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Petron Engineering Construction Ltd.

BSE: 530381 Sector: Engineering
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OPEN 93.75
CLOSE 93.55
52-Week high 217.15
52-Week low 91.05
Mkt Cap.(Rs cr) 71
Buy Price 94.00
Buy Qty 2.00
Sell Price 0.00
Sell Qty 0.00

Petron Engineering Construction Ltd. (PETRONENGG) - Director Report

Company director report

Dear Shareholders

The Directors Of Petron Engineering Construction Limited Are Pleased To Present The41st Annual Report Alongwith The Audited Financial Statements Of Your Company For The YearEnded March 31 2017.


Particulars 2016-17 2015-16
Income From Operations 34455 42191
Other Income 310 682
Total Income 34765 42873
Profit/(Loss) Before Interest Depreciation And Taxes 668 3704
Finance Cost 1894 2459
Profit/(Loss) Before Depreciation And Taxes (1226) 1245
Depreciation 699 728
Profit/(Loss) Before Tax (1925) 517
Tax Expenses (Including Taxes Of Earlier Years) (573) 81
Profit/(Loss) For The Year (1352) 436


The F.Y. 2016-17 Has Been A Challenging Year. We Have Sailed Through And Have DoneReasonably Good Despite Financial Constraints.

• Revenue From Operations Decreased By 19% To ' 34765 Lacs

• Net Loss For The Year Is ' 1352 Lacs Primarily Due To Lower Execution OfProjects And Due To Extend Constraints.

3. Dividend

No Dividend Has Been Recommended By The Board Of Directors Of The Company For FinancialYear 2016-17 As The Company Has Incurred Loss. However The Register Of Members And ShareTransfer Books Will Remain Closed From Friday September 22 2017 To Thursday September28 2017 (Both Days Inclusive).

4. Public Deposits

During The Year Under Review Your Company Has Not Accepted Any Deposit Within TheMeaning Of Sections 73 And 74 Of The Companies Act 2013 Read With The Companies(Acceptance Of Deposits) Rules 2014 (Including Any Statutory Modification(S) OrRe-Enactment(S) For The Time Being In Force).

5. CHANGE In Nature Of Business

During The Financial Year 2016-17 Company Has Not Changed Its Nature Of Business AndHas Been Continuing With The Same Line Of Business.

6. SHARE Capital

The Paid-Up Share Capital As On March 31 2017 Was ' 753.84 Lacs. During The Year UnderReview The Company Has Not Issued Any Shares. The Company Has Not Issued Shares WithDifferential Voting Rights. It Has Neither Issued Employee Stock Options Nor Sweat EquityShares And Does Not Have Any Scheme To Fund Its Employees To Purchase The Shares Of TheCompany. As On March 31 2017 None Of The Directors Of The Company Hold Shares Of TheCompany.

7. Credit Rating

Long Term Loan And Fund Based Working Capital Facilities Of ' 151.66 Crores Have BeenAssigned BBB- Rating. AND Non-Fund Based Working Capital Facilities Of ' 477 Crores HaveBeen Assigned A3 Rating By India Ratings & Research Private Limited.

8. Holding Company/ Subsidiaries Joint Ventures And Associate Companies

There Are No Subsidiary & Associate Companies Within The Meaning Of Companies Act2013. The Company Has Not Entered Into Any Joint Ventures During The Year Under Review.

The Company Has Below Mentioned Companies As Holding Company As At The End Of FinancialYear Ended March 31 2017.

Holding Company KSS Petron Pvt. Ltd.
Ultimate Holding Company Kazstroyservice Global BV


Mr. Sudhir Kumar Jain Independent Director Of The Company Has Resigned From TheDirectorship On February 10 2017 Due To Personal Reasons. The Board Places On Record ItsDeep Appreciation For The Valuable Contribution Made By Him During His Tenure As TheDirector Of The Company.

Except The Above No Other Director Or Key Managerial Person Had Been AppointedResigned Or Retired During The Year.


The Following Non-Executive Directors Are Independent Directors In Terms Regulation16(1)(B) Of SEBI (Listing Obligations And Disclosure Requirements) Regulations 2015 AndSection 149(6) Of The Companies Act 2013:

I) Mr. Sanjay Jain

Ii) Ms. Nandita Vijay Gupta

The Company Has Received Necessary Declaration From Each Independent Director UnderSection 149(7) Of The Companies Act 2013 That He/She Meets The Criteria Of IndependenceLaid Down In Section 149(6) Of The Companies Act 2013 And Regulation 16(1)(B) Of SEBI(Listing Obligations And Disclosure Requirements) Regulations 2015.

