Mar 31, 2023
The Directors have the pleasure in presenting the Thirty Fourth Annual Report together with the audited financial statement for the financial year ended on March 31, 2023.
Financial Results
The Company''s financial performance for the Year ended on March 31, 2023 is summarized below
(Rs. in Crores) |
|
......... ................ ........ '' / / // Standalone ..... Consolidated ........ |
|
Particulars Current Year......Previous Year Current Year Previous Year |
|
2022-2023 2021-2022 2022-2023 2021-2022 |
|
Total I |
ncome ..................... ....... 1054.16 1322.58 ..........2176.49 2827.74 |
Profit(Loss) before Finance Cost, Depreciation & (109.57) (438.99) 447.52 572.53 amortization Expense and Tax Expense ........ .......... .......... ........ ........ |
|
. Less : Finance Cost ............... ................... 164.92.......187.88...... 661.06 975.43 |
|
Depreciation and amortization Expense 44.47 69.20 130.97 166.87 |
|
Profit /(Loss) before Exceptional Item and Tax (318.96) (696.07) (344.51) (569.77) |
|
Exceptional Item (Net of expenses) (24.91) (13.65).....(368.83) (165.17) |
|
Profit /(Loss) Before Tax ........... ....... (343.86) (709.73) ....... (713.34) (734.94) |
|
Less : Tax Expenses ........... .......... 1.57 (25.00) ........ 21.10 9.92 |
|
Less:-Deferred tax liability /(asset)(Including MAT Credit) 5 (3505) (1648) and short (Excess) provision for taxation for earlier years . . (.) (.) |
|
''Profit /(Loss) for the period from continuing Operations (346.48) (716.32) (699.39) (728.38) |
|
Add:- Share of Loss Transferred to Minority Interest........ ''/ ///-,,'' ''.'' (110.24) (4.69) |
|
Net Profit for the period after tax (346.48) (716.32)''///; (588.77) ....... (723.70) |
|
Balance brought forward from last year .......... ........... 569.70.. 1286.02..... (551.49) 172.21 |
|
Loss of Subsidiary for earlier year transferred (net)......... //.. .... ...... ...... .......... . |
|
Other Comprehensive Income (OCI) 0.28 1.68. 0.38 2.20 |
|
Amount available for Appropriations 223.22 569.70 (37.28) (551.49) |
|
Appropriations ........... ....... ........... |
|
Dividend & Tax paid thereon........ .0.00 0.00 ........... 0.00 |
|
Adjustment on account of acquisition of non controlling 000 0 00 0.00 .interest ........ ....... ........ |
|
''Equity Transactions / Share Issue Expenses 0.00.......... 0.00 '' ........ 0.83 |
|
Loss of Subsidiary for previous year ........ ...... 0.00^/........ 0.00 .. ......0.04 |
|
Transfer to Debenture Redemption Reserves ........ ...... 0.00 /........ 0.00 //// ........ |
|
Closing Balance in Retain earnings....... ........ 223.22 569.02 (37.28) (551.49) |
In view of losses incurred, your Directors do not recommended any dividend for the financial year ended on 31st March, 2023. Dividend Distribution Policy:
Securities and Exchange Board of India (''SEBI''), by its notification dated 8th July, 2016, has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''Listing Regulations''), introducing new Regulation 43A and further amended the same on 5th May, 2021 mandating the top 1000 listed entities, based on market capitalization calculated as on 31st March of every financial year, to formulate a Dividend Distribution Policy and disclose the same on the website of the listed entity and a web-link shall also be provided in their annual reports.
The Company has adopted a Dividend Distribution Policy on August 20, 2016, which is available on the website of the Company at the link: https://www.sadbhavene.com/wp-content/uploads/2018/02/Dividend Distribution Policy SEL.pdf. There has been no change to the policy during the year.
Business Overview Standalone Basis
The total revenue during the year under review was Rs. 1054.16 Crores against Rs. 1322.58 Crores for the previous year.
Profit (Loss) before Finance Cost, Depreciation & amortization Expense and Tax Expense for the current year is (Rs. 109.57 Crores) (Rs.438.99 Crores in previous year). Net Profit (Loss) after tax amounted to Rs. (346.48) Crores (Rs. 716.32 Crores in previous year)
As per the Consolidated Financial Statements, the Total Income of the Company, operating profit (PBDIT), and net loss for the year were Rs. 2176.49 Crores, Rs. 447.52 Crores and (Rs. 699.39 Crores) respectively.
Transfer to Investor Education and Protection Fund
The Company has transferred a sum of Rs. 0.23 lakhs to the Investor Education and Protection fund established by the Central Government during the financial year 2022-23, in compliance with Section 124 of the Companies Act, 2013. The said amount represents unclaimed dividend amount for the financial year 2014-15 which were lying with the Company for a period of 7 years from their due dates of payment. Prior to transferring the aforesaid sum, the Company has sent reminders to the shareholders for submitting their claims for unclaimed dividend for the financial year 2014-15.
The Board of Directors of the Company has decided not to transfer any amount into General Reserve for the financial year ended on March 31, 2023.
Change in the Nature of Business, if any
There are no changes in the nature of business during the year.
Material changes and commitments affecting financial position between end of the financial year and date of report
There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report. Information regarding potential impact of COVID-19 pandemic on your Company''s business operations and financial position are provided as part of the MD&A Report.
Merger of Sadbhav Infrastructure Project Limited ("SIPL") with the Company
The Board of Directors in the meeting held on 15th October, 2022 have Withdrawal Scheme of Amalgamation filed with Hon''ble National Company Law Tribunal Ahmedabad Bench (NCLT) with regard to amalgamation of Sadbhav Infrastructure Project Limited (Transferor Company) with Sadbhav Engineering Limited (Transferee Company) under sections 230 to 232 of the Companies Act, 2013. Consequently, on application made by the Company, the NCLT vide its order dated 19th October, 2022 has allowed the withdrawal of the said application. Accordingly, the Scheme of merger stands cancelled.
During the year, there was no change in total equity share capital of Rs. 17,15,70,800/- (Face Value of Re. 1/- each). During the year under review, Company has not allotted any shares without differential voting rights. During the year under review, the Company has not granted any stock options or sweat equity. The Company has no scheme of provision of money for purchase of its own shares by employees or by trustees for the benefit of employees. Hence the details under rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 are not required to be disclosed.
During the year 2022-2023 and up to the approval of Director''s Report, the Company has redeemed Listed Non-Convertible Debentures (NCDs) of Rs. 22.50 Crores on 22-06-2022 for ISIN INE226H07080 and Rs. 45.00 Crores Non-Convertible Debentures (NCDs) on 22-062023 for ISIN INE226H07098.
The aggregate Outstanding Principal amounts of Non-Convertible Debentures was Rs.100.75 crores as on 31st March, 2023.
a) CARE has assigned Revised CARE BB / CARE A4 (CWN) (Double B Plus/ A Four) (Under Credit watch with Negative Implications) from CARE BBB / CARE A3 (CWN) (Triple B / A Three Plus) (Under Credit watch with Negative Implications) and Withdrawn for Long Term/short Term Bank Facilities and Revised from CARE B (Single B Plus) and moved to ISSUER NOT COOPERATING category and removed from Credit watch with Negative Implications; Negative outlook for Non-convertible Debentures.
b) India Rating has assigned IND C/ IND D'' from ''IND BB to Term Loan Facilities and Non- Convertible Debentures of the Company.
Subsidiaries, Joint Ventures and Associates Companies
During the year, No Companies has become/ceased to be company''s subsidiaries, joint ventures or associate company.
However, Company has transferred 100% stake of the equity shares to Sadbhav Bhavnagar Highway Limited and Sadbhav UNA Highway Limited in June, 2023 and Pursuant to the binding terms, w.e.f. 1st April, 2023, for operational conveniences, the physical possession including control of the site of the SBHL has been handed over to the Purchaser.
Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014 the report on performance and financial position of subsidiaries, associates and joint venture companies is attached as a part of Annual Report in Form AOC- 1 prepared under section 129(3) of the Companies Act, 2013 to the consolidated Financial Statements of the Company which forms part of this report.
Consolidated Financial Statements
In compliance with the applicable provisions of Companies Act, 2013 including the Indian Accounting Standard (Ind AS)-33 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial year 20222023.
Board of Directors - Retirement by Rotation
Mr. Dwigesh B. Joshi (DIN: 09733282), is the director liable to retire by rotation at the ensuing Annual General Meeting and, being eligible, offer himself for reappointment. The director recommends his reappointment.
Declaration from Independent Directors of the Company
The terms and conditions of appointment of Independent Directors are in accordance with the applicable Regulations of the SEBI (Listing Obligations and Disclosure Regulations) Regulations, 2015 and also as per the provisions of the Companies Act, 2013 (Act)
read with Schedule IV to the Act.
Your Company has received declaration from all the independent Directors of the Company as required under Sec. 149(7) confirming that they meet with the criteria of independence provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and there has been no change in the circumstances which may affect their status as Independent Director during the year.
During the year 2022-23 and upto the approval of Director''s Report following changes were made in Director and KMPs.
1. Mr. Arun S. Patel (DIN: 06365699), Non-Executive Independent Director of the company ceased to be a director due to expiration of his term w.e.f. 26.09.2022.
2. Mr. Nitin R. Patel (DIN: 00466330), Executive Director & CFO of the company resigned w.e.f.21.11.2022.
3. Mr. Vasistha C. Patel Chief Executive Officer (CEO) of the company resigned w.e.f. 21.11.2022.
4. Mr. Rohit Modi was appointed as the Chief Executive Officer (CEO) of the company w.e.f. 21.11.2022 and tendered resignation from the position of CEO of the Company w.e.f. 14.02.2023
5. Mr. Jatin Thakkar was appointed as Chief Financial Officer (CFO) of the Company in the category of Key Managerial Personnel w.e.f. 17th December, 2022 and tender resignation from the position of CFO of the Company w.e.f. 15.03.2023
6. Mr. Shashin V. Patel (DIN: 00048328) has been appointed and designated as Chairman and Managing Director of the Company in the category of Key Managerial Personnel for a period of three (3) years w.e.f. 17th December 2022 to 16th December 2025.
7. Mr. Rohit Modi was appointed as the group Chief Executive Officer (CEO) of the company w.e.f. 14.02.2023.
8. Mr. Dwigesh B. Joshi (DIN: 09733282) was appointed as an Executive Director and CFO of the company w.e.f. 15.03.2023.
9. Mr. Jatin Thakkar (DIN: 09312406) was appointed as a Non-Executive Director of the company w.e.f. 15.03.2023.
Evaluation of Board Performance
The Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board and Committees, experience and competencies, performance of specific duties and obligations, contribution at the meetings and otherwise, independent judgment, governance issues etc. At the Board Meeting that followed the above-mentioned meeting of the Independent Directors, the performance of the Board, its committees, and individual Directors was also discussed. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated. More details on the same are given in the Corporate Governance Report.
The Audit Committee comprises Directors namely Mr. Sandip V. Patel (Chairman), Mrs. Anjali N. Choksi and Mr. Shashin V. Patel, Dr. Tarang M. Desai. The composition of the Audit Committee is in compliance with the requirement of Section 177 of the Companies Act, 2013 and Regulation 18 of the SEBI (LODR) Regulations, 2015.
Stakeholder Relationship Committee
The Stakeholder Relationship Committee comprises Directors namely Mr. Sandip V. Patel (Chairman), Mr. Shashin V. Patel and Dr. Tarang M. Desai. The composition of the Stakeholder Relationship Committee is in compliance with the requirement of Section 178 of the Companies Act, 2013 and Regulation 20 of the SEBI (LODR) Regulations, 2015.
Board has constitute Risk Management Committee comprises Directors namely Mr. Shashin V. Patel, Mrs. Anjali N. Choksi and Mr. Sandip V. Patel. More details on the same are given in the Corporate Governance Report.
Pursuant to the provisions of Regulation 21 of the Listing Regulations, the Company is not required to constitute a Risk Management Committee. Although not mandatory, as a measure of good governance, the Company has constituted a Risk Management Committee of the Board. The Committee reviews the Company''s performance against identified risks, formulates strategies towards identifying new and emergent risks that may materially affect the Company''s overall risk exposure and reviews the Risk Management Policy and structure.
Details of various committees constituted by the Board of Directors along with dates of meetings and attendance of members of committees as per provisions of the Listing Regulations and Companies Act, 2013 are given in the Corporate Governance Report and forms part of this report.
As on date, the Nomination and Remuneration Committee comprises Directors namely Mrs. Anjali N. Choksi (Chairperson), Mr. Sandip V. Patel and Dr. Tarang M. Desai.
As on date, the Corporate Social Responsibility Committee comprises Directors namely Mr. Shashin V. Patel (Chairman), Mr. Sandip V. Patel and Mrs. Anjali N. Choksi..
As on date, the Finance and Investment Committee comprises Directors namely Mr. Shashin V. Patel (Chairman), Mr. Sandip V. Patel and Mrs. Anjali N. Choksi.
Independent Director''s Meeting
The Independent Directors met on 14th February ,2023, without the attendance of Non-Independent Directors and members of the management. The Independent Directors reviewed the performance of Non-Independent Directors, the Committees and the Board as a whole along with the performance of the Chairman of the Company, taking into account the views of Executive Director and assessed the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made thunder and no complaint has been received on sexual harassment during the financial year 2022-23. Further Company has complied with the provisions relating to the constitution of Internal Complaint Committee under the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company periodically conducts sessions for employees across the organization to build awareness about the Policy and the provisions of Prevention of Sexual Harassment Act.
Nomination and Remuneration Policy
The policy on Director ''s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and also remuneration for Key Managerial Personnel and other employees has been provided under Corporate Governance Report. The weblink for the same is https://www.sadbhaveng.com/wp-content/uploads/2018/02/ REMUNERATION-POLICY.pdf
The Company has a vigil mechanism named Whistle Blower Policy for directors and employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Company''s code of conduct or ethics policy. The details of the said Policy is explained in the Corporate Governance Report and also posted on the website of the Company. The weblink for the same is https://www.sadbhavene.com/wp-content/uploads/2018/02/Whistle Blower Policy-1.pdf
Development and implementation of Risk Management Policy
In accordance with the Regulation 17 of SEBI (LODR) Regulations, 2015, the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the Company by way of Risk Management Policy.
Board of Directors of the Company has identified the risks in two categories i.e. (1) Internal and Business Risk and (2) External Risk. The Management has also envisaged the minimization procedure and its perception in respect of each identified risk.
Further, the Company identifies risks with its degree and control systems are instituted to ensure that the risks in business process are mitigated. The Board provides oversight and reviews the Risk Management Policy periodically. In the opinion of the Board there has been no identification of elements of risk that may threaten the existence of the Company.
During the year, Nine (9) Board Meetings were held on May 30, 2022, June 20, 2022, August 10, 2022, October 15, 2022, November 14, 2022, November 21, 2022, December 17, 2022, February 14, 2023 and March 15, 2023. The details of attendance of Directors is mentioned in Corporate Governance Report which forms part of this report.
Directors'' Responsibility Statement
Pursuant to the requirement in section 134(3) (c) of the Companies Act, 2013, the Directors state that:
a) in the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards had been followed and there are no material departures from the same;
b) the directors had 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 as at March 31, 2023 and of the profit and loss of the Company for the year ended on that date;
c) the directors had taken proper and sufficient care 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;
d) the directors had prepared the annual accounts on a going concern basis;
e) that the directors had laid down internal financial controls to be followed by the company and that the financial controls are adequate and are operating effectively; and
f) that the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Statutory Auditor of the company is M/s. Manubhai & Shah LLP, Chartered Accountants, Ahmedabad (Firm Registration No. 106041W/ W100136).
M/s. Manubhai & Shah LLP, Chartered Accountants (Firm Registration Number: 106041W/W100136), Statutory Auditors of the Company to hold office for the first term of five years from the conclusion of the Thirty First (31st) Annual General Meeting held on September, 29, 2020 until the conclusion of the Thirty Sixth (36th) Annual General Meeting of the Company to be held in the year 2025.
Qualifications, reservations or adverse remarks made by Statutory Auditors in their report for the Financial Year ended on March 31,
2023 are given in the Standalone and Consolidated Independent Auditor''s Report.
Explanation or Comments on Qualifications, Reservations or Adverse remarks or disclaimers made by the auditors and the practicing company secretary in their reports
The Statutory Auditors'' Report contain following qualification on Standalone and Consolidated Results.
Reply of Directors with respect to qualifications /observations raised by Statutory Auditor''s Report:
Details of Audit Qualification (Standalone):
Qualification 1: We draw attention to Note 49 to the accompanying Standalone Financial Results with respect to termination of concession agreement by Rohtak Panipat Tollway Private Limited step-down subsidiary of the Company. The said step-down subsidiary has issued notice of termination of concession agreement to National Highway Authority of India (NHAI) on account of Force Majeure Event as per concession agreement. As explained in the said note, the Company has carried out impairment assessment of outstanding balance in this step-down subsidiary duly considering the expected payment arising out of aforesaid termination and other claims filed with NHAI and based on the above assessment, management has concluded that no impairment / adjustment to the carrying value of the loan and other receivables balance is necessary as at March 31, 2023.
However, we have not been able to corroborate the management''s contention of realizing the carrying value of loan and other receivables of Rs. 14,865.37 Lakhs as on the reporting date, related to the said step-down subsidiary.
Accordingly, we are unable to comment on appropriateness of the carrying value of such loan and the consequential impact on the financial results and financial position of the Company as at reporting date and for the quarter and year ended on March 31, 2023.
Reply to qualification 1: The Company has outstanding loan and other receivable of Rs. 14865.38 lakhs given to Rohtak Panipat Tollway Private Limited (RPTPL), a step-down subsidiary company which is engaged in construction, operation and maintenance of road projects under concession agreement with National Highways Authorities of India (NHAI). The net worth of RPTPL has fully eroded.
Further, the toll collection by RPTPL was forcefully suspended due to agitation and protest held by farmers and other unions against agri-marketing laws from December 25, 2020. Accordingly, RPTPL could not collect toll user fees from December 25, 2020. RPTPL had sent various communications to NHAI for such forceful suspension of toll. RPTPL has issued notice for termination of concession agreement on July 27, 2021 considering the above event as Force Majeure Event in terms of concession agreement. RPTPL has filed claim amounting to Rs. 395784.40 lakhs relating to termination payments, O&M cost due to force majeure, Covid claim & demonetization etc. with NHAI in terms of concession agreement. In respect of such claims, NHAI has approached to the RPTPL for settlement of all these claims by way of conciliation proceedings, which has been consented by it.
Considering the management assessment of probability and tenability of receiving above claims from NHAI as per the terms of concession agreement, which is backed by legal opinion and communications from NHAI for conciliation, the management has assessed that there is no impairment in the value of loan given to RPTPL and consequently no provision/adjustment to the carrying value of loan and other receivable as at March 31, 2023 is considered necessary.
The Statutory Auditors'' Report contain following qualification on Standalone financial statements on the basis of Report on the Internal Financial Controls:
Qualification 1: The Company''s internal financial control system towards estimating the carrying value of loan and other dues receivables in the step down subsidiary company, as explained in Note 49 to the standalone financial statements were not operating effectively which could potentially lead to not providing adjustments, if any, that may be required to the carrying values of loan and other dues recoverable from such step down subsidiary and its consequential impact on the earnings, other equity and related disclosures in the standalone financial statements.
Reply to Qualification 1: The Company has outstanding loan and other receivable of Rs. 14865.38 lakhs given to Rohtak Panipat Tollway Private Limited (RPTPL), a step-down subsidiary company which is engaged in construction, operation and maintenance of road projects under concession agreement with National Highways Authorities of India (NHAI). The net worth of RPTPL has fully eroded.
Further, the toll collection by RPTPL was forcefully suspended due to agitation and protest held by farmers and other unions against agri-marketing laws from December 25, 2020. Accordingly, RPTPL could not collect toll user fees from December 25, 2020. RPTPL had sent various communications to NHAI for such forceful suspension of toll. RPTPL has issued notice for termination of concession agreement on July 27, 2021 considering the above event as Force Majeure Event in terms of concession agreement. RPTPL has filed claim amounting to Rs. 395784.40 lakhs relating to Termination payments, O&M cost due to force majeure, Covid claim & demonetization etc. with NHAI in terms of concession agreement. In respect of such claims, NHAI has approached to the RPTPL for settlement of all these claims by way of conciliation proceedings, which has been consented by it.
Considering the management assessment of probability and tenability of receiving above claims from NHAI as per the terms of concession agreement, which is backed by legal opinion and communications from NHAI for conciliation, the management has assessed that there is no impairment in the value of loan given to RPTPL and consequently no provision/adjustment to the carrying value of loan and other receivable as at March 31, 2023 is considered necessary.
Qualification 2: There was weakness in operating effectiveness over system of creation and issuance of purchase order, goods receipt
note, accounting of consumption and processing of invoices which could result into possible adjustments of transactions / balances.
Reply to Qualification 2: The company has adequate system of creation and issuance of purchase order, goods receipt note, accounting of consumption and processing. In few cases due to man power resource constraint there were some delay on few occasion in creation and issuance of purchase order, goods receipt note, accounting of consumption and processing of invoices. However, company has proper system of maker checker for processing of PO, GRN and consumption and No GRN and consumption will take place without creation of purchase order. Further management is taking steps to ensure that system operate effectively so that such instances do not occur. On the basis of above there were no material misstatement due to the weakness in operating effectiveness over system of creation and issuance of purchase order, goods receipt note, accounting of consumption and processing of invoices.
Qualification 3: In our opinion, the Company''s system for processing of journal entries into accounting software does not have maker checker system which could result into possible effect to the processing of transactions and its consequential effect on balances.
Reply to Qualification 3: The company has adequate system of manual approval of processing of journal entries in accounting software and journal entries are also verified by the internal auditor. Company are in process of incorporating the maker checker process in accounting software for processing of journal entries.
It may be noted that there were no material misstatements of account balances due to the weakness in system for processing of journal entries in accounting software due to absence of maker checker system.
