The Members of
Hindustan Construction Co. Ltd.
The Directors are pleased to present the 89th Annual Report together
with the Audited Financial Statements for the year ended March 31,2015.
2. Financial Highlights
Particulars Year ended Year ended
March 31,2015 March 31,2014
Rs crore Rs crore
Turnover 4,301.14 4,113.49
Profit before Interest,
Depreciation, Exceptional Items, 781.77 643.76
Other Income andTax
Less: Finance Costs 651.13 607.94
Depreciation 150.30 144.61
Add: Other Income 134.53 213.59
Add/Less: Exchange Gain/(Loss) 12.45 (13.85)
Profit before Tax 127.32 90.95
Less: Tax Expense 45.67 10.31
Profit/(Loss) after Tax 81.65 80.64
Add: Balance brought forward from last year 69.00 (11.64)
Less: Impact of depreciation/amortisation 2.73 -
(Refer Note 3.2 of the Financial Statements)
Balance carried to Balance Sheet 147.92 69.00
As your Company is under CDR, it is necessary to conserve and optimise
use of resources to improve the health of the Company. Hence, your
Directors have not recommended any dividend for the financial year
ended March 31, 2015.
The turnover of the Company at Rs. 4,301 crore has shown an increase of
4.6% as compared to Rs. 4,113 crore for the previous year. The profit
before tax is Rs. 1273 crore (including exceptional item) as compared to
Rs. 90.9 crore for the previous year.
Your Directors are pleased to inform that during the year under report,
the Company has secured the following major contracts.
- Numaligarh to Jorhat Section of NH 37, Assam Contract Value: Rs. 455
- Indo Nepal Borderto Rudhauli Section of NH-233, Uttar Pradesh
Contract Value: Rs. 393 crore
- Jamugurihat-Biswanath Chariali Bypass NH-52, Contract Value: Rs. 392
- Delhi Metro Tunnel Package CC-66, NCR Contract Value: Rs. 300 crore
- Munirka Flyover, New Delhi Contract Value: Rs. 278 crore,
- Kolkata Elevated Road Contract Value: Rs. 257 crore
- Sawra Kuddu Hydroelectric Project, Himachal Pradesh
Contract Value: Rs.180 crore
- Bhandup Complex Pipeline IV, Mumbai Contract Value: Rs.120 crore
- RIL Civil Works, Gujarat Contract Value: Rs. 88 crore
The total balance value of works on hand as on March 31,2015 is Rs.14,451
Decisions are awaited from various clients for tenders submitted by the
Company for 22 packages amounting to around Rs. 13,987 crore (HCC share Rs.
13,673 crore). Tenders for various packages for 45 projects worth over
Rs. 36,766 crore (HCC share Rs. 28,583 crore) are expected to be submitted
in the near future. The Company has also submitted prequalification
bids for 24 projects worth over Rs. 15,606 crore (HCC share Rs. 13,454
crore) which are under evaluation.
Operations of Subsidiaries
i) Lavasa Corporation Ltd. - Integrated Urban Development & Management
Lavasa has kept its rationale of developing a smart city for all and is
tailoring partnerships and tie ups with global leaders. Partnerships
are well in place and many of these projects are moving towards
In the hospitality space, the Accor group is successfully running its
operation with the two brands - Mercure Lavasa and the 1500 plenary
capacity Lavasa International Convention Centre (LICC). Another brand
of the Accor group - Novotel is scheduled for opening in April 2016.
Projects with renowned hospitality players like Formule One, Holiday
Inn, Langham and Eaton amongst others are slated to follow in quick
As for the existing hospitality projects, Ekaant -The Retreat and
Waterfront Shaw Apartment Hotel continue to flourish. Fortune Select
Dasve is in its seventh year of successful operations with an occupancy
of 66%. Accor Mercure is in its sixth year of successful operation with
an occupancy at 56%. In the tourism space, Lakeshore Watersports, Neo
Spark Games Arcade and Xthrill Adventure Sports & Academy are also
functioning successfully. Additionally agreements have also been signed
to set up training facilities with Hockey Australia, Sir Nick Faldo for
Golf Academy and Sir Steve Redgrave Rowing Academy.
On the retail front, a significant area has already been leased.
Restaurants like Smokin Joe''s, VenkysXpress, Subway, Cafe Coffee Day,
Baskin Robbins, All American Diner, Granma''s Homemade Patisserie, Chor
Bizarre, Oriental Eight, Past Times Pub, Tabakh, Pizzavala, Naashta
Paani, Paanchi Krunchyand Indulge have commenced operations. Many other
non F&B outlets such as Mapro, Charosa Wine Boutique and Health First
Organic store have successfully started operations including Lavasa''s
first miniplex- Fun Square Digital Cinema.
Significant progress was made in the education space. Christel House
Lavasa is into its sixth year of operations with 445 students. 2014-15
also saw launch of Phase 2 of Christel House till grade 6th. Corporate
entities such as EduSports, Yoga Blessing and Linguaphone showed keen
interest to contribute towards Christel House Lavasa School by way of
sports programmes, educational and Yoga workshops.,
Ecole Hoteliere Lavasa started its sixth batch in 2014- 15. The seventh
batch will commence from 28th July 2015. In May 2015, the third batch
of the institute graduated and received their certification from Ecole
Hoteliere de Lausanne. Christ University started its first batch with
14 students in 2014-15 & is commencing its second batch for the
academic year 2015-16 with the target batch size of 60 students for
PGDM program with specialization in Finance and Marketing.
Knowledge Vistas Limited (KVL) is already running Little Millennium,
pre primary school at Lavasa for last five years. It is also likely to
start the k12 school from academic year 2016-17 Abhinav Shiksha
Sansthan, New Delhi will start from the academic year 2017-18 across
the area of 62,500 sq. ft. Other educational partners like Symbiosis
Institute (Pune) are also in the process of launching their programs.
Lavasa continued to enjoy healthy sales in residential and commercial
space. In institutional sales, the company closed the transaction with
Hindustan Times Media Limited, the premier media establishment which
has acquired over 6 acres of land. The media house proposes to
establish a state-of-art training centre for its executive staff. A
proposal has also been submitted to The Times Group to start a premier
management training institute on land it has acquired in Mugaon.
The Doon Public School has acquired a 10 acre plot in Mugaon to start
its brand of school. Till the project is completed the school would
operate out of an incubation space in Dasve.
Hazel Hotels that had acquired 2 plots of land aggregating to 2.1 acres
with BUA of 40,000 sft has been granted building plan approval by SPA
and proposes to commence construction of a Ramada Encore branded hotel.
J Vora Hospitality is all set for a soft launch of its 80 keys
vegetarian hotel in Dasve by December 2015. SOSFIPL, an NGO has
obtained SPA approval for a bakery with a BUA of 20,000 sq.ft in Bhoini
and will commence construction activity this year.
Symbiosis Institute has already been granted building plan approval and
will commence construction of its large campus post monsoon.
Lavasa continued its focus on branding and communication activities in
2014 - 15. Emphasis through the year was on communicating that
development work at Lavasa has commenced with right earnest, raise
awareness about the planned city and its advantages. Positioning Lavasa
city as India''s first smart city, building preference and restoring
customer confidence in the project were the key goals.
A new advertisement campaign was launched in May 2014- Unlocking
India''s Potential to capitalize on the cause of 100 smart cities.
