Time to reset economy

Get App

Time to reset economy

SENSEX NIFTY
you are here:

Supreme Infrastructure India Ltd.

BSE: 532904 | NSE: SUPREMEINF |

Shares falling in the `Trade-to-Trade` or `T-segment` are traded in this series and no intraday is allowed. This means trades can only be settled by accepting or giving the delivery of shares.
Series: BE | ISIN: INE550H01011 | SECTOR: Construction & Contracting - Civil

Success
Alert
Please select a Day.
Info

BSE Live

Jan 27, 16:00
20.43 0.97 (4.98%)
Volume
AVERAGE VOLUME
5-Day
21,079
10-Day
19,112
30-Day
10,516
15,829
  • Prev. Close

    19.46

  • Open Price

    20.40

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    0.00 (0)

NSE Live

Jan 27, 15:41
20.20 0.95 (4.94%)
Volume
AVERAGE VOLUME
5-Day
7,721
10-Day
10,870
30-Day
10,354
1,885
  • Prev. Close

    19.25

  • Open Price

    20.20

  • Bid Price (Qty.)

    20.20 (2000)

  • Offer Price (Qty.)

    0.00 (0)

Annual Report

For Year :
2018 2016 2015 2014 2013 2012 2011 2010 2009

Director’s Report

To

The Members of

SUPREME INFRASTRUCTURE INDIA LIMITED

The Directors have pleasure in presenting their 35th Annual Report and the Audited Statement of Accounts for the year ended 31st March, 2018.

1. HIGHLIGHTS/ PERFORMANCE OF THE COMPANY Rs. in Crores

Sr. No.

Particulars

As at 31 March 2018

As at 31 March 2017

1

Income from operation

904.04

1050.12

Other income

76.25

73.67

Total Income

980.29

1123.79

2

Profit before Interest, Depreciation & Tax

188.93

215.04

Less: Interest/ Finance Charges

361.35

280.68

Depreciation

21.90

24.72

3

Profit / (Loss) before Exceptional Item and Tax

(194.32)

(90.36)

Exceptional Item

259.49

128.27

Less: Provision for Tax

Current Tax

46.31

0

Deferred Tax

0

0

Tax adjustment for earlier years

0

(15.13)

4

Profit After Tax

(500.12)

(203.50)

Add: Profit at the beginning of the year

618.18

821.44

5

Profit available for appropriation

120.32

618.18

Appropriations

NIL

NIL

6

Balance carried to Balance Sheet (attributable to equity holders)

120.32

618.18

OPERATION AND PERFORMANCE REVIEW

During the year under review, the Company’s income from operations and margins were under stress as compared to the previous year. Total Income during the year was Rs. 980.29 Cr. as compared to Rs. 1123.79 Cr. in the previous year. The Net loss after Tax was Rs. 500.12 Cr. as compared to Rs. 203.50 Crores in the previous year.

No Material changes and commitments have occurred after the close of the financial year till the date of this report, which may materially affect the financial position of the Company.

2. DIVIDEND

In view of the losses incurred and stressed financial resources, your Directors do not recommend any dividend on Equity Shares and Preference Shares for the year under review. Consequently, no amount is transferred to reserves for the year ended 31st March, 2018.

3. TRANSFER OF UNPAID / UNCLAIMED AMOUNTS TO INVESTOR EDUCATION AND PROECTION FUND (IEPF)

During the year under review, the Company has credited Rs. 58,896 to the Investor Education and Protection Fund (IEPF) pursuant to Section 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund (awareness and protection of investors) Amendment Rules, 2014. The cumulative amount transferred to IEPF up to 31st March, 2018 is Rs. 4.75 Lakhs.

4. SHARE CAPITAL

During the year, the Company increased the Authorised share Capital from Rs. 50 Crores to Rs. 75 Crores consisting of 7,25,00,000 (Seven Crores Twenty Five Lakhs) Equity Shares of Rs. 10/- each aggregating to Rs. 72,50,00,000/- (Rupees Seventy Two Crores Fifty Lakhs only) and 25,00,000 (Twenty Five Lakhs) Preference Shares of Rs. 10/- each aggregating to Rs. 2,50,00,000/- (Rupees Two Crores Fifty Lakhs only).