11. Board Evaluation

The Companies Act 2013 Rules Thereunder And The SEBI (Listing Obligations AndDisclosure Requirements) Regulations 2015 Provide That The Annual Report Of The CompanyShall Disclose The Following:

• Manner In Which Formal Performance Evaluation Of The Board Its Committees AndIndividual Directors Including Independent Directors Has Been Carried Out; And

• Evaluation Criteria

To This Effect On The Basis Of The Policy For Performance Evaluation Of IndependentDirectors Board Committees And Other Individual Directors A Process Of Evaluation WasFollowed By The Board For Its Own Performance And That Of Its Committees And IndividualDirectors.

A Separate Meeting Of Independent Directors Performance Of Non-Independent DirectorsPerformance Of The Board As A Whole And Performance Of The Chairman Was Evaluated TakingInto Account The Views Of Executive Directors And Nonexecutive Directors.

The Performance Was Evaluated On Parameters Such As Attendance And Participations InThe Meetings Compliance With Policies Of The Company Ethics Code Of ConductSafeguarding Interest Of Whistle-Blowers Under Vigil Mechanism Professional SkillsProblem Solving And Decision-Making Etc.

The Board Approved The Evaluation Results As Collated By The Nomination AndRemuneration Committee.

12. Board Committees

During The Year In Accordance With The Companies Act 2013 & SEBI (ListingObligations And Disclosure Requirements) Regulations 2015 The Board Re-Constituted SomeOf Its Committees. Currently There Are Following Committees:

1. Audit Committee

2. Nomination And Remuneration Committee

3. Stakeholders' Relationship Committee

4. CSR Committee

Details Of All The Committees Alongwith Their Charters Composition And Meetings HeldDuring The Year Are Provided In The "Corporate Governance Report" Which Forms APart Of This Annual Report.


Four Meetings Of The Board Of Directors Were Held During The Year. The Details Of TheBoard Meetings And The Attendance Of The Directors At The Meetings Are Provided In The"Corporate Governance Report" Which Forms Part Of This Annual Report. TheIntervening Gap Between Any Two Meetings Was Within The Period Prescribed By The CompaniesAct 2013 And The Secretarial Standard On Board Meetings Issued By The Institute OfCompany Secretaries Of India (ICSI).

14. Directors' Responsibility Statement

The Board Of Directors Of The Company Confirms:

A. That In The Preparation Of Annual Accounts The Applicable Accounting Standards HaveBeen Followed And There Has Been No Material Departure;

B. That The Selected Accounting Policies Were Applied Consistently And Made JudgmentsAnd Estimates That Are Reasonable And Prudent So As To Give A True And Fair View Of TheState Of Affairs Of The Company As At March 31 2017 And Of The Profits/Loss Of TheCompany For The Year Ended On That Date;

C. That Proper And Sufficient Care Has Been Taken For The Maintenance Of AdequateAccounting Records In Accordance With The Provisions Of The Companies Act For SafeguardingThe Assets Of The Company And For Preventing And Detecting Fraud And Other Irregularities;

D. That The Annual Accounts Have Been Prepared On A "Going Concern" Basis;

E. That Internal Financial Controls Have Been Laid Down To Be Followed By The CompanyAnd Such Internal Financial Controls Are Being Strengthened On Specific Areas To EnsureGreater Effectiveness;

F. That Proper Systems Have Been Devised To Ensure Compliance With The Provisions OfAll Applicable Laws And Such Systems Are Adequate And Operating Effectively.


The Audit Committee Comprises Of Mr. Sanjay Jain Chairman Who Is An IndependentDirector Mr. Ravi Keswani Member Who Represents The Promoters And Ms. Nandita VijayGupta Member Who Is Also An Independent Director. All The Recommendations Made By TheAudit Committee Were Accepted By The Board.


In Terms Of The Provisions Of Section 197(12) Of The Act Read With Rules 5 Of TheCompanies (Appointment And Remuneration Of Managerial Personnel) Rules 2014 DisclosuresPertaining To Remuneration And Other Details Are Appended As "Annexure - I" ToThe Directors' Report.

