the Board effective April 18, 2013 in view of his prior
professional commitments. Mr. D. R. Kaarthikeyan stepped down from the
Board effective April 17, 2013. Mr. Shailesh H. Bathiya who retires by
rotation has expressed his desire not to seek reappointment due to
prior professional commitments.
The Board places on record its sincere appreciation of the invaluable
and mature guidance and advice contributed by Mr. Madhukar B. Chobe,
Mr. D. R. Kaarthikeyan, Mr. P. H. Ravikumar and Mr. Shailesh H. Bathiya
during their tenure.
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company, Mr. Arvind Kumar Joshi retires
by rotation at the ensuing Annual General Meeting and being eligible,
has offered himself for reappointment.
The brief profle of Mr. Arvind Kumar Joshi as required by Clause 49 of
the Listing Agreement has been detailed in the Section on ÂCorporate
Governance''.
All the Directors of the Company have confrmed that they are not
disqualifed from being appointed as Directors in terms of Section 274
(1) (g) of the Companies Act, 1956.
DIRECTORS'' RESPONSIBILITY STATEMENT :
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Directors of the Company, to the best of their knowledge and
belief and on the basis of the information and explanations received by
them, hereby state and confrm that :
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
(ii) the accounting policies have been selected and applied them
consistently and made judgments and estimates that are reasonable and
prudent, so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2013 and of the proft on Standalone basis
and loss on Consolidated basis of the Company for the year ended on
that date;
(iii) proper and suffcient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts have been prepared on a going concern basis.
STATUTORY INFORMATION :
Since the Company is not engaged in any manufacturing activity, the
other particulars relating to conservation of energy and technology
absorption as stipulated in the Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1998 are not applicable.
Expenditure incurred in foreign currency amounted to Rs. 252.74 lacs.
There was no earning in foreign exchange.
PARTICULARS OF EMPLOYEES :
During the year under review, 3 (three) employees employed throughout
the year were in receipt of remuneration of Rs. 60 lacs or more per
annum. In terms of the provisions of Section 217 (2A) of the Companies
Act, 1956, read with the Companies (Particulars of Employees) Rules,
1975, as amended, the names and other particulars of the employees are
set out in the annexure to the Directors'' Report. Having regard to the
provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report
excluding the aforesaid information is being sent to all the members of
the Company and others entitled thereto. Any member interested in
obtaining such particulars may write to the Company Secretary at the
Registered Offce of the Company.
APPRECIATION :
Your Directors would like to express their grateful appreciation and
thanks for the valuable co-operation and support received from the
Company''s bankers, fnancial institutions, business associates,
suppliers, consultants, customers, contractors and shareholders at
large during the year under review and look forward to the same in
greater measure in the coming years.
The Directors also wish to place on record their appreciation of the
unstinted efforts and contributions made by the Management Team and the
employees of the Company at all levels.
CAUTIONARY STATEMENT
Certain statements made in the Directors'' Report and the Management
Discussion and Analysis may constitute Âforward looking statements''
within the meaning of applicable securities laws and regulations.
Actual results could differ from those expressed or implied. Several
factors could make signifcant difference to the Company''s operations
that include labour and material availability, and prices, cyclical
demand and pricing in the Company''s principal markets, changes in
interest rates, changes in government regulations, tax regimes,
economic development within India and other incidental factors. The
Company does not undertake any obligation to publicly update any
forward looking statements, whether as a result of new information,
future events or otherwise.
For and on behalf of the Board
Hemant M. Shah
Executive Chairman
Mumbai, May 29, 2013
Mar 31, 2011
The Directors have pleasure in presenting their Twenty Third Annual
Report of the Company together with the Audited Accounts for the year
ended March 31, 2011.
