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Raghava Estates & Properties Ltd.

BSE: 531627 Sector: Infrastructure
NSE: N.A. ISIN Code: INE348J01016
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Raghava Estates & Properties Ltd. (RAGHAVAESTATES) - Director Report

Company director report

Dear Shareholders

We are delighted to present before you the Twenty Eigth Annual Report on business andoperations along with the Audited financial statements and the Auditors Report of yourcompany for the financial year ended March 31 2016.

1. Financial Highlights:

(Rs in Lakhs)

Particulars March 31 2016 March 312015
Total Revenues 1097.37 2291.45
Expenses before Interest & Depreciation 1049.27 2042.01
Interest 33.04 46.24
Depreciation &. Amortisation 13.00 7.09
Total Expenditure 1095.31 2095.34
Profit/fLoss) before tax 2.06 196.11
Provision for taxes f2.781 f42.091
Profit after Tax [0-72) 154.02

During the year your company had total income of ^1097.37 Lakhs against ^2291.45 Lakhsof previous year. Company had a Net Loss of ^ 0.72 lakhs as against Net profit of ^ 154.02Lakhs of previous year.

2. DIVIDEND:

In view of the working capital requirements for the on going & forth comingprojects the board has not recommended any dividend.

3. FUTURE PROSPECTS:

Your company views the future with optimism as the demand for Housing is growing dayby day and keeping in view the demand the management is anticipating good increase inturnover during the forthcoming years.

4. RESERVES:

During the year the Company has not transferred any amounts to General Reserves or anyother reserves.

5. CHANGE IN THE NATURE OF BUSINESS. IF ANY:

During the year under review there is no change in nature of business of the company.

6. CHANGE IN SHARE CAPITAL

The Authorised Share Capital of the Company as on date of Balance Sheet is ^55000000/- divided into 5500000 equity shares of ^ 10/- each

The paid up share capital of the company as on date of balance sheet is ^30192000/-divided into 3019200 equity shares of ^ 10/- each.

During the year under review there is no increase in Authorised share capital and noallotment of shares.

7. MATERIAL CHANGES:

There are no material changes during the year under review that effect the financialposition of the company.

8. FIXED DEPOSITS

The Company has received advances from several customers to the tune ofRs.1058.81 lakhsof which an amount of Rs.475.45 Lakhs were outstanding for a period of more than 365 daysas on 31st March 2016. To such extent the company has not complied with theprovisions of Sections 73 to 76 of Companies Act 2013 and Clause 2 (xii)(a) of tireCompanies (Acceptances of Deposits) Rules 2014with regard to the advances received.

9. INFORMATION ABOUT SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:

Your Company doesn’t have any subsidiary or Joint Ventures or Associate Companyand it is not a subsidiary or Joint Venture or Associate to any other Company.

10. AUDITORS:

Statutory

M/s Suresh & Babu Chartered Accountants Firm Regd. No.004254S was appointed asStatutory Auditors of the Company at 26th Annual General Meeting of the Companyheld on 30th September 2014 to hold office until the conclusion of the AnnualGeneral meeting of the Company to be held in the year 2017 subject to the ratification ofthe members at every Annual General Meeting.

In view of the above necessary resolution has been proposed at the 28thAnnual General meeting ratifying the appointment of M/s. Suresh & Babu CharteredAccountants as the Statutory Auditors of the Company from the conclusion of the 28thAnnual General meeting of the Company until the conclusion of the next Annual GeneralMeeting of the Company.

Secretarial Auditor

Smt.Durga Bhavani Agarwal Practicing Company Secretary was appointed to conduct theSecretarial Audit of the company for the fiscal year 2016 as required under section 204of the companies Act 2013 and Rules thereunder. The Secretarial Audit report for fiscalyear 2016 forms part of the Annual Report as Annexure - I to the Board Report. TheSecretarial Audit Report contains qualification reservation and adverse remark.

Auditors Certificate on Corporate Governance.

As required by SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the auditors Certificate on Corporate Governance is enclosed as Annexure - IV to theBoard’s Report. The auditor certificate for fiscal 2016 does not contain anyqualification reservation or adverse remarks.

11. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE DEALING RULE8(3):

A) Conservation of energy

i) The steps taken or impact on conservation of energy: NIL

ii) The steps taken by the company for utilizing alternate sources of energy; NIL

iii) The capital investment on energy conservation equipments; NIL

B) Technology absorption

i) The efforts made towards technology absorption: NIL

ii) The benefits derived like product improvement cost reduction product developmentor import substitution

iii) In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year)

iv) The details of technology imported : NIL

v) The year of import: NA

vi) Whether the technology been fully absorbed: NA

vii) If not fully absorbed areas where absorption has not taken place and the reasonsthereof; and: NIL

viii) The expenditure incurred on Research and Development: NIL

C) Foreign exchange earnings and outgo

The Foreign exchange earned in terms of actual inflows during the year and the ForeignExchange outgo during the year in terms of actual outflow: NIL

12. ANNUAL RETURN

Full Extracts of Annual Return in Form No. MGT-9 is enclosed as Annexure-II

13. DIRECTORS

Changes in Directors and Key Managerial Personnel

During the year under review there is change in the Board / Committee Composition.

14. MEETINGS OF THE BOARD OF DIRECTORS:

Six meetings of the board were held during the year. For details of the meetings of theboard please refer to the corporate governance report which forms part of this report.

15. BOARD DIVERSITY

The Company recognizes and embraces the importance of a diverse board in its success.We believe that a truly diverse board will leverage differences in thought perspectiveknowledge skill regional and industry experience cultural and geographical backgroundage ethnicity race and gender which will help us retain our competitive advantage. TheBoard has adopted the Board Diversity Policy which sets out the approach to diversity ofthe Board of Directors.

16. BOARD EVALUATION:

The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 (“SEBI ListingRegulations”). The performance of the board was evaluated by the board after seekinginputs from all the directors on the basis of the criteria such as the board compositionand structure effectiveness of board processes information and functioning etc. Theperformance of the committees was evaluated by the board after seeking inputs from thecommittee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc. The board and the nomination and remunerationcommittee reviewed the performance of the individual directors on the basis of thecriteria such as the contribution of the individual director to the board and committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings etc. In addition the chairman was also evaluated onthe key aspects of his role. In a separate meeting of independent directors performanceof non-independent directors performance of the board as a whole and performance of thechairman was evaluated taking into account the views of executive directors andnon-executive directors. The same was discussed in the board meeting that followed themeeting of the independent directors at which the performance of the board itscommittees and individual directors was also discussed.

17. AUDIT COMMITTEE

The details pertaining to composition of audit committee is included in the CorporateGovernance Report which forms part of this report.

18. PARTICULARS OF LOAN. GUARANTEES OR INVESTMENTS UNDER SECTION 186:

During the year under review your company has not given loan or Guarantee orinvestments under section 186 of Companies Act 2013.

19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

During the year under review your company has not given or entered into any contractsor arrangements with the related parties.

20. PARTIULARS OF REMUNERATION TO DIRECTORS / KMP / EMPLOYEES:

No employees were covered under the provisions of Section 197(12) of the Companies Act2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

21. DECLARATION OF INDEPENDENT DIRECTORS:

The Directors of the Company have given the Declaration pursuant to the provisions ofSection 149 of the Companies Act 2013.

22. WHISTLE BLOWER POLICY:

The company has a Whistle Blower policy to report genuine conferences or grievances.The Company promotes a favorable environment for employees to have an open access to theaudit committee Functional heads and Managing director so as to ensure ethical and fairconduct of the business of the company.

23. NOMINATION AND REMUNERATION POLICY:

The Board of directors has framed a policy which lays down the frame work in relationto rumination to Directors Key Managerial Personnel and Senior Management of the company.The policy also lays down the criteria for selection and appointment of Board members. Thedetails of this policy are explained in the Corporate Governance Report.

24. POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Company’s policy on directors’ appointment and remuneration and othermatters provided in section 178(3) of the Act has been disclosed in the corporategovernance report which forms part of this report.

25. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS:

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year under review such controls were tested and noreportable material weakness in the design or operation were observed.

26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION.PROHIBITION AND REDRESSAL) ACT 2013.

