IRB Infrastructure Developers

1.  INITIAL PUBLIC OFFER (IPO)
 
 i) In the previous year, the Company completed an Initial Public Offer
 (IPO) of 51,057,666 Equity Shares of Rs. 10 each for cash at a price of
 Rs. 185 each aggregating to Rs. 9,445,668,210.
 
 The premium of Rs. 175 per share, amounting to Rs. 8,935,091,550 from
 the allotment was credited to Securities Premium Account. The Share
 Issue expenses incurred by the Company during the current year
 amounting to 13,105,373 (Previous Year: Rs. 1,005,226,557) and
 unadjusted share issue expenses amounting to Rs. NIL (Previous Year Rs.
 19,679,245 ) has been adjusted against Securities Premium Account.
 
 Pursuant to the Public Issue, shares of the Company are listed on
 National Stock Exchange and Bombay Stock Exchange effective February
 25, 2008.
 
 ii) Statement showing the use of proceeds from Initial Public Offer
 upto March 31, 2009 out of the total IPO proceeds of Rs. 9,445,668,210,
 an amount of Rs. 8,395,500,056 (Previous Year Rs. 7,173,512,853) is
 utilized as under:
 
 2.  DEBENTURES
 
 In the previous year 3,940,083, 7.5% fully convertible debentures of
 Rs. 670/- each has been sub-divided into 39,400,830, 7.5% fully
 convertible debentures of Rs. 67/- each. On September 10, 2007 all
 outstanding debentures were converted into 34,038,444 equity shares of
 Rs. 10/- each at a premium of Rs. 67.55 per share. Debenture issue
 expense of Rs. 1,61,392,894/- has been adjusted against the Securities
 Premium Account in the previous year in accordance with the accounting
 policy as mentioned in para l(p) above.
 
 3.  The Company is constructing Six Lanning of Surat Dahisar Section on
 National Highway 8. The project is at start up stage of construction.
 The expenditure incurred directly or indirectly related to construction
 of the project is classified as pre-operative expenditure for Toll
 Collection Right and will be amortised over the concession period.
 
 Necessary details as per Part II of Schedule VI to the Companies Act,
 1956 have been disclosed in Schedule V.
 
 Income/Expenditure which are not directly or indirectly related to the
 construction of the project have been credited/charged off to Profit
 and Loss Account. Toll Income received from existing road of Surat -
 Dahisar section is credited to Profit and Loss Account since, these
 pertains to income not from new road constructed by the company as per
 Concession Agreement entered with National Highway Authority of India
 (NHAI).
 
 4.  SEGMENT INFORMATION
 
 (a) The Company has disclosed Business Segment as the primary segment.
 Segments have been identified taking into account the nature of the
 products, the differing risks and returns, the organisation structure
 and internal reporting system.
 
 (b) The Companys operations predominantly relate to Road
 Infrastructure Projects. Other business segments reported are real
 estate development sector.
 
 (c) The Companys activities are restricted within India and hence no
 separate geographical segment disclosure is considered necessary.
 
 (d) For the purpose of reporting, business segment are primary segment
 and the geographic segment is a secondary segment.
 
 (e) Segment Revenue, Segment Results, Segment Assets and Segment
 Liabilities include the respective amounts identifiable to each of the
 segments as also amounts allocated on a reasonable basis.
 
 (f) The net expenses, which are not directly attributable to the
 Business Segment, are shown as unallocated corporate cost.
 
 (g) Assets and Liabilities that cannot be allocated between the
 segments are shown as a part of unallocated corporate assets and
 liabilities respectively.
 
 Footnotes:
 
 1.  Segment Assets exclude the following:
 
 (a) Advance payment of income tax (net of tax provisions) Rs.
 145,082,129
 
 (b) Advance payment of Fringe Benefit Tax (net of tax provisions) Rs.
 642,015
 
 (c) Miscellaneous Expenditure (to the extent not written off or
 adjusted) Rs. 9,597,973
 
 2.  Segment Liabilities exclude the following:
 
 (a) Provision for taxation (Net of tax payments) - Rs. 145,101,866
 
 (b) Provision for fringe benefit tax (net of advance tax payments) -
 Rs. 2,399,881
 
 (c) Deferred Tax Liabilities (net) Rs. 181,586,633
 
 5.  RELATED PARTY DISCLOSURES Names of Related Parties
 
 (a) Enterprises owned or significantly influenced by key management
 personnel or their relatives (Enterprises)
 
 A. J. Tolls Private Limited, Anuya Enterprises, Aryan Construction, D.
 S. Enterprises, Deepali Construction, Dattakrupa Enterprises, Global
 Safety Vision Private Limited, Ideal Infoware Private Limited, Ideal
 Softtech Park Private Limited, JDV Finlease Private Limited, Ideal Toll
 and Infrastructure Private Limited, J. D.  Mhaiskar (HUF), Jan
 Transport, Jayant Construction Company, JDV Udyog, MEP Toll Road
 Private Limited, Mhaiskar Udyog, Rideema Enterprises, RideemaToll
 Private Limited, V. D. Mhaiskar (HUF), VCR Toll Services Private
 Limited, Virendra Builders
 