5. FINANCE

During the year under review, the Company’s Financials were under severe stress on account of several factors like delay in execution of projects, delay in execution of BOT Projects, cost over runs on delayed projects, high interest cost vis-a - vis volume of the Company’s operation, stressed working capital finance and similar factors peculiar to the infrastructure sector.

S4A SCHEME

During the year under review, the S4A Scheme duly approved by the lenders and the resolutions pertaining to the approval of the SIIL S4A Scheme, issuance of securities under the SIIL S4A Scheme and other relevant resolutions in this regard were duly approved by the shareholders at their 34th Annual General Meeting held on 30th October, 2017.

After receiving approval from majority of the banks constituting 90% of the debt, the promoters, lenders and trustee executed the Framework Agreement, Debenture Trust Deed and Share Purchase Agreement for implementation of S4A Scheme on 8th December, 2017.

As part of the scheme, it was proposed to issue equity shares and warrants to the promoters and non promoters. Since the proposed allotment to promoters would have triggered the open offer, the promoters made an application to SEBI under regulation 3(1) of SEBI Takeover regulations and exemption in this regard was awaited.

The Reserve Bank of India on February 12, 2018 issued a circular in respect of ‘Resolution of Stressed Assets - Revised Framework’ wide Circular No. RBI/2017-18/131 according to which all accounts, including such accounts where any of the schemes have been invoked but not yet implemented, shall be governed by the revised framework. Consequently, it was decided not to implement the SIIL S4A Scheme which was under implementation. The private placement offers for issuance of Optionally Convertible Debentures, equity shares and warrants as approved by the shareholders pursuant to their resolution dated October 30, 2017 has since then been withdrawn/ abandoned.

In view of the above, it is decided to work on new resolution plan in line with above referred RBI Circular dated 12th February, 2018. The New Resolution Plan is under consideration with the lenders.

6. CREDIT RATING

Your Company has been assigned “IND D” by India Ratings & Research Pvt. Ltd. for the long term facilities, cash credit facilities and non fund based limits of the Company.

7. CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Companies Act, 2013 and implementation requirements ofIndian Accounting Standards (‘IND-AS’) Rules on Accounting and disclosure requirements, which is applicable from current year, and as prescribed by Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “SEBI Listing Regulations”) the audited Consolidated Financial Statements are provided in this Annual Report.

Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of each of the subsidiary and joint venture in the prescribed form AOC-1 is annexed to this annual report.

Pursuant to Section 136 of the Companies Act, 2013 the financial statements of the subsidiaries are kept for inspection by the shareholders at the Registered Office of the Company. The said financial statements of the subsidiaries are also available on the website of the Company www.supremeinfra.com under the Investors Section.

8. DETAILS OF SUBSIDIARY COMPANIES, JOINT VENTURES AND ASSOCIATES COMPANIES

As on 31st March, 2018, the Company had Fourteen Subsidiaries (Direct & Indirect) of which thirteen are incorporated and based in India & one Overseas. The Company also had one Associate Companies as on 31st March, 2018. Some Joint Venture Projects have become non operative on account of the completion of the projects.

The Company has adopted a policy for determining material subsidiaries in terms of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015. The said policy is available on the Company’s website. A statement containing the salient features of the financial statements of the subsidiary companies is attached to the financial statements in Form AOC-1.

SUBSIDIARY COMPANIES

The Company’s two Subsidiary Companies viz. Supreme Infrastructure BOT Private Limited and Supreme Infrastructure BOT Holdings Private Limited undertake various BOT projects along with its holding Company. The BOT projects are housed in the Special Purpose Vehicle Company (‘SPV Company’) incorporated for the purpose.

1. SUPREME INFRASTRUCTURE BOT PRIVATE LIMITED (SIBPL)

As per the Audited financials for year ended 31st March, 2018, SIBPL registered a total income of Rs. 49.19 Lakhs as against 77.91 lakhs in the previous year. SIBPL has the following operative subsidiary companies executing the BOT projects:

i. Supreme Manor Wada Bhiwandi Infrastructure Private Limited ( SMBIPL)

Incorporated as SPV Company for execution of the Project of ‘widening of Manor- Wada (24.25 Kms) and Wada Bhiwandi Road (40.07 Kms) on SH-34 and SH-35 respectively in the State of Maharashtra and to convert it into a 4 lane highway on BOT basis’. The total length of the project aggregates to 64.32 Kms. The Concession period of the project is 28 years and 6 months from the date of work order. EPC work is executed by the Supreme Infrastructure India Ltd. The Company commenced tolling operations for this project on 4th March, 2013. The Company is also in the process of executing additional bypass road from SH-35 at Vishwabharati Phata-Bhinar-Vadpa Junction (KM 0/000 to 7/900 (Total Length - 7.90 km) Dist. Thane, Maharashtra on BOT (Toll) basis. Once completed, the bypass road would attract more road traffic for the main road project. Income from toll collection for the year ended 31st March, 2018 was Rs. 4315.40 Lakhs as compared to Rs. 4826.05 Lakhs in the previous year.

