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Ashoka Buildcon Ltd.

BSE: 533271 Sector: Engineering
NSE: ASHOKA ISIN Code: INE442H01029
BSE 14:52 | 23 May 123.00 3.35
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OPEN 120.00
PREVIOUS CLOSE 119.65
VOLUME 90193
52-Week high 186.20
52-Week low 93.15
P/E 11.06
Mkt Cap.(Rs cr) 3,453
Buy Price 122.80
Buy Qty 50.00
Sell Price 123.15
Sell Qty 22.00
OPEN 120.00
CLOSE 119.65
VOLUME 90193
52-Week high 186.20
52-Week low 93.15
P/E 11.06
Mkt Cap.(Rs cr) 3,453
Buy Price 122.80
Buy Qty 50.00
Sell Price 123.15
Sell Qty 22.00

Ashoka Buildcon Ltd. (ASHOKA) - Director Report

Company director report

BOARD'S REPORT

Dear Members

Ashoka Buildcon Limited

Your Directors have pleasure in presenting the 25th AnnualReport along with audited financial statements of your Company for the year ended March31 2018.

Financial Results

The financial performance of your Company for the year ended March 312018 is summarized below :

(Rs. in Lakh except EPS)

Particulars

Standalone

Consolidated

2017-18

2016-17

2017 -18#

2016-17*

Total Receipts / Gross Sales and Operating Income

254605.42

208523.09

365457.95

306115.61

Profit Before Depreciation and Tax

34267.09

26713.91

25648.40

10919.17

Depreciation

5322.27

5073.52

29143.19

26401.26

Profit/(Loss) Before Tax

28944.82

21640.39

(3494.79)

(15482.09)

Provision for Taxation

5244.24

4030.96

8370.65

6983.24

Profit/(Loss) after tax

23700.58

17609.43

(11865.44)

(22465.33)

Share of Prolit/(Loss) of subsidiaries transferred to Non-controlling Interest *

N. A.

N. A.

(753.15)

(1942.68)

Profit/(Loss) after tax (post minority interest)

NA

NA

(11211.95)

(20570.72)

Dividend

2994.60

1497.19

2994.60

1497.19

Balance carried to Balance sheet

23700.58

17609.43

(11211.95)

(20570.72)

Earnings per Equity Share (EPS) Basic (face value Rs.5/- each)

12.66

9.41

(5.94)

(10.97)

Diluted (face value Rs.5/- each)

12.66

9.41

(5.94)

(10.97)

 

* Applicable only in case of consolidated financial statements.

# Restated

State of Company's Affairs Operations

a) During the year under review the Company has won Road Projectsworth of Rs.7011.31 Crore and Power Projects worth of Rs.344.67 Crore as detailed below.

Name of the Project Authority

Length (KM.)

Project Cost (Rs. in Crore)

Construction of Eight (8) Lane Vadodara Kim Expressway in the State of Gujarat National Highways Authority of India

13.00

1687.00

Four (4) laning of Tumkur-Shivamogga section Karadi to Banwara of NH-206 on in the State of Karnataka National Highways Authority of India

56.705

1218.50

Projects comprising of 9 National Highway stretches (Bundle 1) on Toll Operate Transfer Mode in India. The Company is 0 & M Partner. National Highways Authority of India

680.68

1025.00

Four (4) laning of Tumkur - Shivamogga section Mallasandra to Karadi of NH-206 in the State of Karnataka National Highways Authority of India

65.195

917.00

Six Laning of Khairatunda to BarwaAdda Section ofNH 2 in the State of Jharkhand National Highways Authority of India

40.02

860.10

Four (4) Laning of Belgamn - Khanapur Section of NH-4 A in the State of Karnataka National Highways Authority of India

30.00

856.20

Up-gradation of Jalgaon - Bhadgaon (section I) of NH 753 J from Chainage 4+000 Km to 56+200 Km to Two lane with paved shoulders in the State of Maharashtra onEPC mode Ministry of Road Transport & Highway (MoRT&H) through Public Works Department National Highway (P.W.D) Maharashtra