Primary thought behind the campaign that ran from May to June 2014 was
that if India needs to grow, infrastructure needs to grow in sync.
India needs ''New cities'' and Lavasa is one such new city which can
serve as a prototype for creating new cities. This campaign was
followed by a Smart City Campaign that positioned Lavasa as India''s
First Smart city. The campaign highlighted the various ''smart'' aspects
of Lavasa through a nationwide advertising campaign using the Times of
India and Hindustan Times group publications. Simultaneously magazines
such as Forbes were used to spread this message. The print campaign was
ably supported by outdoor, on-site media, digital and social media.
Media coverage of the event and interviews with spokespersons resulted
in the news being carried by both print and electronic media.
Lavasa continued with its strategy of creating large events at Lavasa
to attract the right footfalls. Events held during the year were
Martial Arts Festival,
Marathi Box Cricket League, FAME 2014, Freedom 2014, Mirchi Queen Bee,
The Lost Party and Gladrags Mrs. India. Digital and social media
channels were leveraged primarily for engagement and for information
dissemination. The new mobile-friendly website was launched in April
2014 with a contemporary look & feel. Lavasa also initiated e-mailer
campaigns to selected databases of Times of India and Hindustan Times
and tied up with Google to create ''Google Street view'' for our first
In 2014-15, the Public Relations campaign focused on positioning Lavasa
city as India''s first smart city with focused efforts towards building
preference and restoring customer confidence in the project. To enable
this, a number of site visits were organized
for media, the primary influencers and other key influencers of public
opinion. Through the year over 75 journalists from print, TV, news
wires and web media from Mumbai, Pune and Lavasa region visited Lavasa.
Meetings with senior editors and constant engagement with beat
reporters led to better appreciation of company''s stand on issues and
presentation of a balanced perspective on most issues. Stories in
leading magazines, newspapers and international publications were
initiated to convey that development work at Lavasa has commenced with
right earnest and that the company is committed to developing the city.
Tourism stories in travel and trade media were initiated to promote
Lavasa city as a premier tourist destination. Lavasa as a cultural hub
was promoted by leveraging travel and lifestyle media to publicize the
city''s initiatives like the World Fest 2014, Freedom 2014 and FAME 2014
Promotional initiatives of various Special Purpose Vehicles like
Christel House Lavasa, Ecole Hoteliere Lavasa, Dasvino Town & Country
Club, Mercure Lavasa Fortune Select Dasve, Lakeshore Watersports and X
Thrill were publicized through news stories, editorial feature stories
and photo features.
Lavasa city now has a full-fledged operational Farmer''s market known as
Hara Bazaar; a two screen movie theatre for visitors and residents; It
has a fully operational post office, a hospital with pharmacy and
several new food and beverage establishments open for business. It also
has four operating hotels and four additional hotels will be opening
soon which collectively will take the total number of hotel rooms in
Lavasa to more than 600. Lavasa has a Petrol Pump, two Bank branches
along with ATMs, a Convention Centre, a public safety centre with Fire
engine, Police outpost to be upgraded to a full-fledged police station,
Tourist information center with a Hop On - Hop Off Bus facility,
Multilevel Car parking facilities, Nature trail, Citizen contact center
with 24x7 support to citizens through emergency and non-emergency
contact numbers, rental housing for low income groups, simulated golf
course facilities; water sports facility with latest
Jetovator'',''adventure sports facility, a modern club with gym, sports
and spa facilities, public transport system for citizens, Schools for
local population and two operational College campuses.
Building the infrastructure right, from the beginning, is a key
strategy to ensuring long-term livability. The drinking water at Lavasa
is fit for
consumption, straight from the tap, without the need for additional
filtration. The sewage is treated as per required standards before
being reused for irrigation and other non-potable uses. Lavasa''s power
distribution grid is nearly 99% reliable and the young city is already
on the cutting edge of urban environmental sustainability initiatives.
Over 50km. of well maintained motor able roads are operational and more
being constructed, Lavasa has already opened parks and play areas to
the public.The e-governance portal will play a major role in
communicating with citizens and providing round the clock services.
Around the clock Lavasa Citizen Call Centre has been operational since
2009-2010. The Call Centre is a one-stop information source for non
emergency and emergency related services. It provides a single window
resolution for all customer needs and visitor requests, be involved in
proactive information distribution, data collection and management
services, customer satisfaction surveys and customer handover and
The City Management Services (CMS) Department is equally dynamic in
seeking to coordinate services in this rapidly changing setting. It is
currently divided into seven specialist divisions including Customer
Services, Public Safety & Security, Enterprise Utilities, Public Works,
Administration & Finance, Community Development and Geographic
Information Systems & Management Information Systems.
The City Management Services Department envisions to slowly evolve into
a new governance entity that will, at some point, be the core of a new
replicable governance model. It meets on a monthly basis with a
committee of villagers from throughout the project area. The Village
Committee is the first of several such citizen advisory groups that
will together form a key component of the Lavasa citizen and
stakeholder engagement mechanisms.
Lavasa Corporation has 10574 acres of land including 455 acres of land
Lavasa continues to regularly monitor environmental aspects such as air
quality, water quality and soil quality are being carried out as per
MoEF guidelines. The Environmental Compliance Report is being submitted
to MoEF once in six months. The last report was submitted in December
2014 and work of Biodiversity conservation and enhancement continues at
required pace. Lavasa Sustainability report for the period 2010-13 was
prepared and accorded highest rating application level A as per GRI
Lavasa also became a member of Cll-Western Region Sub-Committee for
Environmental Business and has contributed its learning and experience
within the region.
First town, Dasve is ready with all basic infrastructure, such as
access roads, internal roads, water treatment plant, water distribution
network, sewage network, sewage treatment plant, telecom network and
services which are operational. Till date more than 801 residential
units have been handed over to CMS department and over 677 residential
units have been handed over to customers. Work on rest of few
properties - Lake View apartments, Club View apartments, Delfino
apartments, Valley View apartments, BrookViewapartments, Rental
housing, Retail and hostel tower B, Christel House Phase II, Novotel
Hotel and Holiday Inn is in progress.
Work on the infrastructure for the second town of Mugaon has been
accelerated. Work on utilities like water, sewer, power, data lines and
on the approach road is in progress. Work on 29 buildings at Mugaon has
commenced. The improvement to the existing Mugaon-Tamhini Zilla
Parishad road is complete. The portion of this road will also form a
part of the approach road for the proposed tunnel between Tamhini and
Mugaon. Work on the inter village road from Mugaon to Dhamanohol is
complete (6 kms).
Lavasa has also initiated a number of development and empowerment
programs for the local community. Some of the key initiatives include
provision of treated drinking water to 12 villages in the project area
at 62 locations on a daily basis. Calligraphy workshops, aptitude tests
and counseling for students of Zilla Parishad (ZP) schools, creche for
labor children; starting the Apollo Lavasa Primary Health Centre at
Bhoini and provision of free health check up, medicines and ambulance
service to villagers; monthly health and awareness camps for HIV/ AIDS,
malaria, nutrition, and water borne diseases. Employment and self
employment opportunities to the locals have also been provided.
