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Power Mech Projects Ltd.

BSE: 539302 | NSE: POWERMECH |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE211R01019 | SECTOR: Infrastructure - General

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Sep 30, 16:00
409.90 3.60 (0.89%)
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8,131
10-Day
6,911
30-Day
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  • Prev. Close

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  • Bid Price (Qty.)

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  • Offer Price (Qty.)

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Sep 30, 15:58
403.45 -2.70 (-0.66%)
Volume
AVERAGE VOLUME
5-Day
70,327
10-Day
74,403
30-Day
125,442
29,303
  • Prev. Close

    406.15

  • Open Price

    409.95

  • Bid Price (Qty.)

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  • Offer Price (Qty.)

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Annual Report

For Year :
2018 2017 2016 2015 2014

Director’s Report

DIRECTORS’ REPORT

Dear Shareholders,

The Directors have immense pleasure in presenting the Nineteenth Annual Report of your Company along with the audited financial statements (both standalone and consolidated) for the financial year ended 31st March, 2018.

FINANCIAL RESULTS

The financial performance for the current year in comparison to the previous year is as under: (Rs in Mn)

Sl.

No.

Standalone

Consolidated

Particulars

Current Year (2017-18)

Previous Year (2016-2017)

Current Year (2017-18)

Previous Year (2016-2017)

1

Revenue from operations

13,101

12,911

15,479

13,382

2

Other income

74

77

67

77

3

Total income

13,175

12,988

15,546

13,459

4

Expenditure

12,163

12,005

14,243

12,461

5

Profit before interest, depreciation and tax

1,710

1,694

2,090

1,737

6

Depreciation

364

396

428

409

7

Interest and finance charges

334

315

359

329

8

Profit before tax

1,012

983

1,300

1,003

9

Provision for taxes (including DTL)

353

346

392

356

10

Profit after tax

659

637

908

647

11

Other Comprehensive income

-

4

-

4

12

Total Comprehensive income for the year

659

641

908

651

13

Dividend for the year (including corporate dividend tax)

17.73

17.70

17.73

17.70

14

Reserves(excluding revaluation reserves)

6,665

6,025

6,838

6,065

15

EPS (Rs) on face value Rs.10/- each share

44.79

43.29

54.01

43.96

16

Book value (Rs.) on face value of Rs.10/- each share

463

419

474

422

OPERATING RESULTS AND BUSINESS

Your Company has achieved operational turnover of Rs. 13,101 Mn and profit after tax of Rs. 659 Mn during FY 17-18 as against previous year operational turnover of Rs. 12,911 Mn and profit after tax of Rs. 641 Mn respectively.

Further your Company has achieved consolidated operational turnover of Rs. 15,479 Mn and profit after tax of Rs. 908 Mn during FY 17-18 as against previous year consolidated operational turnover of Rs. 13,382 Mn and profit after tax of Rs. 651 Mn respectively.

DIVIDEND

Your Directors are pleased to recommend a final dividend at Re 1/- per equity share of face value of Rs. 10/- each for the year ended 31st March, 2018. The Final Dividend is subject to the approval of Members at the ensuing annual general meeting. The total dividend for the financial year will absorb Rs. 17.73 Mn, including Dividend Distribution Tax of Rs. 3.02/- Mn.

SUBSIDIARIES & JOINT VENTURES

As on 31st March, 2018 your Company has five subsidiaries, i.e Hydro Magus Private Limited (HMPL), Power Mech Industri Private Limited (PMIPL), Mas Power Mech Arabia (Saudi Arabia), Power Mech Projects LLC (Oman) and Power Mech BSCPL Consortium Private Limited.

Further there is one Joint Venture Company i.e. GTA Power Mech Nigeria Limited (Nigeria).

During the financial year, the Company has divested its entire shareholding from Power Mech - CPNED Services (Hongkong) Holding Co Ltd, JV Company.

