Sunteck Realty Limited
Your Directors have the pleasure in presenting the 33rd Annual Report of theCompany on the business and operations of the Company together with the Audited Statementof Accounts for the year ended 31st March 2016.
The Companys performance during the financial year ended 31st March 2016 ascompared to the previous financial year is summarised below:
| || || || ||(Rs. In Lacs) |
| || |
|Particulars || |
For the year ended on 31.03.2016
For the year ended on 31.03.2015
For the year ended on 31.03.2016
For the year ended on 31.03.2015
|Total Income ||16753.49 ||10194.20 ||79407.96 ||31687.05 |
|Total Expenditure ||1892.86 ||1607.16 ||53648.34 ||16891.19 |
|Depreciation ||64.05 ||67.52 ||208.95 ||196.94 |
|Interest ||570.25 ||833.73 ||1429.85 ||1761.93 |
|Profit Before Tax ||14226.33 ||7685.79 ||24120.82 ||12836.99 |
|Provision for Tax & Deferred Tax ||220.73 ||214.88 ||8189.05 ||4698.08 |
|Profit After Tax ||14005.60 ||7470.91 ||15931.77 ||8138.91 |
During the year under review the total revenue earned is Rs. 16753.49/- Lacs comparedto previous years revenue of Rs. 10194.20/- Lacs on standalone basis. The profitbefore tax stands at Rs. 14226.32/- Lacs as compared to Rs.7685.79/- Lacs during theprevious year. The consolidated revenue for the current year amounted to Rs. 79407.96 Lacsagainst Rs. 31687.05 /- Lacs compared to the previous year. The profit before tax onconsolidated basis stands at Rs. 24120.82 Lacs as compared to Rs. 12836.99/-Lacs duringthe previous year.
NATURE OF BUSINESS
The Company is engaged in the activities of developing residential and commercialprojects. During the year under review there was no change in the nature of business ofthe Company.
Your Directors are pleased to recommend a dividend of 100% i.e. Rs. 2/- per Equityshare on 62966207 Equity Shares of face value Rs. 2/- each out of the profits of theCompany for the financial year 2015-16 subject to approval of shareholders at the ensuingAnnual General Meeting. Total outflow on account of dividend shall amount to Rs.151569290/- (Rupees Fifteen Crores Fifteen Lacs Sixty Nine Thousand Two Hundred andNinety Only) including dividend distribution tax.
TRANSFER TO RESERVES
Your Directors do not propose to transfer any amount to reserves out of the profitsearned during FY 2015-16.
During the year under review the Company has not allotted any Equity Shares thus thepaid up Equity Share Capital of the Company remains the same. Also the Company has notissued shares with differential voting rights and sweat equity shares.
ALLOTMENT OF NON-CONVERTIBLE DEBENTURES DURING THE YEAR
The Company has raised an amount of Rs. 550000000/- (Rupees Fifty Five Crores Only)by way of issuing 5500 11.75 % Secured Redeemable Non-Convertible Debentures("NCD") of Rs. 100000/- (Rupees One Lakh each) on private placement basis on13th January 2016. The NCDs are listed on the Wholesale Debt Market Segment of BSELimited.
Your Company has not accepted any deposits from public and as such no amount onaccount of principal or interest on public deposits was outstanding as on the date of theBalance Sheet.
SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES
The Company has 19 subsidiaries 2 LLPs where Company exercises significant control and8 Associates/Joint Ventures of which 1 Company is Joint Venture entity in UAE.
The performance and financial position of each of the subsidiaries associates andjoint venture companies for the year ended March 31 2016 is attached to the financialstatements hereto in form AOC 1.
As per Section 129(3) of the Companies Act 2013 the Company has prepared consolidatedfinancial statements of the Company and its subsidiaries its Associates and Joint Venturein accordance with applicable accounting standards issued by the Institute of CharteredAccountants of India forms part of this Annual Report. In terms of Section 136 of theCompanies Act 2013 (the Act) Financial statements of the subsidiarycompanies are not required to be sent to the members of the Company. The Company willprovide a copy of separate annual accounts in respect of each of its subsidiary to anyshareholder of the Company if so desired and said annual accounts will also be kept openfor inspection at the Registered Office of the Company.