The company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at workplace (Prevention Prohibition and Redressal)Act 2013. All employees (permanent contractual temporary and trainee) are covered underthe Policy. The following is a summary of sexual harassment complaints received anddisposed off during each year:

a) No. of Complaints Received : NIL
b) No. of Complaints Disposed off : NIL

27. IMPLEMENTATION OF RISK POLICY:

Pursuant to Clause 49 of the listing Agreement the Company has framed a RiskManagement Policy. This policy framework enables the company to identify and evaluaterisks and opportunities.

This framework seeks to create transparency minimize adverse impact on businessobjective and enhance the Companies competitive advantage.

28. CORPORATE SOCIAL RESPONSIBLY:

Yours company is not falling under the CSR criteria Corporate social responsibility isnot applicable.

29. OPTION TO ALL THE DIRECTORS TO PARTICIPATE IN VIDEO CONFERENCE.

Pursuant to Section 173(2) of the Companies Act 2013 Company can hold Board Meetingthrough Video Conferencing. Ministry of Corporate Affairs also released a notification inthis regard. These new rules enable the Directors sitting at place other than the venuedecided by the Board of Directors to participate in the Meeting through VideoConferencing. Board of Directors has given option to all the Directors of the company ifinterested to participate in the Board Meeting through Video Conferencing by givingadvance intimation to the Board.

30. REPLIES TO AUDITORS QUALIFICATION IN AUDIT REPORT :

In reply to the observation by the Auditor in point No.(v) of annexure to the AuditReport we hereby inform the Board of Director and members of the company that companyhas already paid an amount of Rs.215.63 Lakhs out of Rs.475.45 Lakhs. As on Report datean amount of Rs.259.82 Lakhs is still due which can be re-paid in next few months.

In reply to the observation by the Auditor in point No.(viii) of annexure to the AuditReport we hereby inform the Board of Director and members of the company that theManagement is trying to clear the outstanding dues and will clear in next few months.

31. REPLIES TO AUDITORS QUALIFICATION IN SECRETARIAL AUDIT REPORT:

In reply to the observation by the Auditor in point No.(vii)(d) of Audit Report wehereby inform the Board of Director and members of the company that company has alreadypaid an amount of Rs.215.63 Lakhs out of Rs.474.45 Lakhs. As on Report date an amount ofRs.259.82 Lakh is still due which will be re-paid in next few months.

Further the Management is trying the clear the dues of Andhra Pradesh State FinancialCorporation in next few months.

In reply to other qualifications in Audit Report Board has noted the requirements andassure to comply the same.

32. DISCLOSURE ON RELATED PARTY TRANSACTION:

All Related Party Transactions are entered on Arm’s Length basis and are incompliance of the Companies Act 2013 and the SEBI (LODR) Regulations 2015. There are nomaterially significant related party transactions made by the Company with PromotersDirectors or Key Managerial Personnel etc. which may have potential conflict with theinterest of the Company at large. All Related Party Transactions are presented to theAudit Committee and the Board. Ombinus approval is obtained for transactions which areforeseeable and repetitive in nature. A statement of all Related Party Transactions ispresented before the Audit Committee on quarterly basis specifying the nature value andterms and conditions of the transactions. Complete details mentioned in the Notes toaccounts

Information on transactions with related parties pursuant to section 134(3)(h) of theAct read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in Annexure - 5in Form AOC2 to this report.

Related Party Transaction (RPT) Details for the year 2015-2016 RPT Names:

S.No. Name & Address Position Held Relationship
1) R P Villas Private Limited Associate Company Associate Company
2) RTP Constructions Private Limited Associate Company Associate Company
3) REL Builders Private Limited Associate Company Associate Company
4) REL Housing Development Pvt Ltd Associate Company Associate Company
5) Lingam Ravindra Rao Managing Director KMP
6) Lingam Tulasi Prasad Whole Time Director KMP
7) K Harischandra Prasad Director KMP
8) T Sri Rambabu Director KMP
9) Kanuru Koteswara Rao Director KMP
10) Ch Ananeyulu Director KMP
11) Lingam Poorvaja Director KMP
12) Sridhar babu Nagala Whole Time Director KMP
13) Sudhakar Rao Puwada Director KMP