FINANCIAL RESULTS :
The salient features of the Companys standalone and consolidated
financial results for the year under review are as follows:
(Rs. in lac)
STANDALONE CONSOLIDATED
March March March March
31,2011 31,2010 31,2011 31,2010
Net Sales / Income from
Operations 42594 48202 67676 57963
Other Income 4942 3204 3655 3846
Total Income 47536 51406 71331 61809
Operating Expenditure 15216 15265 31967 19526
Profit before Depreciation /
Interest / Tax 32320 36141 39364 42283
Depreciation 484 311 1285 714
Interest and Finance Charges 16246 11968 20923 16800
Profit before Tax 15590 23862 17156 24769
Provision for Tax 470 6208 2402 8166
(Add) / Less : (Excess) /
Short provision for taxation
for previous year (2028) 275 (3827) 275
Minority Interest / Share of
Profit / (Loss) of Subsidiaries
8c Associates / Others -- -- (963) 163
Net Profit for the Year 17148 17379 17618 16491
Balance Profit brought
forward from Previous Year 59707 50832 59478 51491
Amount available for
appropriation 76855 68211 77096 67982
APPROPRIATIONS
Proposed Dividend 1818 3636 1818 3636
Dividend Distribution Tax 302 618 302 618
General Reserves 1890 1750 1890 1750
Debenture Redemption Reserve 7475 2500 7475 2500
Balance carried to Balance
Sheet 65370 59707 65611 59478
Earning per Share (Rs.) (EPS) 23.58 24.81 24.22 23.54
OPERATIONAL HIGHLIGHTS :
The Company has adopted an unique growth oriented and pragmatic
business model of development of real estate projects through its
subsidiaries, joint ventures, associates, partnership firms and public
private partnership with strategic investors. The benefits accruing
from this business model are :
- highly capital efficient and allows the Company to grow the business
without tying up large amount of capital in land purchases.
- for any given amount of capital it allows the Company to do more
projects than would otherwise have been possible.
- leveraging of development capabilities and resources.
- creation of enhanced pool of construction and marketing expertise.
- greater profitability and significantly reduces the exposure to risks
in any one project.
- facilitates expansion in additional geographical areas.
- stable source of revenue during tough economic times.
The merits of the business model is reflected in the consolidated
results of the Company for the year under review, which witnessed a
growth of 15.41 % at Rs. 71331 lac as against Rs. 61809 lac in the previous
year. The consolidated net profit stood at Rs. 17618 lac as against Rs.
16491 lac in the previous year.
On a standalone basis the total income of the Company was lower by
7.53% at Rs. 47536 lac as against Rs. 51406 lac in the previous year A
significant increase in cost of construction has had the impact on
Profit before Tax which stood at Rs. 15590 lac as against Rs. 23862 lac in
the previous year, The net profit was Rs. 17148 lac as against Rs. 17379
lac in the previous year.
Further, based on the business model adopted by the Company, the
increase in loans and advances represents substantial investments by
your Company in its subsidiaries, associates, joint ventures,
partnerships and other entities towards growing the business to drive
higher profits in future and reflects the managements confidence
towards strong business growth. The management has always endeavoured
to time the real estate cycle during downturn, which has resulted in
acquisition of land bank at lower valuation, which will provide stable
pipeline of projects in the near future.
Your Company has initiated steps for sustaining growth through cost
optimization, process improvement and efficient management of working
capital. Your Company is also consolidating on the initiatives taken in
previous few quarters.
APPROPRIATIONS :
An amount of Rs. 1890 lac (Rs. 1750 lac) is credited to General Reserves
and Rs. 7475 lac (Rs. 2500 lac) is credited to Debenture Redemption
Reserve. Out of the amount available for appropriation, your Directors
have recommended a dividend of Rs. 2.50/- (25 %) (Previous Year : Rs. 5 per
share - 50 %) per equity share of the face value of Rs. 10 each for the
year ended March 31, 2011, aggregating Rs. 1818 lac (Previous Year : Rs.
3636 lac). The dividend distribution tax amounts to Rs. 302 lac (Previous
Year : Rs. 618 lac),
The dividend payout for the year under review has been formulated in
accordance with the Companys policy of striving to maintain a stable
dividend payout linked to performance and keeping in view the Companys
need for capital to finance its growth plans through internal accruals
to the maximum. Your Directors believe that this will subsequently lead
to an increase in shareholders value in the long term.
