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Arihant Foundations & Housing Ltd.

BSE: 531381 Sector: Infrastructure
NSE: ARIHANT ISIN Code: INE413D01011
BSE 00:00 | 25 Apr 42.30 -2.20
(-4.94%)
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42.30

HIGH

42.30

LOW

42.30

NSE 00:00 | 24 Apr 44.40 0
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OPEN

44.60

HIGH

44.60

LOW

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OPEN 42.30
PREVIOUS CLOSE 44.50
VOLUME 105
52-Week high 64.70
52-Week low 39.05
P/E 20.84
Mkt Cap.(Rs cr) 36
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 42.30
CLOSE 44.50
VOLUME 105
52-Week high 64.70
52-Week low 39.05
P/E 20.84
Mkt Cap.(Rs cr) 36
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Arihant Foundations & Housing Ltd. (ARIHANT) - Director Report

Company director report

Your Directors are pleased to present the Directors' Report of your Company togetherwith the Audited Financial Statements and the Auditors' Report for the period ended 31stMarch 2017. The summarized financial results for the Financial Year are as under:

WORKING RESULTS:

FINANCIAL PERFORMANCE:

During the year under review company has Revenue from operation of Rs. 4388.64 Lakhs(Previous Year: Rs. 7180.19 Lakhs) and Other Income of Rs.1116.72 Lakhs (Previous Year:Rs. 1184.66 Lakhs) and the Net Profit of the Company amounted to Rs.164.266 Lakhs(Previous Year: Loss of Rs. 792.55 Lakhs). After providing for Interest & Financecharges and Depreciation the Company has performed well during the year under reviewdespite the major changes economic policies like demonetization and enactment of RERA Actwith a Profit after Tax of is Rs. 109.96 Lakhs as compared to the previous year loss ofRs.521.63 Lakhs).

(Rs. In Lakhs)
S. No Particulars 1st April 2016 to 31st March 2017 1st January 2015 to 31st March 2016
(12 Months) (15 Months)
I. Total Revenue 5505.366 8364.860
ii. Total Expenses 5341.099 9157.407
iii Profit before exceptional and extraordinary items and tax (I-II) 164.266 (792.546)
IV Exceptional items - -
V Profit before extraordinary items and tax (III -IV) 164.266 (792.546)
VI Tax expense:
(1) Current tax 54.306 47.805
(2) Deferred tax - (318.72)
VII Profit (Loss) for the period from continuing operations 109.960 (521.632)
VIII Transfer to Capital Redemption Reserve - -
IX Profit (Loss) for the period (VII- VIII) 109.960 (521.632)

DIVIDEND

Your directors do not declare any Dividend for the financial year ended 31st March2017 due to inadequate profit and to Conserve reserves.

DEPOSITS

During the year under review the company didn't raise funds by way of fixed depositsfrom Public.

Subsidiaries & Joint Ventures /Associates

There are six subsidiaries and two joint ventures of your Company as on 31st March2017. M/s Arihant Griha Limited Vaikunt Housing Limited Varenya Constructions Limitedand Transperent Heights Real Estate Limited are the wholly-owned subsidiaries and M/s.Escapade Real Estate Private Limited with 66.67% stake and M/s. North Town Estates PrivateLimited is the subsidiary of your Company with 65% stake. M/s. Arihant Unitech RealtyProjects Limited Mangalagiri Realty Private Limited (formerly known as ArihantIndo-African Infra Developers and Builders Private Limited) are Joint Venture entities ofyour Company. Your Company does not have any material non-listed Indian SubsidiaryCompany. No Company ceases to be Subsidiary and no Company has become Subsidiary duringthe year under review. Details of financial statements of subsidiaries are given in AoC-1as Annexure 1.

Performance Plans and Prospects of your Company

Your Company's current year Projects:

During the year under review the Company has executed and handed over three (3)residential projects and one (1) Commercial project covering an area of 4.40 Lakh squarefeet. The Company's Project managers are guided by policy and principle in the successfulimplementation and completion of various projects.