Details of Audit Qualification (Consolidated):
The Statutory Auditors have provided following qualification in their audit report -
1. As detailed in Note 66 & 67 of the accompanying Consolidated Financial Results, with respect to Rohtak Panipat Tollway Private Limited (RPTPL) and Rohtak Hisar Tollway Private Limited (RHTPL), step down subsidiaries of the Group in which interest on rupee term loan from banks and financial institutions as well as unsecured loans from group companies have not been accounted considering the fact that both subsidiaries have issued termination notices and lenders of both step down subsidiaries have classified all the secured borrowings as non-performing assets. This has resulted in the understatement of finance cost and the related interest liability and corresponding understatement of losses, amount of which is unascertained.
The auditors of RPTPL and RHTPL have expressed qualified opinion on the financial statement of RPTPL and RHTPL for the year ended March 31, 2023 vide their report dated May 25, 2023.
2. As detailed in Note 68 of the accompanying statement, with respect to Sadbhav Vidarbha Highway Limited (Concessionaire or SVHL), step down subsidiary of the group in which case lenders of SVHL has exercised right of substitution of concessionaire in the month of February, 2023. The Concessionaire vide its letter dated May 5, 2023 had recommended National Highway Authority of India (NHAI), Harmonious substitution of concessionaire. The approval of NHAI is awaited. As mentioned in the said note, no adjustment to the carrying value of assets and liabilities have been made in the financial statements of SVHL and the financial statements of SVHL is prepared on going concern basis. Owing to the uncertainty of outcome of substitution proceedings and lack of other alternate audit evidence, we are unable to comment about adjustment that may be required to the carrying value of assets and liabilities and their consequential impact on the financial position of the Group as on March 31, 2023.
3. As detailed in Note 69 of the accompanying statement, with respect to Sadbhav Nainital Highway Limited (Concessionaire or SNHL), step down subsidiary of the group in which case National Highway Authority of India (NHAI) vide its letter dated April 17, 2023 has given In-Principal approval for harmonious substitution of concessionaire. As mentioned in the said note, no adjustment to the carrying value of assets and liabilities have been made in the financial statements of SNHL and the financial statements of SNHL is prepared on going concern basis pending finalization of substitution.
The auditors of SNHL have expressed qualified opinion on the financial statement of SNHL for the year ended March 31, 2023 vide their report dated May 26, 2023.
4. As detailed in Note 70(a) of the accompanying Consolidated Financial Results, with respect to Sadbhav Bangalore Highway Private Limited (SBGHPL), subsidiary of the group in which Tax credit receivables are carried in the Balance sheet at Rs. 4,267.40 Lakhs under the Other Current assets. However, during financial year 2022-2023, the SBGHPL does not have any business activity nor are we informed about the management plan for taking up other business activity. Hence we are unable to comment about utilization / realisation of such tax credit receivables.
5. As detailed in Note 71(a) of the accompanying Consolidated Financial Results, with respect to Sadbhav Jodhpur Ring Road Private Limited (SJRRPL), subsidiary of the group in which Tax credit receivables are carried in the Balance sheet at Rs. 1,554.50 Lakhs under Other Current assets. However, during financial year 2022-2023, the SJRRPL does not have any business activity nor are we informed about the management plan for taking up other business activity, nor are we informed about the management plan for taking up other business activity.
The auditors of SJRRPL have expressed qualified opinion on the financial statement of SJRRPL for the year ended March 31, 2023 vide their report dated May 26, 2023 mentioning that they are unable to comment about the utilization of tax credits in foreseeable future.
Reply of Directors with respect to qualifications /observations raised by Statutory Auditor''s Report:
Reply to qualification 1: Finance cost includes Interest expenses in respect of two step down subsidiary companies namely Rohtak Hissar Tollways Private Limited (RHTPL) and Rohtak Panipat Tollways Private Limited (RPTPL) amounting to Rs. 12280.90 lakhs and Rs. 10269.40 lakhs reversed during the quarter ended March 31, 2023 which were provided in earlier period where Financials of RPTPL & RHTPL are prepared on non going concern basis due to issue of termination notice to NHAI by RPTPL & RHTPL.
Reply to qualification 2: In case of Sadbhav Vidarbha Highway Limited (Concessionaire or SVHL), step down subsidiary where lenders of SVHL have exercised right of substitution of concessionaire in the month of February, 2023. The Concessionaire vide its letter dated May 5, 2023 had recommended National Highway Authority of India (NHAI), Harmonious substitution of concessionaire. The approval of NHAI is awaited. The SIPL and SVHL are in active discussion with Gawar Construction Limited for executing endorsement/ settlement agreement. Owing to the uncertainty of outcome of substitution proceeding note, no adjustment is made to the carrying value of assets and liabilities in the financial statements of SVHL and the financial statements of SVHL is prepared on going concern basis.
Reply to qualification 3: In case of Sadbhav Nainital Highway Limited (Concessionaire or SNHL), step down subsidiary where National Highway Authority of India (NHAI) vide its letter dated April 17, 2023 has given In-Principal approval for harmonious substitution of concessionaire. The SIPL and SNHL are in active discussion with Gawar Construction Limited for executing endorsement/settlement agreement. As per the Binding Term Sheet, the recoverability of the amount invested by SIPL as Equity and Sub-debt is substantially certain and hence as per management estimate, no provision is required to be made to the carrying value of assets and liabilities in the financial statements of SNHL and the financial statements of SNHL is prepared on going concern basis.
Reply to qualification 4: Sadbhav Banglore Highway Private Limited (SBGHPL), step down subsidiary in which Tax credit receivables are carried in the Balance sheet at Rs. 4267.40 lakhs under the Other Current assets. Presently, the SBGHPL does not carry out any business activity. However, management of SBGHPL is evaluating various option for utilising above mention credit and is confident about the utilization of the credit. For which the statutory auditors have expressed qualified opinion on financial results in this regards.
Reply to qualification 5: Sadbhav Jodhpur Ring Road Private Limited (SJRRPL), subsidiary in which Tax credit receivables are carried in the Balance sheet at Rs. 1554.50 lakhs under the Other Current assets. Presently, SJRRPL does not carry out any business activity. However, management of SJRRPL is evaluating various option for utilising above mention credit and is confident about the utilization of the credit. For which the statutory auditors have expressed qualified opinion on financial results in this regards.
The Statutory Auditors'' Report contain following qualification on Consolidated financial statements on the basis of Report on the Internal Financial Controls:
Qualification 1: There was weakness in operating effectiveness over system of creation and issuance of purchase order, goods receipt note, accounting of consumption and processing of invoices of the Holding Company which could result into possible adjustments of transactions / balances.
Reply to Qualification 1: The Holding Company has adequate system of creation and issuance of purchase order, goods receipt note, accounting of consumption and processing. In few cases due to man power resource constraint there were some delay on few occasion in creation and issuance of purchase order, goods receipt note, accounting of consumption and processing of invoices. However, Holding Company has proper system of maker checker for processing of PO, GRN and consumption and No GRN and consumption will take place without creation of purchase order. Further management is taking steps to ensure that system operate effectively so that such instances do not occur. On the basis of above there were no material misstatement due to the weakness in operating effectiveness over system of creation and issuance of purchase order, goods receipt note, accounting of consumption and processing of invoices.
Qualification 2: In our opinion, the Holding Company''s system for processing of journal entries into accounting software does not have maker checker system which could result into possible effect to the processing of transactions and its consequential effect on balances.
Reply to Qualification 2: The Holding Company has adequate system of manual approval of processing of journal entries in accounting software and journal entries are also verified by the internal auditor. Holding Company are in process of incorporating the maker checker process in accounting software for processing of journal entries.
It may be noted that there were no material misstatements of account balances due to the weakness in system for processing of journal entries in accounting software due to absence of maker checker system.
Qualification 3: SIPL, one of the subsidiary Company''s internal processes with regards to the confirmation and reconciliation of trade payables, trade receivables, other incidental balances pertaining to the said trade payables and trade receivables are not operating effectively which could result into possible adjustments of balances.
The auditor of SIPL have expressed qualified opinion on the internal financial controls over financial reporting for the year ended March 31, 2023 vide their report dated May 28, 2023.
Reply to Qualification 3: SIPL, one of the subsidiary company''s has adequate system for balance confirmation of trade payable and receivables. The SIPL is reconciling the outstanding balance of trade payables and receivables on regular intervals. The SIPL has an internal audit system which is commensurate with the size and nature of its business and there is no weakness in recognition of income and expenses Further as part of internal audit scope such balances are also reviewed by them and hence possibility of misstatement is not there.
Qualification 4: SIPL, one of the subsidiary Company''s system for processing of journal entries into accounting software does not have maker checker system which could result into possible effect to the processing of transactions and its consequential effect on balances.
The auditor of SIPL have expressed qualified opinion on the internal financial controls over financial reporting for the year ended March 31, 2023 vide their report dated May 28, 2023.
Reply to Qualification 4: SIPL, one of the subsidiary company''s has adequate system of manual approval of processing of journal entries in accounting software and journal entries are also verified by the internal auditor. The SIPL has an internal audit system which is commensurate with the size and nature of its business. SIPL are in process of incorporating the maker checker process in accounting software for processing of journal entries.
It may be noted that there were no material misstatements due to the weakness in system for processing of journal entries in accounting software due to absence of maker checker system.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder, the Company had appointed M/s. Ravi Kapoor and Associates, Practicing Company Secretaries, Ahmedabad to undertake the Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report is annexed herewith as ''Annexure 1'' to this Report. The adverse remarks by Secretarial auditor and management reply are given below
Secretarial Audit Report contains following observations and Board of Directors of the Company submitted responses for the same as follows.
1. Regulation 17 (1) (c) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 requires that the Board of directors of the top 2000 listed entities shall comprise of not less than six directors. Minimum Directors requirement was not fulfilled by the Company for a period of 80 days. Accordingly, Company was in default of Regulation 17(1)(c) for a period of 80 days from 25th December 2022 till 14th March 2023. To that extent Company has not complied with the said provisions of SEBI LODR Regulations.
2. Pursuant to Section 405 of the Companies Act, 2013 the Central Government made it necessary for all the "Specified Companies" to furnish the Form MSME-1, Half Yearly return about the payment to micro and small enterprise suppliers. However, the Company has not filed the said form for the period ended on 30th September, 2022 and on 31st March, 2023 respectively with Ministry of Corporate Affairs and to that extent not complied with the provisions of the Act.
3. Pursuant to Regulation 31 (1) (b) of SEBI LODR Regulations, the listed entity shall submit to the stock exchange(s) a statement showing holding of securities and shareholding pattern separately for each class of securities, in the format specified by the Board from time to time on a quarterly basis, within twenty-one days from the end of each quarter. There was a delay in Filing of Shareholding Pattern for the Quarter ended June 2022 by 20 days which is in violation of Regulation 31 (1) (b). Thus, Company has not complied with the said provisions of SEBI LODR Regulations to that extent.
4. Pursuant to SEBI Circular no. SEBI/HO/CFD/CMD1/CIR/P/2019/140 dated November 21, 2019, the Company was required to make disclosure with the Stock Exchange(s) with respect to default in payment of interest/repayment of principle amount on loans from Banks/Financial Institutions. However, Information with respect to payment of interest/repayment of principle amount on loans from Banks/Financial Institutions, including delay made if any, is not available and accordingly we are not in a position to identify the deviation, if any on Compliance of SEBI Circular no. SEBI/HO/CFD/CMD1/CIR/P/2019/140 dated November 21, 2019.
Reply of Directors with respect to qualifications / Observations raised by Secretarial Auditors are as under:
1. Reply to qualification No. 1: During the period from 25th December 2022 till 14th March 2023 the Company was in process of identifying the suitable candidate to fill the vacancy created due to expiry of the term of Mr. Arun S. Patel, Independent Director w.e.f. 25th September, 2022. The Board of Directors of Sadbhav Engineering Limited (the Company) in its meeting held on 15th March, 2023 has considered and approved appointment of
Mr. Dwigesh Joshi (DIN: 09733282) as an additional Executive Director of the Company for a period of three (3) years with effect from 15th March, 2023 to 14th March 2026 (both days inclusive) and; Mr. Jatin Thakkar (DIN:09312406) as an additional Non-Executive Director of the Company with effect from 15th March, 2023.
Hence, the composition of Board has been complied pursuant to Regulation 17(1)(c) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable provisions.
And Appointment of above mentioned Directors also approved by the shareholders of the Company through Postal Ballot.
Company has also made payment of Rs. 37,800/- after deduction of TDS Rs. 3,500/- through NEFT on 7th March, 2023 towards fines / penalties.
2. Reply to qualification No. 2: Due to Unavailability of required information from the MSME Vendors, Company was not able to file the Half yearly return of MSME-1 during the year with the Ministry of Corporate Affairs. No Vendor has declared that they have registered with MSME.
3. Reply to qualification No. 3: Due to Inadvertent circumstances, there was a delay of 20 days in Filing of Shareholding Pattern for the quarter ended 30-06-2023. However, the Company have submitted the Shareholding Pattern to the Stock Exchange after 20 days. Also Company has paid Rs. 47,200/- each to BSE Limited and National Stock Exchange of India Limited through NEFT on 02nd September, 2022 towards fines / penalties for non-submission of shareholding pattern within time period under regulations 31 (1) (b) of SEBI LODR Regulations.
4. Reply to qualification No. 4: This matter is strictly confidential & being reported by the Internal Auditor to the Board of Directors but all the issues are merely operational and not having any material adverse impact on the company.
The Board had, on the recommendation of the Audit Committee, appointed M/s Rajendra Patel & Associates, Cost Accountants, Ahmedabad to audit the cost records of the Company for the financial year 2022-2023 on a remuneration of Rs. 75,000/-p.a. The Cost Audit Report for the year 2022-2023 will be filed before the due date with the Ministry of Corporate Affairs. As required under the Act and Rules made thereunder, the remuneration payable to the Cost Auditors is required to be placed before the Members in a general meeting for ratification. Accordingly, a resolution seeking ratification by members for the remuneration payable to M/s.Rajendra Patel & Associates is included at Item No. 3 of the Notice convening 34th Annual General Meeting.
Compliance with Secretarial Standards
The Company is in compliance with the Secretarial Standards on Meeting of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India and approved by the Central Government.
Reporting of Frauds by Auditors
During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditor have not reported any instances of fraud committed against your Company by its officers or employees to the Audit Committee or the Board, under Section 143(12) of the Act.
As per Regulation 27 of SEBI (LODR) Regulations, 2015, a separate section on Corporate governance practices followed by the Company, together with a certificate from M/s. Ravi Kapoor & Associates, Practicing Company Secretaries, Ahmedabad, confirming compliance conditions of Corporate Governance forms an integral part of this Report.
Management Discussion and Analysis (MDA)
MDA, for the year under review, as stipulated under Regulation 34(2)(e) of SEBI (LODR) Regulations, 2015 with the Stock Exchanges is presented in a separate section, which forms a part of the Annual Report.
Corporate Social Responsibility
The Annual Report on CSR activities is annexed as Annexure-2 to this Report. The CSR policy is available on the https://www. sadbhaveng.com/wp-content/uploads/2021/09/Corporate-Social-Responsibilitv-Policv.pdf
Particulars of Employees and related disclosures
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 attached as ''Annexure - 3'' which forms part of this report.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as ''Annexure 4'' which forms part of this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo
The rules regarding conservation of Energy and Technology Absorption are not applicable to the Company. However, details of Foreign Exchange Earnings and Outgo are mentioned below:
Foreign Exchange Earnings: Nil Foreign Exchange Outgo: Nil
Particulars of Loans, Guarantees or Investments
The provisions of Section 186 (except sub-section) of the Companies Act, 2013, with respect to a loan, guarantee or security is not applicable to the Company as the Company is engaged in providing infrastructural facilities. The details of investment made during the year under review are disclosed in the financial statements.
Contracts and Arrangements with Related Parties
All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm''s length basis. Particulars of contract / arrangement / transaction entered into by the Company with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions forms integral part of this report in form AOC-2 as per ''Annexure - 4''.
The Company in terms of Regulation 23 of SEBI (LODR) Regulations, 2015, submits within 15 days from the date of publication of its standalone and consolidated financial results for the half year, disclosures of related party transactions on a consolidated basis for the half yearly period upto March 31, 2023, in the format specified in the relevant accounting standards for annual results to the stock exchanges. The said disclosures can be accessed on the website of the Company at www.sadbhaveng.com.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company ''s website at the link: https://www.sadbhavene.com/wp-content/uploads/2021/09/RELATED-PARTY-TRANSACTION-POLICY.pdf Your Directors draw attention of the members to notes no.46 to the Standalone Financial Statements which sets out related party disclosures.
Pursuant to the provisions of Section 92 (3) of the Companies Act, 2013, read with Companies (Management and Administration) Rules, 2014, Company has placed Annual Return in Form MGT-7 for the financial year ended on March 31, 2023 on the website of the Company at www. sadbhavene. com and the same can be addressed at weblink
https://www.sadbhaveng.com/investors/#aem-egm-documents
The Company has designed and implemented a process driven framework for Internal Financial Controls [IFC] within the meaning of the explanation to section 134[5][e] of the Act. For the year ended on March 31, 2023, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implement new and/ or improved controls whenever the effect of such gaps would have a material effect on the Company''s operations.
Business Responsibility and Sustainability Reporting
As our Company does not fall in one thousand listed entities based on market capitalization as on 31st March, 2022, therefore, Business Responsibility and Sustainability Reporting does not applicable to our company.
During the year under review, your Company has not accepted any fixed deposits from the public Pursuant to Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014. Thus, as on 31st March, 2023, there were no deposits which were unpaid or unclaimed and due for repayment.
Code for Prevention of Insider Trading
Your Company has adopted a Code of Conduct to regulate, monitor and report trading by designated persons and their immediate relatives as per the requirements under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code for practices and procedures or fair disclosure of unpublished price sensitive information which has been made available on the Company''s website at www.sadbhaveng.com.
The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year alongwith their status as at the end of the financial year
Insolvency Proceedings to which Company is/was Respondent mentioned below: |
||
Sr. No. Particulars Type of Creditor |
Status as at |
the end of financial year |
1 LSC Infratech Limited Operational Creditor |
Pending before the |
Hon''ble NCLT Bench, Ahmedabad |
2 Sany Heavy Industry India Pvt. Ltd # Operational Creditor |
Settled & Closed on 29.03.2023 |
|
Shri Ganesh Enterprise through Suresh 3 Operational Creditor ....... Gupta Proprietor ....... |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
4 Tirupati Driling & Mining Services Pvt Ltd Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
5.....Rishabh Infra ........... Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
6.....Strata Geosystems India Pvt. Ltd Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
7 B K B Transport Private Limited Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
8 S S Infra Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
9 Krishna Trades Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
10 D. THAKKAR CONSTRUCTION PVT LTD Operational Creditor |
Pending before th |
e Hon''ble NCLT Bench, Mumbai |
11 RKD Constructions Pvt. Ltd. Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
12 Automark Industries India Pvt. Ltd Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
13 Almondz Global Infra-Consultant Ltd Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
14 OFB Tech Private Limited # Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
15 Kunal Conchem Operational Creditor |
Pending before the Hon''ble NCLT Bench, Ahmedabad |
|
16 Metro Infrasys Private Limited Operational Creditor |
Pending before the |
Hon''ble NCLT Bench, Ahmedabad |
17 Suwarna Buildcon Private Limited (4) ...... Operational Creditor |
Pending before the |
Hon''ble NCLT Bench, Ahmedabad '' |
rheoplAst TECHNOLOGY PRIVATE .............. 18 LIMITED Operational Creditor |
Pending before the |
Hon''ble NCLT Bench, Ahmedabad |
19 KUMAON GASES PRIVATE LIMITED Operational Creditor |
Pending before the |
Hon''ble NCLT Bench, Ahmedabad |
# Till the date of this report the matter has been settled and disposed off. |
The Details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof Not Applicable during the year under review.General
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
4. Neither the Managing Director nor the Whole-time Directors of the Company receive any commission from the Company and not disqualified from receiving any remuneration or commission from any of subsidiaries of the Company.
5. All properties and insurable interests of the company to the extent required have been adequately insured.
6. No significant and material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Company''s future operations.
The Company maintained healthy, cordial and harmonious industrial relations at all levels. The enthusiasm and unstinting efforts of employees have enabled the Company to remain at the leadership position in the industry and the Management appreciates the employees of all cadres for their dedicated services to the Company.
Your Directors place on record their gratitude to the Ministry of Corporate Affairs, BSE Limited, National Stock Exchange of India Limited, Securities and Exchanges Board of India, Central Government, State Governments and Company''s Bankers for the assistance, co-operation and encouragement they extended to the Company. Your Directors also wish to place on record their sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, supplier, sub-contractors, business associates and employees in ensuring an excellent all around operational performance.
Mar 31, 2018
To,
The Members,
The Directors have the pleasure in presenting the Twenty Ninth Annual Report together with the audited financial statements for the year ended March 31, 2018.