FINANCE :
Issue of Debentures :
During the year under review, the Company issued 2 series of Secured,
Redeemable, Non-convertible Debentures amounting to Rs. 200 crores on
private placement basis as per details given below :
a. 1,000 - 17 % Secured Redeemable Non-convertible Debentures having
face value of Rs. 10,00,000 per debenture aggregating Rs. 100 crores; and
b. 10,000 - 12 % Secured Redeemable Non-convertible Debentures having
face value of Rs. 1,00,000 per debenture aggregating Rs. 100 crores, which
are redeemable at a premium.
The Company has created Debenture Redemption Reserve in accordance with
the applicable provisions of the Companies Act, 1956.
AUDITORS :
M/s. Sudit K, Parekh & Co., Chartered Accountants, the retiring
Auditors, have by their letter dated May 28,2011 informed the Company
of their decision not to seek reappointment as Joint Auditors of the
Company in view of their heavy professional pre-occupation. The Board
of Directors, based on the recommendation of the Audit and Compliance
Committee, propose the reappointment of M/s. Doshi Doshi & Associates,
Chartered Accountants and the appointment of M/s. Haribhakti & Co.,
Chartered Accountants in place of M/s. Sudit K. Parekh & Co. as Joint
Auditors to conduct the audit of the accounts of the Company for the
year ending March 31,2012.
M/s. Doshi Doshi & Associates and M/s. Haribhakti & Co. have forwarded
their certificates to the Company, stating that their respective
reappointment/appointment if made, would be within the limits specified
in that behalf under Section 224 (1) (b) of the Companies Act, 1956.
The necessary resolution is included in the Notice of the ensuing
Annual General Meeting.
AUDITORS REPORT :
In respect of Auditors observations regarding delays in payment of
undisputed Works Contract Tax, Income Tax deducted at source and
Service Tax, it is hereby clarified that the delays were temporary in
nature and all of the outstanding dues have been paid subsequent to the
close of the year.
CONSOLIDATED ACCOUNTS :
In terms of Clause 41 of the Listing Agreement executed with the Stock
Exchanges, the Consolidated Financial Statements which have been
prepared in accordance with Accounting Standards - AS-21, AS-23 and
AS-27 as issued by the Institute of Chartered Accountants of India, are
annexed to and form part of the Annual Report.
FIXED DEPOSITS :
Total amount of deposits outstanding as on March 31,2011 was Rs. 1134.33
lac. There were no unclaimed/unpaid deposits as at the year end.
INSURANCE:
All the insurable interests of your Company including inventories,
buildings are adequately insured.
INFORMATION TECHNOLOGY :
As reported last year, the implementation of ERP package - Oracle e
Business Suite 12.0, one of the best ERP worldwide, across the
organization, has been completed. This will result in most of the
Companys processes integrating into a single system, avoidance of
duplication of work, increased efficiency, improved management
information systems and better management control of operations and
activities. The Project was initiated in January 2010,
During the year under review, the Company initiated measures to
integrate the ERP package with external systems such as Customer
Relationship Management, Document Management System, Project Management
& Execution and E-Recruitment. The Company has also intiated steps to
connect all its Nodal site offices to Corporate Office in order to
speed up transaction processing, The Company is continuously working
and concentrating on IT to get maximum benefit for the organization.
The Companys IT systems are periodically audited to ensure the
adequacy of Information Systems control. Information Security and
privacy aspects.
SUSTAINABLE DEVELOPMENT AND CARBON FOOTPRINTS :
Your Company is the recipient of Leading the Green Building Movement
Award awarded in October 2010 by Indian Green Building Council (IGBC).
The Company shares information pertaining to sustainability-related
issues - carbon footprint, green building initiatives, and renewable
energy usages in buildings with Carbon Disclosure Project (CDP), a
London based international organisation, on an annual basis.
CORPORATE SOCIAL RESPONSIBILITY :
As part of corporate social responsibility, your Company has
wholeheartedly supported the circulars on Green Initiative in the
Corporate Governance issued by the Ministry of Corporate Affairs
allowing paperless compliances by companies by service of notices
/documents to the members through electronic mode. Recognising the
spirit of the said circular, the Company has forwarded this annual
report in electronic form to those members who have consented to the
same and have registered their e-mail addresses with the Depositories
through their respective Depository Participants.