Ministry of Environment and Forests (MOEF) Issue
As you are aware that Lavasa was issued a show cause Notice by Ministry
of Environment & Forests (MoEF), Government of India (GOI) regarding
violations of the Environmental Impact Assessment notifications of 1994
as amended in 2004 and superseded in 2006 (EIA Notifications). The
Company made various representations as per the directions given by
the authorities and after complying the conditions stipulated, MOEF
GOI was pleased to accord the Environmental Clearance to the Company.
Herein below given are the updates in the matter during the Financial
Year 2014 - 2015:-
1. Transfer Petition (C) No. 1326 of 2012 filed by your Company for
transferring the National Green Tribunal (NGT) Appeal No. 9 of 2012
filed by Dyaneshwar Shedge was listed before the Registrar for
completing the pleadings. Earlier, the Hon''ble Supreme Court, vide its
order dated October 19, 2012, stayed the proceeding before NGT The
Transfer Petition was listed before Hon''ble Supreme Court on August 04,
2014, wherein after hearing the parties in the matter, the Hon''ble
Supreme Court was pleased to pass the following order:-
Looking at the facts of the cases, we are of the view that these
petitions should be heard either by the Green Bench or by another
appropriate Bench. The Registry to place the matters before the Hon''ble
the ChiefJustice oflndia so that appropriate orders may be passed.
The Company''sTransferPetition (C) No. 1326 of
2012 along with Civil Appeal being No. 4280 of
2013 and Contempt Petition being No. 203 of 2013 filed against
Dyaneshwar Shedge are pending before the Hon''ble Supreme Court for
2. NGT Appeal No. 36 of 2011 filed by the Company was listed on October
16, 2014 and the Hon''ble Tribunal was pleased to adjourn the matter
sine-die till decision of Apex Court.
3. The record and proceedings in NGT Appeal No. 9 of 2012 filed by
Dyaneshwar Shedge have been transferred to Hon''ble Supreme Court in
view of the stay granted by Apex Court.
4. Public Interest Litigation (PIL) No. 129 of 2014 filed by Suniti S R
and others (Petitioners), wherein the Company is Respondent No 12, was
listed before the Hon''ble Bombay High Court on August 11, 2014, wherein
the Hon''ble Court issued Rule
in the matter without passing any adverse order against the Company.
The Company has filed further Affidavit in Reply in the matter on
The Petitioners have on December 10, 2014 filed a Civil Application
being No. 186 of 2014 for amending the PIL interalia to challenge
Environmental Clearance grated to your Company. On December 16, 2014
PIL No. 129 of 2014 was tagged with Writ Petition No. 3836 of 2014 and
the same stands adjourned. Meanwhile the Company is in the process of
filing reply to the Civil Application No. 186 of 2014, and the matter
is currently pending.
Further, the Company is regularly filing six monthly compliance report
as per the Environmental Clearance order.
ii) HCC Real Estate Ltd.
HREL, a wholly owned subsidiary of your Company is into the business of
building residential & office complexes in real estate sector.
HRL (Thane) Real Estate Limited
HRL (Thane) Real Estate Ltd. a subsidiary of HREL initiated the
acquisition of 183 acres of land at Ghodbunder Road, Thane for
Integrated Township Development. Till date, the Development Agreement
and Power of Attorney for 32 acres have been executed in favour of the
Company. The Company continued its activity of securing its position
for land title and other documentation.
The Company has filed a criminal case against Mr. Atul Sonawala and 8
others, Director of Om Gurukripa Realtors Pvt. Ltd. Police enquiry is
under process for the said case.
HRL Township Developers Limited
No activities were carried out during the year. Company continued its
search process for joint development opportunities
NashikTownship Developers Limited
During the year, the Company has sold its land and completed all the
land related transactions. For further opportunities, the Company is
looking for joint development opportunities in residential sectors
since Nashik city is growing industrially as well as economically.
Maan Township Developers Limited
Maan Township Developers Ltd a subsidiary of HREL has acquired
approximately. 28 acres of land by way of purchase and the Development
Agreement and Power of Attorney have been executed in favor of the
The company has now decided to sell the land in piece parcels.
Powai Real Estate Developers Limited
No activities were carried out during the year. However, the company
continued to look for an opportunity to find ideal land parcels for
joint development in residential sectors.
HCC Realty Limited
No activities were carried out during the year. Panchkutir Developers
During the year, your Company continued its efforts on the following
projects in the residential sector.
Development of Vikhroli (E) land parcel: Out of the total land holding
of around 32 acres by Panchkutir Developers Ltd. in Vikhroli (E), the
survey of tenements on Phase-1 of 14.5 acres of land to ascertain the
development potential of the free sale component is completed. Out of
the 1960 slum residents, consent of about 1400 residents representing
more than 70% has already been obtained and the process for forming the
society is in progress.
Slum declaration of Phase-1 land was challenged and the same has been
set aside by the Special Slum Tribunal. Subsequently, the litigant
filed a Writ Petition challenging the above said Order of the Slum
Tribunal in Bombay High Court . The High Court upheld the 3C order and
asked the Tribunal for actual verification of slum details. Against
this order, the litigant has filed an appeal challenging the above said
Order of the Slum Tribunal on divisional board in High Court.
Development of Powai land: MOU-cum-Development Agreement and Power of
Attorney were executed by the land owner in favour of the Special
Purpose Vehicle , Panchkutir Developers Ltd., a subsidiary of HCC for
12 acres of land. Due to non performance by the land owner of the
various obligations under the MOU- cum-Development Agreement in spite
of repeated reminders, the company has been legally advised to invoke
the Arbitration clause forming part of the MOU- cum-Development
Agreement. Accordingly, Arbitration proceedings have been initiated and
till date recording of the evidence of Claimant''s witnesses has been
completed and the matter is now stated for hearing in July 2015 for
evidence of Respondent.
iii) HCC Infrastructure
HCC Infrastructure Company Ltd., a wholly owned
subsidiary of your Company, develops and operates infrastructure
concessions in transportation, power and water sector through its
HCC Concessions Ltd., HCC Power Ltd., and HCC Operations & Maintenance
Ltd. The current portfolio has six NHAI road concessions, totaling
about Rs.5,500 crore, housed under HCC Concessions.
Your Company''s focus on sustainable and responsible development through
the Public Private Partnership results from expertise in concept
innovation, risk analytics, construction management and operations.
The strong management team at the Company follows a strict investment
discipline to create value for its members. Along with a focus on
financial discipline, quality and timely execution, the Company is
committed to provide reliable, safe and world class operations and
maintenance services to the country''s end users.
In 2011, the Xander group, a global investment firm, valued HCC
Concessions Limited at Rs.1,650 crore and had acquired a 14.5% stake
Current Road Portfolio:
HCC Concessions has a current portfolio of Rs. 5,500 crore which includes
six NHAI road concessions. These include one annuity and five toll
based projects: Nirmal (annuity) in Telangana (erstwhile Andhra
Pradesh) on NH7, the Delhi Faridabad Elevated Expressway (dfskyway™)
on NH2, Dhule Palesner Highway in Maharashtra on NH3 and three
contiguous sections of 250 km in West Bengal on NH34. Of these, Nirmal
Annuity, diskyway™, Dhule Palesner Highway and the first leg of
NH34''s development, the Baharampore Farakka Highway are operational.