The Information Required As Per Rule 5(2) And 5(3) Of Companies (Appointment AndRemuneration Of Managerial Personnel) Rules 2014 Is Provided In The Annexure Forming PartOf The Report. In Terms Of The First Proviso To Section 136 Of The Act The Report AndAccounts Are Being Sent To The Shareholders Excluding The Aforesaid Annexure. AnyShareholder Interested In Obtaining The Same May Write To The Company Secretary At TheRegistered Office Of The Company. None Of The Employees Listed In The Said Annexure IsRelated To Any Director Of The Company.


In Terms Of Section 178(3) Of The Companies Act 2013 And Part D Of Schedule IISecurities And Exchange Board Of India (Listing Obligations And Disclosure Requirements)Regulations 2015 Your Company Has Framed Nomination And Remuneration Policy. The SaidPolicy Of The Company On Director's Appointment And Remuneration Including Criteria ForDetermining Qualifications Positive Attributes Independence Of Directors And OtherMatters Is Annexed As 'Annexure II'. We Affirm That The Remuneration Paid To The DirectorsIs As Per The Terms Laid Out In The Nomination And Remuneration Policy Of The Company.


Independent Directors On Their Appointment Are Issued A Letter Of Appointment SettingOut In Details The Terms Of Appointment Duties Responsibilities And Expected TimeCommitments. Necessary Arrangements Are Made To Organize The Interactive Sessions With TheMembers Of Senior Management Of The Company. The Details Of Programmes For FamiliarizationOf Independent Directors With The Company Their Roles Rights Responsibilities In TheCompany Is Displayed Up On The Website Of The Company I.E.Http://Www.Petronengineering.Com.

During The Year Under Review Independent Directors Were Apprised On An Ongoing BasisIn The Various Board/ Committee Meetings On Industry Developments Regulatory UpdatesBusiness Overview Operations Financial Statements Update On Statutory Compliances ForBoard Members Etc.


M/S. Lodha & Co. Chartered Accountants (Registration No. 301051E) New Delhi WereAppointed As Independent (Statutory) Auditors Of The Company At The 39th Annual GeneralMeeting. They Have Been Appointed As Independent Auditors From The Conclusion Of The 39thAnnual General Meeting Until The Conclusion Of The 44th Annual General Meeting Subject ToRatification By The Member/ Shareholders At Every Annual General Meeting.

The Company Has Received A Letter From M/S. Lodha & Co. Chartered Accountants NewDelhi To The Effect That Their Appointment If Ratified Will Be In Accordance With TheLimits Prescribed Under Section 139(1) Of The Companies Act2013 And That They Are NotDisqualified Within The Meaning Of Section 141 Of The Act.

Accordingly The Appointment Of M/S. Lodha & Co. Chartered Accountants New DelhiIs Proposed For Approval And Ratification By The Shareholders At The 41st Annual GeneralMeeting.


Pursuant To Section 204 Of The Companies Act 2013 And Rules Thereunder TheSecretarial Audit For The Financial Year 2016-17 Was Conducted By M/S. Pradeep Purwar AndAssociates Practicing Company Secretary And The Secretarial Audit Report For TheFinancial Year Ended March 31 2017 Is Annexed Herewith Marked As "Annexure III"To This Report.

The Board Has Also Appointed M/S. Pradeep Purwar And Associates As Secretarial AuditorTo Conduct Secretarial Audit Of The Company For Financial Year 2017-18.


The Company Has Appointed Internal Auditor. The Scope And Authority Of The InternalAuditor Is As Per The Terms Of Reference Approved By The Audit Committee. To Maintain ItsObjectivity And Independence The Internal Audit Reports To The Chairman Of The AuditCommittee Of The Board And Managing Director.

The Internal Auditor Monitors And Evaluates The Efficacy And Adequacy Of InternalControl System In The Company Its Compliance With Operating Systems Accounting ProceduresAnd Policies Of The Company.

During The Period Under Review The Company Has Complied With The Provisions Of The ActRules Regulations Guidelines Standards Etc. Issued By The Regulatory Bodies.