CORPORATE GOVERNANCE :
Your Company attaches considerable significance to good Corporate
Governance as an important step towards building investor confidence,
improve investors protection and maximize long term shareholder value.
Pursuant to Clause 49 of the Listing Agreements with the Stock
Exchanges, a compliance report on Corporate Governance has been annexed
hereto as part of this Annual Report. The Company is in compliance with
the requirements and disclosures that have to be made in this regard.
The Auditors Certificate on compliance with Corporate Governance
requirements by the Company forms part of this Annual Report,
In terms of sub-clause (v) of Clause 49 of the Listing Agreement, a
certificate from CEO/CFO, inter alia, confirming the correctness of the
financial statements, adequacy of internal control measures and
reporting of matters to the Audit and Compliance Committee in terms of
the said Clause, is also annexed as a part of this Annual Report.
CORPORATE GOVERNANCE - VOLUNTARY GUIDELINES 2009
The Ministry of Corporate Affairs has issued a set of Voluntary
Guidelines on "Corporate Governance and "Corporate Social
Responsibility in December 2009. These guidelines are expected to
serve as a benchmark for the Corporate Sector and also help them in
achieving the highest standard of corporate governance. The guidelines
broadly focus on areas such as Board of Directors, responsibilities of
the Board, Audit Committee functions, roles and responsibilities,
appointment of auditors, mechanism for whistle blower support and
compliance with Secretarial Standards.
The Company is substantially in compliance with some of the provisions
of these guidelines as reported in the section on Corporate
Governance in this Annual Report. The other provisions of these
guidelines are being evaluated and your Company will strive to adopt
the same in a phased manner.
SUBSIDIARIES :
During the year under review :
1. The following companies became subsidiaries of your Company :
- Ackruti City Magnum Limited
- Merrygold Buildcon Private Limited
- Vega Developers Private Limited (formerly Pure Gold Developers
Private Limited)
- Pushpak Healthcare Services Private Limited
2. The following companies ceased to be subsidiaries of your Company :
- Ackruti Center Infotech Limited
- E Commerce Magnum Solution Limited
The total number of subsidiaries as on March 31, 2011 was 33.
There has been no material change in the nature of the business of the
subsidiaries. All the subsidiary companies are non- material,
non-listed subsidiary companies as defined under Clause 49 of the
Listing Agreements entered into with the Stock Exchanges.
The Ministry of Corporate Affairs (MCA) has, vide General Circular
No.2/2011 dated February 8, 2011, granted general exemption under
Section 212 (8) of the Companies Act, 1956 from attaching the Balance
Sheet, the Profit and Loss Account and other documents of the
subsidiary companies to the Balance Sheet of the Company. Accordingly,
the Audited Statements of Account and the Auditors Report thereon
along with the Reports of the Board of Directors of the subsidiary
companies are not attached to this Annual Report. As directed in the
aforesaid MCA Circular, the summarized financials of all the subsidiary
companies have been disclosed in the Consolidated Balance Sheet under
the heading "Summary of Financial Statements of Subsidiary Companies
which forms part of this Annual Report.
The annual accounts and the related detailed information of these
subsidiary companies will be made available to any member of the
Company/its subsidiaries seeking such information at any point of time
and are also available for inspection by any member of the Company/its
subsidiaries at the registered office of the Company and also at the
respective registered offices of the subsidiary companies during
working hours between 11.00 a.m. and 1.00 p.m. upto the date of the
Annual General Meeting.
DIRECTORS :
Mr. Shailesh V. Haribhakti and Mr. R H. Ravikumar resigned from the
Board of Directors of the Company effective March 11,2011 due to their
other business commitments.
The Board places on record its sincere appreciation of the invaluable
contribution and mature advice provided by Mr. Haribhakti and Mr.
Ravikumar during their tenure as Directors of the Company,
At the meeting of the Board of Directors of the Company held on May
16,2011, Mr. Abhijit Datta and Mr. Arvind Kumar Joshi were appointed as
Non-Executive Independent Directors to fill the casual vacancies caused
by the resignations of Mr. Haribhakti and Mr, Ravikumar respectively.
