Simplex Infrastructures

The Directors have pleasure in presenting Ninetieth Annual Report
 together with the Audited Statement of Accounts for the financial year
 ended 31st March, 2008.
 
 THE FINANCIAL HIGHLIGHTS ARE SET OUT BELOW:
 
                                                            (Rs. in mn)
                                      31 ST MARCH 2008 31 ST MARCH 2007
 
 Gross Billing                                28081.20         17082.14
 
 Earning before interest, depreciation, 
 tax and amortisation (EBIDTA)                 2920.45          1724.95
 
 Less: Interest & finance charges              1007.30           632.25
 
 Earning before depreciation, 
 tax and amortisation (EBDTA)                  1913.15          1092.70
 
 Less: Depreciation and amortisation            642.65           391.08
 
 Profit before tax                             1270.50           701.62
 
 Less: Provision for tax-current tax            264.00            97.00
 
 Fringe benefit tax                       11.97 275.97    9.31   106.31
 
 Profit before deferred tax                     994.53           595.31
 
 Less: Deferred tax                              93.74            58.19
 
 Profit after tax                               900.79           537.12
 
 Balance brought forward from the previous year 1192.07          795.20
 
 Profit available for appropriation             2092.86         1332.32
 
 Less: Transferred to:
 
 General Reserve                                 100.00           60.00
 
 Proposed Dividend                                98.95           68.60
 
 Tax thereon                               16.81 215.76   11.65  140.25
 
 Balance carried to Balance Sheet               1877.10         1192.07
 
 REVIEW OF OPERATIONS
 
 The turnover of the Company at Rs. 28,081.20 mn has shown an increase
 of 64.39% as compared to Rs.17,082.14 mn in the previous year. Profit
 before tax increased by 81.08% from Rs.  701.62 mn to Rs. 1,270.50 mn.
 Profit after tax increased by 67.71% to Rs. 900.79 mn compared to Rs.
 537.12 mn in 2006-07.
 
 The EBIDTA of the Company has shown a significant increase at 69.31%
 from Rs. 1,724.95 mn in the previous year to Rs. 2,920.45 mn in the
 year under review. Cash or Gross Profit (EBDTA) has also shown a
 healthy rise of 75.08% at Rs. 1,913.15 mn from Rs.  1,092.70 mn in the
 last year.
 
 Your Company has emerged as a well-diversified Construction
 
 Services Company with presence in almost all sectors of construction
 business. Your Company bagged several prestigious orders in various
 sectors of the construction business viz., Ground Engineering, Power,
 Urban Infrastructure, Building & Housing, Marine, Industrial and
 Transportation. The Current Order book of your Company stands at Rs.
 100,127 mn.
 
 Your Company with its signif cant project management and execution
 expertise has been able to capitalise on the opportunities in the
 Middle East. The Company already has its branch ofices in Dubai, Qatar
 and Bahrain. During 2007-2008 your Company has also established branch
 office in Oman. The Current Overseas order book position of the Company
 stands at Rs. 26635 mn. As always, your Company is in constant pursuit
 towards leveraging its technical capabilities to provide high quality
 construction services with significant cost advantage to its clients.
 
 NEW BUSINESS INITIATIVES
 
 Considering our diverse client mix spread across India and the Middle
 East and banking on the capabilities and good track record your Company
 has made a cautious and gradual foray into the real estate development
 business with different partners without undertaking the risks and
 costs of the land, in the cities with relatively more potential.
 
 Your Company has entered into a contract for on-shore oil drilling
 services business by commissioning one oil-drilling rig for an Oil
 Company recently. Your Company is exploring and in negotiation with Oil
 Companies to expand this business further.
 
 DIVIDEND
 
 Your Directors recommend an enhanced dividend of 100% (previous year
 80%) on equity shares of face value of Rs. 2.00 each for the financial
 year ended 31st March, 2008, which if approved at the forthcoming
 Annual General Meeting will be paid to all eligible members whose name
 appear in the register of Members of the Company at the close of
 business on 11th September, 2008. The dividend outgo (including tax on
 dividend) will be Rs.  115.76 mn (previous year Rs. 80.25 mn).
 
 CAPITAL EXPENDITURE
 
 During the year under review, the Company has made additions of Rs.
 3332.65 mn to its Fixed Assets.
 
 ALLOTMENT OF SHARES TO QIBs
 
 During the year ended 31st March, 2008 the Company issued 6,400,000
 equity shares of Rs. 2/- each at a price of Rs. 625/- per share,
 including a premium of Rs. 623/- per share aggregating to Rs. 4,000 mn
 in accordance with the resolution passed by the Shareholders pursuant
 to Section 81 (1A) of the Companies Act, 1956 and Chapter XIIIA of SEBI
 (Disclosure and Investor Protection Guidelines), 2000.
 