The Auditors M/S. Lodha & Co. Chartered Accountants New Delhi In Their ReportHave Drawn Attention To Note No. 32 33 And 44A On The Following Matter:

Auditors' Qualification No. 1


In Respect Of Certain Suspended / Delayed Contracts As At 31stmarch 2017 TradeReceivable Of ' 1748 Lacs (Net Of Mobilization Advance And Provisions Of ' 2934 Lacs)(As At 31st December 2016 Trade Receivables Of ' 1775 Lacs Net Of Mobilization AdvanceAnd Provisions Of ' 2934 Lacs) (As At 31st March 2016'1923 Lacs Net Of MobilizationAdvance And Provisions Of ' 2934 Lacs) And Unbilled Revenue Of ' 6256 Lacs (' 6256 LacsAs At 31st December 2016 And 31st March 2016 ) Are Doubtful Of Recovery And The BalancesOf Trade Receivables And Trade Payables Are Pending For Confirmation/ Negotiation.Further The Trade Payables Amounting To ' 815 Lacs (' 815 Lacs As At 31st December 2016And ' 819 Lacs As At 31st March 2016 Lacs) And Other Trade Receivables In Respect Of AboveMentioned Contracts Are Also Subject To Final Negotiation/ Confirmation. We Are Unable ToComment About The Status Of Amount Receivables / Payables On The Reported Loss For TheThree Months/ Year Ended On 31stmarch 2017 And Its Corresponding Impact On Assets /Liabilities As At That Date.

This Matter Was Also Qualified In Our Report On The Financial Results For TheQuarter/Year Ended 31st March 2016 And In Our Limited Review Report For Quarter/ NineMonths Period Ended 31st December 2016.


The Company's Response With Regard To Above Qualifications Is As Under:


The Matter Mainly Relates To A Mega Project (The Largest Private Investment In TheRegion) - Which Is Nearly 60% Complete Which Had Hit A Roadblock Because Of The CostEscalation Natural Disaster And Financial Constraints At The Client's End. The Client HasConfirmed That They Are In Discussions With Various Prospective Investors For FinancialSupport To Restart The Project. Considering The Developments It Is Expected That TheProject Will Restart In Near Future. Apart From The Above The Same Has Also BeenReaffirmed By The Top Executives Of The Said Customer.

As Commented By The Auditors In Their Report On The Realization Of Trade ReceivablesAnd Unbilled Revenue Of The Said Project The Management Hereby Informs That The AmountOutstanding In The Form Of Trade Receivables Is Pending Negotiations With Client And TheUnbilled Revenues Are In The Form Of Unfinished Works And Inventories Most Of Which AreMarketable If Required. The Management Is Of The View That Recovery Will Be Made UponRestart Of The Project.

In Respect Of Trade Receivables And Unbilled Revenue Of Other Contracts The Company IsNegotiating With The Clients And Is Confident Of Realisation Of Those Receivables.

Further The Accounts Payables Are Subject To The Reconciliation Of The Work PerformedAt The Said Project And Can Be Accurately Ascertained After Re-Negotiation Upon Restart OfThe Project Or Otherwise As The Case May Be.


Auditors' Qualification No. 2 Quote:

' 2922 Lacs Of Revenue Recognized Till 31st March 2017 FY 2016-17 ' Nil (Till 31stMarch 2016'2922 Lacs) On Account Of Cost Overruns / Claim On Certain Contracts WhichAre Not In Accordance With The Principles Set Out In The Accounting

Standards AS-7 'Construction Contracts' And Consequently Balance In Retained EarningsAnd Unbilled Revenue Balance As At 31st March 2017 Is Higher By ' 2922 Lacs (As At 31stDecember 2016 By ' 2953 Lacs And As At 31st March 2016'2922 Lacs).

This Matter Was Also Qualified In Our Report On The Financial Results For TheQuarter/Year Ended 31st March 2016 And In Our Limited Review Report For Quarter/ NineMonths Period Ended 31st December 2016.


The Company's Response With Regard To Above Qualification Is As Under:


There Are Contractual Provisions In Some Of The Contracts For Claims Against ExtendedStay At Pre-Determined Rates Per Month As Specified In The Respective Contracts.Accordingly The Company Has Lodged Claims For The Extended Stay. Further During ExecutionOf Works Some Of The Specifications Scope And Methodology Of Execution Have UndergoneChanges For Which Change Order Requests Have Been Submitted With The Respective Clients.

The Company Is Negotiating With The Clients And Is Confident Of Realisation Of ThoseClaims.


Auditors' Qualification No. 3 Quote:

There Are Delays In Payment Of Statutory Dues And Non/Delay In Filing Of CertainStatutory Returns And Auditors Are Unable To Comment On Impact On The Loss For Quarter /Year. Company Needs To Further Strengthen Internal Control System In This Regard.


