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IVRCL Directors Report, IVRCL Reports by Directors
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IVRCL

BSE: 530773|NSE: IVRCLINFRA|ISIN: INE875A01025|SECTOR: Construction & Contracting - Civil
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Download Annual Report PDF Format 2015 | 2014 | 2013 | 2011 | 2010
Directors Report Year End : Mar '15    « Mar 14
The Members,
 
 The Directors are pleased to present the 28th Annual Report with
 audited financial statements of the Company for the Financial year
 2014-15.
 
 1.  Financial Highlights             Standalone (Rs. in million)
 
 Particulars                          FY 2014-15       FY 2013-14
 
 Total Revenue                        31,174.17        43,048.07
 
 Gross Profit before interest,           142.36         2,047.81
 
 Depreciation, Exceptional
 Item & Tax
 Less:
 
 Interest                              6,529.24         5,847.25
 
 Depreciation                            903.59           879.82
 
 Exceptional Item                       (568.15)        2,291.55
 
 (Loss) / Profit Before Tax           (6,722.32)       (6,970.81)
 
 Provision for tax                         -              196.98
 
 (Loss) / Profit After Tax            (6,722.32)       (7,167.79)
 
 Balance brought froward              (3,074.68)        4,093.11
 
 Balance carried to b/s               (9,797.00)       (3,074.68)
 
 Paid-up capital                         918.28           613.77
 
 Reserves & Surplus                   10,444.05        13,889.04
 
 EBIDTA                                  142.36         2,047.81
 
 2. DIVIDEND
 
 Your directors expressed their inability to recommend any dividend for
 the financial year 2014-15.
 
 3. PERFORMANCE REVIEW
 
 Your company achieved a gross turnover of Rs. 31, 174.17 million for the
 financial year 2014-15 as against Rs. 43,048.07 million in the previous
 financial year. Profit/(Loss) after Tax (PAT) stood at Rs. (6,722.32)
 million as compared to Rs. (7,167.79) million for the previous financial
 year.
 
 The Earnings before Interest, Depreciation, Exceptional Item & Taxes at
 Rs. 142.36 million are 0.46% of the turnover for the period under review
 as against 4.76% for the previous financial year.
 
 During the year under review, there is no change in nature of business
 of the company and no material changes and commitments have occurred
 after the close of the year till the date of this Report, which affect
 the financial position of the Company.
 
 4. BUSINESS REVIEW
 
 The Management Discussion and Analysis Section of the Annual Report
 presents a detailed business review of the company.
 
 5. CORPORATE DEBT RESTRUCTURING.
 
 The Company approached the Corporate Debt Restructuring (CDR) Forum
 under CDR guidelines issued by the Reserve Bank of India, on January
 20, 2014, for effective restructuring of the debts of the Company.
 
 The Corporate Debt Restructuring Empowered Group approved the
 Restructuring package (CDR Package) for the company on June 28, 2014
 and the Company has executed Master Restructuring Agreement on June 30,
 2014 for availing the said facilities.
 
 In accordance with the CDR package, the CDR lenders have waived the
 obligation of the Company to pay any liquidated damages, default or
 penal interest / interest/further interest charged by the Lenders in
 excess of the concessional rates approved under CDR scheme with effect
 from November 30, 2013 (the COD).
 
 The rate of interest has been changed/ revised and reduced to State
 Bank of India (SBI) base rate plus 1.25 % (currently effective rate is
 11.10% per annum with effect from the COD).
 
 The interest due and accrued with effect from the COD to December 31,
 2014 on cash credit facilities and upto September 2015 on other term
 borrowings shall be funded and converted into Funded Interest Term Loan
 (FITL) and lenders shall convert the same along with accrued interest
 thereon into equity at the end of each calendar quarters. Accordingly
 15,22,52,074 Equity shares of face value of Rs. 2/- were allotted at Rs.
 24.39/- per equity share to CDR lenders during the year under review,
 upon receipt of conversion notices from the respective CDR lenders. As
 a result, the paid up capital of the Company has been increased from Rs.
 61,37,73,292/- to Rs. 91,82,77,444/- during the year.
 
 6. SUBSIDIARY COMPANIES.
 
 The Company has 29 direct subsidiaries and 4 associate companies within
 the meaning of Section 2(87) and 2(6) of the Companies Act, 2013
 respectively (hereinafter referred as Act). There has been no material
 change in nature of business of the Subsidiaries and Associates.
 
 Pursuant to Proviso to Section 129(3) of the Act, a statement
 containing the brief details of performance and financials of the
 Subsidiary, Associate Companies and Joint Venture, for the financial
 year ended March 31, 2015 is attached to Financial Statements of the
 Company.
 