The four operational projects have been operational for between one and
five years and are running smoothly. Farakka Raiganj Highway, the
second leg of NH-34 development in West Bengal is expected to be
operational later this year while the last leg, Raiganj Dalkhola has
seen significant improvement in terms of land acquisition and work is
expected to start shortly. Material defaults by NHAI, largely due to
delayed handing over of land for all three NH-34 packages have resulted
in the Concessionaire''s filing of a claim of Rs. 883 crore as damages
from NHAI as on June 30, 2014. Despite the aforementioned delays and a
recessionary environment in the past few years, the NH-34 projects
continue to be a substantial source of value creation for the
During the past year, there was very limited opportunity for new
projects since only about 740 km were awarded by NHAI. HCC Concessions
has chosen to focus on the execution of its under construction projects
and also raise capital through stake sale at attractive valuations.
The Company will evaluate NHAI projects in the next financial year,
albeit conservatively, while also evaluating state road opportunities.
Status of Operational Assets:
Dhule Palesner Highway Project (NH-3)
The project road is part of NH-3, commonly referred to as the
Agra-Mumbai road, originating from Agra and ending at Mumbai. It is a
primary conduit for transportation of passengers as well as freight
traffic from the state of Uttar Pradesh to major towns in the states of
Madhya Pradesh and Maharashtra. In FY09, NHAI awarded a contract for
the development of a four lane highway from Km 168.500 to Km 265.000 on
the Maharashtra/MP border to an HCC led consortium on a BOT (toll)
basis. The concession period is 18 years, including a construction
period of 30 months. The project was operational in February 2012,
about 4 months ahead of its scheduled completion. The project has been
developed at a total investment of Rs. 1,420 crore.
The operation of project road is running smoothly. During the year,
the Company implemented the 10x tolling for Overloaded vehicles in line
with the NHAI Fee Rules. NHAI also handed over the land for the
Developed Section from Km 219.7 to Km 233.0 after a delay of 1.5 years.
The contractor has started the mobilization and is expected to finish
the work on the remaining 2 lanes within six months. The daily toll
revenue is expected to increase by about Rs. 2-3 lakhs after this
development. The remaining concession period for the project is about
Pursuant to the interest expressed by the Sadbhav Group to acquire the
Company''s stake in the SPVs, the Company has also entered into
definitive agreements with the Sadbhav Group for the sale of its entire
economic stake in Dhule PalesnerTollway Ltd. The transaction is subject
to receipt of necessary approvals.
Delhi Faridabad Elevated Expressway (NH-2) (dfskyway™ )
The Delhi Faridabad Elevated Expressway or dfskyway™ is a six lane
4.4 km elevated highway
connecting Delhi and Haryana at Badarpur. This award winning
engineering marvel designed and developed by HCC Concessions Ltd with
an investment of nearly Rs. 600 crore boasts 20 exits, 10 underpasses and
is the first of its kind spaghetti structure in India. The dfskywa/M
contributes significantly to Delhi''s rapidly expanding infrastructure
by reducing travel time by over 40 minutes through an extremely
congested corridor that benefits residents and inter-state traffic
The project''s concession period is 20 years, including construction
period of 24 months. Of the three satellite cities, Faridabad is
under-developed and under-priced relative to other parts of NCR.
However, since the development of this asset, there has been a 30-40%
increase in property prices (2008-10).
Besides, Faridabad has been ranked as the 8th fastest developing city
by The City Mayors Foundation. This asset has been awarded the Best
Project Award by Construction Industry Development Council 2011 and the
Infrastructure Excellence Award 2011 by CNBC TV18.
In February 2013, this SPV has undergone restructuring of its debt due
to revenues falling short of projections which is mainly attributed to
the prolonged economic slowdown in the country (coinciding with COD)
and the existence of toll free local road, which is being used by the
long distance vehicles to escape paying toll charges.
In order to enhance the revenue on this project and reduce maintenance
costs, the Company is in the process of implementing 10x tolling for
overloaded vehicles in accordance with NHAI Fee Rules. The Company has
also submitted a comprehensive proposal for advertising along the
project highway. The project is a signature project in Delhi having
very high visibility and the Company is expecting significant revenues
from the latter sources.
Nirmal Annuity (NH-7)
This project road from Kadtal to Armur inTelengana (erstwhile Andhra
Pradesh) is a part of the Nagpur- Hyderabad section of NH-7 In FY07,
NHAI awarded the development of four-laning of 30 km long Kadtal Armur
Section of NH-7 on a BOT basis under the Annuity scheme to HCC. The
concession period for the project is 20 years, including a construction
period of 24 months. The project was developed with an investment by
HCC of Rs. 315 crore. This project was operational in July 2009, 100 days
ahead of the scheduled completion
date. The debt at Nirmal has since been refinanced through a structured
bond at 9.38% fixed rate of interest for a 17 year tenure.
As part of the capital raising activity, the Company has signed
definitive agreements for the 100% sale of this project to Highway
Concessions One Pvt Ltd (an entity majorly held by IDFC Alternatives
managed India Infrastructure Fund). Highway Concessions One will
acquire a 74% equity stake upfront, while the remaining 26% shall be
acquired upon receipt of an approval from NHAl.The Company is working
towards the fulfillment of conditions precedent and the transaction is
expected to close shortly.
The SPV has received timely annuity payments over the last year and the
operations and maintenance are being managed efficiently by HCC
Operations and Maintenance Ltd.
Baharampore Farakka Highway (NH-34)
This 101 km project is the first section of 250 km contiguous section
on NH-34 (West Bengal) from Baharampore to Dalkhola and was awarded to
the Company in 2010.
NH34 provides nearest access to Kolkata and Haldia ports for the north
eastern states of India and neighbouring Bangladesh, Bhutan and Nepal.
The traffic on NH34 comprises 85-90% commercial traffic, carrying a
diversified mix of manufactured goods, building materials, steel, jute,
food grains and tea.
The project road starts from north of Kolkata at Km 191.420 near
Baharampore and ends at Farakka (before Farakka barrage) at Km 294.680.
The project achieved commercial operations in May 2014 and has been
tolling smoothly. The operations and maintenance is being managed by
HCC O&M Ltd. The Company implemented the 10x tolling for overloaded
vehicles on this project in August 2014 to enhance revenue and reduce
maintenance costs and was amongst the first few in the country to
implement the same.
The completion of the project is delayed by 22 months as of March 2015,
largely due to material defaults by NHAI in providing land on a timely
basis. Provisional Completion (PCOD) was achieved 9 months after SFLD
(Scheduled Four-laning Date) and Final Completion (FCOD) will be
delayed by a total of 35 months due to delayed handover of Right of Way
(ROW), tardy design clearances for major bridges and structures,
of various hindrances, utilities shifting, etc. As of June 30, 2014,
the Concessionaire has filed Rs. 290.85 crore worth of claims from the
NHAI for the damages suffered due to NHAI defaults. The Concessionaire
will submit further claims for increased costs beyond June 30, 2014.
Since the realization of claim from the Authority will be a lengthy
process, the SPV meanwhile approached its Lenders in August 2014 to
assist in funding the delays and has subsequently received support from
The concession period for the project is 25 years, including a
construction period of 30 months. The project is being implemented with
an investment of Rs. 1,169 crore.
As part of its capital raising activity, the Company has entered into a
non-binding Term Sheet for the sale of 100% stake in the project,
subject to requisite clearances and approvals. The proposed transaction
is expected to close by the end of Q1FY16 after the diligence process
and documentation is completed.