Financial Results
The Companyâs financial performance for the Year ended on March 31, 2018 is summarized below:
(Rs. in crores)
Particulars |
Standalone |
Consolidated |
|||||
Current Year 2017-2018 |
Previous Year 2016-2017 |
Current Year 2017-2018 |
Previous Year 2016-2017 |
||||
Total Revenue |
3594.76 |
3407.84 |
5093.38 |
4654.18 |
|||
Profit before Finance Cost, Depreciation & amortization Expense and Tax Expense |
504.84 |
443.16 |
1595.30 |
1346.37 |
|||
Less : Finance Cost |
190.67 |
153.44 |
1312.92 |
1187.45 |
|||
Depreciation and amortization Expense |
97.90 |
100.04 |
358.42 |
321.13 |
|||
Profit /(Loss) before Exceptional Item and Tax |
216.27 |
189.68 |
(76.04) |
(162.21) |
|||
Exceptional Item (Net of Income) |
- |
- |
- |
- |
|||
Profit /(Loss) Before Tax |
216.27 |
189.68 |
(76.04) |
(162.21) |
|||
Less : Tax Expenses |
47.36 |
40.48 |
86.96 |
20.61 |
|||
(Less:-Deferred tax liability /(asset) |
(51.75) |
(38.65) |
(48.98) |
(11.17) |
|||
Profit /(Loss) for the period from continuing Operations |
220.66 |
187.85 |
(114.02) |
(171.65) |
|||
Add:- Share of Loss Transferred to Minority Interest |
- |
- |
110.94 |
117.62 |
|||
Net Profit for the period after tax |
220.66 |
187.85 |
(3.08) |
(54.03) |
|||
Balance brought forward from last year |
799.95 |
636.64 |
(244.96) |
(125.03) |
|||
Loss of Subsidiary for earlier year transferred (net) |
0.00 |
0.00 |
0.00 |
0.00 |
|||
Other Comprehensive Income (OCI) |
0.72 |
(1.82) |
0.85 |
(2.68) |
|||
Amount available for Appropriations |
1020.61 |
824.49 |
(248.03) |
(179.08) |
|||
Appropriations |
|
|
|
||||
Transfer to General Reserve |
0.00 |
10.00 |
0.00 |
10.00 |
|||
Proposed Dividend & Tax |
15.49 |
14.46 |
24.01 |
14.46 |
|||
Adjustment Relating to Fixed Assets/Others |
0.00 |
0.07 |
0.00 |
0.07 |
|||
Adjustment on account of acquisition of non controlling interest |
0.00 |
0.00 |
0.00 |
17.08 |
|||
Equity Transactions |
0.00 |
0.00 |
0.00 |
1.84 |
|||
Transfer to Debenture Redemption Reserves |
0.00 |
0.00 |
46.22 |
22.43 |
|||
Closing Balance in Retain earnings |
1005.13 |
799.56 |
(318.26) |
(244.96) |
|||
Dividend
Directors are pleased to recommend dividend of 100% (Rs.1 per equity share of Rs.1 each) for the financial year ended March 31, 2018 (P.Y. 75%) for approval of the shareholders. The final dividend, if approved, will result in cash payout of Rs.17.16 Crores and dividend tax of Rs.3.53 Crores.
Business Overview Standalone Basis
The total revenue during the year under review was Rs.3594.76 Crores against Rs.3407.84 Crores for the previous year resulting the Increase of 5.48%. Profit before Finance Cost, Depreciation & amortization Expense and Tax Expense for the current year is Rs.504.84 Crores (Rs.443.16 Crores in previous year) thereby resulting the increase of 13.92%. Net Profit after tax amounted to Rs.220.66 Crores (Rs.187.85 Crores in previous year) thereby resulting increase of 17.47%.
Consolidated Basis
As per the Consolidated Financial Statements, the Total Income of the company, operating profit (PBDIT), and net loss for the year were Rs.5093.38 Crores, Rs.1595.30 Crores and Rs.114.02 Crores respectively.
Dividend Distribution Policy
The Company has adopted a Dividend Distribution Policy on August 20, 2016, which is available on the website of the Company at the link: http://sadbhaveng.com/wp-content/uploads/2018/02/Dividend Distribution Policy SEL.pdf
There has been no change to the policy during the year 2017-18.
Transfer to Investor Education and Protection Fund
The Company has transferred a sum of Rs.0.12 lakhs to the Investor Education and Protection fund established by the Central Government during the financial year 2017-18, in compliance with Section 124(6) of the Companies Act, 2013. The said amount represents unclaimed dividend amount for the financial year 2009-2010 which were lying with the Company for a period of 7 years from their due dates of payment. Prior to transferring the aforesaid sum, the Company has sent reminders to the shareholders for submitting their claims for unclaimed dividend for the financial year 2009-2010.
Reserves
The Company has not transferred any amount into General Reserve during the period.
Change in the Nature of Business, if any
There are no material changes in the nature of business during the year.
Material changes and commitments affecting financial position between end of the financial year and date of report
There have been no material changes and commitments affecting financial position between end of the financial year and the date of the report.
Operations Ongoing Works
The following major works are under execution and the same are progressing satisfactorily.
(Rs. in crores)
Sector |
No. of projects |
Work order |
Work done |
Work on hand |
Transportation |
38 |
19529.88 |
8754.77 |
10775.11 |
Irrigation |
19 |
2378.52 |
1924.65 |
453.87 |
Mining Operation |
9 |
3020.31 |
999.95 |
2020.36 |
Total |
66 |
4928.71 |
11679.37 |
13249.34 |
The Companyâs order book (pending execution) shows work on hand amounting to Rs.13249.34 crores as on the March 31, 2018. BOT Projects under Implementation
Name of the Company |
Details of Project |
Cost of the Project |
Status as on March 31, 2018 |
% Shareholding (Ownership) |
|
(Rs.in crores) |
Cost incurred (Including Mobilisation and Material Advances) (Rs. in crores) |
SEL |
SIPL |
||
Mysore-Bellary Highway Pvt. Ltd. (MBHPL) |
The DBFOMT (Annuity) project is for the existing State Highway (SH33 & SH3) from Malavalli to Pavagada (Approx length of 193.344 Kms) in the State of Karnataka (WAP-1). |
811.20 |
761.93 |
74 |
- |
Sadbhav Rudrapur Highway Pvt. Ltd. (SRHPL) |
Four Laning of Rampur-Kathgodam section of NH-87 (New NH No. 9) from km 0.000 (km190.000 of NH-24) to km 42.791 (design chainage 43.446) [Package-I] in the State of Uttar Pradesh under NHDP-III on Hybrid Annuity Mode. |
73 |
8.00 |
278.95 |
- 100 |
Sadbhav Nainital Highway Pvt. Ltd.(SNHPL) |
Four Laning of Rampur-Kathgodam section of NH-87 (New NH No. 9, 109) from km 42.791 (design chainage 43.446) to km 88.000 (design chainage 93.226) [Package-II] in the State of Uttarakhand under NHDP-III on Hybrid Annuity Mode. |
65 |
7.00 |
91.34 |
- 100 |
Sadbhav UNA Highway Pvt. Ltd. (SUHPL) |
Four Laning of Una to Kodinar of NH-8E from Km. 180.478 to Km. 221.610 (Design Chainage from Km. 181.450 to Km. 222.400) (Package-V) in the State of Gujarat on Hybrid Annuity Mode under NHDP Phase IV. |
62 |
3.00 |
130.47 |
- 100 |
Sadbhav Bhavnagar Highway Pvt. Ltd. (SBHPL) |
Four Laning of Bhavnagar-Talaja Section of NH-8E from km. 7.090 to km. 53.585 (Design Ch from km. 6.945 to km. 54.990) (Package-I) in the State of Gujarat on Hybrid Annuity Mode under NHDP Phase-IV. |
81 |
9.00 |
269.14 |
- 100 |
Sadbhav Banglore Highway Pvt. Ltd. (SBHPL) |
Two/Four Laning of BRT Tiger Reserve Boundary to Bangalore Section of NH-209 (Existing Chainage from 287.520 to 461.550) in the State of Karnataka to be executed on BOT (Hybrid Annuity) basis under NHDP Phase-IV. |
100 |
8.00 |
135.22 |
- 100 |
Sadbhav Udaipur Highway Pvt. Ltd. (SUHPL) |
Six lane of Greenfield proposed Udaipur Bypass [Connection between NH-76 at existing Km 118 500 at Debri to NH-8 Km 287 400 at Kaya Village (Udaipur bypass length 23.883)] on Hybrid Annuity Mode, Package-IV under NHDP phase V in the State of Rajasthan. |
89 |
1.00 |
140.85 |
- 100 |
Sadbhav Vidarbha Highway Pvt. Ltd. (SVHPL) |
Four laning of Waranga to Mahagaon section of NH-361 from km 253.000 to km 320.580 (Package-I) (Design Length 66.880 Km) in the state of Maharashtra under NHDP Phase-IV on Hybrid Annuity Mode. |
107 |
1.00 |
60.21 |
- 100 |
Sadbhav Jodhpur Ring Road Pvt. Ltd. (SJRPL) |
Four Laning of Dangiywas (km 96.595 of NH-112) to Jajiwal (km 283.500 of NH-65 Nagaur Road) section Package-I (Design length 74.619 km) of Jodhpur Ring Road (In Principally declared NH) in the State of Rajasthan under NHDP Phase-VII. |
110 |
6.00 |
- 100 |
|
Sadbhav Tumkur Highway Pvt. Ltd. (STHPL) |
Four laning of Tumkur - Shivamogga section from Km 121 900 (Banwara) to Km 170 415 (Bettadahalli) of NH-206 on Hybrid Annuity Mode under NHDP Phase-IV in the state of Karnataka. (Package - III). |
100 |
8.00 |
- 100 |
BOT Projects Partial Implementation:
Name of the |
Details of Project |
Cost of |
Status as on March 31, 2018 |
% Shareholding |
||
Company |
the Project |
Cost incurred |
(Ownership) |
|||
(Rs. in |
(Including |
|||||
crores) |
Moblisation |
|||||
|
And |
|||||
|
Material |
SEL |
SIPL |
|||
|
Advances (Rs. in Crores) |
|||||
|
||||||
Maharashtra |
- Modernization and computerization of integrated |
1426.37 |
1625.05 |
^2.63 |
91 |
|
Border Check post Network Ltd. (MBCPL) |
border check posts at 22(Twenty Two) locations in the state of Maharashtra on Build Operate and Transfer (ESOT) Basis. |
|
||||
- The project is in joint venture between Company & its |
|
|||||
associates, SREI Infrastructure Finance Limited and SREI |
|
|||||
Sahaje-village Limited |
|
SEL: Sadbhav Engineeing Limited
SIPL: Sadbhav Infrastructure Project Limited
Revenue Generating BOT Project:
^ By virtue of agreement to be transferred to SIPL.
Notes:
1. In respect of MBHPL - In accordance with the share purchase agreement dated November 03, 2014 our company to Sell 74.00% of the outstanding equity interest to SIPL. However, said transfer is subject to approval from the Government authority.
2. Pursuant to Share Purchase Agreement dated 16.01.2017 entered by the company with D.Thakkar Construction Pvt. Ltd. and DTC Toll Projects Pvt. Ltd. (collectively referred as DTC), Sadbhav Infrastructure Projects Limited (SIPL), a subsidiary company of the company, the company has Sold 3125 shares of Maharashtra Border Check post Network Ltd (MBCPNL) to DTC. However the said shares are pledged with the lenders of MBCPNL, hence Transfer formalities are pending.
In terms of Memorandum of understanding (MOU) dated 17/01/2017 between the company and Sadbhav Infrastructure Projects Limited (SIPL), a subsidiary company of the company, the company has sold 6,590 shares of of Maharashtra Border Check post Network Ltd. (MBCPNL) to SIPL. MBCPNL has received approval from Government Maharashtra for transfer of shares from the company to SIPL. As at reporting date transfer formalities of 6,590 shares are in the process as shares held by the company are being pledged with lenders of MBCPNL.
Employee Stock Option Scheme
The Company implemented the Sadbhav Employee Stock Option Scheme 2008 (ESOS Scheme 2008). The Nomination and Remuneration Committee administers and monitors the Scheme.
The applicable disclosures as stipulated under applicable Rules and Regulations as on March 31, 2018 with regard to Employee Stock Option Plan are provided in âAnnexure 1â forming part of this report.
Company has received certificate from Auditors of Company confirming that scheme has been implemented in accordance with SEBI Regulations and resolution passed by Shareholders. Auditorâs certificate would be placed at Annual General Meeting for inspection by members.
Share Capital
During the year, there was no change in total equity share capital of Rs.17,15,70,800/- (Face Value of Rs.1/- each).
Debentures
The Company raised an aggregate amount of Rs.320 Crores by way of issue of Non-Convertible Debentures on private placement basis. The said Non-Convertible Debentures are listed on the BSE Ltd. The Company has redeemed Rs.236 Crores of Non Convertible Debentures (NCDs) during the year 2017-18. The aggregate Non-Convertible Debentures Outstanding amounts to Rs.84 Crores as on 31st March, 2018. The Company has raised Non Convertible Debentures to the tune of Rs.170 Crores on private placement basis and the same has alloted on June 22, 2018.
Credit Rating
Rating agency Credit Analysis & Research Ltd. (CARE) has assigned CARE A1 (A One plus) to Short Term Facilities / Commercial Papers and CARE A (Single A plus) to additional Long-term facilities and Non Convertible Debentures.
Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.
Subsidiaries, Joint Ventures and Associates Companies
During the year, the Following Companies has become/ceased to be companyâs subsidiaries, joint ventures or associate company.
Sr. No. |
Name of the Subsidiary/ Joint ventures/associate Company |
Period of becoming companyâs subsidiaries, joint ventures or associate company. |
Period of ceasing to companyâs subsidiaries, joint ventures or associate company. |
Remarks, if any |
1 |
Sadbhav Vidarbha Highway Pvt. Ltd. |
24/04/2017 |
N.A. |
Step-down Subsidiary by virtue of incorporation |
2 |
Sadbhav Udaipur Highway Pvt. Ltd. |
23/05/2017 |
N.A. |
Step-down Subsidiary by virtue of incorporation |
3 |
Sadbhav Jodhpur Ring Road Pvt. Ltd. |
03/01/2018 |
N.A. |
Step-down Subsidiary by virtue of incorporation |
4 |
Sadbhav Tumkur Highway Pvt. Ltd. |
20/03/2018 |
N.A. |
Step-down Subsidiary by virtue of incorporation |
Note: Between the end of the financial year 2017-18 and the date of this report, One new wholly owned subsidiary company and Four new step down subsidiaries Companies were incorporate as per mentioned below:
Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014 the report on performance and financial position of subsidiaries, associates and joint venture companies is attached as Annexure in Form AOC 1 prepared under section 129(3) of the Companies Act, 2013 to the consolidated Financial Statements of the Company which forms part of this report.
The Company will keep the separate audited financial statements in respect of each of subsidiaries at the Corporate Office of the Company and its subsidiaries and make them available upon the request by any shareholder of Company. The said financial statements are also available on the website of your Company at http://www.sadbhaveng.com/investors. The Policy for determining material subsidiaries as approved may be accessed on the Companyâs website at the link: http://www.sadbhaveng.com/wp-content/uploads/2018/02/MATERIAL SUBSIDIARY.pdf.
Consolidated Financial Statements
In compliance with the applicable provisions of Companies Act, 2013 including the Indian Accounting Standard (Ind AS)-33 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial year 2017-18.
Board of Directors and Key Managerial Personnel Retirement by Rotation
Mr. Vikram R. Patel and Mr. Vasistha C. Patel, are the directors liable to retire by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment. The directors recommend their reappointment.
Criteria of independence as mentioned under Section 149 (6) of the Companies Act, 2013
The terms and conditions of appointment of Independent Directors are in accordance with the applicable Regulations of the SEBI (Listing Obligations and Disclosure Regulations) Regulations, 2015 and also as per the provisions of the Companies Act, 2013 (Act) read with Schedule IV to the Act.
Your Company has received declaration from all the Independent Directors of the Company as required under Sec. 149(7) confirming that they meet with the criteria of independence provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and there has been no change in the circumstances which may affect their status as Independent Director during the year.
Change in Directors and KMPs
Mr. Sandip A. Sheth, Independent Director resigned from the Company on June 1, 2017. During the year, there was no change in KMPs.
Evaluation of Board Performance
In compliance to the provisions of the Companies Act, 2013 and Regulation 27 of SEBI (LODR) Regulations, 2015 the annual performance evaluation of Board and its Committee was carried out during the year under review. More details on the same are given in the Corporate Governance Report.
Audit Committee
The Audit Committee comprises Directors namely Mr. Sandip V. Patel (Chairman), Mr. Nitin R. Patel, Mr. Atul N. Ruparel and Mr. Arun S. Patel. The composition of the Audit Committee is in compliance with the requirement of Section 177 of the Companies Act, and Regulation 18 of the SEBI (LODR) Regulations, 2015.
Committees of Board
Details of various committees constituted by the Board of Directors as per provisions of the Listing Regulations and Companies Act, 2013 are given in the Corporate Governance Report and forms part of this report.
Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules and no complaint has been received on sexual harassment during the financial year 2017-18. Further Company has complied with the provisions relating to the constitution of Internal Complaint Committee under the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Nomination and Remuneration Policy
The policy on Directorâs appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and also remuneration for Key Managerial Personnel and other employees has been provided under Corporate Governance Report.
Whistle Blower Policy
The Company has a vigil mechanism named Whistle Blower Policy for directors and employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. The details of the said Policy is explained in the Corporate Governance Report and also posted on the website of the Company.
Development and implementation of Risk Management Policy
In accordance with the Regulation 17 of SEBI (LODR) Regulations, 2015, the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the Company by way of Risk Management Policy.
Board of Directors of the Company has identified the risks in two categories i.e. (1) Internal and Business Risk and (2) External Risk. The Management has also envisaged the minimization procedure and its perception in respect of each identified risk.
Further, the Company identifies risks with its degree and control systems are instituted to ensure that the risks in business process are mitigated. The Board provides oversight and reviews the Risk Management Policy periodically. In the opinion of the Board there has been no identification of elements of risk that may threaten the existence of the Company.
Meetings of Board
During the year, Four Board Meetings were held and the details of which are given in the Corporate Governance Report.
Directorsâ Responsibility Statement
Pursuant to the requirement in section 134(3) (c) of the Companies Act, 2013, the Directors state that :
(a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards had been followed and there are no material departures from the same;
(b) the directors had 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 as at March 31, 2018 and of the profit and loss of the Company for the year ended on that date;
(c) the directors had taken proper and sufficient care 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;
(d) the directors had prepared the annual accounts on a going concern basis;
(e) that the directors had laid down internal financial controls to be followed by the company and that the financial controls are adequate and are operating effectively; and
(f) that the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Statutory Auditors
As per Sections 139, 142 and other applicable provisions, if any, of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, as may be applicable and pursuant to the recommendations of the Audit Committee and subject to the approval of the members, The Board has appointed, M/s. Dhirubhai Shah & Co. LLP, Chartered Accountants, Ahmedabad (Firm Registration No. 102511W/W100298), as statutory auditors of the Company, to hold office for the period of Four years from the conclusion of this 29th Annual General Meeting (AGM) until the conclusion of the 33rd AGM to be held in Financial year 2021-22.
The Company has received a certificate that they satisfy the criteria provided under Section 141 of the Companies Act, 2013 and that the appointment, if made, shall be in accordance with the applicable provisions of the Companies Act, 2013 and rules framed thereunder.
There are no qualifications, reservations or adverse remarks made by Statutory Auditors in their report for the Financial Year ended March 31, 2018.
Details in respect of frauds reported by auditors under sub-section (12) of Section 143 other than those which are reported to the central government.
During the year under consideration, there was no such instances.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder, the Company had appointed M/s. Ravi Kapoor and Associates, Practicing Company Secretaries, Ahmedabad to undertake the Secretarial Audit for the financial year 2017-18. The Secretarial Audit Report is annexed herewith as âAnnexure 2â to this Report. There are no qualification, reservations or adverse remarks made by Secretarial Auditors in their report.
Cost Auditors
The Board had, on the recommendation of the Audit Committee, appointed M/s Rajendra Patel & Associates, Cost Accountants, Ahmedabad to audit the cost records of the Company for the financial year 2018-19 on a remuneration of Rs.1,50,000/- p.a. The Cost Audit Report for the year 2017-2018 was filed before the due date with the Ministry of Corporate Affairs. As required under the Act and Rules made thereunder, the remuneration payable to the Cost Auditors is required to be placed before the Members in a general meeting for ratification. Accordingly, a resolution seeking ratification by members for the remuneration payable to M/s Rajendra Patel & Associates is included at Item No. 6 of the Notice convening 29th Annual General Meeting.
Corporate Governance
As per Regulation 27 of SEBI (LODR) Regulations, 2015, a separate section on Corporate governance practices followed by the Company, together with a certificate from the Companyâs Auditors confirming compliance forms an integral part of this Report.
Management Discussion and Analysis (MDA)
MDA, for the year under review, as stipulated under Regulation 34(2)(e) of SEBI (LODR) Regulations, 2015 with the Stock Exchanges is presented in a separate section, which forms a part of the Annual Report.
Corporate Social Responsibility
The Annual Report on CSR activities is annexed to this Report. The CSR policy is available on the website of the Company at the link: http://sadbhaveng.com/wp-content/uploads/2018/02/CORPORATE SOCIAL RESPONSIBILITY.pdf. The CSR activities is annexed herewith as âAnnexure 3â.
Particulars of Employees and related disclosures
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 attached as âAnnexure 4â which forms part of this report.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as âAnnexure 5â which forms part of this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo
The rules regarding conservation of Energy and Technology Absorption are not applicable to the Company. There was no earning and outgo in the foreign currency, while expenditure the particulars of the dividend in foreign currency are given in the notes no. 55 to the Standalone Financial Statements.
Particulars of Loans, Guarantees or Investments
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes no. 7, 17 & 58 to the Standalone Financial Statements.
Contracts and Arrangements with Related Parties
All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis. Particulars of contract / arrangement / transaction entered into by the Company with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions forms integral part of this report in form AOC-2 as per âAnnexure 6â.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at the link: http://sadbhaveng.com/wp-content/uploads/2018/02/RELATED PARTY TRANSACTIONS1.pdf. Your Directors draw attention of the members to notes no. 52 to the Standalone Financial Statements which sets out related party disclosures.
Extract of Annual Return
Extract of Annual Return of the Company is annexed herewith as âAnnexure 7â to this Report.
Internal Financial Controls
The Company has designed and implemented a process driven framework for Internal Financial Controls [IFC] within the meaning of the explanation to section 134(5) (e) of the Companies Act, 2013. For the year ended on March 31, 2018, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implement new and/ or improved controls whenever the effect of such gaps would have a material effect on the Companyâs operations.
Business Responsibility Reporting
As per Regulation 34(2) (f) of the Listing Regulations, 2015, a separate section on Business Responsibility Reporting forms a part of this Annual Report.
General
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this report.
4. Neither the Managing Director nor the Whole-time Directors of the Company receive any commission from the Company and not disqualified from receiving any remuneration or commission from any of subsidiaries of the Company.