The Company's Response With Regard To Above Qualification Is As Under:


Certain Statutory Dues Could Not Be Paid On Due Dates Due To Cash Flow Issues HoweverMajority Of Such Dues Have Since Been Paid Along-With Interest. Delayed Payment Charges(Penalties) If Any Will Be Accounted For As And When Settled/Paid. Necessary Steps HaveBeen Initiated For Filing / Revision Of Returns. The Company Is In The Process OfStrengthening Internal Control Systems.


The Auditors Have Also Drawn Attention To The Following Observations:


1. Confirmation Of Balance

Regarding Pending Confirmation / Reconciliation Of Balances Of Certain TradeReceivable Unbilled Revenue Other Liabilities (Including Statutory Dues And Returns) AndLoan & Advances As At March 31 2017 Where The Management Is Confident That ThereWill Not Be Any Material Impact On Confirmation / Reconciliation On Profit For The Year.

2. Management Estimates Related To Pending/Delayed Projects

Regarding Certain Pending/Delayed Projects Estimated Costs To Completion Are Based UponManagement Estimations And Where The Management Is Confident That There Will Not Be AnyMaterial Impact On Completion Of Work In Future.



The Observations Of The Auditors Are Self Explanatory. Unquote


Construction Companies Are Facing Difficulty Due To Difficult Market ConditionsIncreased Inflation Sporadic Labour Wage Increase Fluctuating Supply Of Feed-StocksCost Overruns Due To The Delay In Government Approvals Land Acquisition Etc. Clients AndConsultants Are Also Adopting The 'Wait And Watch' Situation And Have Become Averse ToTake Risky Decisions Due To The Dynamic Environment.

The Cumulative Effects Of These Conditions Will Have To Be Borne By Your Company. DueTo The Uncertainty In The Indian Infrastructure Industry Your Company Is Also Looking OutTo Explore Opportunities In The Middle East Far East And Africa Etc.

The Company Manages / Monitors The Principal Risks And Uncertainties That Can ImpactIts Ability To Achieve Its Objectives. The Company's Management Systems OrganizationalStructures Code Of Conduct Governs The Business Of The Company And Takes View Of RisksAnd Put Efforts To Achieve Risk Mitigation Through Internal Control Systems.


As Per Explanation To Section 134 Of The Companies Act 2013 The Internal FinancialControls (IFC) Are Reviewed By Your Management And Key Areas Are Subject To VariousStatutory Internal And Operational Audits. The Review Of The IFC Inter Alia Consists OfThe Optimum Utilization And Safeguarding Of Its Assets The Prevention And Detection OfFrauds And Errors The Accuracy And Completeness Of The Accounting Records And AdherenceTo Applicable Accounting Standards And The Timely Preparation Of Reliable FinancialDisclosures; Compliance With Applicable Laws Regulations And Management Policies; And AnEffective Management Information System.


The Company Has Appropriate Internal Control System For Business Processes With RegardsTo Its Operations Financial Reporting And Compliance With Applicable Laws AndRegulations. There Are Well Defined And Documented Procedures Policies And AuthorityGuidelines For Each Function In The Company. Your Company Has In-House Internal Audit TeamWho Conduct Audits Across All Locations Project Sites And Business Units Of The CompanyThroughout The Year To Test Check The Internal Control System.

Your Company Has An Audit Committee Whose Chairman Is An Independent Director. TheCommittee Meets Periodically With The Management Internal Audit Team And RepresentativesOf The Statutory Auditors To Review Your Company's Program Of Internal Audits Findings& Recommendations Made In The Auditors' (Both Internal & Statutory) Reports AndThe Follow-Up & Compliance Status Of Its Earlier Observations.


Details Of Loan Investments And Guarantees Given Are Provided In The NotesAccompanying The Financial Statement.


The Company Has Got A Policy To Approve The Related Party Transactions And DealingsWith The Related Party By The Audit Committee / Board Of Directors.

None Of The Transactions With Related Parties Fall Under The Scope Of 188(1) Of TheAct. The Information On Transactions With Related Parties Pursuant To Section 134(3)(H) OfThe Act Read With Rule 8(2) Of The Companies (Accounts) Rules 2014 Are Given In Form AOC- 2 Appended As "Annexure - IV".

The Policy On Materiality Of Related Party Transactions And Dealing With Related PartyTransactions As Approved By The Board May Be Accessed On The Company's Website AtWww.Petronengineering.Com.