Pursuant to Section 262 of the Companies Act, 1956 read with Article
140 of the Articles of Association of the Company, Mr. Arvind Kumar
Joshi holds office upto the date of the ensuing Annual General Meeting
as Mr. P. H. Ravikumar in whose place he has been appointed, would have
retired by rotation at the ensuing Annual General Meeting had he not
resigned. The Company has received notice from a member under Section
257 of the Companies Act, 1956 along with requisite deposit proposing
his appointment as a Director of the Company.
Mr. D. R. Kaarthikeyan and Mr. Shailesh H. Bathiya, Directors, retire
by rotation at the ensuing Annual General Meeting and being eligible,
have offered themselves for reappointment.
The brief profiles of Mr. Arvind Kumar Joshi, Mr. D. R. Kaarthikeyan
and Mr. Shailesh H. Bathiya as required by Clause 49 of the Listing
Agreements have been detailed in the Section on Corporate Governance.
Your Directors recommend the appointment of Mr. Arvind Kumar Joshi and
reappointment of Mr. D. R. Kaarthikeyan and Mr. Shailesh H. Bathiya as
Directors of your Company.
DIRECTORS RESPONSIBILITY STATEMENT :
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Directors of the Company, to the best of their knowledge and
belief and on the basis of the information and explanations received by
them, hereby state and confirm that :
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
(ii) the accounting policies have been selected and applied them
consistently and made judgments and estimates that are reasonable and
prudent, so as to give a true and fair view of the state of affairs of
the Company as at March 31,2011 and of the profit of the Company for
the year ended on that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts have been prepared on a going concern basis.
AWARDS :
Your Company has been the proud recipient of the following awards and
recognition :
a. "Leading the Green Building Movement" awarded by Indian Green
Building Council;
b. "Ackruti Gold"- the commercial project of the Company at Bandra
Kurla complex has been awarded three management systems certificates by
British Standards Institute (BSI) in the following categories :
- Environmental Management System - ISO 14001:2004.
- Occupational Health & Safety Management System - BS OHSAS 18001:2007.
- Integrated Management System - PAS 99 : 2006.
STATUTORY INFORMATION :
Since the Company is not engaged in any manufacturing activity, the
other particulars relating to conservation of energy and technology
absorption as stipulated in the Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1998 are not applicable.
Expenditure incurred in foreign currency amounted to Rs. 132.75 lac.
There was no earning in foreign exchange.
Statement pursuant to Section 217 (2A) of the Companies Act, 1956 read
with The Companies (Particulars of Employees) Rules, 1975 as amended
is annexed hereto as Annexure - I and forms part of this Annual Report.
GROUP FOR INTER-SE TRANSFER OF SHARES :
As required under Clause 3(i)(e) of the Securities and Exchange Board
of India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997, persons constituting "Group" (within the meaning as defined in
the Monopolies and Restrictive Trade Practices Act, 1969) for the
purpose of availing exemption from the applicability of the provisions
of Regulations 10 to 12 of the aforesaid SEBI Regulations are given in
the Statement annexed to and forming part of this Annual Report.
APPRECIATION :
Your Directors would like to express their grateful appreciation and
thanks for the valuable co-operation and support received from the
Companys bankers,financial institutions,business
associates,suppliers,consultants,customers and contractors and
shareholders at large during the year under review and look forward to
the same in greater measure in the coming years.
The Directors also wish to place on record their appreciation of the
unstinted efforts and contributions made by the Management Team and the
employees of the Company at all levels.
For and on behalf of the Board
Hemant M. Shah
Executive Chairman
Mumbai,
May 30, 2011
(Source : World Economic Outlook : Recovery, Risk, and Rebalancing -
International Monetary Fund Report)
2Cushman & Wakefield (C&W) India Real estate Investment report 2010 :
Riding the Wave - Re-emergence of Indian realty sector,
Mar 31, 2010
The Directors have pleasure in presenting their Twenty Second Annual
Report of the Company together with the Audited Accounts for the year
ended March 31, 2010.