52.20

237.30

Up-gradation of Bhadgaon - Chalisgaon (section II) of NH 753 J [Jalgaon - Bhadgaon - Chalisgaon - Nandgaon - Mamnad (46.800 Km)] in the state of Maharashtra onEPC mode Ministry of Road Transport & Highway (MoRT&H) through Public Works Department National Highway (P.W.D) Maharashtra

46.800

210.21

Sub-total A

7011.31

 

Power Projects

(Rs. in Crore)

Execution of Urban Electrification works for 12 Towns in Ranchi and Medininagar in the State of Jharkhand Jharkhand BijliVitran Nigam Limited

282.73

Turnkey Project at Karana Dist. Wardlia under Nagpur Zone Maharashtra State Electricity Transmission Co. Ltd

38.78

Establishment of 132/33 KV sub-station at Jawliar Dist. Palghar on Turnkey basis in the State of Maharashtra Maharashtra State Electricity Transmission Company Ltd.

17.55

Turnkey Project under Green Energy Corridor Dist. Alunednagar Maharashtra Maharashtra State Electricity Transmission Co. Ltd.

5.61

Sub-total B

344.67

Total

7355.98

 

b. Updates on Projects

• Your Company received Completion Certificates for both theAnnuity Projects viz. Chennai Outer Ring Road Project in the State of Tamil Nadu andMudholNipani Road Project in the State of Karnataka;

• Your Company received Completion Certificate for first of itsInternational Project at Maldives;

• Your Company received Completion Certificate for EasternPeripheral Expressway (EPE) Project which the Company completed in record time;

• The Company has successfully achieved financial closure forAshoka RanastalamAnandapuram Road Limited step down subsidiary of the Company.

• The balance toll and annuity collection period for ongoingProjects is as follows.

Name of the Project Concession / Toll Period / Annuity
EOT Projects
Bhandara to Maharashtra Border 16th March 2008 to 15th March 2028
Durg Bypass to Chliatisgarh Border Road Project 22nd July 2008 to 21st July 2028
JaoraNayagaon Road Project 25th August 2008 to 25th Aug 2033
Belgaum - Dharwad Road Project 04th May 2011 to 3rd May 2041
Sambhalpur - Kharagpur Road Project 14th November 2011 to 13th November 2041
Dhankuni - Kharagpur Road Project 01st April 2012 to 31st March 2037
Nagar Aurangabad Road Project 18th December 2006 to 18th December 2018
Waghur Hydro Project 30 years from the commissioning date
Foot Overbridges on Eastern Express Highway - NH - 3 (Pravin Hotel - Vikroli) 31st May 2003 to 30th September 2018
Foot Overbridges on Eastern Express Highway - NH - 3 (Tagor Nagar - Vikroli) 31st May 2003 to 30th September 2019

 

 

Projects handed over
Nashirabad Railway Over Bridge 24thJuly 2000 to 23rdNovember 2017 (Handed over as at 31st March 2018)
Indore - Edlabad Road Project 24th September 2001 to 18thFebruary 2017 (As on31/3/2017 toll period over)
Pune - Shirur Road Project 6lhJul\ 2005 to 6thJuly 2015 (Under Arbitration)
KatniByepass Road Project 19th August 2002 to 21st February 2020(toll collection income is not recognised in books as the matter is sub-judiced)
Foot Overbridges on Eastern Express Handed over in earlier years
Highway - NH - 3
1. Godrej Company
2.Luiswadi Thane
3.Mental Hospital Thane
4.Priyadarshani Circle Chembur
Annuity Projects
Mudhol - Nipani - Maharashtra Border (Karnataka) 12th December 2014 (Concession period 10 Years)
Hungund-Talikot (Karnataka) 3rd October 2016 (Concession period 10 Years)
Bagewadi - Bailhongal - Saundatti(Kamataka) 3rd October 2016 (Concession period 10 Years)
Kharar - Ludhiana (Punjab) 15th March 2017 (Concession Period 17.5 Years)
Ranatsalam - Anandapuram (Andhra Pradesh) 16th November 2017(Concession Period 17.5 Years)
Joint Venture
EOT
Wainganga Bridge at Bhandara 3rd March 2001 to 15th February 2018 and further extension for 3 years and 6 months as per District Court Order
Ashoka Bridgeways 17th March 2004 to 15th November 2018
Annuity Projects
Chennai Outer Ring Road Phase II fron Nemihcheri to Minjur 12thMarch 2014 (Concession period 20 Years)

 

Future Outlook

We believe that in view of the great thrust the Government has on aninfrastructure we feel going ahead there is a very huge opportunity for us in NationBuilding. We are optimistic that we will ramp our Order Book to a new peak in the RoadSector and Power Distribution Sector as well.