5. All properties and insurable interests of the company to the extent required have been adequately insured.
6. No significant and material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Companyâs future operations.
Industrial Relations
The Company maintained healthy, cordial and harmonious industrial relations at all levels. The enthusiasm and unstinting efforts of employees have enabled the Company to remain at the leadership position in the industry and the Management appreciates the employees of all cadres for their dedicated services to the Company.
Acknowledgments
Your Directors place on record their gratitude to the Central Government, State Governments and Companyâs Bankers for the assistance, co-operation and encouragement they extended to the Company. Your Directors also wish to place on record their sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, suppliers, sub-contractors, business associates and employees in ensuring an excellent all around operational performance.
For and on behalf of the Board of Directors
Shashin V. Patel
Place : Ahmedabad Chairman & Managing Director
Date : August 13, 2018 DIN: 00048328
Mar 31, 2017
To
The Members,
The Directors have the pleasure in presenting the Twenty Eighth Annual Report together with the audited financial statement for the year ended March 31, 2017
Financial Results
The Company''s financial performance for the Year ended on March 31, 2017 is summarized below:
(Rs,in crores)
(Rupees in Millions)
Particulars |
Standalone |
Consolidated |
||
Current Year 2016-2017 |
Previous Year 2015-2016 |
Current Year 2016-2017 |
Previous Year 2015-2016 |
|
Total Revenue |
3407.84 |
3283.26 |
4654.18 |
4132.46 |
Operating Profit before Finance Cost, Depreciation and amortization Expense and Tax Expense |
443.16 |
431.80 |
1346.37 |
1066.96 |
Less: Finance Cost |
153.44 |
150.73 |
1187.45 |
1075.17 |
Depreciation and amortization Expense |
100.04 |
97.06 |
321.13 |
232.61 |
Profit /(Loss) before Exceptional Item and Tax |
189.68 |
184.01 |
01 (162.21) |
(240.82) |
Exceptional Item (Net of Income) |
- |
(19.45) |
- |
42.15 |
Profit /(Loss) Before Tax |
189.68 |
164.56 |
(162.21) |
(198.67) |
Less : Tax Expenses |
40.48 |
37.77 |
20.61 |
18.12 |
(Less:-Deferred tax liability /(asset) |
(38.65) |
(5.23) |
(11.17) |
3.75 |
Profit /(Loss) for the period from continuing Operations |
187.85 |
132.01 |
(171.65) |
(220.54) |
Add:- Share of Loss Transferred to Minority Interest |
- |
- |
117.62 |
117.26 |
Net Profit for the period after tax |
187.85 |
132.01 |
(54.03) |
(103.28) |
Balance brought forward from last year |
636.64 |
529.08 |
125.03) |
(6.51) |
Loss of Subsidiary for earlier year transferred (net) |
0.00 |
0.00 |
0.00 |
9.21 |
Other Comprehensive Income (OCI) |
(1.82) |
0.60 |
(2.68) |
0.72 |
Amount available for Appropriations |
824.49 |
661.09 |
(179.06) |
(100.58) |
Transfer to General Reserve |
10.00 |
10.00 |
10.00 |
10.00 |
Proposed Dividend & Tax |
14.46 |
14.45 |
14.46 |
14.45 |
Adjustment Relating to Fixed Assets/Others |
0.07 |
0.00 |
0.07 |
0.00 |
Transfer to General Reserve |
10.00 |
10.00 |
10.00 |
10.00 |
Equity Transactions |
0.00 |
0.00 |
1.93 |
0.00 |
Transfer to Debenture Redemption Reserves |
0.00 |
0.00 |
22.43 |
0.00 |
Closing Balance in Retain earnings |
799.56 |
(636.64 |
(244.94) |
(125.03) |
Dividend
Directors are pleased to recommend dividend of 75% (Re 0.75 per equity share of Re 1 each) for the financial year ended March 31, 2017 (P.Y. 70%) for approval of the shareholders. The final dividend, if approved, will result in cash payout of Rs, 12.01 Crores and dividend tax of Rs 2.45 Crores.
Dividend Distribution Policy
Securities and Exchange Board of India (''SEBI''), by its notification dated 8th July, 2016, has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''Listing Regulations''), introducing new Regulation 43A mandating the top 500 listed entities, based on market capitalization calculated as on 31st March of every financial year, to formulate a Dividend Distribution Policy and disclose the same in their Annual Reports and on their websites.
Dhule-Palesner Design, Engineering, Finance, Procuremen Tollway Ltd. (DPTL) Construction, Operation and Maintenance of 4/6 lanin of MP/ Maharashtra Border-Dhule section of NH-3 fror km 168.500 to km 265.000 (89 Kms) in the State Maharashtra under NHDP Phase IIIA on BOT (Toll) Basi |
t, 1420.00 169.03 g m f s. |
- 100 |
Bijapur-Hungund Four laning of Bijapur-Hungund Section of NH-13 fror Tollway Private Ltd. km 102.000 to km 202.000 (97.22Kms) in the stat (BHTPL) of Karnataka on Design, Build, Finance, Operate an Transfer ("DBFOT"), Toll basis. |
m 1322.61 115.85 e d |
- 77 |
Hyderabad-Yadgiri Design, Engineering, Construction, Developmen Tollway Private Finance, Operation and Maintenance of four lanin Ltd. (HYTPL) of Hyderabad- Yadgiri Section from km 18.600 to kr 54.000 (36.65Kms) of NH-202 in the state of Andhr Pradesh under NHDP Phase-III on DBFOT (Toll) Bas Package No. NHDP-III/ BOT/AP/04. |
t, 506.40 56.91 g m a is |
- 100 |
Maharashtra Modernization and computerization of integrate Border Check border check posts at 22 (Twenty Two) locations in th Post Network Ltd. State of Maharashtra on Build Operate and Transfe (MBCPL) (BOT) Basis. Toll collection has been started in 13 out 22 Check Posts. |
d 1426.37 157.24 A2.6 e >r f |
53 91 |
Rohtak-Panipat Four laning of Rohtak to Panipat Section of NH-71A fror Tollway Pvt. Ltd. k.m. 0.000 km 63.30 of NH-10 to km 80.858 km 83.50 (RPTPL) NH-1 in the state of Haryana (80.85 Kms) on BOT bas under NHDP phase-III. |
m 1240.10 90.84 is |
- 100 |
Shreenathji- Four Laning of Gomati Chauraha - Udaipur section Udaipur Tollway NH-8 (from Km 177/000 to Km 260/100) in the state Private Limited Rajasthan under NHDP Phase IV. (SUTPL) |
f 1151.46 103.15 |
- 100 |
Bhilwara- Four laning of Rajsamand - Bhilwara Section of NH-75 Rajsamand Tollway (from km 0.000 to km 87.250) under NHDP Phase IV Pvt. Ltd. (BRTPL) the State of Rajasthan on DBFOT (Toll) Basis. |
8 677.86 32.92 n |
- 100 |
Rohtak-Hissar The project consists of "4 - Laning of Rohtak to Hissa Tollway Pvt. Ltd. Section of NH-10 from Km 87.000 to km 170.00 (RHTPL) including connecting link from km 87.000 (NH-10) t km 348.000 (NH-71) to be executed as BOT (Toll) proje on DBFOT pattern under NHDP Phase III in the state Haryana (Length 98.810 Km). |
ir 1270.96 38.97 0 o :t f |
- 100 |
* In respect of MBHPL - In accordance with the share purchase agreement dated November 03, 2014 our company to Sell 74.00% of the outstanding equity interest to SIPL. However, said transfer is subject to approval from the Government authority.
** In terms of Memorandum of Understanding (MOU) dated January 17, 2017 between the Company and Sadbhav Infrastructure Project Limited (SIPL), SEL reduced its commitment, to sell investment in MBCPNL to third party, from 22% to 9% and resultantly, transferred such 13% ownership/beneficial ownership in MBCPNL to the SIPL, raising SIPL holding to 91%. SEL reaffirms that consideration received by it aggregating to INR 280.13 Million, is towards transfer of entire ownership of 91% in MBCPNL, and hence, no further payment is required to be made by SIPL to SEL. The procedural formalities for transfer of equity shares were in progress as on the date of balance sheet.
By virtue MOU pending transfer from Sadbhav Engineering Limited to Sadbhav Infrastructure Project Limited.
Employee Stock Option Scheme
The Company implemented the Sadbhav Employee Stock Option Scheme 2008 (ESOS Scheme 2008). The Nomination and Remuneration Committee administers and monitors the Scheme.
The applicable disclosures as stipulated under applicable Rules and Regulations as on March 31, 2017 with regard to Employee Stock Option Plan are provided in ''Annexure 1'' forming part of this report.
Company has received certificate from Auditors of Company confirming that scheme has been implemented in accordance with SEBI Regulations and resolution passed by Shareholders. Auditor''s certificate would be placed at Annual General Meeting for inspection by members.
Share Capital
During the year, the total paid-up equity share capital of the company has been increased from Rs, 17,15,33,800 - to Rs, 17,15,70,800/on account of allotment of 37,000 equity shares of Re. 1/- each at a premium of Rs, 49 per share to the employees of the Company under Sadbhav Employee Stock Option Scheme 2008 (ESOS Scheme 2008).
Debentures
The Company raised an amount of Rs, 320 Crores by way of issue of Non-Convertible Debentures on private placement basis. The said Non-Convertible Debentures are listed on the BSE Ltd. The aggregate Non-Convertible Debentures Outstanding amounts to 255.89 crores as on 31st March, 2017.
Credit Rating
Rating agency Credit Analysis & Research Ltd. (CARE) assigned CARE A1 (A One plus) to additional Short-term Bank facilities of Rs, 20 Crores and reaffirmed CARE A ; stable (Single A plus; Outlook: Stable) to additional Long-term Bank facilities of Rs, 110 Crores.
Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.
Subsidiaries, Joint Ventures and Associates Companies
During the year, the Following Companies has become/ceased to be company''s subsidiaries, joint ventures or associate company.
Sr. No. |
Name of the Subsidiary/ Period of becoming Period of ceasing to Remarks, if any Joint ventures/associate company''s subsidiaries, company''s subsidiaries, Company joint ventures or joint ventures or associate company. associate company. |
1 |
Sadbhav Rudrapur 01/05/2016 N.A. Step-down Subsidiary Highway Pvt. Ltd. by virtue of incorporation |
2 |
Sadbhav Nainital 01/05/2016 N.A. Step-down Subsidiary Highway Pvt. Ltd. by virtue of incorporation |
3 |
Sadbhav UNA Highway 22/06/2016 N.A. Step-down Subsidiary Pvt. Ltd. by virtue of incorporation |
4 |
Sadbhav Bhavnagar 20/06/2016 N.A. Step-down Subsidiary Highway Pvt. Ltd. by virtue of incorporation |
5 |
Sadbhav Banglore 29/10/2016 N.A. Step-down Subsidiary Highway Pvt. Ltd. by virtue of incorporation |
Note: Between the end of the financial year 2016-17 and the date of this report, two new wholly owned subsidiary companies i.e. Sadbhav Vidarbha Highway Private Limited and Sadbhav Udaipur Highway Private Limited, were incorporated with an object to execute highway projects as per the concessions agreements signed with NHAI.
Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014 the report on performance and financial position of subsidiaries, associates and joint venture companies is attached as Annexure in Form AOC 1 prepared under section 129(3) of the Companies Act, 2013 to the consolidated Financial Statements of the Company which forms part of this report.
The Company will keep the separate audited financial statements in respect of each of subsidiaries at the Corporate Office of the Company and its subsidiaries and make them available upon the request by any shareholder of Company. The said financial statements are also available on the website of your Company at http://www.sadbhaveng.com/investors. The Policy for determining material subsidiaries as approved may be accessed on the Company''s website at the link: http://www.sadbhaveng.com/wp-content/ uploads/2016/01/MATERIAL SUBSIDIARY.pdf.
Consolidated Financial Statements
In compliance with the applicable provisions of Companies Act, 2013 including the Indian Accounting Standard (Ind AS)-33 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial year 2016-17.
Board of Directors and Key Managerial Personnel Retirement by Rotation
Mr. Nitin R. Patel and Mr. Vipul H. Patel, are the directors liable to retire by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment. The directors recommend their reappointment.
Appointments
The Board, on recommendation of Nomination & Remuneration Committee and subject to approval of members in ensuing Annual General Meeting, appointed/reappointed the followings:
1. Reappointed Mr. Arun S. Patel as Independent Director of the Company, on expiring of his first term as Independent Director, to hold office for further 5 (five) consecutive years for a second term from 26/09/2017 to 25/09/2022 under the Companies Act, 2013 and SEBI (LODR) 2015.
2. Appointed Mr. Shashin V. Patel as Chairman and Managing Director of the Company and Key Managerial Personnel for period of 3 years w.e.f. 01.07.2017.
3. Reappointed Mr. Nitin R. Patel as Whole-time Director designated as an Executive Director of the Company for further period of 3 years w.e.f. 01.07.2017.
4. Reappointed Mr. Vasistha C. Patel as Whole-time Director designated as an Executive Director of the Company for further period of 3 years w.e.f. 01.10.2017.
5. Reappointed Mr. Vikram R. Patel as Whole-time Director designated as an Executive Director of the Company for further period of 3 years w.e.f. 01.10.2017.
Resignation
Pursuant to section 168 of the Companies Act, 2013 Mr. Vishnubhai M. Patel Chairman and Managing Director of the Company resigned due to Health Condition w.e.f. 03-03-2017. The Board at its meeting held on 03-03-2017 had Conferred the honorary title of "Chairman Emeritus" to Mr. Vishnubhai M. Patel for his valuable service to the company since its incorporation.
Mr. Sandip A. Sheth, Independent Director resigned from the company w.e.f .01-06-2017 due to pre-occupancy of his professional. The Board places on record its deep sense of appreciation on valuable contribution made by outgoing director during his tenure on the Board.
Criteria of independence as mentioned under Section 149 (6) of the Companies Act, 2013
The terms and conditions of appointment of Independent Directors are in accordance with the applicable Regulations of the SEBI (Listing Obligations and Disclosure Regulations) Regulations, 2015 and also as per the provisions of the Companies Act, 2013 (Act) read with Schedule IV to the Act.
Your Company has received declaration from all the independent Directors of the Company as required under Sec. 149(7) confirming that they meet with the criteria of independence provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 and there has been no change in the circumstances which may affect their status as Independent Director during the year.
Evaluation of Board Performance
In compliance to the provisions of the Companies Act, 2013 and Regulation 27 of SEBI (LODR) Regulations, 2015 the annual performance evaluation of Board and its Committee was carried out during the year under review. More details on the same are given in the Corporate Governance Report.
Audit Committee
The Audit Committee comprises Directors namely Mr. Sandip V. Patel (Chairman), Mr. Nitin R. Patel, Mr. Atul N. Ruparel and Mr. Arun S. Patel. The composition of the Audit Committee is in compliance with the requirement of Section 177 of the Companies Act, and Regulation 18 of the SEBI (LODR) Regulations, 2015.
Committees of Board
Details of various committees constituted by the Board of Directors as per provisions of the Listing Regulations and Companies Act, 2013 are given in the Corporate Governance Report and forms part of this report.
Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules and no complaint has been received on sexual harassment during the financial year 2016-17.
Nomination and Remuneration Policy
The policy on Director''s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and also remuneration for Key Managerial Personnel and other employees has been provided under Corporate Governance Report.
Whistle Blower Policy
The Company has a vigil mechanism named Whistle Blower Policy for directors and employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Company''s code of conduct or ethics policy. The details of the said Policy is explained in the Corporate Governance Report and also posted on the website of the Company.
Development and implementation of Risk Management Policy
In accordance with the Regulation 17 of SEBI (LODR) Regulations, 2015, the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the Company by way of Risk Management Policy.
Board of Directors of the Company has identified the risks in two categories i.e. (1) Internal and Business Risk and (2) External Risk. The Management has also envisaged the minimization procedure and its perception in respect of each identified risk.
Further, the Company identifies risks with its degree and control systems are instituted to ensure that the risks in business process are mitigated. The Board provides oversight and reviews the Risk Management Policy periodically. In the opinion of the Board there has been no identification of elements of risk that may threaten the existence of the Company.
Meetings of Board
During the year, Seven Board Meetings were held and the details of which are given in the Corporate Governance Report. Directors'' Responsibility Statement
Pursuant to the requirement in section 134(3) (c) of the Companies Act, 2013, the Directors state that :
(a) in the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards have been followed and there are no material departures from the same;
(b) the directors 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 as at March 31, 2017 and of the profit and loss of the Company for the year ended on that date;
(c) the directors have taken proper and sufficient care 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;
(d) the directors have prepared the annual accounts on a going concern basis;
(e) that the directors have laid down internal financial controls to be followed by the company and that the financial controls are adequate and are operating effectively; and
(f) that the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Statutory Auditors
As per Section 139 and Section 142 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the term of M/s. Surana Maloo & Co., Chartered Accountants, Ahmedabad having Firm Registration No. 112171W as the Statutory Auditors of the Company expires at the conclusion of the ensuing Annual General Meeting (AGM) of the Company. The Board of Directors of the Company at its meeting held on August 14, 2017, on the recommendation of the Audit Committee and subject to approval of the members, has appointed M/s. Dhirubhai Shah & Doshi, Chartered Accountants (Firm Registration No 102511W) as the Statutory Auditors of the Company from the conclusion of 28th AGM of the Company till the conclusion of 29th AGM to be held in the Calendar year 2018.
The Company has received a certificate that they satisfy the criteria provided under Section 141 of the Companies Act, 2013 and that the appointment, if made, shall be in accordance with the applicable provisions of the Companies Act, 2013 and rules framed thereunder.
There are no qualifications, reservations or adverse remarks made by Statutory Auditors in their report for the Financial Year ended March 31, 2017.
Details in respect of frauds reported by auditors under sub-section (12) of Section 143 other than those which are reported to the central government.
During the year under consideration, there was no such instances.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules made there under, the Company had appointed M/s. Ravi Kapoor and Associates, Practicing Company Secretaries, Ahmadabad to undertake the Secretarial Audit for the financial year 2016-17. The Secretarial Audit Report is annexed herewith as ''Annexure 2'' to this Report. The Board is of the opinion that the Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Cost Auditors
The Board had, on the recommendation of the Audit Committee, appointed M/s Rajendra Patel & Associates, Cost Accountants, Ahmadabad to audit the cost records of the Company for the financial year 2017-18 on a remuneration of Rs, 1,50,000/-p.a. The Cost Audit Report for the year 2015-2016 was filed before the due date with the Ministry of Corporate Affairs. As required under the Act and Rules made there under, the remuneration payable to the Cost Auditors is required to be placed before the Members in a general meeting for ratification. Accordingly, a resolution seeking ratification by members for the remuneration payable to M/s Rajendra Patel & Associates is included at Item No. 14 of the Notice convening 28th Annual General Meeting.
Corporate Governance
As per Regulation 27 of SEBI (LODR) Regulations, 2015, a separate section on Corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forms an integral part of this Report.
Management Discussion and Analysis (MDA)
MDA, for the year under review, as stipulated under Regulation 34(2)(e) of SEBI (LODR) Regulations, 2015 with the Stock Exchanges is presented in a separate section, which forms a part of the Annual Report.
Corporate Social Responsibility
The Annual Report on CSR activities is annexed to this Report. The CSR policy is available on the http://sadbhaveng.com/wp-content/ uploads/2016/Q1/CORPORATE SOCIAL RESPONSIBILITY.pdfof the Company. The CSR activities is annexed herewith as ''Annexure 3''.
Particulars of Employees and related disclosures
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 attached as ''Annexure 4'' which forms part of this report.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as ''Annexure 5'' which forms part of this report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo
The rules regarding conservation of Energy and Technology Absorption are not applicable to the Company. There was no earning and outgo in the foreign currency, while expenditure the particulars of the dividend in foreign currency are given in the notes no. 55 to the Standalone Financial Statements.
Particulars of Loans, Guarantees or Investments
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes no. 7, 17 & 58 to the Standalone Financial Statements.
Contracts and Arrangements with Related Parties
All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm''s length basis. Particulars of contract / arrangement / transaction entered into by the Company with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions forms integral part of this report in form AOC-2 as per ''Annexure 6''.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link: http://sadbhaveng.com/wp-content/uploads/2016/01/RELATED PARTY TRANSACTIONS1.pdf. Your Directors draw attention of the members to notes no. 52 to the Standalone Financial Statements which sets out related party disclosures.
Extract of Annual Return
Extract of Annual Return of the Company is annexed herewith as ''Annexure 7'' to this Report.
Internal Financial Controls
The Company has designed and implemented a process driven framework for Internal Financial Controls [IFC] within the meaning of the explanation to section 134[5][e] of the Act. For the year ended on March 31, 2017, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implement new and/ or improved controls whenever the effect of such gaps would have a material effect on the Company''s operations.
Business Responsibility Reporting
As per Regulation 34[2][f] of the Listing Regulations, 2015, a separate section on Business Responsibility Reporting forms a part of this Annual Report.
General
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this report.
4. Neither the Managing Director nor the Whole-time Directors of the Company receive any commission from the Company and not disqualified from receiving any remuneration or commission from any of subsidiaries of the Company.
5. All properties and insurable interests of the company to the extent required have been adequately insured.
6. No significant and material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Company''s future operations.
Industrial Relations
The Company enjoyed cordial relations with the employees during the year under review and the Management appreciates the employees of all cadres for their dedicated services to the Company.
Acknowledgments
The Directors wish to express their appreciation for the support and co-operation of the Central and State Government, Bankers, Financial Institutions, Suppliers, Vendors, Associates, Subcontractors and Shareholders during the year under review. Your Directors wish to place on record their appreciation for the employees of the Company at all levels for their commitment, dedication and continued support to the Company.
For and on behalf of the Board of Directors
Place : Ahmadabad Shashin V. Patel
Date : August 14, 2017 Chairman & Managing Director
DIN : 00048328
Mar 31, 2014
Dear Members,
The Directors have the pleasure in presenting the Twenty Fifth Annual
Report together with the audited statement of accounts for the year
ended March 31, 2014.