Status of Assets under Development:
Farakka Raiganj Highway (NH-34)
The project road starts from Farakka at Km 294.680 and ends at Raiganj
at Km 398.000. The Farakka Raiganj section is about 102 km in length
and traverses through Farakka barrage, Kalia Chawk Bazaar and Malda
city in Malda and North Dinjapur districts of West Bengal. It also
passes through various small villages like Sujapur, Gazole, Stalkuri,
Itahar and ends before Raiganj town. The concession period is 30 years,
including a construction period of 30 months. The project is being
implemented with an investment of Rs. 1,378 crore.
A substantial stretch (79%) of roads and structures of this second and
largest leg of NH-34 development has been completed and toll collection
is expected to commence by the year end. In the last year, almost the
entire land has been made available for construction after a long
delay. The completion of the project is delayed by 22 months as of
March 2015, largely due to material defaults by NHAI in providing land
on a timely basis. The Provisional Completion (PCOD) is estimated to be
achieved 29 months after SFLD (Scheduled Four-laning Date) while Final
Completion (FCOD) will be delayed by a total of 37 months due to
delayed handover of Right of Way (ROW), tardy design clearances for
major bridges and structures, removal of various hindrances, utilities
shifting, etc. As of June 30, 2014, the Concessionaire has filed Rs.
322.72 crore of
claims from the NHAI for the damages suffered due to NHAI defaults. The
Concessionaire will submit further claims tor increased costs beyond
June 30, 2014. Since the realization of claim from the Authority is a
lengthy process, the SPV meanwhile approached its Lenders in August
2014 to assist in funding the delays and has subsequently received
support from its Lenders.
Raiganj Dalkhola Highway
This is the northern section of the NH-34 development, starting at
Raiganj (Km 398.000) and terminating at the town of Dalkhola (Km
452.750). The 50 km project stretch traverses through Raiganj and
Dalkhola towns in North Dinjapur district of West Bengal. It also
passes through various small villages like Soharai, Karandighi,
Maheshbathna and ends at the intersection of NH31. The concession
period is 30 years which includes a construction period of 30 months.
The project is being implemented with an investment of Rs. 684 crore.
The project progress has been very slow due to the non-availability of
land. In the year 2014-15, a significant portion of land has been made
available for construction after a delay of over 4 years. The Company
expects to receive 80% of unencumbered vacant land in the coming months
when execution will restart. As of June 30, 2014, the Concessionaire
has filed Rs. 269.31 crore worth of claims from the NHAI for the damages
suffered due to NHAI defaults. The Concessionaire will submit further
claims for increased costs beyond June 30, 2014. Since the realization
of claim from the Authority is a lengthy process, the SPV meanwhile has
approached its Lenders in February 2015 to assist in funding the delays
and has subsequently received positive indications from its Lenders.
iv) Steiner AG, Switzerland
Steiner AG is a leading total and general contracting company in
Switzerland, specialized in turnkey building construction including
refurbishments and real estate development.
Your Company owns 100% stake in Steiner AG through HCC Mauritius
Enterprises Limited and HCC Mauritius Investment Limited, Wholly Owned
In FY2014-15, Steiner AG has registered a revenue of CHF 853.9 million
(Rs. 5604.2 crore) compared to CHF 796.7 million (Rs. 5,228.7 crore) in the
The net profit stood at CHF 1.7 million (Rs. 11.2 crore) compared to CHF
8.15 million (Rs. 53.4 crore). The company secured fresh orders worth CHF
(Rs. 5,106 crore). The order backlog was CHF 1.12 billion (Rs. 7195 crore)
at the end of the year. In addition to this, the company has secured
orders for more than CHF 192 million (Rs. 1,232 crore), where the
contracts are yet to be signed. The closing cash balance of the company
was CHF 103 million (Rs. 658.5 crore) reflecting company''s steady
financial performance and strong liquidity position.
v) HighbarTechnologies Ltd
HighbarTechnologies Ltd (''Highbar''), a wholly owned subsidiary of your
Company, is an Information Technology Company formed by your Company,
with the vision of providing end-to-end IT solutions to Infrastructure
Highbar was able to service 16 new customers including 6 new customers
from Middle East, Africa and Switzerland taking the total tally of
clients to 94. This has been achieved at a time when the primary
customer segment, the construction industry, is facing multiple
challenges. Despite this, in a short span of time, Highbar has started
dominating the ''IT for Infrastructure'' market. Your Company''s group
legacy has enabled Highbar to understand and service these industries
effectively. The orders won by Highbar have contributed highest value
through net new customers in SAP Ecosystem for infrastructure sector in
calendar year 2014. Highbar has started providing SAP related services
in multiple sectors like Manufacturing, BPO, Agro-Chemicals in addition
to Infrastructure, Real Estate, Retail, Telecom, Consumer Products, PEB
(Pre-engineered Buildings), Iron & Steel etc. It has developed
capabilities to execute successfully very large size projects
concurrently. Customers have demonstrated their faith in Highbar for a
long term association by awarding 5 years support deal in addition to
After securing first order in last year, Highbar has started expanding
its reach in government sector by exploring opportunities. Its Dubai
subsidiary, Highbar Technologies FZ-LLC, has now started strengthening
its presence counting ten major customers in the Middle- East in a
short span of time. Highbar now operates not only in India and
Middle-East but also in Africa (Nigeria) and Europe (Switzerland).
Highbar has grown its IT capabilities and the expertise in various
areas including ERP (Enterprise Resource Planning), Business
Intelligence and dashboards, cloud offerings through Highbar
Employee Portals, CRM (Customer Relationship Management), DMS (Document
Management System) and others. Highbar has also ventured into SAP HANA
implementation thisyear. Newofferings like SAP Fiori, Screen Persona,
Mobility solutions, e-procurement through Ariba sourcing solutions have
increased the breadth of the offerings for the customers. The stack of
services provided by Highbar has gone much beyond SAP into process
consulting and IT Infrastructure support (data-centre, networking etc.)
Solutions like Highbar RapidStart and Highbar RapidStart Analytics are
based on the templatised approach for ERP and Business Intelligence
respectively and are intellectual properties (IP) assets of Highbar.
Highbar has maintained a strategic alliance with SAP at the level of
''Gold Partnership'' and it''s a preferred partner for SAP implementation
and even reimplementation for the infrastructure industry. More than
ten of Highbar''s implementation have now become global case studies,
published on SAP''s website as reference implementations.
Highbar, the spin-off from your Company''s internal IT function, has
succeeded, when the success rate of such experiments is just 5%
globally & in India. Highbar has established a proper scalable
organization structure with all the functions in place to facilitate
and sustain future growth. It is on the course towards accomplishing
its vision of being ''the most preferred end-to-end IT solution
provider'' for infrastructure industry.