FINANCIAL RESULTS :
The salient features of the Companys standalone and consolidated
financial results for the year under review are as follows:
(Rs. in lac)
STANDALONE CONSOLIDATED
March March March March
31, 2010 31, 2009 31, 2010 31, 2009
Net Sales / Income from
Operations 48202.02 43721.66 57963.36 43476.91
Other Income 3200.58 3355.16 3846.21 2001.34
Total Income 51402.60 47076.82 61809.57 45478.25
Profit before tax 23859.45 29333.52 24706.68 28358.22
Profit after tax before
prior period adjustments 17651.62 27024.78 16541.12 26035.12
Net Profit after prior
period adjustment 17379.48 26377.97 16491.41 26473.15
Profit brought forward 50832.07 25234.45 51491.36 25857.56
Profit available for
appropriation 68211.55 51612.42 67982.77 52330.71
APPROPRIATIONS
General Reserves 1750.00 - 1750.00 1.21
Debenture Redemption
Reserve 2500.00 - 2500.00 -
Proposed Dividend 3636.79 667.00 3636.79 667.00
Dividend
Distribution Tax 618.07 113.36 618.07 171.14
Balance carried to
Balance Sheet 59706.69 50832.06 59477.91 51491.36
OPERATIONAL HIGHLIGHTS :
On a standalone basis the total income of the Company was higher by
9.19 % at Rs.51402.60 lac as against Rs. 47076.82 lac in the previous
year. Although the Company maintained a decent pace of growth in sales
despite challenging environment owing to continued general slowdown in
the economy, a significant increase in cost of construction has had the
impact on Profit before Tax which stood at Rs. 23859.45 lac as against
Rs. 29333.52 lac in the previous year. The net profit was Rs. 17379.48
lac as against Rs. 26377.97 lac in the previous year.
The consolidated revenues of the Company witnessed a robust growth of
35.9 % at Rs.61809.57 lac as against Rs. 45478.25 lac in the previous
year. The consolidated net profit was Rs. 16491.41 lac as against Rs.
26473.15 lac in the previous year.
The increase in loans and advances from Rs. 80445 lac to Rs. 128420 lac
represents substantial investments by your Company in its subsidiaries,
associates, joint ventures, partnerships and other entities towards
growing the business to drive higher profits in future and reflects the
Managements confidence towards strong business growth.
Your Company continues to take initiatives for strengthening its
business operations and thereby take advantage of the growing demand
scenario in various verticals of residential and commercial segment.
Your Company is also consolidating on the initiatives taken in previous
few quarters.
Your Directors are pleased to state that after a tough challenging time
in the year under report, realty market is now looking better placed
with both buyer sentiment and liquidity scenario improving
considerably. These are expected to be on the desired track in coming
quarters.
APPROPRIATIONS :
An amount of Rs.1750.00 lac (P.Y. Rs. Nil) is credited to General
Reserves and Rs. 2500 lac (P.Y. Rs.Nil) is credited to Debenture
Redemption Reserve. Out of the amount available for appropriation, your
Directors have recommended a dividend of Rs. 5/- (50 %) (P.Y. : Re.1
per share à 10 %) per equity share of the face value of Rs.10 each for
the year ended March 31, 2010, aggregating Rs. 3636.79 lac (P.Y. :
Rs.667.00 lac). The dividend distribution tax amounts to Rs. 618.07 lac
(P.Y. : Rs.113.36 lac).
The dividend payout for the year under review has been formulated in
accordance with the Companys policy of striving to maintain a stable
dividend payout linked to performance and keeping in view the Companys
need for capital to finance its growth plans through internal accruals
to the maximum. Your Directors believe that this will lead to an
increase in shareholders value in the long term.
THE BUSINESS :
The Company currently operates both - on its own and through its
subsidiaries / joint ventures / associate companies and partnership
firms in the Residential, Commercial, SEZs, Infotech Park, Biotech Park
and Robotic Car Park segments of the Real Estate business. Operations
of the Company include identification and acquisition of land /
development rights, obtaining necessary approvals, planning, execution
and marketing of the projects.