Financial Results (Rs. in crores)
Stand Alone
Current Year Previous Year
2013-2014 2012-2013
Income from Operations 2358.12 1810.99
Profit before Finance Cost,
Depreciation & amortization 285.83 166.09
Expense and Tax Expense
Less : Finance Cost 118.11 84.37
Depreciation and amortization Expense 47.40 31.82
Profit / (Loss) before Exceptional
Item and Tax 120.31 49.90
Exceptional Items (Performance Bonus) (38.35) 60.94
Profit / (Loss) Before Tax 81.96 110.84
Less: Current Tax (9.44) 28.53
Deferred tax liability / (asset) 3.98 8.24
Add: Excess / (Short) provision for
taxation of earlier years (18.74) 0.00
Profit / (Loss) for the period from
continuing Operations 106.16 74.07
Add:- Minority Interest - -
Less:- Share of Loss of Associates - -
Net Profit for the year 106.16 74.07
Balance brought forward from last year 429.78 373.74
Addition due to Increase in Stake - -
Amount available for Appropriations 535.94 447.81
Appropriations
Transfer to General Reserve 10.00 7.50
Transfer to Debenture Redemption Reserve 2.00 0
Dividend on Preference Shares
waivered by Shareholders - -
Proposed Dividend 10.64 9.06
Tax on Proposed Dividend 1.88 1.47
Balance carried to Balance Sheet 511.42 429.78
Financial Results (Rs. in crores)
Consolidated
Current Year Previous Year
2013-2014 2012-2013
Income from Operations 2732.52 2159.59
Profit before Finance Cost,
Depreciation & amortization 476 17 432 27
Expense and Tax Expense
Less : Finance Cost 455.46 304.20
Depreciation and amortization Expense 130.48 170.69
Profit / (Loss) before Exceptional
Item and Tax (109.77) (42.62)
Exceptional Items (Performance Bonus) 121.72 60.94
Profit / (Loss) Before Tax 11.95 18.32
Less: Current Tax 0.61 35.43
Deferred tax liability / (asset) 3.97 8.23
Add: Excess / (Short) provision for
taxation of earlier years (18.70) 0.21
Profit / (Loss) for the period from
continuing Operations 26.07 (25.13)
Add:- Minority Interest 18.15 37.37
Less:- Share of Loss of Associates 0.15 (4.76)
Net Profit for the year 44.37 7.48
Balance brought forward from last year 287.99 290.96
Addition due to Increase in Stake 0 7.56
Amount available for Appropriations 332.36 306.00
Appropriations
Transfer to General Reserve 10.00 7.50
Transfer to Debenture Redemption Reserve 2.00 0
Dividend on Preference Shares
waivered by Shareholders 0 (0.02)
Proposed Dividend 10.64 9.06
Tax on Proposed Dividend 1.88 1.47
Balance carried to Balance Sheet 307.84 287.99
Dividend
The Directors are pleased to recommend for approval of the shareholders
dividend of 0.70% (Rs. 0.70 per equity share of Re. 1 each) for the
financial year ended March 31, 2014. The final dividend, if approved,
will result in cash payout of Rs. 10.64 Crores and dividend tax of Rs.
1.88 Crores.
Business Overview
Standalone Basis
The total income from operations during the year under review was Rs.
2358.12 Crores against Rs. 1810.99 Crores for the previous year
resulting the Increase of 30.21%. Operating profit (PBDIT) for the
current year is Rs. 285.83 Crores (Rs. 166.09 Crores in previous year)
thereby resulting the increase of 72.09%. Net profit after Tax Expenses
amounted to Rs. 106.16 Crores (Rs. 74.07 Crores in previous year)
thereby resulting increase of 43.32%.
Consolidated Basis
As per the Consolidated Financial Statements, the Income from
operations of the company, Operating profit (PBDIT), and Net profit for
the year were Rs. 2732.52, Rs. 476.17 and Rs. 44.37 Crores
respectively.
Ongoing Works
The following major works are under execution and the same are
progressing satisfactorily. (Rs. in crores)
Sector No. of projects Work order
Transportation 24 10134.26
Irrigation 20 2651.91
Mining Operation 14 3484.80
Total 58 16270.97
Sector Work done Work on hand
Transportation 5938.56 4195.70
Irrigation 780.03 1871.88
Mining Operation 1216.30 2268.50
Total 7934.89 8336.08
The Company''s order book (pending execution) shows work on hand
amounting to Rs. 8336.08 Crores as on the June 30, 2014.
* In respect of NSEL expenditure to the extent of Rs. 294.88 Crore has
been incurred. Due to non-availability of land possession for 28.745
kms, actual project length has been restricted to 27.73 kms. Also, NHAI
has issued Completion Certificate for the Project and matter of Annuity
finalization is under consideration by NHAI.
* As per the agreement entered into with investors in Sadbhav
Infrastructure Project Limited (SIPL) the holding of Company in BOT
projects is to be transferred to SIPL after obtaining necessary
approvals.
* Rohtak Panipat Tollway Private Limited has achieved Commercial
Operation Date on 06th January, 2014. The Toll Revenue of Rs. 19.05
Crores is for the period starting from 9th January, 2014 to 31st March,
2014.
* 6 Checkposts have started generating revenue in FY14 at various
points of time while 3 more Check Posts have started generating revenue
in May, 2014.
* In terms of Share Purchase Agreement dated 6th May, 2011 between
Sadbhav Infrastructure Project Limited (SIPL) and Company, SIPL has
acquired entire shareholding of the Company in Nagpur Seoni Expressway
Limited. As at reporting date, the transfer formalities for these
shares is in process.
* The National Highway Authority of India (NHAI) vide Board Meeting
dated May 23, 2014 has approved the proposal for Deferment of Premium
for the Projects of Hyderabad Yadgiri Tollway Private Limited and
Rothak Panipat Tollway Private Limited. Deferment of Premium shall
span over the period from 2014-15 till 2026-27.
Employee Stock Option Scheme:
The Company implemented the ''Sadbhav Employee Stock Option Scheme 2008
(ESOS Scheme 2008) to enable the employees and Directors of the Company
and its subsidiaries to contribute to the growth and profitability of
the Company. Options granted under this scheme vest over a period of
four years period, with 25% of the grants vesting in each year,
commencing one year from the date of grant. Options can be exercisable
within a period of three years from the date of vesting. The
Remuneration Committee administers and monitors the Scheme.
The applicable disclosures as stipulated under SEBI (Employee Stock
Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, is
provided in Annexure-I forming part of this report.
Company has received certificate from Auditors of Company confirming
that scheme has been implemented in accordance with SEBI Guidelines and
resolution passed by Shareholders. Auditors certificate would be placed
at Annual General Meeting for inspection by members.
Preferential allotment of warrants to promoter and promoters Group:
During the year, pursuant to the provisions of Section 81(1A) of the
Companies Act, 1956 and subject to the provisions of Chapter VII of the
Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009, the company has allotted 80,00,000
fully convertible warrants on August 13, 2013 to one or more persons
belonging to promoter and promoter group of the company entitling him
for apply one equity shares against each warrants at a price of Rs.
115.75 per warrant. This warrant can be exercise at any time within 18
months from the date of allotment of the warrants.
Share Capital:
During the year, under ''Sadbhav Employees'' Stock Option Scheme 2008
(ESOS Scheme 2008), 7,16,500 equity shares were allotted to the
directors and employees of the Company at price of Rs. 50/- per equity
share. The paid-up equity share capital of the company has been
increased from Rs. 15,09,45,800/- to Rs. 15,16,62,300/- after
allotment.
Subsidiary Company:
Pursuant to the General Exemption granted by Central Government vide
General Circular No. 2/2011 dated February 08, 2011 and the resolution
passed by the Board of Directors on May 30, 2013, copies of Balance
Sheet, Profit and Loss Account, Report of Board of Directors and the
Report of the Auditors of subsidiary companies have not been attached
to the Annual Accounts of the Company under Section 212 of Companies
Act 1956. As required under the circular statement giving required
details is given elsewhere in this Annual Report. The Company will keep
these documents at the Registered Office of the Company and its
subsidiaries and make them available upon the request by any
shareholder of Company.
Consolidation of Accounts:
Pursuant to the Accounting Standard AS-21 issued by the Institute of
Chartered Accountants of India, Consolidated Financial Statement
presented by the Company includes the financial statement of only those
subsidiaries which have commenced activities.
Fixed Deposit:
The company has not accepted any deposits as defined under Section 58A
of the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, as amended, during the year under review.
Directors:
Retirement by Rotation
Shri Vikramkumar R. Patel and Shri Vasistha C. Patel, are the directors
liable to retire by rotation at the ensuing Annual General Meeting and,
being eligible, offer themselves for reappointment. The directors
recommend their re-appointment.
Appointment
Pursuant to the provision of Section 161(1) of the Companies Act, 2013
and the Articles of Association of the Company, Mr. Sandip A. Sheth and
Mr. Mirat N. Bhadlawala were appointed as Additional Directors
designated as an Independent Director and they shall hold office upto
the date of ensuring Annual General Meeting.
The Board recommend their appointment in the ensuring Annual General
Meeting.
Resignation
Shri Amarsinh J. Vaghela and Shri Hemendra C. Shah, Independent
Directors of the Company have resigned from the Board of Directors. The
Board places on records its deep sense of appreciation on valuable
contribution made by outgoing directors during their tenure on the
Board.
Directors'' Responsibility Statement:
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors'' Responsibility Statement, it is
hereby confirmed that -
(i) in the preparation of the annual accounts, accounting standards
have been followed along with proper explanation relating to material
departure;
(ii) such accounting policies have been selected and applied
consistently and have made judgments and estimates reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at March 31, 2014 and 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 accounts have been prepared on a ''going concern'' basis.
Auditors:
M/s. Surana Maloo & Co., Chartered Accountants, the Statutory Auditors,
retire at the ensuring Annual General Meeting and are eligible for
re-appointment. Your Directors have recommended the re-appointment of
M/s. Surana Maloo & Co., Chartered Accountants, as an auditor of the
Company for a term of three consecutive years to audit the books of
accounts for the Financial Year 2014-15 to Financial Year 2016-17.
The Company has received the written consent from the auditor for their
appointment and a certificate to the effect that the appointment if
made shall be in accordance with the conditions prescribed under the
Rule 4 of Companies (Audit and Auditors) Rules, 2014 and they have also
satisfied the criteria provided in section 141 of Companies Act, 2013.
Auditors'' Report:
The Auditors'' have not made any adverse comments / remarks which
requires clarification from the Directors of Company and accor dingly
no further explanation has been provided by the directors in term of
section 217 of the Companies Act, 1956.
Transfer To Investor Education and Protection Fund:
The Company has transferred a sum of '' 1.25 lacs during the financial
year 2013-14 to the Investor Education and Protection fund established
by the Central Government, in compliance with Section 205A(5) of the
Companies Act,1956. The said amount represents unclaimed dividend
amount for the financial year 2005-2006 which were lying with the
Company for a period of 7 years from their due dates of payment. Prior
to transferring the aforesaid sum, the Company has send reminders to
the shareholders for submitting their claims for unclaimed dividend for
the financial year 2005-2006.
Corporate Governance:
The Company has been proactive in following the principles and
practices of good corporate governance. The Company has ensured that
the Corporate Governance requirements as stipulated in Clause 49 of the
Listing Agreement with the Stock Exchanges are duly complied with. A
report on Corporate Governance along with a certificate from the
Auditors regarding compliance of Clause 49 of Listing Agreement is
annexed.
Industrial Relations:
The Company enjoyed cordial relations with the employees during the
year under review and the Management appreciates the employees of all
cadres for their dedicated services to the Company.
Particulars of Employees:
Information as per Section 217(2A) of the Companies Act, 1956 read with
the Companies (Particulars of Employees) Rules, 1975 as amended, is
given in the Annexure-II and forms part of this Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning
and Outgo:
The rules regarding conservation of Energy and Technology Absorption
are not applicable to the Company. The particulars of the expenditure
and earning in Foreign Currency are given in Notes to Accounts (Note
No. 2.40 to 2.42).
Acknowledgements:
The Directors wish to express their appreciation for the support and
co-operation of the Central and State Government, Bankers, Financial
Institutions, Suppliers, Vendors, Associates, Subcontractors and
Shareholders during the year under review. Your Directors wish to place
on record their appreciation for the employees of the Company at all
levels for their commitment, dedication and continued support to the
Company.
For and on behalf of the Board of Directors
Place : Ahmedabad Vishnubhai M. Patel
Date : August 11, 2014 Chairman
Mar 31, 2013
To The Members,
The Directors have the pleasure in presentng the Twenty Fourth Annual
Report together with the audited statement of accounts for the year
ended March 31, 2013.
Financial Results (Rs. in crores)
Stand Alone Consolidated
Current
Year Previous
Year Current
Year Previous
Year
2012-2013 2011-2012 2012-2013 2011-2012
Income from Operatons 1810.99 2675.55 2159.59 2866.33
Proft before Finance
Cost, Depreciaton &
amortzaton 166.09 301.10 432.27 441.70
Expense and Tax Expense
Less : Finance Cost 84.37 65.11 304.20 155.90
Depreciaton and
amortzaton Expense 31.82 27.44 170.69 86.04
Proft /(Loss) before
Exceptonal Item and Tax 49.90 208.55 (42.62) 199.76
Exceptonal Items
(Performance Bonus) 60.94 0 60.94 0
Proft /(Loss) Before Tax 110.84 208.55 18.32 199.76
Less : Current Tax 28.53 60.72 35.43 73.54
Deferred tax liability/(asset) 8.24 7.38 8.23 7.37
Add : Excess /(Short)
provision for taxaton of 0.00 0.11 0.21 0.11
earlier years
Proft / (Loss) for the
period from contnuing
Operatons 74.07 140.56 (25.13) 118.96
Add:- Minority Interest 37.37 5.61
Less:- Share of
Loss of Associates (4.76) 2.29
Net Proft for the year 74.07 140.56 7.48 122.28
Balance brought forward
from last year 373.74 263.66 290.96 199.17
Additon due to
Increase in Stake 7.56
Amount available
for Appropriatons 447.81 404.22 306.00 321.45
Appropriatons
Transfer to General Reserve 7.50 14.00 7.50 14.00
Transfer to Debenture
Redempton Reserve 0 6.00 6.00
Dividend on Preference
Shares waivered by
Shareholders (0.02)
Proposed Dividend 9.06 9.02 9.06 9.03
Tax on Proposed Dividend 1.47 1.46 1.47 1.46
Balance carried to
Balance Sheet 429.78 373.74 287.99 290.96
Dividend
The Directors are pleased to recommend for approval of the shareholders
dividend of 60% (Rs. 0.60 per equity share of Re 1 each) for the
fnancial year ended March 31, 2013. The fnal dividend, if approved,
will absorb a sum of Rs. 9.06 Crores and dividend tax of Rs. 1.47
Crores.
Business Overview
Standalone Basis
The total income from operatons during the year under review was Rs.
1811.00 Crores against Rs. 2675.55 Crores for the previous year
resultng the decline of 32.31% . Operatng proft (PBDIT) for the current
year is Rs. 166.09 Crores (Rs. 301.10 Crores in previous year) thereby
resultng the decline of 44.83 %. Net proft afer Tax Expenses amounted
to Rs. 74.07 Crores (Rs. 140.56 Crores in previous year) thereby
resultngdecline of 47.30 %.
Consolidated Basis
As per the Consolidated Financial Statements, the Income from operatons
of the company, Operatng proft (PBDIT), and Net proft for the year were
Rs. 2153.34, 432.27 and 7.48 Crores respectvely.
Operatons Ongoing Works
The following major works are under executon and the same are
progressing satsfactorily. (Rs. in crores)
Sector No. of
projects Work
order Work
done Work on
hand
Transportaton 19 10729.45 4498.59 6230.86
Irrigaton 18 2235.14 828.86 1406.28
Mining Operaton 11 2818.88 853.54 1965.34
Total 48 15783.47 6180.99 9602.48
The Company''s order book (pending executon) shows work on hand amountng
to Rs. 9602.48 Crores as on the June 30, 2013.
New Contracts / Projects
Your Company has been declared successful bidder/awarded for following
new contracts/projects during the year and up to the date of this
report.
Transport Sector
1. Contract CC-42: Civil Works for constructon of Depot cum Workshop,
RCC elevated ramp, boundary wall, land development works etc. at Badli
for Jahangir Puri- Badli Corridor (extension of line-2) of phase-III of
Delhi MRTS by Delhi Metro Rail corporaton Ltd. for contract price of
Rs. 64.64 crores.
2. Contract CC- 43: Part design and Constructon of elevated viaduct
and three elevated statons viz. MIE, Bus Stand and City Park including
architectural fnishing, water supply, sanitary installaton, drainage
works and roofng works of statons on Mundka-Bahadurgarh Corridor of
Phase-III of Delhi MRTS (Haryana Porton) by Delhi Metro Rail Corporaton
in the name of Joint Venture known as "Corsan Corviam Construccion
S.A.-Sadbhav Engineering Limited JV" for contract value of Rs. 221.86
crores. Company''s share of interest/partcipaton in the Joint Venture is
40%.
3. Contract CC- 47: Part design and Constructon of elevated viaduct
from Mundka to Tikri Border, (Chainage 16397.128 to 22703.647), siding
at Tikri Border and four elevated statons viz. MIE, Ghevra, Tikri Kalan
& Tikri Border including architectural fnishing, water supply, sanitary
installaton, drainage and civil works related to E & M of
Mundka-Bahadurgarh Corridor of Phase-III of Delhi MRTS (Delhi Porton)
by the Chief General Manager (Tender), Delhi Metro Rail Corporaton in
the name of Joint Venture known as "Corsan Corviam Construccion
S.A.-Sadbhav Engineering Limited JV" for contract value of Rs. 249.65
crores. Company''s share of interest/partcipaton in the Joint Venture is
40%.
Irrigaton Sector
1. Company was awarded 6 (Six) projects/ works by Sardar Sarovar
Narmada Nigam Limited, Gandhinagar, Gujarat aggregatng to Rs. 422.07
crores during the fnancial year 2012-13.
2. Executon of Halon Irrigaton Project complete on Turnkey Basis
including commissioning of entre system, operaton and maintenance of
complete commissioned system for three years for aggregatng contract
value of Rs. 245.61 crores jointly with Vaishnovi Constructons Nagpur.
Company is leading the Joint Venture with 72% partcipaton share i.e for
Rs 176.84 crores.
3. Earthwork for deepening and widening of Parallel Lower Ganga Canal
as per final stage theoretical lined sections (8900 Cusec capacity),
The Chief Engineer Ram Ganga, Irrigaton Department. Govt. of Utar
Pradesh, Kanpur for contract value of Rs. 132.95 crores.
4. Company was awarded 2 (Two) projects/ works by Sardar Sarovar
Narmada Nigam Limited, Gandhinagar, Gujarat aggregatng to Rs. 183.57
crores.
Mining Sector:
1. Bharat Coking Coal Limited (A Subsidiary of Coal India Ltd.) has
awarded project for hiring of HEMM for removal of 248.93 LCM over
burden (OB) and extracton of 72.17 LMT coal. to ÂSadbhav-Vishnusiva
Joint Venture in the rato of 75:25 for contact price of Rs. 210.49
crores
2. Bharat Coking Coal Limited (A Subsidiary of Coal India Ltd.) has
awarded project for hiring of HEMM for removal of 397.34 LCM over
burden OB, and extracton of 65.54 LMT of coal to Sadbhav-Annapurna
Joint Venture in the rato of 80:20. for contact price of Rs. 471.18
crores.
3. Northern Coalfelds Limited (A subsidiary of Coal India Ltd.)
Singrauli (M.P.) has awarded project for excavaton of overburden of
frst dig (Solid) by hiring of equipment for the excavaton of 100.00
Million BCM over burden (OB). The project is for contact price of Rs.
697.36 crores.
4. Uranium Corporaton of India Ltd. Jharkhand has awarded project for
Removal of Overburden/Waste and Extracton of Uranium Ore from
Banduhurang Opencast Mine and transportaton of ore to the ground hopper
at Turamdih or any other specifed area and overburden to the specifc
dump yard in compliance of all relevant status for aggregatng contract
value of Rs.173.14 Crores.
New BOT Projects
Your company has been declared successful bidder/awarded for following
new BOT projects during the year and up to the date of this report.
Project SPV Cost of Project EPC contract Concession (Rs. in Crores)
(Rs. in Crores) Period The DBFOMT (Annuity) project is for the existng
Declared Lowest 737.20 10 (Ten) years State Highway (SH33 & SH3) from
Malavalli to Bidder (L1). from appointed Pavagada (Approx length of
193.344 Kms) in the LOA is awaited date State of Karnataka (WAP-1) Four
laning of Rajsamand-Bhilwara Secton of NH-758 Bhilwara-Rajsamand 676.10
603.00 30 (Thirty) years (from km 0.000 to km 87.250) under NHDP Phase
IV Toll Way Private from appointed in the State of Rajasthan on DBFOT
(Toll) Basis. Limited date The project consists of "4-Laning of Rohtak
to Hissar Rohtak-Hissar 1271.58 1080.00 22 (Twenty Two) Secton of NH-10
from Km 87.000 to km 170.000 Toll Way Private years from including
connectng link from km 87.000 (NH-10) to Limited appointed date km
348.000 (NH-71) to be executed as BOT (Toll) project on DBFOT patern
under NHDP Phase III in the state of Haryana(Length 98.810 Km) BOT
Projects under Implementaton: Name of the Details of Project Cost of
Status as on % Shareholding Company the Project 30 June, 2013
(Ownership) (Rs. in Cost incurred SEL SIPL Crores) (Rs in crores)
Maharashtra - Modernizaton and computerizaton of integrated 1426.37
991.85 63 27 Border Check Post border check posts at 22(Twenty Two)
locatons in the
network Ltd. State of Maharashtra on Build Operate and Transfer
(MBCPL) (BOT) Basis. - The project is in joint venture between Company
& its associates, SREI Infrastructure Finance Limited and SREI Sahaj
e-village Limited in rato of 90:05:05 respectvely. Rohtak-Panipat Four
laning of Rohtak to Panipat Secton of NH-71A 1213.40 1087.74 - 100
Tollway Private Ltd. from km 0.000 Km 63.30 of NH-10 to km 80.858 Km
83.50 of NH-1 in the state of Haryana (80.85 Kms) on
BOT basis under NHDP Phase-III Shreenathji- Four Laning of Gomat
Chauraha - Udaipur secton of 1151.46 67.92 26 74 Udaipur Tollway NH-8
(from Km 177/000 to Km 260/100) in the state of Private Limited
Rajasthan under NHDP Phase IV Solapur-Bijapur Four Laning of
Solapur-Bijapur secton of NH-13 from 183.6 1.97 26 74 Tollway Private
km. 0.00 to km. 110.542 to be executed as BOT (Toll) Limited basis on
DBFOT Patern under NHDP Phase III. Revenue Generatng BOT Project: Name
of the Details of Project Cost of Toll Revenue % Shareholding Company
the Project of the F.Y. (Ownership) (Rs. in 2012-13 SEL SIPL Crores)
(Rs. in Crores)
Mumbai-Nasik Vadape-Gonde 4 Lane BOT project for widening the 794.58
130.61 20 - Expressway Ltd. existng two-lane of 99.50 Kms to four
lanes and its (MNEL) operaton and maintenance. Ahmedabad Ring 4-laning
the present 76.21 km two-lane ring road around 500.80 72.47 - 80 Road
Infrastructure Ahmedabad city and its operaton & maintenance. Ltd.