5. Subsidiaries, Joint Ventures and Associate Companies
As of 31st March 2015, the list of Subsidiaries, Joint Ventures and
Associate Companies of your Company is as follows:-
1. Western Securities Ltd
2. HCC Aviation Ltd
3. HCC Construction Ltd
4. Highbar Technologies Ltd
5. Highbar Technologies FZ LLC
6. HCC Mauritius Enterprises Limited 7 HCC Mauritius Investment Limited
8. Steiner AG (Formerly known as Karl Steiner AG)
9. Steiner Promotions et Participations SA
10. VM ST AG
11. Eurohotel SA
12. Steiner (Germany) GmbH
13. Steiner Leman SAS
14. SNC Valleiry Route De Bloux
15. Steiner India Ltd
16. HCC Infrastructure Company Ltd
17 HCC Concessions Ltd (Formerly known as HCC Infrastructure Ltd)
18. Nirmal BOT Ltd
19. Badarpur Faridabad Tollway Ltd
20. Baharampore - Farakka Highways Ltd
22. Raiganj - Dalkhola Highways Ltd
23. Dhule Palesner Operations & Maintenance Ltd
24. HCC Power Ltd
25. HCC Operations & Maintenance Ltd
26. Narmada Bridge Tollway Ltd 27 HCC Real Estate Ltd
28. HRL Township Developers Ltd
29. HRL (Thane) Real Estate Ltd
30. NashikTownship Developers Ltd
31. Maan Township Developers Ltd
33. Powai Real Estate Developers Ltd
34. HCC Realty Ltd
35. Pune-Paud Toll Road Company Ltd
36. Panchkutir Developers Ltd 37 Lavasa Corporation Ltd
38. Lavasa Hotel Ltd
39. Apollo Lavasa Health Corporation Ltd
40. Lakeshore Watersports Company Ltd
41. Dasve Convention Centre Ltd
42. Dasve Business Hotel Ltd
43. Dasve Hospitality Institutes Ltd
45. Dasve Retail Ltd
46. Full Spectrum Adventure Ltd 47 Spotless Laundry Services Ltd
48. Lavasa Bamboocrafts Ltd
49. Green Hill Residences Ltd
50. My City Technology Ltd
51. Reasonable Housing Ltd
52. Future City Multiservices SEZ Ltd
53. Rhapsody Commercial Space Ltd
54. Valley View Entertainment Ltd
55. Sirrah Palace Hotels Ltd
56. Warasgaon Tourism Ltd
57 Our Home Service Apartments Ltd
58. Warasgaon Power Supply Ltd
59. Sahyadri City Management Ltd
60. Hill City Service Apartments Ltd
61. Kart Racers Ltd
62. Warasgaon Infrastructure Providers Ltd
63. Nature Lovers Retail Ltd
64. Osprey Hospitality Ltd
65. Starlit Resort Ltd
66. Warasgaon ValleyHotelsLtd 67 Rosebay Hotels Ltd
68. Mugaon Luxury Hotels Ltd
69. Warasgaon Assets Maintenance Ltd
70. Hill ViewParkingServicesLtd
71. Whistling Thrush FacilitiesServices Ltd
72. Verzon Hospitality Ltd Joint Ventures
1. HCC-L&TPuruliaJoint Venture
2. HCCSamsungJoint Venture
3. AlpineSamsungHCCJoint Venture
4. AlpineHCCJoint Venture
5. NathpaJhakriJoint Venture
6. Kumagai -Skanska-HCC Itochu Group
7. Dhule Palesner Tollway Limited
8. AGRE Prime Tower Associate Companies
1. Vikhroli Corporate Park Pvt Ltd
2. Warasgoan Lake View Hotels Limited
3. Andromeda Hotels Limited
4. Ecomotel Hotel Limited
5. Knowledge Vistas Limited
6. Bona Sera Hotels Limited
7. Evostate AG
8. Projektentwicklungsges Parking AG.
9. MCR Corporation Real Estate AG
The details as required under Rule 8 of the Companies (Accounts) Rules,
2014 regarding the performance and financial position of each of the
Subsidiaries, Associates and Joint Venture Companies of the Company
form part of the Consolidated Financial Statements of the Company for
the financial year ended 31st March 2015 and hence are not repeated
here for the sake of brevity.
The Company has also formulated a Policy for determining material
subsidiaries, which is uploaded on the website of the Company i.e.
www.hccindia.com and can be accessed at http://www.hccindia.com/pdf/
HCC Policy for determining Material Subsidiaries.pdf
6. Qualified Institutions Placement of Equity Shares (QIP) / Change in
During the year under review, your Company''s Authorised Share Capital
has remain unchanged at Rs. 100,00,00,000 (Rupees One hundred Crore)
comprising 90,00,00,000 Equity Shares of Rs. 1/- each and 1,00,00,000
Redeemable Cumulative Preference Shares of Rs. 10/- each.
Pursuant to the conversion of 3,92,15,686 warrants by the Promoter
Companies i.e. Hincon Holdings Ltd and Hincon Finance Ltd , 3,92,15,686
equity shares of Rs. 1/- each, in aggregate, was alloted by your Company
to the aforementioned Promoter Companies, at a conversion price of Rs.
16.32/- per equity share (including premium of Rs. 15.32/- per equity
share) the Company''s paid up Equity Share Capital increased from Rs.
60,66,10,420/- comprising 60,66,10,420 Equity Shares of Rs.1/- each to Rs.
64,58,26,106/- comprising 64,58,26,106 equity shares of Rs. 1/- each.
After the close of the financial year under review, on April 10, 2015,
your Company has issued and allotted 13,33,32,800 Equity Shares of Rs.1/-
each at an issue price of Rs. 30/- per Equity Share (including premium of
Rs. 29/- per equity share) for an amount aggregating Rs. 399,99,84,000/-to
Qualified Institutional Buyers in accordance with Chapter VIII of SEBI
(Issue of Capital and Disclosure Requirements) Regulations, 2009 as
amended and Section 42 of the Companies Act, 2013 and the rules made
Post the QIP Issue, the paid up Equity Share Capital of the Company is
Rs. 77,91,58,906/- which comprises 77,91,58,906 Equity Shares of Rs. 1/-
7 Public Deposits
Your Company has not accepted any deposits from the public, or its
employees during the year under review.
8. 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 to the Financial Statements.
Also, pursuant to Clause 32 of the Listing Agreement, the particulars
of Loans/Advances given to Subsidiaries have been disclosed in the
notes to the Financial Statements.
9. Employee Stock Option Scheme (ESOP)
As on March 31,2015, 32,39,330 stock options are outstanding , in
aggregate, for exercise as per the exercise schedule and are
exercisable at a price of Rs. 52.03 per stock option.
Each option, when exercised, as per the exercise schedule, would
entitle the holder to subscribe for one equity share of the Company of
face value Rs. 1 each.
During the year under review, no options got vested in the employees of
the Company. 14,55,470 stock options got lapsed between April 1,2014
and March 31,2015.
The particulars with regard to the ESOP as on March 31,2015 as required
to be disclosed pursuant to the provisions of Rule 12 (9) of the
Companies (Share Capital and Debentures) Rules, 2014, are set out in
Annexure I to this Report.
10. Status of GDSs
During the financial year 2005-06, the Company had issued Global
Depository Shares (GDSs) and the underlying shares against each of the
GDSs were issued in the name of the Depository, Citi Bank N.A.
As on March 31,2015, 17,300 GDSs have remained outstanding which forms
part of the existing paid up Equity Share Capital of the Company.
11. Consolidated Financial Statements
In accordance with the Companies Act, 2013 and Accounting Standard (AS)
- 21 on Consolidated Financial Statements read with AS - 23 on
Accounting for Investments in Associates and AS - 27 on Financial
Reporting of Interests in Joint Ventures, the audited Consolidated
Financial Statements are provided in this Annual Report.
12. Corporate Governance
The Company is committed to maintain the highest standards of Corporate
Governance and adheres to the Corporate Governance requirements as
stipulated by Securities and Exchange Board of India(SEBI).