The Government has come up with the ambitious Plan for developing theNational Highways with following the programmes:

• Bharatmala Programme wherein 24800 KMs Road Projects to bedeveloped over next five years period involving an investment of Rs.535000 Crore.

• NHDP program wherein 10000 KMs of National Highways andExpressways would also be put for the bidding.

• Sagarmala Program which is a series of projects to leverage thecountry's coastline and inland waterways to drive industrial development

We will continue giving good returns to our investors. The Company willalso continue to look for opportunities in other infra spaces like Railways City GasDistribution and Smart City Development Prograimne.

Share Capital

During the year under review the Company has not allotted any equityshares with or without differential voting rights. The paid-up Equity Share capital of theCompany as at March 31 2018 remained at Rs.93.57 Crore.

Dividend

During the year under review your Company had declared and paidInterim Dividend of Re.0.80 (Paise Eighty only) per Equity share of face value of Rs. 5/-each for the Financial Year 2017- 18. The total outflow on account of dividend during theyear was Rs.33.05 Crore including Dividend Distribution Tax and final dividend forFY17-18.

Transfer to Reserves

Your Company has not transferred any amount to the general reserveduring the year under review.

Issue of Bonus Shares

Your Company has proposed to issue 1 (one) Equity Share as Bonus Sharefor every 2 (two) Equity Shares of Rs.5/- each held subject to approval of Shareholders.Your Company will capitalize the amount of Rs.46.78 Crore from Reserves and Surplus.

Public Deposits

During the financial year 2017-18 your Company had not accepted anydeposits within the meaning of the provisions of Section 73 of the Companies Act2013("the Act") read with the Companies (Acceptance of Deposits) Rules 2014.

Capital Expenditure

As at March 31 2018 the Gross Fixed Assets & Intangible Assetsstood at Rs.498.81 Crore which includes CWIP and Intangible Assets under Development andnet fixed assets & net intangible assets at Rs.232.36 Crore. Additions during yearamounted to Rs. 104.08 Crore.

Audit Committee

The Audit Committee of the Board of Directors of the Company is dulyconstituted in accordance with the provisions of Section 177 (8) of the Companies Act2013 read with Rule 6 and 7 of the Companies (Meetings of the Board and its Powers) Rules2014 and Regulation 18 of the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 ("LODR 2015") as follows :

Name Designation
Mr. Albert Tauro Chairman (Independent Director)
Mr. Michael Pinto Member (Independent Director)
Ms. Sunanda Dandekar Member (Independent Director)
Mr. Milap Raj Bhansali Member (Executive Director)

 

All the recommendations of the Audit Committee during the year wereaccepted by the Board of Directors of the Company. For further details please refer theCorporate Governance Report forming part of the Annual Report.

Vigil Mechanism:

Your Company is committed to the highest standards of ethical moraland legal business conduct. Accordingly the Board of Directors has established a vigilmechanism by adopting a Whistle Blower Policy in compliance with the provisions of Section177 (9) and (10) of the Act and Regulation 22 of the LODR 2015. The administration of thevigil mechanism is ensured through the Audit Committee. The Whistle Blower Policy of theCompany is annexed to this report as Annexure VIII and posted on the website of theCompany at www.ashokabuildcon.com

 

Subsidiaries

In accordance with Section 129 (3) of the Act and as per IndianAccounting Standards (IndAS) 21 the Company has prepared the Consolidated FinancialStatements of the Company and all its subsidiaries which fonn part of this Annual Report.

The salient features of financial statements of Subsidiary / Associates/ Joint Ventures as per the Act are given in prescribed Fonn AOC-1 as Annexure I to thisReport.