During the year, the lenders have invoked Strategic Debt Restructuring (SDR) with reference date of 24 November 2016. The joint lender’s forum (JLF) of SMBIPL agreed to proceed with the implementation of SDR scheme by invoking pledged equity shares of the promoters in their favour. Pursuant to the invocation of SDR, the lenders have invoked 5,100 equity shares of Rs. 10 each held by its Promotors at par aggregating Rs. 0.51 lakhs on 16 May 2017 representing 51% of the equity share capital of the Company by conversion of outstanding borrowings of an equivalent amount.

ii. Patiala Nabha Infra Projects Private Limited

Incorporated as SPV Company for execution of ‘Patiala Nabha Malerkotla (PNM) Road Project. This partially completed project was awarded by Punjab Industrial Development Board (PIDB), taken over from the earlier owner. The Company commenced tolling operations on 24th June, 2012. The concession period is 13 years. The total length of the road is approximately 56 kms. Income from toll collection for the year ended 31st March, 2018 was Rs. 1015.20 Lakhs as compared to ‘1047.57 Lakhs in the previous year.

iii. Supreme Suyog Funicular Ropeways Private Limited

Incorporated as SPV Company for execution of the Project for construction of funicular railway system at Haji Malang Gad, Ambarnath in Thane District, Maharashtra on Built, Operate and Transfer (BOT) basis. SIBPL is the majority stakeholder in the SPV Company. The project envisages a funicular trolley system for transporting devotees and luggage from the foot of the hill to Haji Malang Durgah and return. The total cost of the project is Rs. 997.30 Million. The concession period is 24 years and 5 months including construction period.

iv. Supreme Vasai Bhiwandi Tollways Private Limited (SVBTPL)

SVBTPL was incorporated as SPV Company for execution of 4 laning of Chinchoti-Kaman-Anjurphata to Mankoli road (Major SH No. 4) section from km 00.00 to km 26.425 of the existing road in the state of Maharashtra on Build-Operate-Transfer (BOT) basis. This partially completed project with existing tolling operations was awarded by PWD, Maharashtra, taken over from the earlier owner. The total length of the stretch is 26.425 kms. SIBPL is the majority stakeholder in the SPV Company. The total concession period is 24.3 years. Income from toll collection for the year ended 31st March, 2018 was Rs. 2718.48 Lakhs as compared to Rs. 3187.43 Lakhs in the previous year.

v. KOPARGAON AHMEDNAGAR TOLLWAYS (PHASE I) PRIVATE LIMITED

Public Works Department had awarded the work of construction of four (4) lane of BOT project viz. “Four Lanning of Kopargaon Ahemdnagar Road SH 10 km 78/200 to 120/000(42.60 Kms) and construction of Two Lane Shirdi- Rahata Bypass (23.30 Kms) (Project I). The project has been executed and the tolling collection started during the current year. Income from toll collection for the year ended 31st March, 2018 was Rs. 1431.34 Lakhs.

vi. Kotkapura Muktsar Tollways Private Limited(KMTPL)

KMTPL incorporated for execution of’Two laning From km 0 000 to km 29 996 (approximately 30.000 km) on the Kotkapura — Muktsar Road of State Highway No.16 (hereinafter called the “SH -16”) in the State of Punjab” on design, build, finance, operate and transfer (“DBFOT”) basis. SIBPL is the majority stakeholder in the SPV Company. The concession period is 18 years including construction period. The starting point of the project corridor is Kotkapura. The project has been executed and the tolling collection started during the current year. Income from toll collection for the year ended 31st March, 2018 was Rs. 628.28 Lakhs.