Subsequent to the end of the financial year, the Company has incorporated a JV Company in Dubai i.e. GTA Powermatic DMCC. SUBSIDIARIES

» Hydro Magus Private Limited: Hydro Magus Private Limited is a subsidiary of Power Mech established with a vision to make positive contribution in surging Hydro Power sector in India and neighbouring countries. The Company''s operation profile envisages supply and construction of hydro power plants on EPC basis, renovation and modernization after sales services, AMC and O&M of existing hydro power plants. The strength of the Company is derived by its commitment in upholding quality and safety in execution at all stages.

- Power Mech Industri Private Limited: A wholly-owned subsidiary of Power Mech, has been established to meet the needs of power plants both thermal as well as Hydro for manufacturing, re-engineering and repairing of components.

With the intention to improve our engineering, machining and repair facilities for general engineering components and non-critical equipment used in power projects including spare parts, a large heavy engineering facility at Noida for non-critical equipment and spare parts have been set up under this Company. The state-of-the-art workshop in Noida is equipped with sophisticated and heavy duty machines with facilities to repair and re- blade turbine rotors of capacity up to 600 MW. Strategically located, the workshop would provide vital service indigenously and therefore bringing down the down time of equipment in a power plant. It is aimed to provide efficient engineering services at affordable price, reasonable time line and high level of quality.

- Power Mech BSCPL Consortium Private Limited: A Subsidiary Company of Power Mech is mainly incorporated to execute the contract relating to the infrastructure development works required for development of medical device manufacturing park for Andhra Pradesh Medtech Zone Limited at Vishakhapatnam.

- Mas Power Mech Arabia: It is a subsidiary of Power Mech, established in Saudi Arabia to cater the needs in the Saudi Arabia and surrounding regions for providing services in ETC, Civil and O&M. The Company is equipped to provide services in all the verticals keeping high standards in quality, safety and timeline.

The Company draws technical guidance and support from the parent company and it will be an extended arm of Power Mech in providing its skills and expertise in this part of the world.

- Power Mech Projects LLC: A subsidiary company of Power Mech incorporated in Oman to tap the local market of Oman and neighbouring countries.

JOINT VENTURES

- GTA Power Mech Nigeria Limited: A joint venture of Power Mech is designed to undertake packages in power, infra and process industry sectors including ETC of civil, mechanical and electrical and also O&M of plants. With solid and stable technical backup from the parent companies, GTA Power Mech is in a position to undertake projects of any magnitude and type in different terrains and weather. The Company has its registered office in Lagos, Nigeria and has established a networking with potential customers. The Company has capability to undertake packages in spectrum of activities in projects and plants supported by expert team in respective fields and strategic and technical collaborations from parent companies.

TRANSFER TO RESERVES

The Board do not propose to transfer any profits to the reserves for the fiscal 2018.

CONSOLIDATED FINANCIAL STATEMENTS

During the year, the Board of Directors reviewed the affairs of the Subsidiaries/JVs. In accordance with Sub Section (3) of Section 129 of the Companies Act, 2013, we have prepared the consolidated financial statements of the company, which forms part of this annual report.

As per the provisions of Section 136 of the Companies Act, 2013 the Company has placed separate audited financial statements of its Subsidiaries on its website www.powermechprojects.in. The annual accounts of the Subsidiary Companies and the related detailed information shall be made available to members seeking such information at any point of time.

The Statement containing the salient features of the Subsidiaries & JVs as per sub -sections (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014 and under Rule 8 of Companies (Accounts) Rules, 2014 of the Companies Act 2013 in Form AOC-1 is herewith annexed as Annexure-2 to this report.

AUDITORS’ REPORT

There are no qualifications, reservations or adverse remarks made by M/s. Brahmayya & Co, Chartered Accountants, Statutory Auditors, in their report for the financial year ended March 31, 2018.

Pursuant to provisions of Section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud to the Audit Committee during the year under review.

Pursuant to Companies (Amendment) Act, 2017, the provision pertaining to ratification of appointment of Statutory Auditor has been omitted with effect from 7th May, 2018. Hence, the agenda for ratification of appointment of Statutory Auditor has not been proposed in the notice of ensuing AGM.