(ARRIL)
Aurangabad-Jalna Widening the existng two-lane stretch of 65.80 kms
277.00 27.71 - 100 Tollway Ltd. (AJTL) to four lanes on Aurangabad
Jalna Highway in state of Maharastra and its operaton and maintenance.
Nagpur-Seoni Rehabilitaton and upgrading to four lane from km. 489.70
61.38 51 39 Expressway Ltd. 596/750 to km. 653/225 on NH-7 in the
state of Madhya (NSEL) Pradesh under North-South Corridor (NHDP Phase
II) on BOT-Annuity basis. Dhule-Palesner Design, Engineering, Finance,
Procurement, Constructon, 1420.00 76.62 26 01 Tollway Ltd. Operaton
and Maintenance of 4/6 laning of MP/ (DPTL) Maharashtra Border- Dhule
secton of NH- 3 from km 168.500 to km 265.000 (89 Kms) in the State of
Maharashtra under NHDP Phase IIIA on BOT (Toll) Basis Bijapur-Hungund
Four laning of Bijapur - Hungund Secton of NH-13 1257.10 86.22 - 77
Tollway Private Ltd. from km 102.000 to km 202.000 (97.22Kms) in the
state of Karnataka on Design, Build, Finance, Operate and Transfer
("DBFOT"), Toll basis. Hyderabad-Yadgiri Design, Engineering,
Constructon, Development, 480.22 11.22 - 60 Tollway Private Ltd.
Finance, Operaton and Maintenance of four laning of Hyderabad-Yadgiri
Secton from km 18.600 to km 54.000 (36.65Kms) of NH-202 in the state of
Andhra Pradesh under NHDP Phase-III on DBFOT (Toll) Basis Package No.
NHDP-III/ BOT/AP/04.
- In respect of NSEL expenditure to the extent of Rs. 294.88 Crore has
been incurred. Project is under suspension and mater is ubjudice.
- As per the agreement entered into with investors in Sadbhav
Infrastructure Project Limited (SIPL) the holding of Company in BOT
projects is to be transferred to SIPL afer obtaining necessary
approvals.
Joint Ventures The Company has the following joint ventures  SEL- GKC
Joint Venture : (Rs. in crores) Project Project % of Company''s Work
Cost Involvement share Completed as on 30/06/2013 Earth work excavaton,
forming embankment and constructon of CD & CM 166.88 52% 86.78 47..68
works of main canal and distributory system of Gouravelly right side
canal from km 0.000 to 47.725 and lef side canal in Karimnagar
District.
Investgaton, design and executon of Canal Network System including
99.31 52% 51.64 30.34
Earth work Excavaton and Forming Embankment, Constructon of CM & CD
Works in Karimnagar Dist under Kodlmial, Potharam Surampet Lachupet.
Investgaton, survey, design and constructon of Bus Rapid Transit System
165.54 50% 82.77 62.26
(BRTS) corridor from Pendurthi to DRM ofce (PTC Corridor) via NAD Jn,
Kancharapalem, Railway Staton.
Improvement/Upgradaton Strengthening/Widening of Govindpur-Sahibganj
229.91 50% 114.95 69.89
State Road Project (Govindpur-Jamtara Contract Package No. I) by Road
constructon Department, Govt. of Jharkhand.
Executon of Omkareshwar right bank lif canal on "Turn Key"basis from
349.30 60% 209.58 98.84
RD 51.281 to 125.Km(excluding V.R.B. at RD 51.281 Km Wasvi-Sirsodia
Road) by Narmada Development Division 20,M.P.
Executon of Omkareshwar right bank lif canal including its distributon
519.93 40% 207.97 150.40
network on "Turn Key"basis from RD 0.00 Km to 51.281.Km (including
V.R.B. at RD 51.281 Km Wasvi-Sirsodia Road) by Narmada Development
Division 20, M.P.
Work of EPC contract for constructon of Radhanpur Sub Branch Canal,
236.20 52% 122.82 38.05
Manpura Sub Branch Canal, Distributaries & Minors of Radhanpur Branch
Canal, RSBC & MSBC including Geo Tech investgaton, Design of structures
and Operaton and maintenance for the same for fve (5) years.
Blast hole drilling, controlled blastng with shock tube initaton
(Nonels), 182.50 51% 93.07 52.51 eXcavaton, loading, transportaton,
dumping, spreading and leveling etc., of 436.50 LBCM over burden, at
Manugur OC-II Extension (Phase-II) project by the Singareni Collieries
Company Limited.
Improvement/ Upgradaton of Mohammadpur- Rajapat- Mashrakh-Khaira-
201.82 50% 100.91 8.21
Chhapra Road (SH-90) Length-64.71 Km. Contract Package No. 3 of Bihar
State Highway Project-II.
SEL- Hindustan Constructon Company Limited Joint Venture :
1. Design, Build, Contract on lump sum basis for constructon of
terminal facilites for passenger water transport along west coast of
Mumbai at Marve and Borivali (Package WWT-3) by Maharastra State Road
Development Corporaton (MSRDC) Mumbai for contract price of Rs. 319.00
crores in Joint venture with Hindustan Constructon Company
Limited-Mumbai. Company is executng entre EPC contract.
Employee Stock Opton Scheme :
The Company implemented the ÂSadbhav Employee Stock Opton Scheme 2008
(ESOS Scheme 2008) to enable the employees and Directors of the Company
and its subsidiaries to contribute to the growth and proftability of
the Company. Optons granted under this scheme vest over a period of
four years period, with 25% of the grants vestng in each year,
commencing one year from the date of grant. Optons can be exercisable
within a period of three years from the date of vestng. The Remuneraton
Commitee administers and monitors the Scheme.
The applicable disclosures as stpulated under SEBI (Employee Stock
Opton Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, is
provided in Annexure -I forming part of this report.
Company has received certfcate from Auditors of Company confrming that
scheme has been implemented in accordance with SEBI Guidelines and
resoluton passed by Shareholders. Auditors certfcate would be placed at
Annual General Meetng for inspecton by members.
Share Capital
During the year, under ÂSadbhav Employees'' Stock Opton Scheme 2008
(ESOS Scheme 2008)'', 5,78,000 equity shares were alloted to the
directors and employees of the Company at price of Rs. 50/- per equity
share. The paid-up equity share capital of the company has been
increased from Rs. 15,03,67,800/- to Rs. 15,09,45,800/- afer allotment.
Subsidiary Company
Pursuant to the General Exempton granted by Central Government vide
General Circular No. 2/2011 dated February 08,2011 and the resoluton
passed by the Board of Directors on May 30, 2013, copies of Balance
Sheet, Proft and Loss Account, Report of Board of Directors and the
Report of the Auditors of subsidiary companies have not been atached to
the Annual Accounts of the Company under Secton 212 of Companies Act
1956. As required under the circular statement giving required details
is given elsewhere in this Annual Report. The Company will keep these
documents at the Registered Ofce of the Company and its subsidiaries
and make them available upon the request by any shareholder of Company.
Consolidaton of Accounts
Further pursuant to the Accountng Standard AS-21 issued by the Insttute
of Chartered Accountants of India, Consolidated Financial Statement
presented by the Company includes the fnancial statement of its
subsidiaries which have commenced actvites.
Fixed Deposit
The company has not accepted any deposits as defned under Secton 58A of
the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, as amended, during the year under review.
Directors
Retrement by Rotaton
Shri Nitn R. Patel, Shri Amarsinh J. Vaghela and Shri Sandip V. Patel,
are the directors liable to retre by rotaton at the ensuing Annual
General Meetng and, being eligible, ofer themselves for
reappointment.The directors recommend their re-appointment.
Appointment
Shri Arun S. Patel, Shri Vasistha C. Patel and Shri Vikramkumar R.
Patel were appointed as Additonal Directors on the Board w.e.f
September 29, 2012. Shri Hemendrakumar C. Shah was also appointed as
Additonal Directors at the Board Meetng held on May 30, 2013 w.e.f May
02, 2013. In accordance with Secton 260 of the Companies Act, 1956 and
Artcle 134 of the Company''s Artcles of Associaton, they will cease to
hold ofce at the forthcoming Annual General Meetng and are eligible for
appointment. The Company has received notces under Secton 257 of the
Act, in respect of the above persons, proposing their appointment as a
Directors of the Company.
Shri Vasistha C. Pate and Shri Vikramkumar R. Patel were also appointed
as Whole-tme Directors designated as Executve Directors of the Company
for a period of fve years w.e.f. October 01, 2012, subject to the
approval of the Members.
Further details about these Directors are given in the Notce of the
ensuing Annual General Meetng and the Explanatory Statement thereto
being sent to the shareholders along with Annual Report.
Resignaton
Shri Girish N. Patel, Executve Director and Shri Pravinkumar M.
Ganatra, Independent Director of the Company have resigned from the
Board of Directors. The Board places on records its deep sense of
appreciaton on valuable contributon made by outgoing directors during
their tenure on the Board.
Directors'' Responsibility Statement
Pursuant to the requirement under Secton 217(2AA) of the Companies Act,
1956, with respect to Directors'' Responsibility Statement, it is hereby
confrmed that -
(i) in the preparaton of the annual accounts, accountng standards have
been followed along with proper explanaton relatng to aterial
departure;
(ii) such accountng policies have been selected and applied
consistently and have made judgments and estmates reasonable and
prudent so as to give a true and fair view of the state of afairs of
the Company at March 31, 2013 and the proft of the Company for the year
ended on that date;
(iii) proper and sufcient care has been taken for the maintenance of
adequate accountng records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventng and detectng fraud and other irregularites; and
(iv) the accounts have been prepared on a Âgoing concern'' basis.
Auditors :
M/s. Surana Maloo & Co., Chartered Accountants, the Statutory Auditors,
retre at the ensuing Annual General Meetng and are eligible for
re-appointment. Your Directors have recommended the re-appointment of
M/s. Surana Maloo & Co., Chartered Accountants as Auditor of the
Company. The Auditor''s have confrmed that their appointment, if made,
would be within limit prescribed under Secton 224(1B) of the Companies
Act, 1956 and they are not disqualifed, within the meaning of
Sub-sectons (3) and (4) of Secton 226 of the Companies Act, 1956.
Auditors'' Report :
The Auditors'' have not made any adverse comments / remarks which
requires clarifcaton from the Directors of Company and accordingly no
further explanaton has been provided by the directors in term of secton
217 of the Companies Act, 1956.
Transfer To Investor Educaton and Protecton Fund :
The Company has transferred a sum of Rs.3.05 lacs during the fnancial
year 2012-13 to the Investor Educaton and Protecton fund established by
the Central Government, in compliance with Secton 205C of the Companies
Act,1956. The said amount represents unclaimed amount received against
the applicaton and allotment of equity shares during the IPO which were
lying with the Company for a period of 7 years from theirdue dates of
payment. Prior to transferring the aforesaid sum, the Company has send
reminders to the applicants for submitng their claims for unclaimed IPO
Refund Money.
Corporate Governance
The Company has been proactve in following the principles and practces
of good corporate governance. The Company has ensured that the
Corporate Governance requirements as stpulated in Clause 49 of the
Listng Agreement with the Stock Exchanges are duly complied with. A
report on Corporate Governance along with a certfcate from the Auditors
regarding compliance of Clause 49 of Listng Agreement is annexed.
Industrial Relatons
The Company enjoyed cordial relatons with the employees during the year
under review and the Management appreciates the employees of all cadres
for their dedicated services to the Company.
Partculars of Employees
Informaton as per Secton 217(2A) of the Companies Act, 1956 read with
the Companies (Partculars of Employees) Rules, 1975 as amended, is
given in the Annexure- II and forms part of this Report.
Energy Conservaton, Technology Absorpton and Foreign Exchange Earning
and Outgo
The rules regarding conservaton of Energy and Technology Absorpton are
not applicable to the Company. The partculars of the expenditure and
earning in Foreign Currency are given in Notes to Accounts (Note No.
2.41 To 2.43).
Acknowledgements
The Directors wish to express their appreciaton for the support and
co-operaton of the Central and State Government, Bankers, Financial
Insttutons, Suppliers, Vendors, Associates, Subcontractors and
Shareholders during the year under review. Your Directors wish to place
on record their appreciaton for the employees of the Company at all
levels for their commitment, dedicaton and contnued support to the
Company.
For and on behalf of the
Board of Directors
Place : Ahmedabad Vishnubhai M. Patel
Date : August 13, 2013 Chairman
Mar 31, 2012
The Directors have the pleasure in presenting the Twenty Third Annual
Report together with the audited statement of accounts for the year
ended March 31, 2012.
Financial Results (Rs. in crores)
Current Year Previous Year
2011-2012 2010-2011
Income from Operations 2675.55 2209.40
profit before Finance Cost,
Depreciation& amortization
Expense and Tax Expense 301.10 256.74
Less : Finance Cost 65.11 54.14
Depreciation and amortization
Expense 27.44 26.86
Profit before Tax Expense 208.55 175.74
Less : Current Tax 60.72 57.55
Deferred tax liability/(asset) 7.38 1.99
Profit after Tax Expense 140.45 116.20
Add : Excess (Short) provision for
taxation of earlier years 0.11 3.39
Net profit for the year 140.56 119.59
Balance brought forward from
last year 263.66 172.56
Amount available for Appropriations 404.22 292.15
Appropriations
Transfer to General Reserve 14.00 12.00
Transfer to Debenture Redemption Reserve 6.00 6.00
Proposed Dividend 9.02 8.99
Tax on Proposed Dividend 1.46 1.49
Balance carried to Balance Sheet 373.74 263.66
Dividend
The Directors are pleased to recommend for approval of the shareholders
dividend of 60% (Rs. 0.60 per equity share of Re 1 each) for the
financial year ended March 31, 2012. The final dividend, if approved,
will absorb a sum of Rs. 9.02 Crores and dividend tax of Rs. 1.46
Crores.
Business Overview
The total income from Operations during the year under review was Rs.
2675.55 crores against Rs. 2209.40 crores for the previous year
recording the growth of 21.10%. Operating profit (PBDIT) for the current
year is Rs. 301.10 crores (Rs. 256.74 crores in previous year) thereby
recording the growth of 17.28%. Net profit after Tax Expenses amounted to
Rs. 140.56 crores (Rs. 119.59 crores in previous year) thereby
recording growth of 17.53 %.
Operations
Ongoing Works
The following major works are under execution and the same are
progressing satisfactorily.
(Rs. in crores)
Sector No. of projects Work order Work done Work on hand
transportation 15 9830.24 4639.52 5190.72
Irrigation 13 1527.08 434.90 1092.18
Mining Operation 8 1796.46 865.70 930.76
Total 36 13153.78 5940.12 7213.66
The Company's order book (pending execution) shows work on hand amounting
to Rs. 7213.66 crores as on the June 30, 2012.
New contracts / projects
Your Company has been awarded following new contracts/projects during
the year and up to the date of this report.
Transport Sector
1. Improvement/Upgradation of
Mohammadpur-Rajapat-Mashrakh-Khaira-Chhapra Road (SH-90) Length-64.71
Km. Contract Package No. 3 of Bihar State Highway Project-II for
contract price of Rs. 201.82 crores in joint venture with GKC Projects
Ltd.- Hyderabad. Company is leading the joint venture with 50%
partcipaton share i.e. for Rs. 100.91 crores of which work amounting to
Rs. 5.44 crores has been completed.
2. Work of Construction of Rigid Pavement Four Lane Main Trunk Roads
including Construction of box culverts and Street Light with Foot-Path
work in Sanand-II (BOL) Industrial Estate with five years free
maintenance guarantee period by the Executive Engineer, GIDC, ahmedabad
for estimated cost of Rs. 126.82 crores
3. Design, Build, Contract on lump sum basis for Construction of
terminal facilities for passenger water transport along west coast of
Mumbai at Marve and Borivali (Package WWT-3) by Maharastra State Road
Development Corporation (MSRDC) Mumbai for contract price of Rs. 319.00
crores in Joint venture with Hindustan Construction Company
Limited-Mumbai. Company is leading the joint venture with more than 51%
participation share.
4. Contract CC-25: Construction of boundary wall, box, culvert and land
development of Mukundpur depot on Mukundpur-Yamuna Vihar corridor
(line-7) of phase-III Delhi MRTS by Delhi Metro Rail Corporation Ltd.
for conract price of Rs. 33.55 crores.
Irrigation Sector
1. Work of excavation and Cement concerting lining of Baitarani Lef Bank
Canal from RD 0.00 km to RD 9.00 km including Construction of structures
and Services Road for contract price of Rs. 79.24 crores by the Chief
Construction Engineer, Anandapur Barrage Project, Salapada, Odisha.
Mining Sector
1. Hiring of HEMM for removal of OB, extraction and transportation of
coal from VIII, V/VI (Top), V/VI IV(Bot), IV (Top), IV (Bot) III, II
(T M), II (T) and II (Midi) seams of Patch 'Q' part Patch 'N" and part
Patch 'P" of Gondudin Colliery of Kusnda Area. The total quantity for
the removal of over burden (OB) is 368.24 LCM and extraction of coal is
54.21 LMT. The project was awarded by Bharat Coking Coal Limited (A
Subsidiary of Coal India Ltd.) for contact price of Rs. 325.32 crores.
New BOT Projects
Your company has been awarded following new BOT projects during the
year and up to the date of this report.
Gomat Chauraha - Udaipur Road Project
# A toll based BOT road project
The project consists of Four Laning of Gomat Chauraha - Udaipur section
of NH-8 (from Km 177/000 to Km 260/100) in the state of Rajasthan under
NHDP Phase IV on Design, Build, Finance, Operate and Transfer (toll)
basis. Shreenathji-Udaipur Tollway Private Limited has been
incorporated as special purpose vehicle to implement this project. The
cost of project is estimated to Rs. 1239 of which EPC contract amounts
to Rs. 975.00 crores. The entre EPC contract will be executed by the
company. The Concession Period of the project is 27 (Twenty Seven)
years from Appointed Date. The financial closure of the project is in
progress.
Solapur - Bijapur Road Project
# A toll based BOT road project
The project consists of FourLaning of Solapur-Bijapur section of NH-13
from km. 0.00 to km. 110.542 to be executed as BOT (Toll) basis on
DBFOT Patern under NHDP Phase III. Solapur-Bijapur Tollway Private
Limited has been incorporated as special purpose vehicle to implement
this project. The cost of the project is estimated to Rs. 1244.27 crores
of which EPC contract amounts to Rs. 999.00 crores. The entre EPC
contract will be executed by the company. The Concession Period of the
project is 20 (Twenty) years from Appointed Date. The financial closure
of the project is in progress.
Joint Ventures
The Company has the following joint ventures -
SEL- GKC Joint Venture :
Over and above the Road as mentioned above, Company is executing
following projects in Joint Venture with GKC Project Ltd.
1. Earth work excavation, forming embankment and Construction of CD & CM
works of main canal and distributor system upto water course level and
CC lining to main canal and other allied works including investigation,
designing and estmation of Gouravelly right side canal from km 0.000 to
47.725 and lef side canal in Karimnagar District. The cost of the
project is Rs. 166.88 crores of which company's share is 52 % i.e. Rs.
86.78 crores of which work amounting to Rs. 44.19 crores has been
completed.
2. investigation, design and execution of Canal Network System including
Earth work exclavation and Forming Embankment, Construction of CM & CD
Works and lining of canals up to sub minors and formation of Field
Channels including Structures to serve an ayacut of 58800 Acres in
Karimnagar Dist under Kodlmial, Potharam Surampet Lachupet and New
tanks at 450 and its Concerned Gravity Canals (Canal Network Package
III). The cost of project is Rs. 99.31 crores of which company's share
is 52% i.e. Rs. 51.64 crores of which work amounting to Rs. 21.29 crores
has been completed.
3. investgation, Survey, Design and Construction of Bus Rapid Transit
System (BRTS) corridor from Pendurthi to DRM office (PTC Corridor) via
NAD Jn, Kancharapalem, Railway Staton with 2 years deffect liability
period under EPC(Design & Build) system. The cost of project is Rs.
165.54 crores of which company's share is 50% i.e. Rs. 82.77 crores of
which work amounting to Rs. 51.31 crores has been completed.
4. Improvement/Upgradation Strengthening/Widening of
Govindpur-Sahibganj State Road Project (Govindpur-Jamtara Contract
Package No. I) by Road Construction Department, Govt. of Jharkhand. The
cost of the project is Rs. 229.91 crores of which company's share is
50% i.e. Rs. 114.95 crores of which work amounting to Rs. 20.21 crores
has been completed.