 (b) Key Management Personnel
 
 Mr. V. D. Mhaiskar, Mr. D. P. Mhaiskar, Mr. J. D. Mhaiskar
 
 (c) Relatives of Key Management Personnel
 
 Mrs. D. V. Mhaiskar (Wife of Mr. V. D. Mhaiskar), Mrs. S. D. Mhaiskar
 (Wife of Mr. D. R Mhaiskar), Mrs. A. J. Mhaiskar (Wife of Mr. J. D.
 Mhaiskar)
 
 6.  DERIVATIVE INSTRUMENTS AND UNHEDGED FOREIGN CURRENCY EXPOSURE
 
 In respect of outstanding derivative contracts of Interest rate swaps
 which are stated below, there is a net unrealized loss as on March 31,
 2009 which has been recognised in the books for Rs. 18,101,149/-
 (Previous Year: Nil), considering the principles of prudence as
 enunciated in Accounting Standard 1 Disclosure of Accounting Policies
 notified in the Companies (Accounting Standards) Rules 2006. Derivative
 contracts entered into by the Company for hedging interest rate related
 risks and are for hedging purpose only.
 
 7.  INTRA-GROUP TURNOVER AND PROFITS ON BOT CONSTRUCTION CONTRACTS
 
 The BOT contracts are governed by Service concession agreements with
 government authorities (grantor). Under these agreements, the operator
 does not own the road, but gets toll collection rights against the
 cost incurred for construction services. Since the construction cost
 incurred by the operator is considered as exchanged with the grantor
 against toll collection rights, profit from such contracts is
 considered as realized.
 
 Accordingly, BOT contracts awarded to group companies (operator), where
 work is subcontracted to fellow subsidiaries, the intra group
 transactions on BOT contracts and the profits arising thereon are taken
 as realised and not eliminated for consolidation under Accounting
 Standard 21.
 
 The revenue and profit in respect of these transactions during the year
 is Rs. 3,661,989,780/-(Previous Year - Rs. 3,055,277,422) and Rs.
 988,761,998/- (Previous Year - Rs. 1,617,063,892) respectively.
 
 8.  GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS
 
 (a) Defined Contribution Plan
 
 Amount recognised as an expense and included in the Schedule 16 -
 Contributions to Provident and other funds of Profit and Loss account
 - Rs. 24,644,075/- (Previous Year Rs. 14,280,344). There are no other
 obligations other than the contribution payable to the respective
 trusts.
 
 (b) Defined Benefit Plan
 
 The Company has an unfunded defined benefit gratuity plan. Every
 employee who has completed five years or more of service gets a
 gratuity on departure at 15 days salary (last drawn salary) for each
 completed year of service.
 
 Amount recognised as an expense and included in the Schedule 16 -
 Contributions to Provident and other funds of Profit and Loss account
 - Rs. 6,436,954/- (Previous Year Rs. 8,353,155/-).
 
 The following tables summarise the components of net benefit expense
 recognised in the profit and loss account and the funded status and
 amounts recognised in the balance sheet for the respective plans.
 
 The estimates of future salary increases, considered in actuarial
 valuation, take account of inflation, seniority, promotion and other
 relevant factors, such as supply and demand in the employment market.
 
 The gratuity liabilities of the Company are unfunded and hence there
 are no assets held to meet the liabilities.
 
 As 2006-07 was the first year of adoption of AS 15 (Revised) Employee
 Benefits, the disclosure for past two years has not been given.
 
 9.  RESURFACING EXPENSES
 
 The Group has a contractual obligation to maintain, replace or restore
 infrastructure at the end of each concession period. The Group has
 recognised the provision in accordance with Accounting Standard (AS) -
 29, Provision, Contingent Liabilities and Contingent Assets i.e. at the
 best estimate of the expenditure required to settle the present
 obligation at the balance sheet date. Resurfacing expenses are to be
 incurred at the end of the concession period.
 
 10.  INVESTMENT UNDER PORTFOLIO MANAGEMENT SCHEME (PMS)
 
 The Company has entered into an agreement with Kotak Securities to
 invest a sum of Rs. 30,000,000 under a portfolio management scheme
 called Opportunities 2010 Portfolio Scheme and agreed for a lock in
 period of Companys portfolio for a period up to December 31, 2010.
 Further, Aryan Infrastructure Investment Private Limited (subsidiary of
 the Company) has also entered into an agreement with Kotak Securities
 to invest a sum of Rs. 20,000,000 under a portfolio management scheme
 called Incubator Equity Portfolio Scheme respectively and agreed for
 a lock in period of Companys portfolio for a period up to March 31,
 2010. The investment under the scheme have been disclosed as Current
 Investments in Schedule 6 and valued accordingly.
 
 11.  Figures pertaining to the subsidiary companies and joint ventures
 have been reclassified wherever necessary to bring them in line with
 the Group financial statements.
 
 12.  PREVIOUS YEAR COMPARATIVES
 
 Previous years figures have been regrouped wherever necessary to
 conform to current years classification.