INTERNAL AUDITORS

The Board of Directors based on the recommendation of the Audit Committee, re-appointed M/s. Ramesh & Co., Chartered Accountants, Hyderabad, as an Internal Auditors of your Company.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has reappointed M/s. P.S. Rao & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report in the Form MR-3 is annexed herewith as Annexure-3 to this report.

The Secretarial Audit Report for the FY 17-18 does not contain any qualification, reservation, adverse remark.

DIRECTORS

Pursuant to the provisions of section 152 of the Companies Act, 2013 and in terms of Article 134 of the Articles of Association of the Company Mr. M. Rajiv Kumar, Director retires by rotation and being eligible, offers himself for reappointment at the ensuing Annual General Meeting. The Board recommends his reappointment.

Your Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (7) of Section 149 of the Act and under Regulation 25 of the SEBI (LODR) Regulations, 2015.

DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR

During the year under review Mr. M. Rajendran has resigned from the Board as Wholetime Director with effect from 13th August, 2017.

During the year under review, Mr. N. Bhupesh Chowdary was appointed as an Additional Director under the category of Wholetime Director by the Board of Directors w.e.f. 13th August, 2017, and subsequently his appointment was ratified by the members of the Company at the previous annual general meeting.

However subsequent to the end of the financial year, Mr. N. Bhupesh Chowdary has resigned as Wholetime Director and CEO due to personal reasons with effect from 01st July, 2018.

BOARD MEETINGS

The Board of Directors of the Company duly met 5 (five times). The intervening gap between any two consecutive Board Meetings was within the period prescribed under the provisions of the Companies Act, 2013.

The details of Board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

COMMITTEES OF BOARD OF DIRECTORS

We have in place all the Committees of the Board which are required to be constituted under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A detailed note on the Board and its committees is provided under the Corporate Governance Report section in this Annual Report.

The Composition of various Committees of the Board is hereunder:

Name of the Committee

Composition of the Committee

Audit Committee

Mr. Sutanu Behuria, Chairman Mr. G.D.V. Prasada Rao, Member Mr. T. Sankaralingam, Member

Nomination and Remuneration Committee

Mr. T. Sankaralingam, Chairman Mrs. S. Lakshmi, Member Mr. G.D.V. Prasada Rao, Member

Corporate Social Responsibility Committee

Mr. S. Kishore Babu, Chairman Mrs. S. Lakshmi, Member Mr. G.D.V. Prasada Rao, Member

Stakeholders Relationship Committee

Mr. M Rajiv Kumar, Chairman Mrs. S. Lakshmi, Member Mr. G.D.V. Prasada Rao, Member

Investment Committee

Mr. S Kishore Babu, Chairman Mr. G.D.V. Prasada Rao, Member Mr. M. Rajiv Kumar, Member

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of loans, guarantees and investments covered under section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

CHANGE IN NATURE OF BUSINESS

There is no change in the nature of business during the period under review.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes and commitments affecting the financial position of the company occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Board of your Company has laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies,the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Companies Act, 2013, your Directors confirm that to the best of their knowledge and belief and according to the information and explanation obtained by them,

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii. such accounting policies as mentioned in the notes to the financial statements have been selected and applied consistently and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2017-18 and of the statement of profit and loss of the Company for that period;

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts for the year 2017-18 have been prepared on a going concern basis.

v. that the Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively.

vi. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and effectively mentioned under various heads of the departments which are in then reporting to the Chairman &Managing Director.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In terms of the provisions of Section 177 (9) & (10) of Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formalized the process and institutionalized ‘Whistle Blower Policy'' within the Company, whereby employees and other stakeholders can report matters such as generic grievances, corruption, misconduct, illegality and wastage/misappropriation of assets to the Company.

The policy safeguards the whistle blowers to report concerns or grievances and also provides direct access to the Chairman of the Audit Committee.

The details of the whistle blower Policy are posted on the website of the Company http://www.powermechprojects.in.