The Company has a Western India focus with presence in major cities
such as Mumbai, Thane, Pune, Surat, Vadodara and Ahmedabad with almost
all the developments being undertaken within the city limits.
The Companys presence in Mumbai is well distributed among the western
& eastern suburbs and the island city.
SEGMENT WISE DISCUSSIONS :
Residential : The Company had last year launched ÃJust Perfect Homes
series of residential apartments in the affordable housing segment at
Mira Road (Ackruti Gardenia), Thane (Ackruti Greenwoods) and Kondhwa,
Pune (Ackruti Countrywoods). All the three projects received tremendous
response. During the year under review, the Company also launched Phase
à II of Ackruti Greenwoods. Plans are afoot to launch Phase II of
Ackruti Gardenia and Ackruti Countrywoods in the current fiscal.
During the year under review, the Company launched three new projects
namely ÃAckruti Jewel, ÃAckruti Sunmist and ÃAckruti Shikhar all
located at Andheri. The response from the prospective buyers in booking
flats of these Projects has been very encouraging.
Commercial : The construction activity of ÃAckruti Solaris at Andheri
is in full swing and is expected to be completed by 2011 end.
Construction activity has also commenced in respect of ÃAckruti Opal
located at Jogeshwari adjoining Western Express Highway. The
construction of ÃAckruti Gold, a LEED certified building at Bandra
Kurla Complex has been completed.
Robotic Car Park : Indias first fully automated 20 storied car park at
Mahalakshmi, Mumbai has become operational. It can park 240 cars as
against 15-20 cars that could be parked earlier prior to the
construction of the car park.
Info Park à Pune : The construction of last building ÃBlock 4 of Phase
- I of Info Park at Hinjewadi, Pune is nearing completion.
Biotech Park : The Company has through its subsidiary namely Gujarat
Ackruti-TCG Biotech Limited embarked upon the development of 700 acres
Biotech Park at Savli, near Vadodara in the State of Gujarat in joint
venture with Gujarat State Biotech Mission and the TCG Group. Phase - I
of the Project has been marketed successfully. For Phase à II of the
Project, the Company has acquired possession of land from GIDC and the
infrastructure development work thereon has commenced.
Mumbai SEZ : The Company has obtained all the requisite approvals from
SEZ authorities. Environmental clearance for the project has been
obtained from the Ministry of Environment and Forest. The project is in
advanced stage of development. The Company had also sought and
obtained the status of Special Planning Authority (SPA) for the Project
from the Government of Maharashtra. The Company will execute the said
project in joint venture with the landowner.
Upvan Lake Project : The Company acquired management control of Upvan
Lake Resorts Private Limited (Upvan) for undertaking the project for
beautification of Upvan Lake at Thane under BOOT Scheme of Thane
Municipal Corporation. Upvan is a subsidiary of the Company.
OTHER OPPORTUNITIES :
The Company has, through its associate companies, undertaken the
development / upgradation of five bus terminals in the State of Gujarat
under the public private partnership scheme. Subsequent to the close of
the year, the Company received the Letter of Acceptance (LOA) from
GSRTC for development of the said bus terminals. Under this Scheme, the
Company will upgrade and maintain the bus depots and in return, will
get lease and parking revenues from the commercial component. These
commercial projects, when completed are expected to generate
significant revenues at a minimal investment.
The Company has embarked upon the development of real estate project on
Ghatkopar-Mankhurd Link Road, Mumbai through an associate company on
public private partnership basis with the Government of Maharashtra.
The Company also received a Letter of Acceptance from Railway Land
Development Authority for development of railway land at Bengaluru.
The Company is also on the look out for strategic acquisitions in order
to achieve inorganic growth.
The Company has also entered into strategic joint venture arrangements
with other real estate development companies for some of its projects
on a profit sharing basis. Collaborating strategically with other firms
reduces the capital investment requirement and helps leverage
development capabilities. It also allows the Company to benefit from an
enhanced pool of construction and marketing expertise and experience
and facilitates expansion into additional geographies and business
lines. All the aforesaid business initiatives would enable the Company
to enhance long term shareholder value.