2. SUPREME INFRASTRUCTURE BOT HOLDINGS PRIVATE LIMITED ( SIBHPL)

SIBHPL was incorporated during the year 2011-12 and is the subsidiary of Supreme Infrastructure India Ltd. 3i India Infrastructure Fund, an investment fund established by international investor 3i Group plc, has through its affiliates viz. Strategic Road Investments Limited, invested Rs. 2000 Million in SIBHPL. As per the Audited financials of the Company for year ended 31st March, 2018, SIBHPL registered a total income of Rs. 10.20 Lakhs as against 68.78 Lakhs in the previous year. SIBHPL has road BOT portfolio housed in the following subsidiaries companies:

i. Supreme Kopargaon Ahmednagar Tollways Private Limited.

This partially completed project was awarded by Maharashtra PWD, taken over from the earlier owner. The Company commenced tolling operations for this project on September 26, 2011. The concession period of the project is up to May 2019. EPC work is executed by Supreme Infrastructure India Ltd. This was the first road BOT project of the Company where toll operations were commenced. Income from toll collection for the year ended 31st March, 2018 was Rs. 4059.76 Lakhs as compared to Rs. 4619.78 Lakhs in the previous year.

ii. Supreme Best Value Kolhapur (Shiroli) Sangli Tollways Pvt. Ltd.

Incorporated as SPV Company for execution of the project of ‘construction, operation, maintenance and augmentation of widening of 2-lane undivided carriage way to 4 lanes between Shiroli and Baswankhind, Ankali to Miraj Phata on SH - 3, Miraj Phata to Sangli on SH -75 and strengthening of existing 2 lanes between Baswankhind and Ankali one way via Jainapur and the other way via Jaisingpur (SH -3) on Design, Build, Finance, Operate and Transfer (DBFOT) toll basis’ in the State of Maharashtra. The estimated cost of project is Rs. 3840 Million. Total envisaged length for 4 laning is 25.66 Kms. & 2 laning is 26.95 Kms. The concession period of the project is 22 years and 9 months including construction period. The project is under implementation.

iii. Supreme Ahmednagar Karmala Tembhurni Tollways Pvt. Ltd. (SAKTTPL)

Incorporated as SPV Company for execution of the project of ‘“Construction of Four Laning of 61.71 kms. of roads at Ahmednagar-Karmala-Tembhurni ch.80/600 to ch.140/080 in the State of Maharashtra on Build, Operate and Transfer ( BOT ) basis. The cost of the project is Rs. 6382 Million. The concession period of the project is 22 years and 9 months including construction period. The project is under implementation.

During the year ended 31 March 2018, the lenders of SAKTTPL invoked SDR with reference date of 24 October 2016. The JLF of SAKTTPL in its meeting held on 11 May 2017 agreed to proceed with the implementation of SDR scheme. Pursuant to the invocation of SDR scheme, the lenders have been allotted 291,429 equity shares of Rs. 10 each at par aggregating Rs. 29.14 lakhs on 22 May 2017 representing 51% of the equity share capital of SAKTTPL by conversion of outstanding borrowings of an equivalent amount.

3. SUPREME PANVEL INDAPUR TOLLWAYS PRIVATE LIMITED (SPITPL)

Incorporated as SPV Company for execution of the Project of ‘Panvel - Indapur section of NH-17 from Km.0.00 to Km.84.00’ in the State of Maharashtra by widening the existing 2-lane dual carriageway to a 4-lane dual carriageway on BOT basis at an estimated cost of project of Rs. 12060 Million. Supreme Infrastructure India Limited (SIIL) holds 26% and its subsidiary SIBPL holds 38% Equity. SPITPL has achieved the desired milestone of NHAI, being completion of fifty percent of the EPC work as per the independent engineer of NHAI. The balance EPC work is being loan financed by NHAI. The total concession period is 24 years including additional extension in the concession period of three years. The project is under implementation.

4. SUPREME MEGA STRUCTURES PRIVATE LIMITED (SMSPL)

Supreme Infrastructure India Limited holds 60% Equity in SMSPL. SMSPL is carrying out the business of Rentals of staging, scaffolding, shuttering steel pipes and structural fabrication, steel fabrication work & job work. Substantial part of the Company’s shuttering and fabrication job is undertaken by Supreme Mega Structures Private Limited. Income from operation for the year ended 31st March, 2018 was Rs. 546.76 Lakhs as compared to Rs. 570.53 Lakhs in the previous year.