 ISSUE OF SHARE WARRANTS
 
 The Company issued 5,500,000 warrants to a promoter group Company on
 preferential basis during the year ended 31st March, 2008 carrying an
 option to the warrant holders to apply for and be allotted equivalent
 number of equity shares within 18 months from the date of allotment at
 a price of Rs. 401/- per warrant. As on 31st March, 2008, 200,000
 warrants have been converted into equity shares of the face value of
 Rs. 2/- each.
 
 PUBLIC DEPOSIT
 
 The Company has no overdue deposit other than unclaimed deposits
 amounting to Rs. 2.11 mn as on 31st March, 2008. On the date of this
 report, deposits aggregating Rs. 0.77 mn of the same has been claimed
 and paid.
 
 CREDIT RATING
 
 In order to comply with BASEL-II Guidelines for obtaining bank
 facilities your Company has got the rating done by Messrs Credit
 Analysis & Research Limited (CARE). The Rating assigned by CARE is
 ‘PR1+’ (PR One Plus) for short term facilities and ‘AA-‘ (Double A
 Minus) for long term facilities.
 
 AUDITORS
 
 The Auditors, Price Waterhouse, Chartered Accountants, will hold office
 until the conclusion of the ensuing Annual General Meeting. We
 recommend re-appointing them as Statutory Auditors of the Company. They
 have furnished a certificate to the effect that their proposed
 appointment, if made will be in accordance with the limits specified
 under section 224 (1-B) of the Companies Act, 1956.
 
 AUDITORS REPORT
 
 With respect to paragraph no. 4.6 of the Auditors’ Report, we would
 like to inform that the matter has been explained in Note No. 9 on
 Schedule 19 forming part of the Balance Sheet.  Derivative losses/gains
 are accounted for in the period in which they occur. The Board is of
 the opinion that the mark to market losses of Rs. 72.47 million as
 shown in Note No. 9 on Schedule 19 is notional. Hence the Company has
 not provided for losses on mark to market basis and will be provided on
 actual basis on expiry or cancellation of the contract.
 
 PARTICULARS OF EMPLOYEES
 
 In terms of the provisions of Section 217(2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975 as
 amended, the names and other particulars of the employees are required
 to be set out in the Annexure to the Directors’ Report. However, as per
 the provisions of Section 219(1) (b)(iv) of the said Act, the Annual
 Report excluding the aforesaid information is being sent to all the
 Members of the Company and others entitled thereto. Member who is
 interested to obtain such particulars may write to the Company
 Secretary at the Registered Office of the Company.
 
 DISCLOSURE OF PARTICULARS
 
 A statement giving details of conservation of energy, technology
 absorption, foreign exchange earnings and outgo in accordance with the
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rule, 1988, is annexed to this report.
 
 DIRECTORS’ RESPONSIBILITY STATEMENT
 
 Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956
 the Board of Directors of the Company hereby state and confirm 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 departures from the same;
 
 (ii) 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 true and fair view of the state of affairs of
 the Company at the end of the financial year and the profit of the
 Company for the period;
 
 (iii) The Directors have taken proper and suficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of Companies Act, 1956 for safeguarding the assets of the
 Company and for preventing and detecting of fraud and other
 irregularities;
 
 (iv) The Directors have prepared the accounts for the financial year
 ended 31st March 2008 on a going concern basis.
 
 CORPORATE GOVERNANCE
 
 All Directors of the Company and Senior Management has affirmed the
 compliance of Code of Conduct framed by the Company. A separate section
 titled ‘Corporate Governance’ including a certificate from the Auditors
 of the Company confirming compliance of the clauses of Corporate
 Governance as stipulated under Clause 49 of the Listing Agreement is
 annexed hereto and forms a part of the Report.
 
 DIRECTORS
 
 Mr. Rajiv Mundhra, Mr. A. D. Mundhra and Mr. N. N. Bhattacharyya retire
 by rotation at the forthcoming Annual General Meeting and being
 eligible offer themselves for re appointment.
 
 Mr. H. B. Guha Biswas and Mr. P. K. Nandy resigned from the
 Directorship of the Company with effect from 10th December, 2007 and
 19th May, 2008, respectively. Your Directors place on record their
 appreciation for the valuable services rendered by Mr. Guha Biswas and
 Mr. Nandy during their tenure as Directors of the Company.
 
 Mr. A. D. Mundhra and Mr. A. Mukherjee, Whole-time Directors are
 proposed to be re-appointed for a period of five years and three years
 respectively with effect from 1st September, 2008.
 
 ACKNOWLEDGEMENT
 
 Your Directors would like to acknowledge with gratitude the
 co-operation and assistance received from the Financial Institutions,
 Banks, Central and State Governments and the Company’s valued investors
 for their continued co-operation and support. Your Directors also take
 this opportunity to record their sincere appreciation of the efforts
 put in by the workers, staff and officers at all level for their
 contribution to the success achieved by the Company.
 
                                 By Order of the Board
 
 Mumbai                          B.D. MUNDHRA
 Dated: 30th June 2008           Chairman & Managing Director