 Pursuant to Section 136 of the Act, the financial statements including
 consolidated financial statements, other relevant documents and audited
 accounts of subsidiaries of the company are available at website of the
 company www.ivrcl.com under Financials section.
 
 During the year under review, none of the Companies have become nor
 ceased to be subsidiaries or Joint Ventures of the Company. M/s IOT
 Utkal Energy Services Limited ceased to be a associate company and none
 of the companies have become associates, duirng the year under review.
 
 The Board has adopted a policy for determining material subsidiaries of
 the Company, as per the provisions of Corporate governance clause of
 Listing agreement. The said policy is hosted at the Company''s website
 at the link http://ivrcl.com/downloads/
 PolicyonMaterialSubsidiaries_New.pdf
 
 7. CONSOLIDATED FINANCIAL STATEMENTS
 
 In terms of Section 129(3) of the Companies Act, 2013 and Clause 32 of
 the Listing Agreement with the Stock Exchanges, Consolidated Financial
 Statements of the Company prepared in accordance with Accounting
 Standards issued by Institute of Chartered Accountants of India, are
 attached and forms part of the Annual Report.
 
 8. EMPLOYEE STOCK OPTION SCHEME.
 
 The shareholders of the Company at the meeting held on September 26,
 2013 approved to grant 1,00,00,000 options to employees of the Company,
 on such terms and conditions as specified by the Board of Directors of
 the Company. The Company is yet to grant the said options.
 
 9. FIXED DEPOSITS
 
 During year under review, your company has neither invited nor accepted
 any Fixed Deposits from the public.
 
 10. CORPORATE GOVERNANCE
 
 Your Company is committed to adhere to the standards of Corporate
 governance as set out by the Listing agreement and the separate section
 on Corporate Governance is annexed to this Report. The majority of the
 decisions of the Board are taken at the Board meetings and the Board
 has constituted certain committees to enable better management of the
 affairs of the Company. The details of composition of the committees
 are disclosed in Corporate Governance Report.
 
 The requisite certificate from Practicing Company Secretaries,
 confirming the compliance of the conditions stipulated under Clause 49
 of the Listing Agreement is attached to the Report on Corporate
 Governance.
 
 11. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 As stipulated under Clause 49 of the Listing Agreement with the Stock
 Exchanges, the Report on Management Discussion and Analysis is annexed
 to this report and forms part of the Annual Report.
 
 12. POLICY ON CODE OF CONDUCT.
 
 The Company has laid down a Code of Conduct for all Board members and
 Senior Management Personnel. Pursuant to Clause 49(II)(E)(ii) of the
 Listing Agreement, the Declaration by the Chairman and Managing
 Director affirming the compliance with the Code of Conduct is attached
 to the Report on Corporate Governance.
 
 13. DIRECTORS AND KEY MANAGERIAL PERSONNEL.
 
 Pursuant to provisions of Section 152 of the companies Act, 2013,
 Mr.K.Ashok Reddy, Director retires by rotation at the ensuing Annual
 General Meeting and being eligible offers himself for re-appointment.
 Pursuant to provisions of Section 149 of the Act, Mr.P.R.Tripathi,
 Mr.T.Ramesh Chandra Bose and Mr.V.Murahari Reddy were appointed as
 Independent Directors of the Company at the last Annual General
 Meeting, for a term of five years.
 
 All the Independent Directors of the company gave declarations to the
 Company that they meet the criteria of independence as specified under
 Section 149(6) of the Act and Clause 49 of the Listing agreement.
 
 Pursuant to provisions of Section 149 and 161 of the Act and Clause
 49(II)(A)(1) of the Listing agreement, Ms.M.Hima Bindu has been
 appointed as an Additional Director of the Company w.e.f March 31,
 2015.
 
 The Company has received a notice from a member proposing the
 candidature of Ms.M.Hima Bindu for the office of Director.
 
 The Board recommends the appointment of Ms.M.Hima Bindu as an
 Independent Director of the Company at the forthcoming Annual General
 Meeting.
 
 During financial year under review, Mr.R.Balarami Reddy, Executive
 Director - Finance & CFO and Mr.K.Ashok Reddy, Executive Director were
 appointed as Joint Managing Directors w.e.f July 1, 2014.
 
 During the year under review, the Non-Executive Directors of the
 Company had no pecuniary relationship or transaction with the Company.
 The Policy on appointment and remuneration for Directors, Key
 Managerial Personnel and other employees as specified under Section
 178(3) of the Act has been disclosed in Corporate Governance Report.
 
 14. MEETINGS OF THE BOARD.
 
 Five meetings of the Board of Directors were held during the year under
 review. For details of the meetings of the Board, please refer to the
 Corporate Governance Report, which forms part of this report.
 