5. SUPREME INFRASTRUCTURE OVERSEAS LLC

With a view to tap the potential of overseas opportunities, Supreme Infrastructure India Limited incorporated a subsidiary Company viz. Supreme Infrastructure Overseas LLC in Sultanate of Oman by investing Rs. 21.2 Million for a 60% Equity stake in the said Company. The rest 40% Equity is held by Ajit Khimji Group LLC & AL Barami Investment LLC.

ASSOCIATE COMPANIES A. ASSOCIATES

1. SANJOSE SUPREME TOLLWAYS DEVELOPMENT PRIVATE LIMITED (SSTDPL)

Sanjose Supreme Tollways Development Private Limited (SSTDPL), a joint venture company, has been incorporated for undertaking the project of six laning of Jaipur Ring Road from Ajmer Road to Agra Road Section in Jaipur (Rajasthan) on DBFOT (Toll) Basis (Project) awarded by Jaipur Development Authority (JDA), Jaipur. During the year under review the project being undertaken by SSTDPL was foreclosed under amicable settlement between SSTDPL and JDA as the project was taken over by NHAI pursuant to declaration of the said project as National Highway in place of State Highway. In furtherance to the same, the project under an amicable settlement was foreclosed.

9. DEPOSITS

During the year under review, your Company has not accepted any deposit from the public or its employees during the year under review. As such, no amount of Principal or Interest is outstanding as on the Balance Sheet date.

10. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

Detailed information on CSR Policy developed and implemented by the Company and CSR initiatives taken during the year pursuant to Sections 134 & 135 of the Companies Act, 2013 is given in the ‘Annexure-I’ as CSR Report.

11. ENVIRONMENT & SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Company’s policy requires conduct of operations in such a manner, so as to ensure safety of all applicable compliances of environmental regulations and preservation of natural resources.

Your Directors further state that during the year under review, no complaints were reported to the Board as required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

12. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tasted and no reportable material weakness in the operations were observed.

13. DIRECTORS AND KEY MANAGERIAL PERSONNEL DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and in terms of the Articles of Association of the Company Mr. Bhawanishankar Sharma, (DIN 01249834) and Mr. Vikas Sharma, (DIN 01344759) retires by rotation at the forthcoming Annual General Meeting and being eligible offers themselves for reappointment.

The Company has received declarations from the Independent Directors confirming that they meet the criteria of independence as prescribed both under Section 149 (6) of the Companies Act, 2013 and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and that there is no change in their status of Independence.

KEY MANAGERIAL PERSONNEL

The Company has designated Mr. Bhawanishankar Sharma, Executive Chairman, Mr. Vikram Sharma, Managing Director, Mr. Vikas Sharma, Director, Mr. Sandeep Khandelwal as Chief Financial Officer and Mr. Vijay Joshi, Company Secretary as “Key Managerial Personnel’ of the Company in terms Section 203 of the Companies Act, 2013 read with Section 2(51) of the said Act.

Familiarisation Program for the Independent Directors

In compliance with the requirement of Listing Regulations, the Company has put in place a Familiarisation Program for the independent directors to familiarize them with their role, rights and responsibility as directors, the working of the Company, nature of the industry in which the Company operates, business model, etc. The details of the Familiarisation Program are explained in the Corporate Governance Report. The said details are also available on the website of the Company www.supremeinfra.com.

A. BOARD EVALUATION

Pursuant to the provisions of Section 134(3)(p), 149(8) and Schedule IV of the Companies Act, 2013 and Regulation of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annual performance evaluation of the Directors as well as that of the Audit Committee, Nomination and Remuneration Committee and Stakeholders’ Relationship Committee has been carried out. The performance evaluation of the Independent Directors was carried out by the entire Board and the performance evaluation of the Chairman and Non-Independent Directors was carried out by the Independent Directors.

B. REMUNERATION POLICY

The Company has adopted a remuneration policy for the Directors, Key Managerial Personnel and other employees, pursuant to the provisions of the Act and Regulation of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The remuneration policy is annexed as Annexure II to this Report.

C. MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year Seven Board Meetings and four Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

14. DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 that the Board of Directors have:

a. in the preparations of the annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. selected such accounting policies as mentioned in the annual accounts and applied them consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the loss of the Company for the year ended on that date;

c. taken proper and sufficient care 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;

d. prepared the annual accounts on a going concern basis;

e. laid down internal financial controls to be followed by the Company and that such financial controls are adequate and were operating effectively; and devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

f. devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT, 2013

Details of loans, guarantees and investments covered under the provisions of Sections 186 of the Companies Act, 2013 are given in notes to the financial statements.

15. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. During the year, the Company has not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materially of related party transactions. Thus, the disclosure in ‘Form AOC-2’ is not applicable.

All Related Party Transactions are placed before the Audit Committee as also the Board of Directors for approval. Prior omnibus approval of Audit Committee and the Board of Directors is obtained on an annual basis for the transactions which are foreseen and of repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The Company has a Related Party Transactions Policy duly approved by the Board and the same is uploaded on the Company’s website. The details of Related Party Transactions are given in the notes to the financial statements.

17. AUDITORS

A. STATUTORY AUDITORS AND THEIR REPORT

M/s. Walker Chandiok & Co LLP, Chartered Accountants and M/s. Ramanand and Associates, Chartered Accountants, holds office upto the date of ensuing Annual General Meeting. M/s. Walker Chandiok & Co LLP and M/s. Ramanand and Associates,Chartered Accountants would need to be reappointed at the ensuing AGM of the company to hold office till the conclusion of the Annual General Meeting of the Company to be held in the year 2019. The Company has received letters M/s. Walker Chandiok & Co. LLP and M/s. Ramanand and Associates, to the effect that their appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013. It is proposed to re-appoint M/s. Walker Chandiok & Co. LLP and M/s. Ramanand and Associates, Chartered Accountants as Joint Auditors to hold office from the conclusion of the Annual General Meeting of the Company to be held in the year 2019. subject to approval by the shareholders. Members are requested to reappoint Auditors and to authorize the Board of Directors to fix their remuneration.

B. EXPLANATION TO THE QUALIFICATION IN AUDITORS’ REPORT

The Directors submit their explanation to the qualifications made by the Auditors in their report for the year 2017-18. The relevant Para nos. of the report and reply are as under:

Qualification and Management’s Reply for Standalone

Audit Report:

1. As stated in Notes 11.2 and 11.3 to the standalone financial statements, the Company’s current financial assets as at 31 March 2018 include trade receivables and unbilled work aggregating Rs. 6,616.13 lakhs (31 March 2017: Rs. 6,616.13 lakhs) and Rs. 3,835.47 lakhs (31 March 2017: Rs. 3,074.86 lakhs) respectively, in respect of projects which were closed/terminated by the clients and where the matters are currently under litigation/negotiations and trade receivables aggregating Rs. 55,396.37 lakhs (31 March 2017: Rs. 23,507.17 lakhs) in respect of projects which were closed/ substantially closed and where the receivables have been outstanding for a substantial period. The Management has assessed that no adjustments are required to the carrying value of the aforesaid balances, which is not in accordance with the requirements of Ind AS 109, ‘Financial Instruments. In the absence of sufficient appropriate evidence to support the management’s contention of recoverability of these balances, we are unable to comment upon the adjustments, if any, that are required to the carrying value of the aforesaid balances, and consequential impact, if any, on the accompanying standalone financial statements. Our opinion on the standalone financial statements for the year ended 31 March 2017 was also qualified in respect of these matters.

2 As stated in Note 18.4 of the standalone financial statements, the Company’s non-current borrowings, short-term borrowings and other current financial liabilities as at 31 March 2018 include balances aggregating to Rs. 9,324.24 lakhs, Rs. 294.21 lakhs and Rs.11,510.27 lakhs respectively in respect of which direct confirmations from the respective lenders have not been received. These borrowings have been classified into current and non-current, basis the original maturity terms stated in the agreements which is not in accordance with the terms of the agreements in the event of defaults in repayment of borrowings. Further, whilst we have been able to perform alternate procedures with respect to certain balances, in the absence of confirmations from the lenders, we are unable to comment on the adjustments, if any, that may be required to the carrying value of these balances on account of changes, if any, to the terms and conditions of the transactions, and consequential impact, on the accompanying standalone financial statements.