Tools of innovation are employed for any new project / marketing
initiative, the purpose being to constantly stay ahead in terms of
ideas.
DIRECTORS :
Mr. Madhukar B. Chobe and Mr. Shailesh V. Haribhakti retire by rotation
at the ensuing Annual General Meeting and being eligible, offer
themselves for reappointment. Appropriate resolutions for their
reappointment are being placed before you at the ensuing Annual General
Meeting.
The brief profile of Mr. Madhukar B. Chobe and Mr. Shailesh V.
Haribhakti as required by Clause 49 of the Listing Agreements has been
detailed in the Section on ÃCorporate Governance. Your Directors
recommend the reappointment of Mr. Madhukar B. Chobe and Mr. Shailesh
V. Haribhakti as Directors of your Company.
DIRECTORS RESPONSIBILITY STATEMENT :
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Directors of the Company, to the best of their knowledge and
belief and on the basis of the information and explanations received by
them, hereby state and confirm that:
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed and that no material departures
have been made from the same;
(ii) the accounting policies have been selected and applied them
consistently and made judgments and estimates that are reasonable and
prudent, so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2010 and of the profit of the Company for
the year ended on that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) the annual accounts have been prepared on a going concern basis.
AWARDS :
Your Company has been the proud recipient of the following award and
recognition :
a. The Companys Residential Project à ÃACKRUTI ORCHID PARK at Saki
Naka, AndheriÃKurla Road, Andheri (East), Mumbai has won the CNBC Awaaz
Real Estate Award 2009 in the category of ÃBest Overall Systems.
Presented in association with CREDAI and adjudged by CRISIL, the award
is Indias most prestigious award for excellence in real estate sector
and acknowledges the best real estate developers for their spirit of
achievement and contribution to society, industry and the nation as a
whole.
b. The Companys project à ÃACKRUTI GOLD at Bandra Kurla Complex,
Bandra (East), Mumbai has achieved pre-certified Platinum Rating under
the LEED India for Core & Shell Rating System from Indian Green
Building Council. The ÃCertification signifies that Documentation has
been submitted for the Project, which demonstrate an intent to design
and build a high performance building in accordance with LEED India
Green Building Rating System.
STATUTORY INFORMATION :
Since the Company is not engaged in any manufacturing activity, the
other particulars relating to conservation of energy and technology
absorption as stipulated in the Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1998 are not applicable.
Expenditure incurred in foreign currency amounted to Rs. 106.66 lac.
There was no earning in foreign exchange.
Ackruti had 260 employees as on March 31, 2010. During the year, 16
employees employed throughout the year and 4 employees employed for
part of the year were in receipt of remuneration of Rs. 24 lac or more
per annum. In accordance with the provisions of Section 217 (2A) of the
Companies Act, 1956 and the rules framed thereunder, the names and
other particulars of employees are set out in the statement annexed to
the Directors Report. In terms of the provisions of Section 219 (1)
(b) (iv) of the said Act, the Directors report is being sent to all
the shareholders of the Company excluding the statement of particulars
of employees. Any shareholder interested in obtaining a copy of the
said statement may write to the Company Secretary.
EMPLOYEES :
Human resources continue to be the biggest asset of the Company. Your
Company aims at creating a corporate culture that respects people,
develops and trains them to deliver high quality performance and
rewards talent and performance with growth opportunities. The staff
strength of the Company comprises of highly qualified and experienced
professionals from various faculties like engineering, finance, legal,
and management. Employee relations continue to be cordial.
APPRECIATION :
Your Directors would like to express their grateful appreciation and
thanks for the valuable co-operation and support received from the
Companys bankers, financial institutions, business associates,
suppliers, consultants, customers, contractors and shareholders at
large during the year under review and look forward to the same in
greater measure in the coming years.
The Directors also wish to place on record their appreciation of the
unstinted efforts and contributions made by the Management Team and the
employees of the Company at all levels.
For and on behalf of the Board
Vyomesh M. Shah Madhukar B. Chobe
Managing Director Wholetime Director
Mumbai, August 7, 2010