5. execution of Omkareshwar Right Bank Lif Canal including its
distributon network up 40 Ha. Chak for culturable command areas (CCA)
of about 29947 Ha. on "Turn Key"basis from RD 51.281 to 125.00 Km
(excluding V.R.B. at RD 51.281 Km Wasvi-Sirsodia Road) by Narmada
Development Division 20, M.P. The cost of the project is Rs. 349.30
crores of which Company's share is 60% i.e. 209.58 crores of which work
amounting to Rs. 14.28 crores has been completed.
6. execution of Omkareshwar Right Bank Lif Canal including its
distributor network up 40 Ha. Chak for culturable command areas (CCA)
of about 28073 Ha.on "Turn Key"basis from RD 0.00 Km to 51.281.Km
(including V.R.B. at RD 51.281 Km Wasvi-Sirsodia Road) by Narmada
Development Division 20, M.P. The cost of the project is Rs. 519.93
crores of which company's share is 40% i.e. 207.97 crores of which work
amounting to Rs. 49.87 crores has been completed.
7. Work of EPC contract for Construction of Radhanpur Sub Branch Canal,
Manpura Sub Branch Canal, Distributaries & Minors of Radhanpur Branch
Canal, RSBC & MSBC (Earthwork, lining, Structures, Service Road,
CR/Escape/HR, Gates, Stop logs, Control Cabin) including Geo Tech
investigation, Design of structures and Operation and maintenance for the
same for five (5) years. The cost of the project is Rs. 236.20 crores
of which company's share is 52% i.e. 122.82.
8. Blast hole drilling, controlled blasting with shock tube imitation
(Nonels), excavation, loading, transportation, dumping, spreading and
leveling etc., of 436.50 LBCM over burden, at Manugur OC-II Extension
(Phase-II) project by the Singareni Collieries Company Limited. The
cost of the project is Rs. 182.50 crores of which company's share is
51% i.e. 93.07 of which work amounting to Rs. 47.10 crores has been
completed.
Wind Power Project:
During the year, in furtherance of Wind Power Project, your company has
successfully commissioned a 7.2 MW WIND FARM at Village Vandhiya,
Taluka :Bhachau, District : Kutch in the State of Gujarat at cost of
Rs. 50.85 crores. The generated power is fully sold to Gujarat Urja
Vikas Nigam Limited (GUVNL) as per the terms of Power Purchase
Agreement entered by the company with GUVNL.
Award & recognition :
During the year, your company has been awarded the prestigious "Most
Admired Developer - Transport Sector Award" at the 4th Infrastructure
Today Awards 2011 in association with KPMG in India. The said coveted
award was received from Mr. Montek Singh Aluwhalia on December 09, 2011
in New Delhi.
Employee Stock Option Scheme :
The Company implemented the 'Sadbhav Employee Stock Option Scheme 2008
(ESOS Scheme 2008) to enable the employees and Directors of the Company
and its subsidiaries to contribute to the growth and profitability of
the Company. Options granted under this scheme vest over a period of
four years period, with 25% of the grants vesting in each year,
commencing one year from the date of grant. Options can be exercisable
within a period of three years from the date of vesting. The remuneration
Committee administers and monitors the Scheme.
The applicable disclosures as stipulated under SEBI (Employee Stock
Opton Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, is
provided in Annexure -I forming part of this report.
Company has received certificate from Auditors of Company confirming that
scheme has been implemented in accordance with SEBI Guidelines and
resolution passed by Shareholders. Auditors certificate would be placed at
Annual General Meeting for inspection by members.
Share Capital
During the year, under 'Sadbhav Employees' Stock Option Scheme 2008
(ESOS Scheme 2008)', 4,92,000 equity shares were allotted to the
directors and employees of the Company at price of Rs. 50/- per equity
share. The paid-up equity share capital of the company has been
increased from Rs. 14,98,75,800/- to Rs. 15,03,67,800/- after allotment.
Subsidiary Company
Pursuant to the General Exemption granted by Central Government vide
General Circular No. 2/2011 dated February 08, 2011 and the resolution
passed by the Board of Directors on May 28, 2012, copies of Balance
Sheet, profit and Loss Account, Report of Board of Directors and the
Report of the Auditors of subsidiary companies have not been attached
with the Annual Accounts of the Company under section 212 of Companies
Act 1956. As required under the circular statement giving required
details is given elsewhere in this Annual Report. The Company will keep
these documents at the Registered office of the Company and its
subsidiaries and make them available upon the request by any
shareholder of Company.
Consolidation of Accounts
Further pursuant to the Accounting Standard AS-21 issued by the Institute
of Chartered Accountants of India, Consolidated Financial Statement
presented by the Company includes the financial statement of its
subsidiaries which have commenced actives.
Fixed Deposit
The company has not accepted any deposits as defined under section 58A of
the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, as amended, during the year under review.
Directors
Shri Pravinkumar M. Ganatra and Shri Girish N. Patel the directors
liable to retire by rotation at the ensuing Annual General Meeting and,
being eligible, offer themselves for reappointment. There has been no
other change in the Directorship of company during the current year.
Directors' Responsibility Statement
Pursuant to the requirement under section 217(2AA) of the Companies Act,
1956, with respect to Directors' Responsibility Statement, it is hereby
confirmed that -
(i) in the preparation of the annual accounts, Accounting standards have
been followed along with proper explanation relating to material
departure;
(ii) such Accounting policies have been selected and applied
consistently and have made judgments and estimates reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at March 31, 2012 and 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 accounts have been prepared on a 'going concern' basis.
Auditors:
M/s. Shashikant Patel Associates, Chartered Accountants, the Statutory
Auditors, retire at the ensuing Annual General Meeting and are eligible
for re-appointment. Your Directors have recommended the re-appointment
of M/s. Shashikant Patel Associates, Chartered Accountants as Auditor
of the Company. The Auditor's have confirmed that their appointment, if
made, would be within limit prescribed under section 224(1B) of the
Companies Act, 1956 and they are not disqualified, within the meaning of
Sub-sections (3) and (4) of section 226 of the Companies Act, 1956.
Auditors' Report:
The Auditors' have not made any adverse comments / remarks which
requires clarification from the Directors of Company and accordingly no
further explanation has been provided by the directors in term of section
217 of the Companies Act, 1956.
Corporate Governance
The Company has been proactive in following the principles and practices
of good corporate governance. The Company has ensured that the
Corporate Governance requirements as stipulated in Clause 49 of the
Listing Agreement with the Stock Exchanges are duly complied with. A
report on Corporate Governance along with a certificate from the Auditors
regarding compliance of Clause 49 of Listing Agreement is annexed.
Industrial Relations
The Company enjoyed cordial relations with the employees during the year
under review and the Management appreciates the employees of all cadres
for their dedicated services to the Company.
Particulars of Employees
information as per section 217(2A) of the Companies Act, 1956 read with
the Companies (Particulars of Employees) Rules, 1975 as amended, is
given in the Annexure- II and forms part of this Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning
and Outgo
The rules regarding conservation of Energy and Technology Absorption are
not applicable to the Company. The particulars of the expenditure and
earning in Foreign Currency are given in Notes to Accounts (Note No.
2.41 to 2.43).
Acknowledgements
The Directors wish to express their appreciation for the support and
co-operation of the Central and State Government, Bankers, Financial
Institutions, Suppliers, Vendors, Associates, Subcontractors and
Shareholders during the year under review. Your Directors wish to place
on record their appreciation for the employees of the Company at all
levels for their commitment, dedication and continued support to the
Company.
For and on behalf of the Board of Directors
Place : Ahmedabad Vishnubhai M. Patel
Date : July 30, 2012 Chairman
Mar 31, 2011
The Members,
The Directors have the pleasure in presenting the Twenty Second Annual
Report together with the audited statement of accounts for the year
ended March 31, 2011.
Financial Results (Rs. in crores)
Current Year Previous Year
2010-2011 2009-2010
Income from Operations 2209.17 1256.93
Profit before Interest, Depreciation & Tax 245.30 154.31
Less : Interest & Finance Charges 42.69 33.09
Depreciation 26.86 23.25
Profit before Tax 175.75 97.97
Less : Provision for tax 57.56 29.70
Provision for deferred tax liability/(asset) 1.99 3.08
Profit after Tax 116.20 65.19
Add : Excess (Short) provision for taxation
of earlier years 3.39 (11.35)
Net Profit for the year 119.59 53.84
Balance brought forward from last year 172.56 137.05
Amount available for Appropriations 292.15 190.89
Appropriations
Transfer to General Reserve 12.00 6.50
Transfer to Debenture Redemption Reserve 6.00 6.00
Proposed Dividend 8.99 5.00
Tax on Proposed Dividend 1.49 0.83
Balance carried to Balance Sheet 263.66 172.56
Dividend
The Directors are pleased to recommend for approval of the shareholders
dividend of 60% (Rs. 0.60 per equity share of Re 1 each) for the
financial year ended March 31, 2011. The final dividend, if approved,
will absorb a sum of Rs. 8.99 Crores and dividend tax of Rs 1.49
Crores.
Business Overview
The total income from operations during the year under review was Rs.
2209.17 Crores against Rs. 1256.93 Crores for the previous year
recording the growth of 75.76% . Operating Profit (PBDIT) for the
current year is Rs.245.30 Crores (Rs.154.31 Crores in previous year)
thereby recording the growth of 58.96 %. Net Profit after tax is
amounted to Rs.119.59 Crores (Rs 53.84 Crores in previous year )
thereby recording a growth of 122.12 %.
Operations
Ongoing Works
The following major works are under execution and the same are
progressing satisfactorily.
(Rs. in crores)
Sector No. of
projects Work order Work done Work on hand
Roads & Highways 13 7505.31 2871.18 4634.13
Irrigation 12 1457.10 324.63 1132.47
Mining Operation 9 1527.61 707.46 820.15
Total 34 10490.02 3903.27 6586.75
The Company's order book (pending execution) shows work on hand
amounting to Rs. 6586.75 Crores as on the June 30, 2011.
New contracts / projects
Your Company has been awarded following new contracts/projects during
the year and up to the date of this report.
Road Sector
1. "Improvement/Upgradation Strengthening/Widening of
Govindpur-Sahibganj State Road Project (Govindpur-Jamtara Contract
Package No. I)" by Road construction Department, Govt. of Jharkhand for
contract price of Rs. 229.91 crores in joint venture with GKC Projects
Ltd.-Hyderabad. Company is leading the joint venture with 50%
participation share i.e. for Rs. 114.95 cores.
2. "Rehabilitation and Up-gradation to 2-lane with paved shoulders and
maintenance of Multai-Chhindwara-Seoni Section of NH-69A and
Narsinghpur-Amarwara-Saoner Section of NH-26B" in Madhya Pradesh and
Maharashtra including construction and maintenance of Ring Road and
connecting roads in Chhindwara Town by NHAI for price of Rs. 1411.36
cores.
Irrigation Sector
1. "Execution of Omkareshwar Right Bank Lift Canal including its
distribution network up 40 Ha. Chak for culturable command areas (CCA)
of about 29947 Ha. on "Turn Key"basis from RD 51.281 to 125. Km
(excluding V.R.B. at RD 51.281 Km Wasvi-Sirsodia Road)" by Narmada
Development Division 20, M.P. for contract value of Rs.349.30 crores in
joint venture with GKC Projects Limited Hyderabad. Company is leading
the joint venture with 60% participation share.
2. "Execution of Omkareshwar Right Bank Lift Canal including its
distribution network up 40 Ha. Chak for culturable command areas (CCA)
of about 28073 Ha. on "Turn Key"basis from RD 0.00 Km to 51.281. Km
(including V.R.B. at RD 51.281 Km Wasvi- Sirsodia Road)" by Narmada
Development Division 20, M.P. for contract value of Rs. 519.93 crores
in joint venture with GKC Projects Limited Hyderabad. Company is
leading the joint venture with 40% participation share.
3. "Work of EPC contract for construction of Radhanpur Sub Branch
Canal, Manpura Sub Branch Canal, Distributaries & Minors of Radhanpur
Branch Canal, RSBC & MSBC (Earthwork, lining, Structures, Service Road,
CR/Escape/HR, Gates, Stop logs, Control Cabin) including Geo Tech
investigation, Design of structures and Operation and maintenance for
the same for five (5) years" for contract price of Rs. 236.20 crores in
joint venture with GKC Projects Limited Hyderabad. Company will lead
the joint venture with 52% participation share.
Mining Sector
1. "Blast hole drilling, controlled blasting with shock tube initiation
(Nonels), excavation, loading, transportation, dumping, spreading and
leveling etc., of 436.50 LBCM over burden, at Manugur OC-II Extension
(Phase-II) Project" by The Singareni Collieries Company Limited for
contract amount of Rs. 182.50 crores in joint venture with GKC Projects
Limited à Hyderabad. Company is leading the joint venture with 51%
participation share i.e. for Rs. 93.07 crores of which work amounting
to Rs. 26.01 crores has been completed.
Transfer of BOT Projects
Company has entered into Agreement with M/s Norwest Venture Partners
(NVP)& The Xander Group Inc (Investors) wherein over a period of time,
subject to necessary approvals, consents to the extend required from
various authorities shares held by Company in nine of the subsidiaries/
joint venture companies have been/ would be transferred to Sadbhav
Infrastructure Project Limited (SIPL) a subsidiary of Company.
Investors have invested a sum of Rs. 400.00 croes for acquiring 22.22%
stake on fully diluted basis in SIPL. This re-structuring and fund
raising would help Company to leverage its finance more effectively and
raising funds for the new project would now be done through SIPL.
Company now holds around 83% equity in SIPL and accounts of SIPL along
with subsidiaries/ joint venture companies have been consolidated with
the financials of Company. Brief summary of each of the Project is as
under :
Name of the Details of Project Cost of the
Company Project
(Rs. in
Crores)
Mumbai-Nasik Vadape-Gonde 4 Lane BOT project 794.58
Expressway Limited for widening the existing two-lane
(MNEL) of 99.50 Kms to four lanes and its
operation and maintenance.
Ahmedabad Ring 4-laning the present 76.21 km two- 500.80
Road
Infrastructure lane ring road around Ahmedabad
Ltd. (ARRIL) city and its operation & maintenance
Aurangabad-Jalna Widening the existing two-lane 277.00
Tollway Ltd. stretch of 65.80 kms to four lanes
(AJTL) and its operation and maintenance
Nagpur Seoni - Rehabilitation and upgrading to 489.70
Expressway Ltd. four lane from km. 596/750 to km.
(NSEL) 653/225 on NH-7 in the state of
Madhya Pradesh under North-
South Corridor (NHDP Phase II)
on BOT-Annuity basis.
- The project is a 51:49 joint
venture between the Company & its
associates and SREI Infrastructure
Finance Limited.
Dhule Palesner - Design, Engineering, Finance, 1420.00
Tollway Ltd. Procurement, Construction,
(DPTL) Operation and Maintenance of 4/6
laning of MP/ Maharashtra Border-
Dhule section of NH- 3 from km
168.500 to km 265.000 in the
State of Maharashtra under NHDP
Phase IIIA on BOT (Toll) Basis
- The project is in joint venture
between the Hindustan
Construction Company Ltd., John
Laing Investment Ltd and Company
& its associates in a ratio of
37:36:27 respectively
Maharashtra Border - Modernization and computerization 1426.37
Check Post Network of integrated border check posts
Ltd. (MBCPL) at 22(Twenty Two) locations in
the State of Maharashtra on Build
Operate and Transfer (BOT) Basis.
- The project is in joint venture
between Company & its associates,,
SREI Infrastructure Finance Limited
and SREI Sahaj e-village Limited in
ratio of 90:05:05 respectively
Hyderabad-Yadgiri - Design, Engineering, Construction, 480.22
Tollway Pvt. Ltd. Development, Finance, Operation
and Maintenance of four laning of
Hyderabad- Yadgiri Section from
km 18.600 to km 54.000 of NH-202
in the state of Andhra Pradesh
under NHDP Phase-III on DBFOT
(Toll) Basis Package No. NHDP-III/
BOT/AP/04.
- Equity component of the project
shared by Sadbhav Infrastructure
Project Ltd., and GKC Projects Ltd
in ratio of 60:40 respectively
Rohtak-Panipat Four laning of Rohtak to Panipat 1213.40
Tollway Pvt. Ltd. Section of NH-71A from km 0.000
Km 63.30 of NH-10 to km 80.858
Km 83.50 of NH-1 in the state of
Haryana on BOT basis under NHDP
Phase-III
Bijapur-Hungund - Project consists of four laning of 1257.10
Tollway Pvt. Ltd. Bijapur à Hungund Section of
NH-13 from km 102.000 to km
202.000 in the state of Karnataka
on Design, Build, Finance, Operate
and Transfer ("DBFOT"), Toll basis
under NHDP Phase-III Package No.
NHDP-III/BOT/KNT/05
- Equity component of the project
shared by Sadbhav Infrastructure
Project Ltd., and Monte Carlo
Construction Ltd. in ratio of 77:23
respectively.
Name of the
Company Status Toll Revenue % Shareholding
as on of the
SEL SIPL
30/06/2011 F.Y. 2010-11
(Rs. in
Crores)
Mumbai-Nasik
Expressway Limited
(MNEL) Completed 51.26 20 -
(except one
ROB for
which Work
In Progress)
Ahmedabad Ring
Road Infrastructure
Ltd. (ARRIL) Completed 63.42 - 80
Aurangabad-Jalna
Tollway Ltd.
(AJTL) Completed 23.69 - 51
(except ROB
for which
Work In
Progress)
Nagpur Seoni
Expressway Ltd.
(NSEL) Expenditure - 51 -
to the
extent of Rs.
292.89 Crore
has been
incurred.
Project
is under
suspension
and matter is
subjudice.
Dhule Palesner
Tollway Ltd.
(DPTL) 949.00 - 27 -
(as on 15th
July 2011)
Maharashtra Border
Check Post Network
Ltd. (MBCPL) 475.39 - 63 27
Hyderabad-Yadgiri
Tollway Pvt. Ltd. 232.99 - - 60
Rohtak-Panipat
Tollway Pvt. Ltd. 149.12 - - 100
Bijapur-Hungund
Tollway Pvt. Ltd. 790.06 - - 77
Joint Ventures
The Company has the following joint ventures Ã
SEL- GKC Joint Venture :
Over and above the Road, Irrigation and Mining Projects as mentioned
above, Company is executing following projects in Joint Venture with
GKC Project Ltd.
1. Earth work excavation, forming embankment and construction of CD &
CM works of main canal and distributory system upto water course level
and CC lining to main canal and other allied works including
investigation, designing and estimation of Gouravelly right side canal
from km 0.000 to 47.725 and left side canal in Karimnagar District. The
cost of the project is Rs. 166.88 croes of which company's share is 52
% i.e. Rs.86.78 crores of which work amounting to Rs.36.93 crores has
been completed.
2. Investigation, design and execution of Canal Network System
including Earth work Excavation and Forming Embankment, Construction of
CM & CD Works and lining of canals up to sub minors and formation of
Field Channels including Structures to serve an ayacut of 58800 Acres
in Karimnagar Dist under Kodlmial, Potharam Surampet Lachupet and New
tanks at 450 and its Concerned Gravity Canals ( Canal Network Package
III). The cost of project is Rs. 99.31 crores of which company's share
is 52% i.e Rs. 51.64 crores of which work amounting to Rs. 16.33 crores
has been completed.
3. Investigation, Survey, Design and Construction of Bus Rapid Transit
System (BRTS) corridor from Pendurthi to DRM Office (PTC Corridor) via
NAD Jn, Kancharapalem, Railway Station with 2 years defect liability
period under EPC(Design & Build) system. The cost of project is Rs.
165.54 crores of which company's share is 50% i.e. Rs. 82.77 crores of
which work amounting to Rs. 47.46 crores has been completed.
Sub Division of Equity Shares :
Pursuant to the approval of Shareholders through the process of Postal
Ballot nominal value of Equity Share of Rs. 10/- has been sub-divided
in to 10 Equity Shares of Re 1/- each.
Right Issue :
Through letter of offer dated August 04,2010 Company made Right Issue
of 6,25,000 equity shares of Rs. 10 each for cash at premium of Rs. 715
per equity share aggregating Rs. 45.31 crores . As per terms of offer,
allottees in Right Issue were also allotted 3 Detachable Warrants for
every one equity share. Right Issue which opened for subscription on
August 18,2010 closed on September 6, 2010 was oversubscribed.
Allotment of 6,25,000 equity shares were made on September 16,2010.
The details of utilization of fund v/s projection made in Letter of
offer dated August 04, 2010 are as under :
(Rs. in crores)
Particulars Proposed Utilized
up to Balance
Utilization 31/03/
2011 Funds
Investment in projects directly or
through Subsidiaries/Joint Ventures/Spvs 18.48 18.48 0.00
Margin Money/ investment for
purchase of Capital Equipment 16.45 4.27 12.18
General Corporate Purposes 8.66 8.66 0.00
Issue Expenses 1.72 1.44 0.28
Total 45.31 32.85 12.46
As per the terms of offer document, untilised balance fund has been
utilized towards working capital requirement.
Allotment of Detachable Warrants :
As per the terms of Right Issue, Company has issued and allotted
18,75,000 the Detachable Warrants convertible in to equal number of
Equity Shares of Rs. 10/- each on September 16,2010, which were due for
conversion into Equity Shares between December 16,2010 to March 15,2012
("Warrant Exercise Period") at an exercise price of Rs. 425/-. The said
Detachable Warrants were subsequently adjusted to 1,87,50,000
Detachable Warrants convertible in to equal number of Equity Shares of
Re 1/- each at price of Rs. 42.50/- per share on account of split of
the face value of Equity Share from Rs. 10 each to Re 1/- per share.
Thereafter as per letter of offer, on December 18, 2010, Board of
Directors exercised Call Option for compulsory conversion of Detachable
Warrants into Equity Shares.
The details of the allotment made on exercise of conversion of the
Detachable Warrants by warrant holders are as under :
Particulars No. of Equity
Shares Allotted Date of
Allotment
Voluntary Conversion- First Tranche 1278120 5/1/2011
Voluntary Conversion- Second Tranche 2524490 19/01/2011
Compulsory Conversion- Exercise of
Call Option 14823190 24/02/2011
Total 18625800
No of Warrants lapsed since not applied
for conversion 124200
Total 18750000
Company received Rs. 79.16 crores towards subscription of Detachable
Warrants.