ONGOING PROJECTS

Project name Location Area (Sqft)
Arihant - 'esta (Residential Complex) Mugappair Chennai 198165
Arihant Tiara (Residential Complex) Nandambakkam Chennai 149568
Aira (Residential Complex) Egmore Chennai 13000
The Verge (Commercial complex) OMR Chennai 85000
TOTAL 445733

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of Loans Guarantees and Investments made during the year are given in thenotes to the Financial Statements.

DIRECTORS:

The Composition of Directors the Company is in compliance with Section 149 of theCompanies Act and Regulation 17 of the SEBI (Listing Obligations & DisclosureRequirements) Regulation 2015.

A) CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the period under review Mrs Meenakshi Jayaraman has resigned from the positionof Company Secretary on January 5 2017.

Further on March 25 2017 Mrs Meenakshi Jayaraman was again appointed as the CompanySecretary of the Company and designated as Key Managerial Personnel (KMP) of the companyin compliance of provisions of section 203 of the Companies Act 2013.

B) DECLARATION BY INDEPENDENT DIRECTORS

A declaration by the Independent Directors that they meet the criteria of independenceas provided in subsection (6) of Section 149 of the Companies Act 2013 was taken onrecord by the Board in their meeting held on April 12 2016. The terms and conditions ofappointment of the Independent Directors are placed on the website of the Companyhttp://www. arihantfoundations.com/investors-details/code-of- conduct/

The Company has also disclosed the Directors' familiarization programme on its websitehttp://www. arihantfoundations.com/investors-details/code-of- conduct/

The independent directors have met on 14.02.2017 and reviewed the performance ofnon-executive directors chairman and executive directors and analyzed the flow ofinformation to the Board. All the Independent directors were present at the meeting.

The Board also evaluated its own performance and that of its committees &Independent Directors.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS:

During the year 11 (eleven) Board Meetings and 4 (four) Audit Committee Meetings wereconvened and held. The intervening gap between the Meetings was within the periodprescribed under the Companies Act 2013.

AUDIT COMMITTEE:

The Audit Committee had a number of meetings both formal and internal interactionswith the management team in reviewing Accounts Finances Compliances and Risks and inensuring improved internal reporting analyses and financial performances. Given theincreasing complexities presented by the new Companies Act and other Laws the AuditCommittee has also focused on Compliance and Governance to meet the needs of the presentand the future. When necessary external consultants have been brought in to support theCommittee and the Management team.

We are happy to report to you that governance of your Company is of a high order as aresult. Further improvements are being implemented.

Nomination and Remuneration Committee has been active in its role as stipulated inSection 178 of the Companies Act 2013. The policy of remuneration of the Directors KMPsand employees are stated elsewhere in the report.

FINANCE

All taxes and statutory dues have been paid. Payment of interest and instalments to theFinancial Institutions and Banks are being made as per schedule. Your Company had notcollected any Fixed Deposits during the Financial Year.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard AS-21 on consolidated financial statementsread with Accounting Standard AS-23 on investment in associates AS-27 on financialreporting of interest in Joint Venture Auditors Report on the consolidated financialstatements audited consolidated Balance Sheet statement of Profit and Loss account andCash flow statements are provided in the Annual Report.

REPORT ON CORPORATE GOVERNANCE

Your Company ensures good corporate governance by implementing and complying with thepolicies standards set out by Securities and Exchange Board of India and other regulatoryauthorities. The requisite certificate issued by Mrs. G. Subhasree Practicing CompanySecretary confirming compliance with the conditions of Corporate Governance as stipulatedunder Regulation 34(3) of the SEBI (Listing Obligations And Disclosure Requirements)Regulations 2015 is attached to this Report as Annexure 5 .

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN -EXCHANGE EARNINGS AND OUTGO.