The report on Corporate Governance as per the requirement of the
Listing Agreement forms an integral part of this Annual Report. The
requisite certificate from the Auditors of the Company confirming
compliance with the conditions of Corporate Governance is attached to
the report on Corporate Governance.
As per the provisions of Section 152 of the Companies Act, 2013, Mr. D.
M. Popat, Director of the Company retires by rotation at the ensuing
Annual General Meeting. However, Mr. D. M. Popat has expressed his
intention not to seek re-election as a Director of the Company.
During the year under review, the Board of Directors of the Company at
its Meeting held on July 31,2014, appointed Ms. Harsha Bangari as
Nominee Director (Nominee of Exim Bank) w.e.f. July 31,2014.
Based on the recommendation of the Nomination and Remuneration
Committee and after reviewing the declarations submitted by Mr. Rajas
R. Doshi and Mr. Anil C. Singhvi, Independent Directors, the Board of
Directors of the Company by way of resolution dated March 17, 2015
passed by circulation, formed an opinion that the said Directors meet
with the criteria of Independence as per Section 149(6) of the
Companies Act, 2013 (the Act) and the rules made thereunder and also
meet with the requirements of Clause 49 of the Listing Agreement with
the Stock Exchanges, for being appointed as the Independent Directors
on the Board of the Company.
Mr. Rajas R. Doshi and Mr. Anil C. Singhvi, who were appointed as
Directors liable to retire by rotation under the provisions of the
erstwhile Companies Act, 1956 and who qualify for being appointed as
Independent Directors of the Company are proposed to be appointed at
the ensuing Annual General Meeting as Independent Directors of the
Company under section 149 of the Companies Act, 2013 for the period
w.e.f. March 17, 2015 upto the conclusion of the 93rd Annual General
Meeting of the Company to be held in the calendar year 2019.
On the recommendation of the Nomination and
Remuneration Committee and after reviewing the declaration submitted by
Dr. Omkar Goswami, Independent Director, the Board of Directors of the
Company at its Meeting held on April 30, 2015 formed an opinion that
the said Director meets with the criteria of Independence as per
Section 149(6) of the Companies Act, 2013 (the Act) and the rules
made thereunder and also meets with the requirements of Clause 49 of
the Listing Agreement with the Stock Exchanges and accordingly
appointed Dr. Omkar Goswami as an Additional Director to hold office as
an Independent Director of the Company w.e.f. April 30, 2015 upto the
conclusion of the 93rd Annual General Meeting of the Company to be held
in the calendar year 2019.
The Board of Directors at its Meeting held on April 30, 2015, on the
recommendation of the Nomination and Remuneration Committee, appointed
Ms. Shalaka Gulabchand Dhawan as Additional Director and also as
Whole-time Director of the Company for a period of five years w.e.f.
April 30, 2015, subject to the approval of the Members of the Company.
Your Company has received the requisite disclosures / declarations from
Mr. Rajas R. Doshi, Mr. Anil C. Singhvi, Dr. Omkar Goswami and Ms.
Shalaka Gulabchand Dhawan as required under the relevant provisions of
the Companies Act, 2013.
Your Company has also received Notices under Section 160 (1) of the
Companies Act, 2013 from members signifying their intention to propose
Mr. Rajas R.
Doshi, Mr. Anil C. Singhvi, Dr. Omkar Goswami and Ms. Shalaka
Gulabchand Dhawan as candidates for the office of Independent Director
/ Director at the ensuing Annual General Meeting.
Further, your Company has also received declarations from all the
Independent Directors of the Company confirming that they meet with the
criteria of Independence as prescribed under the Act and Clause 49 of
the Listing Agreement with the Stock Exchanges.
Profiles of the Directors seeking appointment have been given in the
Notice of the ensuing Annual General Meeting of the Company.
14. Key Managerial Personnel
During the year under review, in addition to Mr. Ajit Gulabchand,
Chairman and Managing Director and Mr. Rajgopal Nogja, Group COO &
Whole-time Director of the Company, the following three Senior
Executives of the Company were formally appointed as Key Managerial
Personnel of the Company in compliance with the provisions of Section
203 of the Companies Act, 2013
i) Mr. Arun V. Karambelkar was appointed as President & Chief Executive
Officer - E&C w.e.f. April 29, 2014
ii) Mr. Praveen Sood was appointed as Chief Financial Officer of the
Company designated as Group CFO & EVP - HCC Group Office w.e.f. April
Hi) Mr. Vithal P Kulkarni to continue to act as Company Secretary of
Remuneration and other details of the said Key Managerial Personnel for
the financial year ended March 31, 2015 are mentioned in the Extract of
the Annual Return which is attached to the Board''s Report.
15. Board Committees
The Board of Directors of your Company had already constituted various
Committees in compliance with the provisions of the Companies Act, 2013
/Listing Agreementviz. Audit Committee, Nomination and Remuneration
Committee, Stakeholders Relationship Committee, CSR Committee and ESOP
During the year under review, in compliance with the provisions of
Clause 49 of the Listing Agreement, the Board had also constituted the
Risk Management Committee.
All decisions pertaining to the constitution of Committees, appointment
of members and fixing of terms of reference / role of the Committees
are taken by the Board of Directors.
Details of the role and composition of these Committees, including the
number of meetings held during the financial year and attendance at
meetings, are provided in the Corporate Governance Section of the
16. Nomination and Remuneration Policy
The Nomination and Remuneration Policy recommended by the Nomination
and Remuneration Committee is duly approved by the Board of Directors
of the Company and the Remuneration Policy of the Company is attached
to the Board''s Report as Annexure II.
17 CSR Policy
The Corporate Social Responsibility Policy recommended by the CSR
Committee of the Directors has been approved by the Board of Directors
of the Company. The same is available on the website of the Company
i.e. www.hccindia.com and is also attached to this Report as Annexure
The disclosure relating to the amount spent on Corporate Social
Responsibility activities of the Company for the financial year ended
31st March 2015 is attached to this Report as Annexure IV.
A calendar of Board Meetings, Annual General Meetings and Committee
Meetings is prepared and circulated in advance to the Directors of your
The Board of Directors of your Company met 4 times during 2014-15. The
meetings were held on May 2, 2014, July 31,2014, October 30, 2014 and
January 29, 2015. The maximum time gap between any two consecutive
meetings did not exceed one hundred and twenty days.
19. Directors'' Responsibility Statement
In accordance with the provisions of Section 134 (5) of the Companies
Act, 2013, your Directors confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures, if any ;
b) the selected accounting policies were applied consistently and the
Directors 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 31,2015 and of the profit of the Company for the
year ended on that date.
c) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act,2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
d) the annual accounts have been prepared on a going concern basis.
e) the internal financial controls have been laid down to be followed
by the Company and such controls are adequate and are operating
f) proper systems to ensure compliance with the provisions of all
applicable laws have been devised and such systems are adequate and are
20. Industrial Relations
The industrial relations continued to be generally peaceful and cordial
during the year.
21. Transfer to Investor Education and Protection Fund (IEPF)
Your Company has, during the year under review, transferred a sum of Rs.
9,17,451/- to Investor Education and Protection Fund, in compliance
with the provisions of Section 205C of the Companies Act, 1956. The
said amount represents dividend for the year 2005-06 which remained
unclaimed by the members of the Company for a period exceeding 7 years
from its due date of payment.