Employee Stock Option Scheme :
The Company implemented the 'Sadbhav Employee Stock Option Scheme 2008
(ESOS Scheme 2008) pursuant to the resolution passed by the members at
the 19th Annual General Meeting held on September 27, 2008. The
Remuneration Committee of Board at its meeting held on October 04, 2010
granted 2,50,000 Employee Stock Options exercisable into 2,50,000
Equity Shares of Rs. 10 each, to eligible employees at a price of
Rs.500/- per share. The said 2,50,000 Employee Stock Options were
subsequently sub-divided in to 25,00,000 to match the reduced nominal
value of Re 1. Remuneration Committee administers and monitors the
Scheme.
The applicable disclosures as stipulated under SEBI (Employee Stock
Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, is
provided in Annexure-I forming part of this report.
Company has received certificate from Auditors of Company confrming that
scheme has been implemented in accordance with SEBI Guidelines and
resolution passed by Shareholders. Auditors certificate would be placed
at Annual General Meeting for inspection by members.
Search and Seizure Operation under Income Tax Act :
During the period under review search and seizure operation under
section 132 of the Income Tax Act, 1961 had taken place in the premises
of the Company and its Directors. During the course of search no
seizure was made by the Income tax department and the Company has not
disclosed any undisclosed income. No demand notice of income tax has
been served on Company till date pursuant to the said search.
Subsidiary Company
Pursuant to the General Exemption granted by Central Government vide
General Circular No. 2/2011 dated February 08, 2011 and the resolution
passed by the Board of Directors on April 20, 2011, copies of Balance
Sheet, Profit and Loss Account, Report of Board of Directors and the
Report of the Auditors of subsidiary companies have not been attached
with the Annual Accounts of the Company under Section 212 of Companies
Act 1956. As required under the circular statement giving required
details is enclosed with the consolidated balance sheet. The Company
will keep these documents at the Registered Office of the Company and
its subsidiaries and make them available upon the request by any
shareholder of Company.
Consolidation of Accounts
Further pursuant to the Accounting Standard AS-21 issued by the
Institute of Chartered Accountants of India, Consolidated Financial
Statement presented by the Company includes the financial statement of
its subsidiaries which have commenced activities.
Fixed Deposit
The company has not accepted any deposits as defined under Section 58A
of the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, as amended, during the year under review.
Directors
Shri Atul N. Ruparel and Shri Sandip V. Patel are the directors liable
to retire by rotation at the ensuing Annual General Meeting and, being
eligible, offer themselves for reappointment.
Directors' Responsibility Statement
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility
Statement, it is hereby confrmed that Ã
(i) in the preparation of the annual accounts, accounting standards
have been followed along with proper explanation relating to material
departure;
(ii) such accounting policies have been selected and applied
consistently and have made judgments and estimates reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at March 31, 2011 and 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 accounts have been prepared on a 'going concern' basis.
Auditors :
M/s. Shashikant Patel Associates, Chartered Accountants, the Statutory
Auditors, retire at the ensuing Annual General Meeting and are eligible
for re-appointment. Your Directors have recommended the re-appointment
of M/s. Shashikant Patel Associates, Chartered Accountants as Auditor
of the Company. The Auditor's have confrmed that their appointment, if
made, would be within limit prescribed under Section 224(1B) of the
Companies Act, 1956 and they are not disqualified, within the meaning of
Sub- sections (3) and (4) of Section 226 of the Companies Act, 1956.
Auditors' Report :
The Auditors' have not made any adverse comments / remarks which
requires clarification from the Directors of Company and accordingly no
further explanation has been provided by the directors in term of
section 217 of the Companies Act, 1956.
Corporate Governance
The Company has been proactive in following the principles and
practices of good corporate governance. The Company has ensured that
the Corporate Governance requirements as stipulated in Clause 49 of the
Listing Agreement with the Stock Exchanges are duly complied with. A
report on Corporate Governance along with a certificate from the
Auditors regarding compliance of Clause 49 of Listing Agreement is
annexed.
Industrial Relations
The Company enjoyed cordial relations with the employees during the
year under review and the Management appreciates the employees of all
cadres for their dedicated services to the Company.
Particulars of Employees
Information as per Section 217(2A) of the Companies Act, 1956 read with
the Companies (Particulars of Employees) Rules, 1975 as amended, is
given in the Annexure-II and forms part of this Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning
and Outgo
The rules regarding conservation of Energy and Technology Absorption
are not applicable to the Company. The particulars of the expenditure
in Foreign Currency and earning in Foreign Exchange are given in Notes
to Accounts (Schedule 23).
Acknowledgements
The Directors wish to express their appreciation for the support and
co-operation of the Central and State Government, Bankers, Financial
Institutions, Suppliers, Vendors, Associates, Subcontractors and
Shareholders during the year under review. Your Directors wish to place
on record their appreciation for the employees of the Company at all
levels for their commitment, dedication and continued support to the
Company.
For and on behalf of the Board of Directors
Place : Ahmedabad Vishnubhai M. Patel
Date : July 30, 2011 Chairman
Mar 31, 2010
The Directors have the pleasure in presenting the Twenty First Annual
Report together with the audited statement of accounts for the year
ended March 31, 2010.
Financial Results (Rs. in crores)
Current Year Previous Year
2009-2010 2008-2009
Income from Operations 1256.93 1062.48
Profit before Interest,
Depreciation & Tax 154.31 120.00
Less : Interest & Finance Charges 33.09 21.39
Depreciation 23.25 15.68
Profit before Tax 97.97 82.93
Less : Provision for tax 29.70 17.81
Provision for deferred tax
liability/(asset) 3.08 1.29
Fringe Benefit Tax 0 0.14
Profit after Tax 65.19 63.69
Less : Short (Excess) provision
for taxation of earlier years 11.35 0.40
Net profit for the year 53.84 63.29
Balance brought forward from last year 137.05 86.25
Amount available for Appropriations 190.89 149.54
Appropriations
Transfer to General Reserve 6.50 6.50
Transfer to Debenture Redemption Reserve 6.00 0.14
Proposed Dividend 5.00 5.00
Tax on Proposed Dividend 0.83 0.85
Balance carried to Balance Sheet 172.56 137.05
Dividend
The Directors are pleased to recommend for approval of the shareholders
dividend of 40% (Rs. 4 per equity share of Rs. 10 each) for the
financial year ended March 31, 2010. The final dividend, if approved,
will absorb a sum of Rs. 5.00 crores and dividend tax of Rs. 0.83
crores.
Business Overview
The total income from operations during the year under review was Rs.
1256.93 crores against Rs. 1062.48 crores for the previous year
recording the growth of 18.30%. Operating profit (PBDIT) for the
current year is Rs. 154.31 crores (Rs. 120.00 crores in previous year)
thereby recording the growth of 28.58 %. However the net proft after
tax is amounted to Rs. 53.84 crores (Rs. 63.29 crores in previous year)
thereby recording a reduction of 14.93 % mainly on account of amendment
made in explanation of section 80(IA) of Income Tax Act, 1961 by
Finance Act, 2009 which required additional provision of Rs. 11.35
crores.
Operations Ongoing Works
The following major works are under execution and the same are
progressing satisfactorily. (Rs. in crores)
Sector No. of projects Work order Work done Work on hand
Roads & Highways 14 6250.27 1289.45 4960.82
Irrigation 12 966.41 375.46 590.95
Mining Operation 8 1394.57 430.29 964.28
Total 34 8611.25 2095.20 6516.05
The Companys order book (pending execution) shows work on hand
amounting to Rs. 6516.05 lacs as on May 31, 2010.
New contracts / projects
Your Company has been awarded following new contracts/projects during
the year and up to the date of this report.
Road Sector
1. Improvement Works of Ranchi Ring Road (Section III Ch. Km 0.600 to
Ch. Km 13.350 and Section IV Ch. Km 0.000 to Km 6.335) (19.085 Kms) in
Jharkhand (Package ID : RRR-I) by Jharkhand Road Project Implementation
Company Limited for accepted Bid Amount of Rs. 252.00 crores.
2. Improvement Works of Ranchi Ring Road (Section V Ch. Km 0.000 to
Ch. Km 10.007 and Section VI Ch. Km 0.000 to Km 7.100) (17.107 Kms) in
Jharkhand (Package ID : RRR-II) Jharkhand Road Project Implementation
Company Limited for accepted Bid Amount of Rs. 225.00 crores.
Mining Sector
1. Removal of all types of material in all kinds of strata at Junad
OCM of Wani North Area in state of Maharstra by Western Coalfield
Limited (WCL) for a contract price of Rs. 68.07 crores.
2. Hiring of HEMM (Shovel, Drill, Dozer etc) for transport and
transportation of materials in various strata at Lakhanpur Area in
state of Orissa by Mahanadi Coalfelds Limited (A subsidiary of Coal
India Ltd.) for contract price of Rs. 225.43 crores.
3. Removal of Over Burden of First Dig (Solid) at Khadia OCP in the
state of Uttar Pradesh by Northen Coalfeld Limited (A subsidiary of
Coal India Ltd.) for contract price of Rs. 136.83 crores.
4. Removal of all types of material in all kinds of strata and
Evacuation of coal from quarry face and transportation to surface at
Navinkundra OC Mine of Majri Areas by Western Coal Fields Limited (A
subsidiary of Coal India Limited) for contract price of Rs. 92.08
crores.
New BOT Projects
Your company has been awarded following three new BOT projects during
the year
Rohtak - Panipat Road Project
- A toll based BOT road project
The project consists of four laning of Rohtak to Panipat Section of
NH-71A from km 0.000 Km 63.30 of NH-10 to km 80.858 Km 83.50 of NH-1 in
the state of Haryana on BOT basis under NHDP Phase-III. Rohtak-Panipat
Tollway Pvt. Ltd. has been incorporated as special purpose vehicle to
implement this project. The cost of project is estimated to Rs. 1364.03
crores of which EPC contract amounts to Rs. 1062.00 crores. The entire
EPC contract will be executed by the company. The Concession Period of
the project is 25 (Twenty Five) years inclusive of construction period
of 910 (Nine Hundred Ten) days from Appointed Date. The fnancial
closure of the project is in progress.
Bijapur- Hungund Road Project
- A toll based BOT road project
The project consists of four laning of Bijapur - Hungund Section of
NH-13 from km 102.000 to km 202.000 in the state of Karnataka on
Design, Build, Finance, Operate and Transfer (ÃDBFOTÃ), Toll basis
under NHDP Phase-III Package No. NHDP-III/BOT/KNT/05. Bijapur- Hungund
Tollway Pvt. Ltd. has been incorporated as a special purpose vehicle
(SPV) to implements this project. The cost of project is estimated to
Rs. 1257.10 crores of which EPC contract amounts to Rs. 1025.00 crores.
The entire EPC contract will be executed by the company. The Concession
Period of the project is 20 (Twenty ) years including construction
period of 910 (Nine Hundred and Ten) days from the Appointed Date. The
fnancial closure of the project has been achieved.
Hyderabad - Yadgiri Road Project
- A toll based BOT road project
The project consists of Design, Engineering, Construction, Development,
Finance, Operation and Maintenance of four laning of Hyderabad-Yadgiri
Section from km 18.600 to km 54.000 of NH-202 in the state of Andhra
Pradesh under NHDP Phase-III on DBFOT (Toll) Basis Package No.
NHDP-III/BOT/AP/04. Hyderabad-Yadagiri Tollway Pvt. Ltd. has been
incorporated as special purpose vehicle to implement this project. The
cost of project is estimated to Rs. 480.22 crores of which EPC contract
amounts to Rs. 398.80 crores. The entire EPC contract will be executed
by the company. The concession period of the project is 23 (Twenty
Three) years inclusive of construction period of 650 (Six Hundred
Fifty) days from Appointed Date. The financial closure of project has
been achieved on March 23, 2010 for debt component of Rs. 380.22
crores. Equity component of the project will be shared by Sadbhav
Engineering Ltd., and GKC Projects Ltd. in ratio of 60:40 respectively.
BOT Projects under implementation :
Nagpur - Seoni Express Way Limited:
- An annuity based BOT road project
This project involves rehabilitation and upgrading to four lane from
km. 596/750 to km. 653/225 on NH-7 in the state of Madhya Pradesh under
North-South Corridor (NHDP Phase II) on BOT- Annuity basis. The project
is a 51:49 joint venture between the Company and SREI Infrastructure
Finance Limited. Construction work amounting to Rs. 177.55 crores has
been completed as on May 31, 2010.
Company has completed rehabilitation and upgrading of 27.750 Km.
stretch which was made available by SPV. Balance stretch of 28.825 Km
is yet to be handed over to SPV by NHAI and same is pending for want of
clearance from Forest Department.
Dhule Palasner Tollway Limited :
- A toll based BOT road project
Dhule Palesner Road Project consists of Design, Engineering, Finance,
Procurement, Construction, Operation and Maintenance of 4/6 laning of
MP/ Maharashtra Border-Dhule section of NH- 3 from km 168.500 to km
265.000 in the State of Maharashtra under NHDP Phase IIIA on BOT (Toll)
Basis. The project is in joint venture between the Hindustan
Construction Company Ltd., John Laing Investment Ltd and Sadbhav
Engineering Limited in a ratio of 37:36:27 respectively. The financial
closure of project was achieved on December 18, 2009 for debt component
of Rs. 1065.00 crores. The company is executing allocated portion of
the EPC contract valuing Rs. 1221.00 crores and the construction work
amounting to Rs. 163.03 croes has been completed as on May 31, 2010.
Maharashtra Border Check Post Network Limited:
Maharashtra Border Check Post Project consists of Modernization and
computerization of integrated border check posts at 22 (Twenty Two)
locations in the State of Maharashtra on Build Operate and Transfer
(BOT) Basis. The project is in joint venture between Sadbhav
Engineering Limited, SREI Infrastructure Finance Limited and SREI Sahaj
e-village Limited in ratio of 90:05:05 respectively. The fnancial
closure of project was achieved on February 03, 2010 for debt component
of Rs. 1141.10 crores. The company is executing 73.61% of the EPC
contract valuing Rs. 1133.00 crores and the construction work amounting
to Rs. 49.67 crores has been completed as on May 31, 2010.
Revenue Generating BOT Project :
Ahmedabad Ring Road Infrastructure Limited (ARRIL)
- A toll-cum-grant based BOT road project
The Sardar Patel Ring Road BOT project for 4-laning the present 76.21
km two-lane ring road around Ahmedabad city and its operation &
maintenance. The construction of the project has been completed and SPV
namely Ahmedabad Ring Road Infrastructure Limited (ARRIL) is collecting
the toll. The toll income for year ended March 31, 2010 was Rs. 52.15
crores. Company holds 80% equity in this SPV.
Aurangabad - Jalna Tollway Limited (AJTWL)
- A toll based BOT road project
The Aurangabad-Jalna BOT project for widening the existing two-lane
stretch of 65.80 kms to four lanes and its operation and maintenance.
The construction of the project has been completed and SPV namely
Aurangabad-Jalna Tollway Limited is collecting toll. The toll income
for year ended March 31, 2010 was Rs. 12.13 crores. Company holds 51%
equity in this SPV.
Mumbai-Nasik Expressway Limited (MNEL)
- A toll-cum-grant based BOT road project
The Vadape-Gonde 4 Lane BOT project for widening the existing two-lane
of 99.50 Kms to four lanes and its operation and maintenance. The
construction work amounting to Rs. 526.59 crores has been completed as
on May 31, 2010 .
The Government of India has issued the Gazette notifcation dated April
21, 2010 prescribing the base toll rates for different category of
vehicles using the Mumbai-Nasik (Vadape - Gonde) section from the Km
chainage 539.500 to Km 440.000 of the National Highway No. 3 in the
State of Maharashtra, which consist of entire project length, being
four laned by Mumbai Nasik Expressway Limited, the special purpose
vehicle promoted by the Company to implement the Project. SPV has
started the collection of Toll from May 29, 2010. Company holds 20%
equity in this SPV.
Joint Ventures
The Company has the following joint ventures -
Sadbhav-PBA Joint Venture
The Company has entered into joint venture with PBA Infrastructure
Limited for construction of roads in multi-model international hub
airport at Nagpur (MIHAN) project complex. The cost of the project is
Rs. 142.36 crores of which the CompanyÃs share is 50% i.e. Rs. 71.18
crores of which work amounting to Rs. 66.58 crores has been completed.
JMC Ã Sadbhav Joint Venture
Joint venture with JMC Project (India) Limited for the construction of
a new 4 lane Agra bypass in the state of Uttar Pradesh under Phase- II
programme of North- South & East- West corridors was completed during
the year.
SEL- GKC Joint Venture :
In the joint venture with GKC Projects Limited the irrigation canal
network project mentioned above , the company is executing the
following project.
1. Earth work excavation, forming embankment and construction of CD &
CM works of main canal and distributory system upto water course level
and CC lining to main canal and other allied works including
investigation, designing and estimation of Gouravelly right side canal
from km 0.000 to 47.725 and left side canal in Karimnagar District. The
cost of the project is Rs. 166.88 crores of which companyÃs share is 52
% i.e. Rs. 86.78 crores of which work amounting to Rs. 35.14 crores has
been completed.
2. Investigation, Survey, Design and Construction of Bus Rapid Transit
System (BRTS) corridor from Pendurthi to DRM office (PTC Corridor) via
NAD Jn, Kancharapalem, Railway Station with 2 years defect liability
period under EPC(Design & Build) system. The cost of project is Rs.
165.54 crores with companyÃs share being 50% i.e. Rs. 82.77 crores of
which work amounting to Rs. 29.39 crores has been completed.
3. Investigation, design and execution of Canal Network System
including Earth work Excavation and Forming Embankment, Construction of
CM & CD Works and lining of canals up to sub minors and formation of
Field Channels including Structures to serve an ayacut of 58800 Acres
in Karimnagar Dist under Kodlmial, Potharam Surampet Lachupet and New
tanks at +450 and its Concerned Gravity Canals (Canal Network Package
III). The cost of project is Rs. 99.31 crores with companyÃs share
being 52% i.e Rs. 51.64 crores of which work amounting to Rs. 8.25
crores has been completed.
Subsidiary Company
As required under the provisions of section 212 of the Companies Act,
1956, a statement of the holding companyÃs interest in the subsidiary
companies is attached as ÃAnnexureà and forms a part of this report. In
the terms of approval granted by the Central Government under the
provisions of section 212(8) of Companies Act, 1956, copies of Balance
Sheet, Profit and Loss Account, Report of Board of Directors and the
Report of the Auditors of the subsidiary companies have not been
attached with the Annual Accounts of the Company. The Company will keep
these documents at the Registered Office of the Company and its
subsidiaries and will also be placed at the companyÃs website. Annual
reports would also be provided to the shareholders on request.
Consolidation of Accounts
Further pursuant to the Accounting Standard AS-21 issued by the
Institute of Chartered Accountants of India, Consolidated Financial
Statement presented by the Company includes the financial statement of
its subsidiaries which have commenced activities.
Fixed Deposit
The company has not accepted any deposits as defined under Section 58A
of the Companies Act, 1956 read with the Companies (Acceptance of
Deposits) Rules, 1975, as amended, during the year under review.
Directors
Shri Nitin R. Patel and Shri Amarsinh J. Vaghela are the directors
liable to retire by rotation at the ensuing Annual General Meeting and,
being eligible, offer themselves for reappointment.
Directors Responsibility Statement
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directorsà Responsibility Statement, it is
hereby confirmed that Ã
(i) in the preparation of the annual accounts, accounting standards
have been followed along with proper explanation relating to material
departure;
(ii) such accounting policies have been selected and applied
consistently and have made judgments and estimates reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at March 31, 2010 and 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 accounts have been prepared on a Ãgoing concernà basis.
Auditors
M/s. Shashikant Patel Associates, Chartered Accountants, the Statutory
Auditors, retire at the ensuing Annual General Meeting and are eligible
for re-appointment. Your Directors have recommended the re-appointment
of M/s. Shashikant Patel Associates, Chartered Accountants as Auditor
of the Company. The AuditorÃs have confirmed that their appointment, if
made, would be within limit prescribed under Section 224(1B) of the
Companies Act, 1956 and they are not disqualified, within the meaning
of Sub- sections (3) and (4) of Section 226 of the Companies Act, 1956.
Auditors Report
The Auditorsà have not made any adverse comments / remarks which
requires clarification from the Directors of Company and accordingly no
further explanation has been provided by the directors in term of
section 217 of the Companies Act, 1956.
Corporate Governance
The Company has been proactive in following the principles and
practices of good corporate governance. The Company has ensured that
the Corporate Governance requirements as stipulated in Clause 49 of the
Listing Agreement with the Stock Exchanges are duly complied with. A
report on Corporate Governance along with a certificate from the
Auditors regarding compliance of Clause 49 of Listing Agreement is
annexed.
Industrial Relations
The Company enjoyed cordial relations with the employees during the
year under review and the Management appreciates the employees of all
cadres for their dedicated services to the Company.
Particulars of Employees
Information as per Section 217(2A) of the Companies Act, 1956 read with
the Companies (Particulars of Employees) Rules, 1975 as amended, is
given in the Annexure- I and forms part of this Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earning
and Outgo
The rules regarding conservation of Energy and Technology Absorption
are not applicable to the Company. The particulars of the expenditure
in Foreign Currency and earning in Foreign Exchange are given in Notes
to Accounts (Schedule 23).
Acknowledgements
The Directors wish to express their appreciation for the support and
co-operation of the Central and State Government, Bankers, Financial
Institutions, Suppliers, Vendors, Associates, Subcontractors and
Shareholders during the year under review. Your Directors wish to place
on record their appreciation for the employees of the Company at all
levels for their commitment, dedication and continued support to the
Company.
For and on behalf of the Board of Directors
Place : Ahmedabad Vishnubhai M. Patel
Date : July 19, 2010 Chairman
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article