The necessary details are furnished in Notes to Financial statements no. 35

PARTICULARS OF EMPLOYEES:

Details of employees covered under Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in Annexure 3 to thisannual report. Employees at all levels have performed well.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. An Internal Complaints Committee (ICC) has been set up by yourCompany to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy. The number ofcomplaints filed during the year was Nil.

RELATED PARTY TRANSACTIONS

All transactions entered into with Related Parties (as defined under the Companies Act2013) during the financial year were in the ordinary course of business and on an Arm'slength pricing basis and do not attract the provisions of Section 188 of the CompaniesAct 2013 and within the ambit of Reg. 23 of the SEBI (Listing Obligations And DisclosureRequirements) Regulations 2015. Suitable disclosure as required by the AccountingStandards (AS18) has been made in the notes to the Financial Statements.

The Board has approved a policy for related party transactions which has been uploadedon the Company's website. http://www.arihantfoundations.com/investors-details/code-of-conduct/

Details of transactions with related parties are given in Form AOC - 2 which isattached to this report and report on AOC - 2 by CEO and CFO is attached to this reporthas Annexure 4.

REMUNERATION POLICY OF THE COMPANY

The objective of the remuneration policy of the Company is to ensure that the level andcomposition of remuneration is reasonable and sufficient to attract retain and motivatedirectors of the quality required to run the company successfully; relationship ofremuneration to performance is clear and meets appropriate performance benchmarks; andremuneration to directors key managerial personnel and senior management involves abalance between fixed and incentive pay reflecting short and long-term performanceobjectives appropriate to the working of the company and its goals.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS

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

DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:

i) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures.

ii) the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit or loss of the company for that period.

iii) the directors have taken proper and sufficient care to maintain adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities.

iv) the directors have prepared the annual accounts on a going concern basis.

v) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.

vi) that systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.

BUSINESS RISK MANAGEMENT

Business Risk Evaluation and Management is an ongoing process within the Organization.The Company has a robust risk management framework to identify monitor and minimizerisks. Pursuant to the requirement of Reg. 17(9) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Company has constituted a Business RiskManagement.

Committee and the details of the Committee are as under:

S. No. Name of the member Category
1. Mr. Ravikant Chairman
Choudhary Non executive Independent
2. Mr. A. Damodaran Member Non executive Independent
3. Mr. Bharat Jain Member Executive Non Independent Director

VIGIL MECHANISM / WHISTLE BLOWER MECHANISM

The Company has a vigil mechanism to deal with instance of fraud and mismanagement ifany. The details of the Policy are explained in the Corporate Governance Report and alsoposted on the website of the Company.

CORPORATE SOCIAL RESPONSIBILITY

Obligation to incur expenses under Corporate Social Responsibility is not applicable toyour Company for the current year. A CSR committee of the Board however has beenconstituted and a policy on Corporate Social Responsibility Policy has been uploaded onthe Company's website http://www.arihantfoundations.com/investors-details/code-of-conduct/

STATEMENT PURSUANT TO LISTING AGREEMENT

Your Company's shares are listed with the National Stock Exchange of India Ltd and theBSE Ltd. We have paid the respective annual listing fees and there are no arrears.

REPORT ON CORPORATE GOVERNANCE

A Report on Corporate governance is annexed herewith as Annexure 5. An extract ofAnnual Return is attached as Annexure 6.

AUDITORS

In accordance with the provisions of Section 139 of the Companies Act 2013 read withRule 6 of The Companies (Audit and Auditors) Rules 2014 every Company shall appointStatutory Auditors to hold office for one term of 5 years and such appointment is subjectto ratification by the Members every year in the annual general meeting. The Act furthermakes it mandatory to rotate the statutory auditors after two terms of 5 years in case ofa firm of auditors. Further Companies have been given time till the year 2017 to effectrotation of Auditors wherever necessary. As you are aware M/s.

B.P Jain & Co. have been the statutory auditors of the company for more than 10years. In order to comply with the requirements mentioned above it is proposed to at theensuing 24th Annual General Meeting by appointing a new firm of Chartered Accountants toact as the Statutory Auditors of the Company.

