KNR Constructions
BSE: 532942 | NSE: KNRCON | ISIN: INE634I01011 | Construction & Contracting - Civil
- Directors Report
- Chairman's Speech
- Auditors Report
- Notes To Accounts
- Accounting Policy
- Finished Products
- Raw Materials
| Directors Report | Year End : Mar '08 |
The Directors take pleasure in presenting the 13th Annual Report and
the audited accounts for the financial year ended 31st March, 2008 and
this is the first annual report and audited accounts provided after
public issue.
FINANCIAL RESULTS :
(Rs. Lakhs)
PARTICULARS 2007-08 2006-07
Gross Income 55406.25 33395.00
Profit before interest and depreciation 7147.88 4312.38
Less: Interest and financial charges 1003.84 890.67
Profit Before depreciation 6144.04 3421.71
Less: Depreciation 1449.40 736.42
Profit before tax 4694.64 2685.29
Provision for tax
(including Wealth Tax, Fringe Benefit
Tax and Deferred Tax ) 1614.14 647.94
Profit after tax 3080.50 2037.35
Less: Prior year taxes and adjustments 125.65 49.65
Net Profit for the year 2954.85 1987.70
Profit brought forward from previous year 3837.65 2236.85
Profit available for appropriation 6792.50 4224.55
Appropriations:
Transfer to General Reserve 150.00 150.00
Dividend® 10% 281.23 202.49
Dividend tax 47.80 34.41
Balance carried forward 6313.47 3837.65
Pald -up capital 2812.35 2024.89
Reserves and Surplus 19812.79 4587.65
REVIEW OF PERFORMANCE:
Your company continues to be in the business of work contracts
specializing in Roads and Bridges and other infrastructure projects
like irrigation projects. During the year under consideration, your
company has achieved a turnover of Rs 54742.71 Lakhs as against Rs
32120.33 Lakhs in the previous year, thus registering an increase of
70.43 %. The company has earned a gross profit of Rs 7147.88 Lakhs
before interest and depreciation as against Rs 4312.38 Lakhs in the
previous year, thus registering a growth of 65.75%. After deducting an
interest of Rs 1003.84 Lakhs, providing for Rs.1449.40 Lakhs towards
depreciation, Rs 1614.14 Lakhs towards provision for income tax, wealth
tax, fringe benefit tax and deferred tax, Rs 125.65 Lakhs towards prior
period items and taxes, the operations resulted in a net profit of Rs
2954.85 Lakhs as against Rs. 1987.70 Lakhs last year, registering a
growth of 48.66 %.
Following are the major works awarded to our Company from since April
2007
SI. Particulars of the Project Amount
No. (Rs. In Millions)
1 Package No: AP7 - Work order received from Patel
Engineering Ltd., as back to back construction of
Design and 4810.00
Construction part of the project
from Islam Nagar (Km 230.00) to
Kadtal (Km 278.00) of Nagpur-Hyderabad
Section on NH-7 in the
State of Andhra Pradesh.
2 Package No: NS-32 - Balance works of
widening 4/6 laning and 1029.98
strengthening of existing
2 lane carriageway of NH-7
(Madurai — Kanniyakumari section) in the State of Tamil Nadu
from KM 203.000 (of existing NH, Panagudy) to km 234.690
(end point of proposed kanniyakumari bypass) construction
package no. NS-32 / TN (Balance) — Company share 50%
With the above new orders, the order book position as on 30th June 2008
stands at Rs. 13,618.54 Millions.
Dividend
Your Directors have recommended a divided of Rs. 1 /- per Equity share
for the financial year ended 31 st March 2008, amounting to Rs. 281.23
Lakhs. The dividend will be paid to the members whose names appear in
the Register of Members as on 24.09.2008; in respect of shares held in
the dematerialized form, it will be paid to members whose names are
furnished by National Securities Depository Limited and Central
Depository Services (India) Limited as beneficial owners as on that
date.
The dividend pay out for the year under review has been formulated in
accordance with the Companys policy linked with long term performance,
keeping in view the companys need for capital for its growth plans and
the intent to finance such plans through internal accruals to the
maximum.
Listing of Equity Shares
The Companys Equity Shares are listed at Bombay Stock Exchange Limited
and National Stock Exchange of India Limited through our Initial Public
Issue (IPO) which was opened on 24th January 2008 and closed on 29th
January 2008. The listing permission from the both the stock exchanges
was received on 14th February 2008 and got trading permission with
effect from 18th February 2008.
The company has utilized the publice issue proceeds in the following
manner:
Rupees in Lakhs
Particulars Proposed Utilised As on
31-03-2008
Investment in Capital Equipment 2130.47 1359.63
Investment in BOT Projects
a - As equity contribution 4234.60 600.00
b- As un-secured loan 3600.00 1800.00
Working Capital 2520.80 2520.80
Issue Expenses 900.90 899.64
Total 113386.77 7180.07
The unutilized sum of Rs.6206.70 lakhs was temporarily invested in
mutual funds and fixed deposits with banks .