22. Particulars of Employees and other additional information.
The information required under Rule 5 (1) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 is attached
herewith as Annexure V. The information as required under Rule 5 (2) of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 will be provided upon request by any member of the Company.
In terms of Section 136 (1) of the Companies Act, 2013, the Report and
the Accounts are being sent to the members excluding the aforesaid
Any member interested in obtaining copy of the same may write to the
Company Secretary at the Registered Office of the Company.
23. Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo.
The information relating to the Conservation of Energy, Technology
Absorption and Foreign Exchange Earnings and Outgo as required to be
disclosed under the Companies (Accounts) Rules, 2014, is given in
Annexure VI forming part of this Report.
24. Statutory Auditors
The Members of the Company had, at the 88th Annual General Meeting
(AGM) held on June 20, 2014, approved the appointment of M/s Walker
Chandiok & Co. LLP Chartered Accountants, Mumbai, bearing ICAI
Registration No. 001076N as the Statutory Auditors of
the Company, to hold office from the conclusion of that AGM until the
conclusion of the 6th AGM held thereafter (subject to ratification of
the appointment by the Members at every AGM held after the abovesaid
Rule 3(7) of Companies (Audit and Auditors) Rules,
2014, states that appointment of the Auditor shall be subject to
ratification by the members at every Annual General Meeting till the
expiry of the term of the Auditor.
In view of the above, the existing appointment of M/s Walker Chandiok &
Co. LLR Chartered Accountants, Mumbai covering the period from the
conclusion of this ensuing AGM until the conclusion of the next Annual
General Meeting to the held in the FY 2016-17, is being placed for
As required under Section 139 of the Companies Act, 2013, the Company
has obtained a written consent from the Auditors to such continued
appointment and also a certificate from them to the effect that their
appointment, if ratified, would be in accordance with the conditions
prescribed under the Companies Act, 2013 and the rules made thereunder,
as may be applicable.
25. Auditors'' Report
The Auditors'' Report to the Members on the Accounts of the Company for
the financial year ended March 31, 2015 does not contain any
qualification, reservation or adverse remark.
26. Secretarial Audit
Secretarial Audit for the FY 2014-15 was conducted by M/s BNP
Associates, Company Secretaries in Practice in accordance with the
provisions of Section 204 of the Companies Act, 2013. The Secretarial
Auditor''s Report is attached to this Report as Annexure VII. There are
no qualifications or observations or remarks made by the Secretarial
Auditor in his Report.
27. Cost Audit
In compliance with the provisions of Section 148 of the Companies Act,
2013, the Board of Directors of the Company at its meeting held on 31st
July 2014 had appointed M/s Joshi Apte & Associates, Cost Accountants
as Cost Auditors of the Company for the FY 2014-15.ln terms of the
provisions of Section 148(3) of the Companies Act, 2013 read with Rule
14(a)(ii) of The Companies (Audit and Auditors) Rules, 2014, the
remuneration of the Cost Auditors has to be ratified by the members.
Acordingly, necessary resolution is proposed at the ensuing AGM for
ratification of the remuneration payable to the Cost Auditors for FY
28. Risk Management
Pursuant to the requirement of Section 134 of the Companies Act, 2013,
the Company has already in place a Risk Management Plan.
The Company has a robust Business Risk Management (BRM) framework to
identify and evaluate business risks and opportunities. This framework
seeks to create transparency, minimise adverse impact on the business
objectives and enhance your Company''s competitive advantage.
The business risk framework defines the risk management approach across
the enterprise at various levels including documentation and reporting.
The framework has different risk models which help in identifying risks
trend, exposure and potential impact analysis at a Company level.
In accordance with the provisions of Clause 49 of the Listing
Agreement, your Company has also constituted a Risk Management
29. Significant and material Orders passed by the Regulators/Courts, if
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of your Company and
its future operations.
30. Internal Control Systems and their adequacy
The Company has Internal Control Systems, commensurate with the size,
scale and complexity of its operations. The Internal Audit Department
monitors and evaluates the efficacy and adequacy of internal control
systems in the Company, its compliance with operating systems,
accounting procedures and policies within the Company. Based on the
report of internal audit function, process owners undertake corrective
action in their respective areas and thereby strengthen the controls.
Significant observations and corrective actions thereon are presented
to the Audit Committee from time to time.
31. Vigil Mechanism Policy
The Company has a vigil mechanism policy to deal with instances of
fraud and mismanagement, if any. The vigil mechanism policy is uploaded
on the website of the Company.
32. Performance Evaluation
Pursuant to the provisions of Section 134 (3) (p),
149(8) and Schedule IV of the Companies Act, 2013 and Clause 49 of the
Listing Agreement, annual Performance Evaluation of the Directors as
well as of the Audit Committee, Nomination and Remuneration Committee
and Stakeholders Relationship Committee has been carried out.
The Performance Evaluation of the Independent Directors was carried out
by the entire Board and the Performance Evaluation of the Chairman and
Non-Independent Directors was carried out by the Independent Directors.
33. Independent Directors Meeting
During the year under review, the Independent Directors of the Company
met on March 18, 2015, inter- alia, to discuss:
i) Evaluation of performance of Non-Independent Directors and the Board
of Directors of the Company as a whole.
ii) Evaluation of performance of the Chairman of the Company, taking
into views of Executive and Non- Executive Directors.
iii) Evaluation of the quality, content and timelines of flow of
information between the Management and the Board that is necessary for
the Board to effectively and reasonably perform its duties.
34. Related PartyTransactions
All related party transactions attracting compliance under Section 188
and / or Clause 49 of the Listing Agreement are placed before the Audit
Committee as also before the Board for approval.
Prior omnibus approval of the Audit Committee is also sought for
transactions which are of a foreseen and repetitive nature.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board of Directors
of the Company is uploaded on the website of the Company i.e.
Pursuant to the approval vide Board Resolution dated May 2, 2014 and
Special Resolution passed by the Members of the Company at the 88th
Meeting of the Company held on June 20, 2014, the remuneration payable
to Mr. Arjun Dhawan, President & CEO - Infrastructure Business relative
of Mr. Ajit Gulabchand, Chairman and Managing Director of the Company,
who is holding office or place of profit in the Company, was revised
w.e.f. November 1, 2014. During the year under review, the
remuneration paid to Mr. Arjun Dhawan, President & CEO - Infrastructure
Business of the Company was Rs. 2.92 crore.
The disclosures on related party transactions are made in the Financial
Statements of the Company.
35. Extract of Annual Return
The details forming part of the extract of Annual Return in prescribed
Form MGT 9 is annexed hereto as Annexure VIII and forms the part of
36. Sexual Harassment
During the year under review, there were no cases filed pursuant to the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013.
Your Directors would like to acknowledge and place on record their
sincere appreciation to all stakeholders - clients, Financial
Institutions, Banks, Central and State Governments, the Company''s
valued investors and all other business partners for their continued
co-operation and excellent support received during the year.
Your Directors recognize and appreciate the efforts and hard work of
all the employees of the Company and their continued contribution to
For and on behalf of Board of Directors,
Chairman & Managing Director
Hincon House, 11th Floor,
247Park, Lai Bahadur Shastri Marg Vikhroli
(West) Mumbai 400 083
Place : Mumbai
Date : April 30, 2015