 The details of the familiarization Programmes for Independent Directors
 are hosted on Company''s website at the link http://ivrcl.com/downloads
 Familiarisation program for Independent Directors.pdf
 
 15. BOARD EVALUATION.
 
 Pursuant to provisions of Companies Act and Corporate governance clause
 of Listing Agreement, the Nomination and Remuneration Committee laid
 down the criteria for performance evaluation of the Individual
 Directors, the Board and its Committees.  Accordingly, the Board of
 Directors has carried out an annual evaluation of its own performance,
 its committees and individual directors.
 
 The performance of the Board was evaluated through a structured
 questionnaire which provides a powerful and valuable feedback for
 improving the board effectiveness, maximizing strengths and
 highlighting areas for further development.
 
 The performance of the Committees was evaluated by the Board by
 considering the effective recommendations made by the Committees, from
 time to time, to the Board of the Directors of the Company and
 effectiveness of Committee meetings etc.
 
 The Board and the Nomination and Remuneration Committee reviewed the
 performance of the individual directors by considering the contribution
 of the individual directors to the Board and Committee meetings,
 preparedness on the issues to be discussed, meaningful and constructive
 contribution and inputs in meetings, relationship with fellow board
 members, willing to devote time and effort to understand the Company
 and its business etc.
 
 As per Schedule IV of the Act, Independent Directors of the Company at
 a separate meeting, evaluated the performance of non-independent
 directors, the Board as a whole and the Chairman of the company taking
 into account the views of executive and non-executive directors.
 Independent Directors also reviewed the quality, quantity and
 timeliness of flow of information between management of the Company and
 the Board, for the effective performance of the board.
 
 16. AUDITORS AND THEIR REPORTS.
 
 Statutory Auditors
 
 M/s.Chaturvedi & Partners., Chartered Accountants were appointed as
 Statutory Auditors of the company at the last Annual General Meeting,
 to hold the office from the conclusion of that meeting till the
 conclusion of the 30th Annual General Meeting, subject to ratification
 by the members at every AGM. The Board recommends the ratification of
 appointment of said auditors for the financial year 2015-16.
 
 The Company has received a letter from the Statutory Auditors that
 their appointment, if made, would be within the limits prescribed under
 the provisions of the Companies Act, 2013 and that they are not
 disqualified for re-appointment.
 
 The Auditors'' Report does not contain any Qualifications, reservations
 or adverse remarks or disclaimar. However it contains emphasis of
 matter on certain points.
 
 Secretarial Auditor.
 
 As per provisions of Section 204 of the Act, the Board of Directors of
 the company appointed M/ s.D.Hanumanta Raju & Co, Practicing Company
 Secretaries as Secretarial Auditors for the purpose of auditing the
 Secretarial activities of the Company for the financial year 2014-15.
 The Secretarial audit report issued by the said auditors has been
 annexed to this report as Annexure A
 
 The Secretarial Audit Report does not contain any adverse remarks or
 qualifications.
 
 Cost Auditor.
 
 As per provisions of Section 148 of the Act read with Rules made
 thereunder, the Board of Directors of the company appointed M/s.Sagar &
 Associates, Practicing Cost Accountants as Cost Auditor for the purpose
 of auditing the Cost accounting records maintained by the company.
 
 17. PARTICULARS OF LOANS, INVESTMENTS AND GUARANTEES.
 
 The particulars of loans, investments made and guarantees issued under
 Section 186 of the Act, during year under review are provided in notes
 to financial statements, which forms part of this Report.
 
 18. RELATED PARTY TRANSACTIONS.
 
 As per the provisions of the Act and Clause 49 of the Listing
 agreement, the Company has formulated a policy on Related party
 transactions to ensure the transparency in transactions between the
 company and related parties. The said RTP Policy is also available at
 Company''s website at the link http:// ivrcl.com/downloads/RelatedParty
 Transaction Policy.pdf.
 
 All Related Party Transactions entered by the Company during the year
 under review were in ordinary course of business and on Arm''s length
 basis. There were no materially significant related party transactions
 entered by the company during year under review.
 
 Since all the related party transactions entered into by the Company,
 were in ordinary course of business and were on Arm''s length basis,
 disclosure in form AOC-2 as required under Section 134(3)(h) of the Act
 is not applicable.
 
 19. INTERNAL FINANCIAL CONTROLS.
 
 The details relating to internal financial controls and their adequacy
 are included in the Management Discussion and Analysis Report, which
 forms part of this Report.
 
 20. RISK MANAGEMENT.
 
 The company has established Risk Management process to manage risks
 with the objective of maximizing shareholders value. The details of
 various risks that are being faced by the Company are provided in
 Management Discussion and Analysis Report, which forms part of this
 Report.
 