Directors
In accordance with the requirements of the Companies Act, 1956 Sri L B
Reddy, Sri D. Ramaiah, Sri J S R Chandra Mouli, and Shri K Jalandhar
Reddy, Directors of the Company are liable to retire by rotation at the
Annual General Meeting and, being eligible, offer themselves for
reappointment at the ensuring Annual General Meeting. Brief resume of
the Directors proposed to be reappointed, nature of their expertise in
specific functional areas, names of the companies in which they hold
directorships and relationships between directors inter-se, as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges in India, are provided in the Report on Corporate Governance.
Auditor and Auditors Report:
M/s. Sukumar Babu & Co., Chartered Accountants, Statutory Auditors of
the company hold office until the conclusion of the ensuring Annual
General Meeting and are eligible for reappointment.
The Company has received letter from the Statutory Auditors to this
effect that their reappointment, if made, would be within the
prescribed limits under the Section 224(IB) of the Companies Act, 1956
and they are not disqualified for such reappointment within the meaning
of Section 226 of the said Act.
The Notes on Accounts referred to in the Auditors Report are
self-explanatory and therefore do not call for any further comments.
Expiation to Auditors Observations
1. With reference to clause VII of Annexure for the Auditors Report,
the management has taken note of the same and appropriate actions will
be taken in the regard
2. With reference to clause 9(b) of Annexure of die Auditors Report,
amount represents the provisions made for entry tax payable on the
purchase of lubricants, HSD, tyres and bitumen. The company is entitled
to the refund of special entry tax already paid by it and is awaiting
the necessary assessment and refund orders. After receipt of the same
the refund amount will be adjusted against this liability. Any excess
or shortfall in the above provision will be accounted for the books of
accounts.
Consolidated Financial Statements:
In accordance with the Accounting Standards AS-21 and AS-27 on
Consolidated Financial Statements read with the Accounting Standard
AS-23 on Accounting for Investments in Associates, the audited
Consolidated Financial Statements are provided in the Annual Report.
Managements Discussion and Analysis Report
Managements Discussion and Analysis Report for the year under review,
as stipulated under Clause 49 of Listing agreement with the Stock
Exchanges in India, is presented in a separate section forming part of
the Annual Report.
Fixed Deposits:
The Company has not accepted any deposits from the public in terms of
Section 58A of the Companies Act, 1956
Particulars of Employees:
The particulars of employees whose details need to be provided under
section 217(2A) of the Companies Act, 1956 read with the Companies
(Particulars of Employees) Rules, 1975 is presented as an Annexure to
this report.
Directors Responsibility Statement:
Pursuant to the requirements under Section 217 (2AA) of the Companies
Act, 1956, with respect to Directors Responsibility Statement, it is
hereby confirmed that:
i) in the preparation of the annual accounts, the applicable accounting
standards read with requirements set out under Schedule VI to the
Companies Act, 1956, have been followed and there are no material
departure from the same;
ii) the Directors have selected such accounting policies and applied
them consistendy and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2008 and profit for the year ended on
that date;
iii) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities and
iv) the Directors have prepared the annual accounts of the Company on a
going concern basis. Conservation of Energy, Technology Absorption
and Foreign Exchange Earnings and Out Go:
The particulars relating Conservation of Energy, Technology absorption,
Foreign Exchange earnings and outgo as required under section 217 (1)
(e) of the Companies Act, 1956 read with Companies (Disclosure of
particulars in the Report of Board of Directors) Rules, 1988 are as
follows
a) Conservation of Energy
The Company has taken suitable measures for conservation of energy. The
Companys main business is Civil Contract Works and mainly depends on
heavy vehicles which run on diesel.
b) Technology absorption, Adoption and Innovation
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 need 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 that cannot be quantified.
c) Foreign Exchange earnings and outgo
Foreign Exchange Earnings - Nil
Foreign Exchange outgo towards
a) Travel - Rs. 1,11,760 (P.Y Rs. 20,038)
b) Import of capital goods - Rs.7,10,23,975 (P.Y. Rs. 3,40,35,650)
Corporate Governance:
In pursuance of Clause 49 of the Listing Agreement entered into with
the stock exchanges, a separate section on Corporate Governance has
been incorporated in the annual report for the information of
shareholders. A certificate from the auditors / Practicing Company
Secretary of die Company regarding compliance with the conditions of
Corporate Governance as stipulated under Clause 49 also forms part of
die annual report.
Acknowledgements:
Your Directors wish to place on record dieir gratitude to the Companys
shareholders, customers, vendors and bankers for their continued
support to KNRCLs growdi initiatives Your Directors also wish to place
on record, their appreciation of the contribution made by employees at
all levels, who through dieir competence, sincerity, hard work,
solidarity and dedicated support, have enabled your Company to make
rapid strides in its business initiatives Your Directors also thank the
Central and State Government and dieir various agencies, particularly,
National Highway Authority of India and other Governmental agencies for
extending their support during the year, and look forward to their
continued support.
On behalf of the Board of Directors
of KNR Constructions Limited
Sd/- Sd/-
K Narasimha Reddy M Rajesh Reddy
Managing Director Executive Director
Place : Hyderabad
Date : 30.08.2008 |
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