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Madhucon Projects

BSE: 531497|NSE: MADHUCON|ISIN: INE378D01032|SECTOR: Construction & Contracting - Civil
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Mar 15
Notes to Accounts Year End : Mar '16

Terms/ Rights attached to Shares:- The Company has only one class of paid-up equity shares having par value of Re.1/-per share. Each shareholder of equity share is entitled to one vote per share. The Company declares and pays Dividend in Indian Rupees only. The Dividend proposed by the Board of Directors is subject to approval of the shareholders in the Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by shareholders.

f) Bonus Shares/ Buy back shares for Consideration other than cash being received during the past five Years

(1) Aggregate number and class of shares allotted as fully paid up pursuant to contracts without payment being received in Cash - Nil

(2) Aggregate number and class of shares allotted as fully paid up by way of Bonus shares - Nil

(3) Aggregate number and class of Shares bought back - Nil

Notes for Long Term Borrowings From Banks and Financial Institutions:

Term Loans from Banks:

(i) United Bank Of India: Outstanding amount payable to UBI.

Term Loans from Financial Institutions:

(i) SREI Equipment Finance Limited :

Secured by Subservient charge on movable fixed assets of the company worth Rs. 308 Crores.

(ii) Mahindra & Mahindra Financial Services Limited :

Secured by hypothecation of tippers financed through the loan arrangements.

(iii) Magma Fincorp Limited:Securen by Hypothication of specific assets purchased out of the loan amount.

Note: CC Limits from Axis bank 13.25%, Bank of India 13.20%, IDBI Bank 14.75%, Kotak (ING Vysya) 14.55%, OBC 13.25%,

SBI 14.85%, ICICI Bank 14.75% &12.00%.

The company has availed the Working capital Cash credit facility from various banks under Multiple Banking Arrangement are secured by:

i) Pari-Passu First charge by way of hypothecation of the company''s inventory, work-in-progress and receivables, both present and future (otehr than project specific) with other working capital lenders.

ii) Pari-Passu second charge on all the unencumbered movable fixed assets of the company, both present and future with other working capital lenders.

*Others - Subsidiary Companies Investments in PT Madhucon Sriwijaya Power and Madhucon Energy Ltd has been sold. Investment in Rjauli Bakhtiyapur Expressways Ltd, Agastyamuni Hydro Power Pvt Ltd, Rudrapayag Hydro Power Ltd and Tilwara Hydro Power Pvt Ltd has written off during the financial year 2015-16.

*Others-Associate Companies Investment of Madhucon Sugars & Power Industries Ltd and MBN Anchored Earth Ltd has been sold during the financial year 2035-36. Investment in Ramnagar Power Pvt Ltd has been written off during the financial year 2035-36.

i) *Other Advances given to Rudraprayag Hydro Power Pvt Ltd Rs.328.3 3 lakhs, Ramnagar Power Pvt Ltd Rs.7.47lakhs, African Natural Resources Ltd (Mauritius) Rs.23.67lakhs, Legend Natura Resources Ltd (Mauritius) Rs.20.62lakhs and Madhucon Oil & Gas Ltd Rs.2.73lakhs has been written off since the companies closed during the F.Y. 2035-36.

ii) Vijayawada - Machilipatnam Expressways Limited a step down subsidiary of the Company entered in to concession agreement with National Highways Authority of India (NHAI) for developing a road project in Andhra Pradesh state. NHAI has terminated the Concession Agreement vide letter no : NHAI /BOT-I/3 3039/302/2007/63 dated : 29th October 2033 though NHAI failed to issue ROW and further confirmed it vide its letter no. NHAI/BOT-I/3 3039/302/2007/403 dated 27th August, 2034. Company has preferred a claim on NHAI for an amount of Rs. 3 3859.70lakhs towards expenses incurred and losses suffered on account of obtaining permits, financial costs, agency charges and consultants fee etc. on this project by the Company and the EPC Contractor. The advances given has been written off during the financial year 2035-2036.

iii) The company has got land allotted through auction bidding to the extent of 9.04 acres at Kukatapally in SY.378 & 379 by Andhra Pradesh Housing Board (APHB) under development agreement dated 9.32.2005 and incorporated the three SPVs as Subsidiaries Madhucon Mega Mall Private Limited (Shopping Mall cum Multiplex), Nama Hotels Private Limited (Four Star Hotel) and Madhucon Heights Private Limited (Residential/office).

Due to unavoidable circumstances, the construction of Shopping Mall cum Multiplex project could not be completed within the time by Madhucon Mega Mall Private Limited. Hence the APHB issued letter bearing No.305/Madhucon/AE/PC/2005, dated 36-32-2033 for revoking the Power of Attorney and Resumption of land to the extent of 5.32 Acres, aggrieved by the above said letter the company filed arbitration petition under sec.9 of Arbitration and conciliation Act,3996 before the XIA C J Court, CCC, Hyderabad seeking injunction against the APHB and after elaborate arguments the Hon''ble court was pleased to pass the Status quo order against the APHB and the same is pending.

Further based on the internal assessment and a legal opinion, the management is confident that it will succeed the above case and the loan given to such SPV is fully realizable. The carrying value of the investment is stated as book value. Their is no effect of going concern assumption.

iv) Unsecured Loans and advances include amounts given to Nama Investments Limited and NNR Infra Investments Private Limited. These companies have been incurring losses and the accumulated losses exceeded the net worth of these companies. As the value of investments of these companies are more than the loans and advances due from these companies, management is confident on the realisation carrying value of the assets at the values stated in the books of accounts.

v) Madhucon Infra Limited, Trichy-Thanjavur Expressways Limited, Madhucon Heights Private Limited, Nama Hotels Private Limited, PT Madhucon Indonesia and Madhucon Natural Resources Limited, Subsidiaries of the Company have been incurring losses and except MIL, net worth of these companies are fully/ substantially eroded. The management is taking necessary steps/ initiatives to improve the activities/business in these companies. Upon implementation of these initiatives, the management is confident of improving the profitability in these subsidiaries. Management is also confident that the carrying values of investments in and unsecured interest free loans and advances to these subsidiaries (which included amounts given as a sub-ordinate debt in terms of Common Loan Agreement entered with Bankers as a part of promoter''s contribution from time to time to its road SPVs for their project finances) are realizable at the value stated in the books.

1. The long term unquoted investments in equity shares of subsidiary companies as given hereunder and included in Note No.2.11 are pledged with Banks and Financial Institutions which have extended loan facilitates to the respective investee companies.

2. Segmental Reporting:

The Company''s operations predominantly consist of construction/project activities. Hence there are no reportable segments under Accounting Standard-17.

3. Micro & Small Enterprises: The Management has taken steps to identify the enterprises which have provided goods & services to the company and which qualify under the definition of Micro and Small Enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of the amounts payable to such enterprises as on 31st March, 2016 has been made in the financial statements based on information received and such amount outstanding as on 31st March, 2016 to Micro and Small Enterprises is NIL. Further, in the view of the Management, the impact of interest, if any, that may be payable in accordance with the provisions of the Act is not expected to be material.

4. In accordance with Accounting Standard 11(revised)the net exchange gain/(Loss) credited to profit & loss account is Rs.155.06Lakhs (previous year net exchange loss debited Rs.166.03lakhs) and foreign exchange difference (net) on capital account included in the cost of respective asset is Rs. Nil (previous year: Rs. Nil ).

5. Additional information pursuant to the provisions of Schedule III to the Companies Act, 2013 (wherever applicable).

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