The Company has formulated a policy for determining material subsidiariesand such policy is disclosed on Companys website.
MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL
In Compliance with provisions of Section 152 of the Companies Act 2013 Ms. RachanaHingarajia (DIN: 07145358) Director of the Company retires by rotation at the ensuingAnnual General Meeting and being eligible offers herself for re-appointment. Appropriateresolution for her re-appointment is being placed for approval of the members at theensuing AGM.
The Board of Directors on the recommendations of the Nomination and RemunerationCommittee appointed Mr. Mahesh Sheregar (DIN: 02493456) as an Additional Director (incapacity of Executive Director) on 12th February 2016 .He will be holding his office asDirector till the date of the ensuing Annual General Meeting of the Company. The Companyhas received notice under 160(1) of the Act from member proposing his candidature forappointment as Director. Mr. Mahesh Sheregar (DIN: 02493456) is also appointed as ChiefExecutive Officer for international business of the Company.
The brief resume of the Directors seeking appointment and re-appointment has beendetailed in the Notice and Corporate Governance Report.
Mr. Jignesh Sanghavi (DIN: 02232988) has resigned w.e.f. the close of Business hours on29th September 2015. The Board has placed on record its appreciation for the outstandingcontribution made in the development of the Company by Mr. Sanghavi.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013.
DISCLOSURES RELATED TO BOARD COMMITTEES AND POLICIES
The Board of Directors met 4 times during the financial year ended March 31 2016 inaccordance with the provisions of the Companies Act 2013 and rules made thereunder. TheDirectors actively participated in the meetings and contributed valuable inputs on thematters brought before the Board of Directors from time to time.
Additionally during the financial year ended March 31 2016 the Independent Directorsheld a separate meeting in compliance with the requirements of Schedule IV of theCompanies Act 2013 Clause 49(II)(B)(6) of Listing Agreement and Regulation 25(3) of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 (hereinafter referred to as "Listing Regulations"). Forfurther details of the meetings of the Board please refer to the Corporate GovernanceReport which forms part of this Annual Report.
Directors Responsibility Statement
In terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the
Company for the year ended March 31 2016 the Board of Directors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as on March 31 2016 and of theprofits of the Company for the year ended on that date;
c. proper and sufficient care was taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Committees of the Board
a) Nomination and Remuneration Committee
A Nomination and Remuneration Committee is in existence in accordance with theprovisions of subsection (3) of Section 178 of the Companies Act 2013. Kindly refer tothe section on Corporate Governance under the head Nomination and RemunerationCommittee for matters relating to constitution meetings functions of the Committeeand the remuneration policy formulated by this Committee.
b) Audit Committee
An Audit Committee is in existence in accordance with the provisions of Section 177 ofthe Companies Act 2013. Kindly refer to the section on Corporate Governance under thehead Audit Committee for matters relating to constitution meetings andfunctions of the Committee.
c) Corporate Social Responsibility Committee
As per the provisions of Section 135 of the Companies Act 2013 the Board of Directorshas constituted a Corporate Social Responsibility (CSR) Committee.
The Corporate Social Responsibility Committee (CSR Committee) has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which has been approved by the Board.
The CSR Policy may be accessed on the Companys website at the linkhttp://www.sunteckindia.com/codes-policies.aspx.
The Company has undertaken projects in the areas of Health Education EnvironmentSustainability and Animal Welfare as part of its initiatives under "Corporate SocialResponsibility (CSR). These projects are largely in accordance with Schedule VII of theCompanies Act 2013.
For details of the composition of the Committee the CSR policy and other relevantdetails that are required to be disclosed under the provisions of Section 134(3)(o) of theCompanies Act 2013 and the Companies (Corporate Social Responsibility Policy) Rules2014 kindly refer to Annexure I hereto which forms part of this report.
d) Other Board Committees
For details of other Board committees viz. Stakeholders Relationship Committeeand others kindly refer to the section on Corporate Governance.