There Is No Occurrence Of Material Changes And Commitment Made Between The End Of TheFinancial Year And Date Of This Report Which Has Affected The Financial Position Of TheCompany.

27. MANAGEMENT Discussion AND Analysis

The Management Discussion And Analysis As Required Under Regulation 34(2) SecuritiesAnd Exchange Board Of India (Listing Obligations And Disclosure Requirements) Regulations2015 Forms An Integral Part Of This Report And Gives Details Of The Overall IndustryStructure Economic Developments Performance And State Of Affairs Of Your Company'sVarious Businesses Internal Controls And Their Adequacy And Other Material DevelopmentsDuring The Financial Year 2016-17.


The Company Has Established A Vigil Mechanism / Whistle Blower Policy For Directors AndEmployees To Report Their Genuine Concerns. The Whistle Blower Policy Is Also Uploaded OnCompany's Website.

29. EXTRACT OF Annual Return

In Accordance With Section 134(3)(A) Of The Companies Act 2013 An Extract Of TheAnnual Return In Form MGT-9 Is Appended As "Annexure - V" To The Board's Report.


The Compliance Certificate From Practicing Company Secretary On Corporate GovernancePursuant To Clause - E Of Schedule V Of The SEBI (Listing Obligations And DisclosureRequirements) Regulations 2015 Confirming Compliance With The Conditions Of CorporateGovernance Forms Part Of The Directors' Report.


(A) Conservation Of Energy

I) Steps Taken For Energy Conservation Inter Alia Include The Following:

• Office Air Conditioning Comfort Temperature Optimization

• Electricity Consumption Reduction By Daily Monitoring And Control

• Operational Control Of HVAC System (Air Conditioning) In Winding Premises

• Compressed Air Pressure Reduction In Non-Use Time

• Closing Of Unwanted Opening From Air Conditioned Premises Reducing Cooling Loss

• Access Control On Air Conditioning. Installation Of Remote Control Switch InOffice Optimizing Operating Temperature

• Put In System To Switch Off The HVAC A/C Lights Fans When Not Required

Ii) Steps Taken By The Company For Utilizing Alternate Sources Of Energy:

• Open The Blinds/Curtains In Offices To Use Natural Lights

Iii) Capital Investment On Energy Conservation Equipments: NIL

(B) Technology Absorption: Not Applicable Expenditure Incurred On Research AndDevelopment: NIL

(C) Foreign Exchange Earnings And Outgo

Particulars With Regard To Foreign Exchange Earnings And Outgo Are Given Below:

Total Foreign Exchange Used And Earned:

I) Value Of Imports On CIF Basis ' 10.50 Lacs

Ii) Expenditure In Foreign Currency ' 7.87 Lacs

Iii) Foreign Exchange Earned ' Nil

Further It Does Not Include Revenue Recognized (Received / Receivables) In ForeignCurrency From One Of Its Clients Amounting To ' 808.53 Lacs For The Services Rendered /Job Execution Done In Special Economic Zone.

32. Material Development IN Human Resources / Industrial Relations FRONT IncludingNumber OF PERSONS EMPLOYED

Though The Company Is Passing Through A Challenging Period Due To Financial ConstraintsIncluding Cash-Flow Problems Your Company's Relation With Its Staff / Workers HasRemained Cordial During The Year.

The Company Is Having 443 Employees As On 31st March 2017.

33. CORPORATE SOCIAL Responsibility (CSR) Policy

The Corporate Social Responsibility And Governance Committee (CSR&G Committee) HasFormulated And Recommended To The Board A Corporate Social Responsibility Policy (CSRPolicy) Indicating The Activities To Be Undertaken By The Company Which Has Been ApprovedBy The Board. The CSR Policy May Be Accessed On The Company's Website. The Contents Of ThePolicy Along With The Annexure Specified In Rule 8 Of The Companies (Corporate SocialResponsibility) Rules 2014 Is Annexed Herewith As 'Annexure VI'.


The Company Has Adopted A Whistle Blower Policy To Provide A Formal Vigil Mechanism ToThe Directors And Employees To Report Their Concerns About Unethical Behavior Actual OrSuspected Fraud Or Violation Of The Company's Code Of Conduct Or Ethics Policy. The PolicyProvides For Adequate Safeguards Against Victimization Of Employees Who Avail Of TheMechanism And Also Provides For Direct Access To The Chairperson Of The Audit Committee.It Is Affirmed That No Personnel Of The Company Has Been Denied Access To The AuditCommittee. The Whistle Blower Policy May Be Accessed On The Company's WebsiteWww.Petronengineering.Com.