3 Auditor’s Qualification on the Internal Financial Controls relating to above matters:

In our opinion, according to the information and explanations given to us and based on our audit procedures performed, the following material weakness has been identified in the operating effectiveness of the Company’s Internal Financial Controls over Financial Reporting as at 31 March 2018:

The Company’s internal financial controls in respect of supervisory and review controls over process of determining impairment allowance for trade receivables which are doubtful of recovery and assessment of recoverability of unbilled work, were not operating effectively. Absence of detailed assessment conducted by the management for determining the recoverability of trade receivables and unbilled work that remain long outstanding, in our opinion, could result in a potential material misstatement to the carrying value of trade receivables and unbilled work and consequently, could also impact the loss (financial performance including comprehensive income) after tax.

A ‘material weakness’ is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual financial statements or interim financial statements will not be prevented or detected on a timely basis.

We have considered the material weakness identified and reported above in determining the nature, timing and extent of audit tests applied in our audit of the standalone financial statement of the Company as at and for the year ended 31 March 2018 and the material weakness has effected our opinion on the standalone financial statements of the Company and we have issued a qualified opinion on the standalone financial statements.

Management reply to the above Auditors’ qualification:

1 Trade receivables and unbilled work (other current financial assets) as at 31 March 2018 include Rs. 6,616.13 lakhs (31 March 2017 : Rs. 6,616.13 lakhs) and Rs. 3,835.47 lakhs (31 March 2017 : Rs. 3,074.86 lakhs), respectively, relating to contracts which the clients terminated during earlier years and recovered the advances given against bank guarantees. The clients (government authorities) have not disputed payment of certified bills included under trade receivables. Dispute Resolution Committee has referred the matter to arbitrator and arbitration proceedings have been initiated (under the new ordinance of the arbitration rules) during the previous years, in respect of a party where net claims lodged by the Company by far exceed the amounts recoverable.

Trade receivables as at 31 March 2018 include Rs. 55,396.37 lakhs (31 March 2017 : Rs. 23,507.17 lakhs), in respect of projects which were closed/substantially closed and which are overdue for a substantial period of time. These trade receivables include amounts due from developers aggregating Rs. 4,399.47 lakhs for which the Company has filed/in process of filing winding up petition with the National Company Law Tribunal (NCLT).

The Company formed a senior management team comprising personnel from contract and legal department to rigorously follow up including negotiate / initiate legal action, where necessary for matters referred above. Based on the contract terms and these on-going recovery / arbitration procedures (which are at various stages) and an arbitration award received in favour of the Company during the previous period, the management is reasonably confident of recovering these amounts in full. Accordingly, these amounts have been considered as good and recoverable.

2 Non-current borrowings, short-term borrowings and other current financial liabilities as at 31 March 2018 include balances aggregating Rs. 9,324.24 lakhs, Rs. 294.21 lakhs and Rs. 11,510.27 lakhs, respectively in respect of which direct confirmations from the respective lenders have not been received. Further, out of these balance, non current borrowings, short-term borrowings and other current financial liabilities amounting to Rs. 9,324.24 lakhs, Rs. 294.21 lakhs and Rs. 3,967.81 lakhs, respectively, represent loans which were classified as Non-Performing Assets (NPAs) by the lenders. In the absence of confirmations from the lenders, the Company has provided for interest and other penal charges [except as stated in II (d) above] on these borrowings based on the latest communication available from the respective lenders at the interest rate specified in the agreement. The Company’s management believes that amount payable on settlement will not exceed the liability provided in books in respect of these borrowings. Further, certain lenders have not recalled or initiated recovery proceedings for the existing facilities at present. Accordingly, classification of these borrowings into current and non-current as at 31 March 2018 is based on the original maturity terms stated in the agreements with the lenders.

3 Management believes that Company’s internal financial controls in respect of assessment of the recoverability of trade receivables and unbilled work were operating effectively and there is no material weakness in such controls and procedures.

The Auditors qualification in respect of Consolidated Financial Statements and Management Response thereof is in line with the above.

Further, other observations made by the Auditors in their report are self-explanatory and do not call for any further comment. The Notes on financial statement referred to in the Auditors’ Report are self-explanatory and do not call for any further comments.

C. COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its Infrastructure activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s. Shashi Ranjan & Associates to audit the cost accounts of the Company for the financial year 2018-19. Accordingly, a Resolution seeking Member’s ratification for the appointment and remuneration payable to M/s. Shashi Ranjan & Associates, Cost Auditors is included at the Notice convening the Annual General Meeting.