The Board of Directors on the recommendations of the Audit Committee at the meetingheld on 14th February 2017 have decided to recommend to the shareholders theappointment of M/s. Ramachandra Rao & Associates (Firm Regn. No. 007735S) Chennai asthe Statutory Auditors of the Company for a period of 5 years from the ensuing 24th annualgeneral meeting until the conclusion of the Twenty ninth annual general meeting of theCompany subject to ratification annually by shareholders if required by law. M/s.Ramachandra Rao & Associates (Firm Regn. No. 007735S) has given their consent to actas Statutory Auditors and have also confirmed that their appointment if made shall be inaccordance with the provisions of the Companies Act 2013.

INTERNAL AUDITORS

The Internal Auditors M/s. Ernst & Young LLP have played an important role instrengthening the Systems and internal Controls within the Company.

SECRETARIAL AUDIT

The Board appointed Mrs. G. Subhasree Practising Company Secretary Chennai to conductSecretarial Audit for the Financial Year 2016-17. The Secretarial Audit Report for theFinancial Year ended March 31 2017 is attached to this Report as Annexure 7.

PARTICULARS PURSUANT TO SECTION 197(12) AND THE RELEVANT RULES OF THE COMPANIES ACT2013:

a) The ratio of the remuneration of each Director to the median employee's remunerationfor the financial year and such other details as prescribed is as given below:

S. No. Name of the Director Ratio
1. Mr. Kamal Lunawath 5.5419
2. Mr. Vimal Lunawath 5.5419
3. Mr. Bharat Jain 8.3128

b) The median remuneration for the period from April 2016 to March 2017 - Rs.216532.30/-

c) The percentage increase in remuneration of the Managing Director Chief FinancialOfficer Company Secretary or Manager if any in the financial year:

Mr. Kamal Lunawath - (Managing Director) : N.A.

Mr. Vimal Lunawath - (Chief Financial Officer) : N.A.

Mrs. J.Meenakshi - (Company Secretary) : N.A.

d) The percentage increase in the median remuneration of employees in the financialyear: Nil

e) The number of permanent employees on the rolls of company: 51

f) Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and any exceptionalcircumstances for increase in the managerial remuneration:

Increase in remuneration is based on remuneration policy of the Company.

g) If remuneration is as per the remuneration policy of the company: Yes

PERSONNEL

The Board wishes to place on record its appreciation of all employees of the Companyfor their wholehearted efforts and contribution to the performance and growth of theCompany.

ACKNOWLEDGEMENTS

Your Directors place on record their gratitude for the support and co- operationreceived from CMDA Corporation of Chennai Banks and Financial Institutions CustomersSuppliers and Shareholders and for their continued support. The Board also wish to placeits sincere appreciation to the dedicated and committed team of employees.

For and on behalf of the Board of Directors

ARIHANT FOUNDATIONS & HOUSING LIMITED

(KAMAL LUNAWATH) (VIMAL LUNAWATH)
Managing Director Whole time Director
DIN: 00087324 DIN: 00586269
Place: Chennai
Date: 30.05.2017

Annexure to Directors' Report:

Board of Directors' explanation for the observations made in the Secretarial Auditreport.

Refer observations in the Secretarial Auditors Report point (ii);

Forms for filing the returns on transfer of IEPF were not available as on date oftransfer and also there was a delay from the Bank to receive the unclaimed Dividenddetails. However the MCA has now released the said Forms and the Company is takingnecessary steps to file the forms with regard to transfer of unclaimed dividend to IEPF.

For and on behalf of the Board of Directors

ARIHANT FOUNDATIONS & HOUSING LIMITED

(KAMAL LUNAWATH) (VIMAL LUNAWATH)
Managing Director Whole time Director
DIN: 00087324 DIN: 00586269
Place: Chennai
Date: 30.05.2017