Vigil Mechanism for the Directors and Employees
In compliance with provisions of Section 177(9) and (10) of the Companies Act 2013read with Regulation 22 of the Listing Regulations your Company has adopted whistleblower policy for Directors and employees to report genuine concerns to the management ofthe Company. The whistle blower policy of the Company is posted on the website of theCompany and may be accessed at http://www.sunteckindia.com/codes-policies.aspx.
The Companys management systems organisational structures processes standardscode of conduct and behaviors together form the system that governs how the Group conductsthe business of the Company and manages associated risks.
The approach is based on a clear understanding of the variety of risks that theorganisation faces disciplined risk monitoring and measurement and continuous riskassessment and mitigation measures.
Annual Evaluation of Directors Committee and Board
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theBoard is required to monitor and review the Board evaluation framework. The Evaluationprocess provides the manner in which the performance of Directors as a collective body inthe form of Board Committees and the Board functions and performs. The overall performanceof the Board was satisfactory.
Particulars of Remuneration
The information as required under the provisions of Section 197(12) of the CompaniesAct 2013 and Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are set out in MGT 9 attached hereto.
During the financial year 2015-16 there were 3 persons employed for a part of thefinancial year who were in receipt of remuneration of not less than Rs. 5 lacs p.m. As onMarch 31 2016 there were total 188 permanent employees.
However in accordance with the provisions contained in the proviso to Section 136(1)of the Companies Act 2013 the particulars relating to other employees of the Company arenot being sent as a part of this Annual Report. The same is available for inspection byany Member at the registered office of the Company during working hours on working days ofthe Company up to the ensuing Annual General Meeting. Any Member interested in obtaining acopy of the same may write to the Company Secretary at the registered office of theCompany.
DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEME
In compliance with the provisions of Rule 12(9) of the Companies (Share Capital andDebenture) Rules 2014 and SEBI (Share Based Employee Benefits) Regulations 2014 thedetails of Employees Stock Option Scheme as on March 31 2016 is furnished in Annexure IIattached herewith and forms part of this Report.
PARTICULARS OF LOANS ADVANCES GUARANTEES AND INVESTMENTS
Pursuant to Section 186 of the Companies Act 2013 and Schedule V of the ListingRegulations details of Loans to subsidiaries are given at note no. 19 in the FinancialStatements. No Loans /guarantees have been provided to Related Parties other thanSubsidiaries Joint Ventures LLPs or Associate Companies referred to in note no. 32.Loans to other body corporate given by the Company are in the ordinary course of businessand on arms length basis.
PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
All the transactions/contracts/arrangements of the nature as specified in Section188(1) of the Companies Act 2013 entered by the Company during the year under review withrelated party (ies) are in the ordinary course of business and on arms Length basis. Thereare no material significant related party transactions made by the Company with PromotersDirectors or Key Managerial Personnel which may have a potential conflict with theinterest of the Company at large and consequently no particulars in form AOC-2 have beenfurnished.
The Policy on related party transactions and dealing with related party transactions asapproved by the Board may be accessed on the Companys website athttp://www.sunteckindia.com/codes-policies.aspx.
Disclosure on related party transactions is provided in notes to financial statementsas note no. 32.
DISCLOSURES UNDER SECTION 134(3) (L) OF THE COMPANIES ACT 2013
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Companys financial position have occurred between the end of thefinancial year of the Company and the date of this report.
INTERNAL FINANCIAL CONTROLS
The Company has adequate Internal Financial Controls in place with reference tofinancial statements and is operating effectively. These are continually reviewed by theCompany to strengthen the same wherever required. In compliance with the provisions ofsection 138 of the Companies Act 2013 read with Rule 13 of Companies (Accounts) Rules2014 the internal control systems are supplemented by Internal Audit carried out byindependent firm of Chartered Accountants M/s. Pricewaterhouse Coopers Private Limitedfor periodical review by management.
POSTAL BALLOT FOR OBTAINING APPROVAL OF MEMBERS
During financial year 2015-16 the members through Postal Ballot approved andauthorised the Board of Directors by way of special resolution passed on 15th July 2015to provide loans or guarantee or to make further investment or provide security inconnection with loans to subsidiary companies (including overseas subsidiaries) for anamount not exceeding Rs. 2000/- crores (Two Thousand Crores Only). Mr. Veeraraghavan NPractising Company Secretary was appointed as the scrutinizer for carrying out the Postalballot process in a fair and transparent manner. The details of the procedure of Postalballot and voting pattern are provided in the Report of Corporate Governance.
DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL
There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.
DISCLOSURES IN RESPECT OF VOTING RIGHTS NOT DIRECTLY EXERCISED BY EMPLOYEES
There are no shares held by trustees for the benefit of employees and hence nodisclosure under Rule 16(4) of the Companies (Share Capital and Debentures) Rules 2014has been furnished.
STATUTORY AUDIT AND AUDITORS REPORT
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the Companies(Audit and Auditors) Rules 2014 M/s. Lodha & Co. Chartered Accountants theStatutory Auditors of the Company hold office upto the conclusion of the 33rdAnnual General Meeting. However their appointment as Statutory Auditors of the Company issubject to ratification by the members at every Annual General Meeting. The Company hasreceived a certificate from the said Auditors that they are eligible to hold office as theAuditors of the Company and are not disqualified for being so appointed.
Necessary resolution for ratification of appointment of the said Auditors is includedin the Notice of Annual General Meeting for seeking approval of members.
Observations of statutory auditors on accounts for the year ended March 31 2016:
There are no qualifications reservations or adverse remarks made by M/s. Lodha &Co. Chartered Accountants Statutory Auditors of the Company in their report for thefinancial year ended March 31 2016.
Pursuant to provisions of section 143(12) of the Companies Act 2013 the StatutoryAuditors have not reported any incident of fraud to the Audit and Compliance Committeeduring the year under review.
As required under provisions of Section 204 of the Companies Act 2013 and theCompanies (Appointment & Remuneration of Managerial Personnel) Rules 2014 the reportin respect of the Secretarial Audit carried out by Veeraraghavan N. Company Secretary inpractice in Form MR-3 for the financial year 2015-16 forms part to this report. In respectof the observation made by the Auditor in the report Directors would like to state thatthe Company is in process of appointing CFO of the Company.
In compliance with provisions of Section 148 of the Companies Act 2013 and the rulesmade thereunder and as amended from time to time the requirement of cost audit and themaintenance of the cost records are not applicable to the Company. However the prescribedaccounts and records have been maintained.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) of the Companies Act 2013 Extract ofthe Annual Return for the financial year ended March 31 2016 made under the provisions ofSection 92(3) of the Act is attached as Form MGT 9 as Annexure III which forms part ofthis Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Considering the nature of activities of the Company the Company is not required tofurnish information as required under the provisions of Section 134(3) (m) of theCompanies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofconservation of energy and technology absorption.
The details of foreign exchange earnings and outgo during the year under review is asbelow:
|i) Foreign Exchange Earned: ||Rs. 96136920/- |
|ii) Foreign Exchange Outflow: ||Rs. 8336663/- |
INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2014
During the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. YourCompany has a policy and framework for employees to report sexual harassment cases atworkplace and the Process ensures complete anonymity and confidentiality of information.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights as to dividend voting or otherwise.
2. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
Service of documents through electronic means
All documents including the Notice and Annual Report shall be sent through electronictransmission in respect of members whose email IDs are registered in their demat accountor are otherwise provided by the members. A member shall be entitled to request forphysical copy of any such documents.
The report on Corporate Governance and the certificate from the Statutory Auditorsregarding compliance with the conditions of Corporate Governance have been furnished inthe Annual Report and form a part of the Annual Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis report has been separately furnished in theAnnual Report and forms a part of the Annual Report.
ACKNOWLEDGEMENT AND APPRECIATION
Your Directors would like to express their sincere appreciation and gratitude for theco-operation and assistance from its shareholders bankers regulatory bodies and otherbusiness constituents during the year under review.
Your Directors also wish to place on record their deep sense of appreciation for thecontribution and commitment made by every member of the Sunteck Family.
| ||On behalf of the Board of Directors |
|Mumbai 30th May 2016 ||Kamal Khetan (DIN: 00017527) |
| ||Chairman & Managing Director |