D. SECRETARIAL AUDITORS

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 appointed M/s. Nidhi Bajaj & Associates, Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year 2017-18 is annexed herewith as ‘Annexure III. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

18. Board Committees

The Board of Directors of your Company had already constituted various Committees in compliance with the provisions of the Companies Act, 2013 / SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee.

Details of the role and composition of these Committees, including the number of meetings held during the financial year and attendance at meetings, are provided in the Corporate Governance Section of the Annual Report.

19. Vigil Mechanism

The Vigil Mechanism of the Company, also incorporates a whistle blower policy in terms of the Listing Regulations. Protected disclosures can be made by a whistle blower through an e-mail, or a letter to the Ombudsperson Task Force or to the Chairman of the Audit Committee.

20. CORPORATE GOVERNANCE

As per Regulation of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges, a separate section on corporate governance practices followed by the Company, together with a certificate from the Practicing Company Secretary confirming compliance forms an integral part of this Report.

21. MANAGEMENT DISCUSSION AND ANALYSYS

A detailed review of the operations, performance and future outlook of the Company and its business is given in the Management Discussion and Analysis appearing as Annexure to this Report.

22. COMPLIANCE WITH SECRETARIAL STANDARDS

Pursuant to the approval given on April 10, 2015 by Central Government to the Secretarial Standards specified by the Institute of Company Secretaries of India, the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from July 1, 2015. These secretarial Standards were thereafter revised and made effective from October 1, 2017. The Company is in compliance with the same.

23. REPORTING OF FRAUD

The Auditors of the Company have not reported any instances of fraud committed against the Company by its officers or employees as specified under Section 143(12) of the Act.

24. LISTING

Equity Shares of the Company are listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The Company has paid listing fees for the year 2018-2019.

25. 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 given hereunder:

A. CONSERVATION OF ENERGY

The Company’s main activity is of construction which does not require any utilities. However, Power is required for (a) running the crushing unit, (b) operating the ready mix concrete plant (c) operating the asphalt plant and (d) at the various project sites for operating the machinery/ equipment and lighting. The power requirement of manufacturing units are met from local distribution sources and from generator sets. The power required at the project sites for operating the machinery/equipment and lighting are met from the regular distribution sources and are arranged by the clients who award the contracts. At the project sites where the power supply cannot be arranged, diesel generator sets are used to meet the requirement of power.

The conservation of energy in all possible areas is undertaken as an important means of achieving cost reduction. Savings in electricity, fuel and power consumption receive due attention of the management on a continuous basis.

B. TECHNOLOGY ABSORPTION, ADAPTATION, RESEARCH & DEVELOPMENT AND INNOVATION

The Company has not acquired any technology for its manufacturing division. However, the technology adopted and applied is the latest technology available in the Industry and main thrust has always been put to adapt the latest technology.

In terms of Research and Development, it is the Company’s constant endeavor to be more efficient and effective in planning of construction activities for achieving and maintaining the highest standard of quality.

In view of the above, the rules regarding conservation of Energy and Technology Absorption are not applicable to the Company.

C. FOREIGN EXCHANGE EARNINGS AND OUT GO

During the year under review, there was no foreign exchange outgo as also no foreign exchange earnings.

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as ‘Annexure V.

27. EMPLOYEE STOCK OPTION SCHEME

With an objective of participation by the employees in the ownership of the Company through share based compensation scheme/ plan, your company has implemented ESOS Scheme after having obtained the approval of the shareholders at the Annual General Meeting of the Company held on 30th September, 2015. However, no ESOS have been granted during the year under review.

28. GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

a. Details relating to deposits covered under chapter V of the Act.

b. Neither the Managing Director nor the Whole-time Director of the Company receives any remuneration or commission from any of its subsidiaries.

c. No significant or material orders in view of the management were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future.

29. ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for their continued support and co-operation by financial institutions, banks, government authorities and other stakeholders. Your Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

ON BEHALF OF THE BOARD OF DIRECTORS

Sd/-

(B.H.SHARMA)

EXECUTIVE CHAIRMAN

Place: Mumbai

Date: June 6, 2018

Registered Office:

Supreme House, Plot.No.94/C,

Opp. I.I.T. Main Gate, Pratap Gad, Powai,

Mumbai- 400 076

Director’s Report