 

KMP"Key Managerial Personal

RPT Transactions

(A)

Name of the Related Party Sales of material directly or through appointed sole selling aqent (Amount in Rs.) Purchase of material directly or through appointed sole selling aqent (Amount in Rs.) Supply of material directly or through appointed sole selling aqent (Amount in Rs.)
Lingam Ravindra Rao Nil Nil Nil
Lingam Tulasi Prasad Nil Nil Nil
Total Nil Nil Nil

(B)

Name of the Related Party Selling / disposing of property of any kindly directly or through appointed agent (Amount in Rs.) Purchase of property of any kindly directly or through appointed agent (Amount in Rs.) Leasing of property (Amount in Rs.)
Lingam Ravindra Rao Nil Nil Nil
Lingam Tulasi Prasad Nil Nil Nil
Total Nil Nil Nil

(C)

Name of the Related Party Loan Given (Amount in Rs.) Loan taken (Amount in Rs.) Remuneration (Amount in Rs.)
Lingam Ravindra Rao Nil Nil 900000/-
Lingam Tulasi Prasad Nil Nil 900000/-
Sridhar Babu Nagala Nil Nil 900000/-
Total Nil Nil 2700000/-

 

Name of the Related Party Appointment to any office of profit or its subsidiary company or associate Company (Amount in Rs.)
Total NIL

33. CORPORATE GOVERNANCE REPORT

As required by Clause 49 of the Listing Agreement on corporate Governance the companyhas complied with Corporate Governance requirements under Companies Act 2013 and asstipulated under the Listing Agreement with the Stock Exchanges. A separate section onCorporate Governance under the Listing Agreement along with a certificate from theauditors confirming the compliance forms part of this Report.

34. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Pursuant to the provisions of Clause 49 of Listing Agreement a report on ManagementDiscussion & Analysis is herewith annexed as Annexure - III to this Report.

35. HUMAN RESOURCES AND INDUSTRIAL RELATIONS:

The relationships with employee have been fairly cordial.

36. BUSINESS RESPONSIBILITY REPORT

The SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015(Regulations) mandates inclusion of the Business Responsibility Report (BRR) as part ofthe Annual Report for top 100 listed entities based on market capitalization with theregulations. As our Organization is not covered in the Ist phase of top 100 listedcompanies Business Responsibility Report is not applicable to company.

37. DIRECTORS RESPONSIBILITY STATEMENT

The financial statements are prepared in accordance with the Generally AcceptedAccounting Principles (GAAP) under the historical cost convention on accrual basis exceptfor certain financial instruments which are measured at fair values. GAAP comprisemandatory accounting standards as prescribed under section 133 of the Companies Act 2013read with Rule 7 of the Companies (Accounts) Rules 2014 the provisions of the Act (tothe extent notified) and guidelines issued by the Securities and Exchange Board of India(SEBI). There are no material departures from the prescribed accounting standards in theadoption of these standards.

The Directors confirm that :

• In Preparation of the Annual accounts for the financial year ended March312016 the applicable accounting standards have been followed.

• They have selected such accounting policies and applied them consistently andmade judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period.

• They have taken proper and sufficient care towards maintenance of 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.

• They have prepared the annual accounts on a going concern basis.

• They have laid down internal financial controls which are adequate and areoperating effectively.

• They have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.

38. GREEN INITIATIVES

As in the previous years this year too we are publishing only the statutorydisclosures in the print version of the Annual Report. Electronic copies of the AnnualReport 2016 and notice of the 28th Annual General Meeting are sent to almembers whose email addresses are registered with the company / Depository Participant(s).For members who have not registered their email addresses physical copies are sent in thepermitted mode.

ACKNOWLEDGEMENT

Your Directors place on record their deep appreciation of the continued co-operationand support extended by staff and Bankers.

For and on behalf of the Board of Directors Raghava Estates & Properties Limited

Sd/- Sd/-
Lingam Ravindra Rao Lingam Tulasi Prasad
Managing Director Whole Time Director
00465464 00186910
Place: Vijayawada
Date : 18.07.2016