RISK MANAGEMENT

The Company has risk management mechanism in place which mitigates the risk at appropriate situations and there are no elements of risk, which in the opinion of Board of Directors may threaten the existence of the Company. A detailed description of the risks & threats has been disclosed in the Management Discussion Analysis Report forming part of the Annual Report.

RELATED PARTY TRANSACTIONS

During the year, no transaction with related parties was in conflict with the interests of the Company. All transactions entered into by the Company with related parties during the financial year were in the ordinary course of business and on an arm''s length pricing basis.

Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseeable and repetitive nature. All Related Party Transactions are placed on a quarterly basis before the Audit Committee and Board of Directors for their review.

The Policy on Related Party Transactions as approved by the Board is uploaded on the website of the Company http://www. powermechprojects.in/images/Policy-on-Related-Party-Transactions.pdf.

The particulars of contracts or arrangements with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 in Form AOC-2 is annexed herewith as Annexure-4 to this report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the details forming part of the extract of the Annual Return in Form MGT- 9 is annexed herewith as Annexure-5 to this report.

MANAGEMENT DISCUSSION & ANALYSIS

Pursuant to the provisions of Regulation 34(2) (e) of the of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a report on Management Discussion & Analysis forms part of the Annual Report and is herewith annexed as Annexure-6 to this report.

CHANGES IN SHARE CAPITAL

During the year under review, there was no change in the share capital of the Company. The paid up share capital of the Company is Rs. 14,71,07,640/- divided into 1,47,10,764 equity shares of Rs. 10/- each.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors as required under Section 197 (12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and the information required pursuant to Section 197 (12) of the Act read with Rule 5(2)&(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of your Company has been appended as Annexure-7 to this Report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as Annexure-8 to this report.

CORPORATE SOCIAL RESPONSIBILITY

The Company works primarily through its trust, Power Mech Foundation, the CSR arm of the Company.

The Foundation is tirelessly and steadfastly engages itself in meeting the social causes in the neighbourhood irrespective of cast and creed. The beneficiaries are abandoned infants, forsaken street children, neglected orphans, physically and mentally challenged children, students in remote villages and deserving people seeking medical assistance.

At every given opportunity the Foundation conducts periodical Blood donation camps, Health camps and other social awareness camps at regular periodicity.

The Foundation is adopting schools in the neighbourhood villages and takes care of the academic needs of the poor students. The services of the villagers and neighbourhood people are also involved during such events to give thrust and achieve success.

A detailed report on the CSR activities taken up by your Company is annexed as Annexure-9 to this report. Further the details of the policy are also posted on the website of the company www.powermechprojects.in

CORPORATE GOVERNANCE

The Board of Directors and the Management of your Company recognise the importance of good corporate governance in ensuring greater transparency, protecting the interests of its shareholders, as well as strengthening investors'' confidence in its management and financial reporting and are, accordingly, committed to maintaining a high standard of corporate governance.

In line with the commitment of the Company to maintaining high standards of corporate governance, the Company will continually review its corporate governance processes to strive to fully comply with the all the statutory laws and regulations as are applicable to the Company in letter and spirit.

As required under Regulation 34(3) of the Listing Regulations, a detailed report on Corporate Governance is included in the Annual Report as Annexure-10. The Secretarial Auditors have certified the Company''s compliance with the requirements of Corporate Governance in terms of Regulation 34(3) of the Listing Regulations and the same is annexed to the Report on Corporate Governance.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its

future operations.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed off during the year:

- No.of complaint received : Nil

- No.of complaints is posed off: Nil

ACKNOWLEDGMENTS

We thank our customers, vendors, investors, bankers for their continued support during the year. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was possible by their hard work, solidarity, cooperation and support.

We thank the Governments of various Countries where we have our operations and more particularly Government of India and various regulators viz a viz RBI, SEBI, Registrar of Companies, Income Tax Department, and all the state government and other government agencies for their support, and look forward to their continued support in future.

For and on behalf of the Board of Directors of

Sd/-

S Kishore Babu

Place: Hyderabad Chairman & Managing Director

Date:11.08.2018 DIN: 00971313

Director’s Report