The Company Has Zero Tolerance For Sexual Harassment At Workplace And Has Adopted APolicy On Prevention Prohibition And Redressal Of Sexual Harassment At Work Place InLine With The Provisions Of Sexual Harassment Of Women At Work Place (PreventionProhibition And Redressal) Act 2013 And The Rules There Under. The Policy Aims To ProvideProtection To Employees At The Workplace And Prevent And Redress Complains Of SexualHarassment And Or Matters Connected Or Incidental Thereto With The Objective Of ProvidingA Safe Working Environment Where Women Employees Can Feel Secure.

The Company Has Constituted A Committee Which Has Got The Powers To Enquire Into TheComplaints Of Sexual Harassment And Recommend Appropriate Action.

The Company Has Not Received Any Complaint Of Sexual Harassment During The FinancialYear 2016-17.


Your Company Is Continuing To Execute The Contracts Related To FabricationInstallation Of Plant Machinery And Equipments For Cement Refinery PetrochemicalsPower Fertilizer Plants Etc. It Is Also Continuing To Execute Turnkey / CompositeConstruction Projects.

Over A Period Of Time Your Company Has Developed The Capabilities Of ExecutingVertical Construction Contracts Across All Sectors Which Will Be Preferred Mode OfExecution Of Future Contracts And Multiple Project Execution Simultaneously.


No Significant Material Orders Have Been Passed By The Regulators Or Courts OrTribunals Which Would Impact The Going Concern Status Of The Company And Its FutureOperations.

38. Transfer Of Unpaid DIVIDEND TO INVESTOR Education AND PROTECTION Fund

In Terms Of The Provisions Of Section 124 Of The Companies Act 2013 DividendsRemaining Unpaid/ Unclaimed For A Period Of Seven Years Have To Be Statutorily TransferredTo The Investor Education And Protection Fund (IEPF) Administered By The CentralGovernment. To Ensure Maximum Disbursement Of Unclaimed Dividend The Company RegularlySends Reminder To The Relevant Investors.

Unclaimed Dividend In Respect Of The Financial Year 2009-10 Will Be Due For Transfer ToIEPF On September 7 2017 In Terms Of Section 124 Of The Companies Act 2013. Members WhoHave Not Encashed Their Dividends For The Financial Year Ended 31st March 2010 Or AnySubsequent Year(S) Are Requested To Lodge Their Claims With The Company Immediately.

Pursuant To IEPF Authority (Accounting Audit Transfer And Refund) Rules 2016 CameInto Effect From September 7 2016 Which Stipulates That Shares On Which Dividend Has NotBeen Paid Or Claimed For Seven Consecutive Years Or More Are To Be Transferred To IEPFWith One Of The Depository Participants As May Be Identified By IEPF.

A Separate Communication In This Regard Has Already Been Sent To The Shareholders OfThe Company Who Have Not Encashed Their Dividend Warrants Providing Them Details Of TheUnencashed Warrants And Requesting Them To Comply With The Procedure For Seeking PaymentOf The Same.

39. Cautionary STATEMENTS

Statements In This Report On Management Discussion And Analysis Describing TheCompany's Objectives Or Outlook Opportunities Expectations And Estimates May BeForward-Looking Statements Within The Meaning Of Applicable Laws Or Regulations ActualResults Could However Differ Materially From Those Expressed Or Implied.

40. Acknowledgements

Your Directors Would Like To Express Their Sincere Appreciation For The Assistance AndCo-Operation Received From The Bankers Clients Dealers Vendors And Members For TheirSupport And Confidence Placed In The Company. Your Directors Also Wish To Place On RecordTheir Deep Sense Of Appreciation For Committed Services By The Company's Executives StaffAnd Workers At All Levels For Their Unstinted Efforts As Well As Their CollectiveContribution To The Company's Performance.

The Directors Would Also Like To Offer Its Sincere Thanks To The Company'sShareholders Bankers Customers Dealers Suppliers And All Other Business Associates ForTheir Unstinted Support And Continued Confidence In The Company.

For And On Behalf Of The Board Of Directors

Ajay Hans
Date : July 24 2017 Managing Director
Place : Mumbai (DIN: 03068249)