 21. WHISTLE BLOWER POLICY.
 
 The Board has adopted a Whistle Blower Policy as stipulated under
 Section 177(9) of the Act and Clause 49 of the Listing agreement to
 report the genuine concerns of the employees and Directors. Protected
 disclosures can be made by the employees of the company to the
 Ombudsperson appointed by the Board for this purpose and can also have
 access to the Chairman of Audit Committee.
 
 The Whistle Blower Policy adopted by the Board has been hosted on
 Company''s website at the link http://
 ivrcl.com/downloads/WhistleBlowerPolicy.pdf
 
 22. EXTRACT OF ANNUAL RETURN.
 
 The Extract of Annual Return of the company as provided under section
 92(3) of the Act is annexed as Annexure B to this Report.
 
 23. SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS.
 
 There are no significant and material orders passed by the regulators
 or tribunals impacting the going concern status and Company''s
 operations in future.
 
 24. CASES FILED UNDER SEXUAL HARASSMENT ACT.
 
 No cases were filed pursuant to the Sexual Harassment of Women at work
 Place (Prevention, Prohibition and Redressal) Act, 2013, during the
 year under review.
 
 25. PARTICULARS OF EMPLOYEES
 
 The statement containing the information pertaining to employees as
 required under Section 197(12) of the Act read with Rule 5(2) of
 Companies (Appointment and Remuneration of Key Managerial Personnel)
 Rules 2014, is annexed to this report. Having regard to provisions of
 Section 136 of the Act, the Annual Report excluding the aforesaid
 information is being sent to the members of the company. The said
 information is available for inspection at the registered office of the
 Company during working hours and any member interested in obtaining the
 said information may write to Company Secretary and the same will be
 furnished on request.
 
 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 to Key Managerial Personnel) Rules, 2014
 is annexed as Annexure C to this Report.
 
 26. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS & OUTGO:
 
 Conservation of Energy, which is an ongoing process in the Company''s
 activities. The core activity of the company is civil construction
 which is not an energy intensive activity.
 
 There is no information to be furnished regarding Technology Absorption
 as your Company has not undertaken any research and development
 activity in any manufacturing activity nor any specific technology is
 obtained from any external sources which needs to be absorbed or
 adapted.
 
 Innovation is a culture in the Company to achieve cost efficiency in
 the construction activity to be more and more competitive in the
 prevailing environment and the effect of the same cannot be quantified.
 
 The particulars of expenditure and earnings in foreign currency are
 furnished in item No.31 to Notes to Financial Statements.
 
 27. CORPORATE SOCIAL RESPONSIBILITY.
 
 As per the provisions of Section 135 of the Act, the Company has
 constituted the CSR committee to formulate, implement and monitor the
 CSR Policy of the Company. However as the Company does not have average
 net profits for the three immediately preceding financial years, the
 Section 135(5) of the Act pertaining to spending of 2% of average net
 profits of the company for immediately preceding three financial years
 and disclosure required to be given under Section 135(5) of the Act and
 Rule 8 of Companies (Corporate Social Responsibility Policy) Rules,
 2014, are not applicable, to the Company, for the financial year
 2014-15.
 
 28. 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, and expects
 continued support, higher level of productivity for achieving the
 targets set for the future.
 
 29. DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the provisions of Section 134(5) of the Act, the Board of
 Directors hereby state that:
 
 (a) in preparation of annual accounts, the applicable accounting
 standards have been followed along with proper explanation relating to
 material departures.
 
 (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 at the end of the financial year and of the profit and
 loss of the company for that period;
 
 (c) the directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safeguarding the assets of the company and
 for preventing and detecting fraud and other irregularities;
 
 (d) the directors had prepared the annual accounts on a going concern
 basis; and
 
 (e) the directors, in the case of a listed company, had laid down
 internal financial controls to be followed by the Company and that such
 internal financial controls are adequate and were operating
 effectively.
 
 (f) the directors had devised proper systems to ensure compliance with
 the provisions of all applicable laws and that such systems were
 adequate and operating effectively.
 
 30. ACKNOWLEDGEMENTS
 
 The Directors wish to express their appreciation of the support and
 co-operation of the Central and the State Governments, bankers,
 financial institutions, suppliers, associates and subcontractors, and
 expects the same in future as well for sustaining the growth rates
 achieved in the past.
 
                         For and on behalf of the Board of Directors
 
                                                       IVRCL Limited
 
 Date: May 30, 2015                                   E.Sudhir Reddy
 
 Place :                                Chairman & Managing Director
 
 M-22/3RT, Vijayanagar colony,
 
 Hyderabad-500057
 
 CIN:L45201AP1987PLC007959
 
 Tel No:  91 40 23343550/3678
 
 Fax No :   91 40 23345004
 
 Email id: in_grievances@ivrinfra.com
 
 Website : www.ivrcl.com
Source : Dion Global Solutions Limited
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