During the year under review :

• 74% stake in the equity share capital of Tech Berater PrivateLimited has been acquired by Viva Infrastructure Limited a Wholly Owned Subsidiary of theCompany to make it a Step Down subsidiary of the Company;

• Ashoka Aerospace Private Limited with 100% stake in its equityshare capital had been incorporated as a Wholly Owned Subsidiary;

• Ashoka Ranastalam Anandapuram Road Limited had been incorporatedas a Wholly Owned Subsidiary of Ashoka Concessions Limited a Subsidiary of the Companyfor execution of Ranastalam-Anandapuram Road Project in the State of Andhra Pradesh. It isa step down subsidiary of the Company.

In accordance with third proviso of Section 136(1) of the CompaniesAct 2013 the Annual Report of the Company containing therein its standalone and theconsolidated financial statements lias been placed on the website of the Company www.ashokabuildcon.com . Further as per fourthproviso of the said section audited annual accounts of each of the subsidiary companieshave also been placed on the website of the Company www.ashokabuildcon.com . Shareholders interestedin obtaining a copy of the audited annual accounts of the subsidiary companies may writeto the Company Secretary at the Company's registered office address.

Disclosure relating to remuneration of Directors Key ManagerialPersonnel and particulars of employees

In accordance with Section 178 and other applicable provisions of theAct read with the Rule 6 of the Companies (Meeting of Boards and its Powers) Rules 2014issued there under and Regulation 19 of the LODR 2015 the Board of Director at theirmeeting held on 30th September 2014 formulated the Nomination and RemunerationPolicy of your Company on the recoimnendations of the Nomination and RemunerationCommittee. The salient aspects covered in the Nomination and Remuneration Policy coveringthe policy on appointment and remuneration of Directors and other matters have beenoutlined in the Corporate Governance Report which fonns part of the Annual Report.

The Managing Director and Whole-time Directors of your Company do notreceive remuneration from any of the subsidiaries of your Company. The informationrequired under Section 197 of the Act read with the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 in respect of Directors/employees ofyour Company is set out in Annexure III to this Report.

The Remuneration Policy of the Company is available on the website ofthe Company www.ashokabuildcon.com

 

Directors and Key Managerial Personnel

In compliance with the provisions of Sections 149 152 Schedule IV andother applicable provisions of the Act read with the Companies (Appointment andQualification of Directors) Rules 2014 Mr. Michael Pinto Mr. Sharadchandra AbhyankarMr. Albert Tauro and Mr. Gyan Cliand Daga had been appointed as Independent Directors onthe Board of Directors of your Company to hold office up to five (5) consecutive yearsupto March 312019 and Ms. Sunanda Dandekar had been appointed as an Independent Directorto hold office upto March 30 2020.

Mr. Satish D. Parakh Managing Director is liable to retire by rotationat the ensuing AGM pursuant to section 152(6)(c) of the Act read with theCompanies(Appointment and Qualification of Directors) Rules 2014 and the Articles ofAssociation of the Company and being eligible has offered him self for re-appointment. Thebrief resume of Mr. Satish Parakh and other information under Regulation 36 of the SEBI(Listing Obligation and Disclosure Requirements) Regulation 2015 (LODR 2015) andSecretarial Standard 2 (SS-2) with respect to the Director seeking re-appointment liasbeen provided in the Notice convening 25th AGM. Your Directors recoimnend hisre-appointment.

Mr. Satish Parakh Managing Director Mr. Paresh Mehta Chief FinancialOfficer and Mr. Manoj Kulkami Company Secretary have been recognized as the Whole-timeKey Managerial Personnel of your Company in accordance with the provisions of sections2(51) and 203 of the Act read with the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014.

None of the Key Managerial Personnel has resigned during the year underreview.

In accordance with the Section 149(7) of the Act each IndependentDirector has given a written declaration to the Company at the time of appointment and atthe first meeting of the Board of Directors in every financial year confirming that he/shemeets the criteria of independence as mentioned under Section 149(6) of the Act andRegulation 16(1) (b) of the LODR 2015.

Awards and Recognitions received by the Company during the year:

Awarded by Name of the Award/ Recognition
CIA WORLD Builder & Infra Awards Infra Company of The Year
National Leadership Best Enviromnental for GHG
Awards Reduction
Construction World Infra Awards First Fastest Growing Company
Construction Times - Power Project Munger Power Project
D & B Infra Awards Infra Company of The Year
UBM India - OHS Awards OHS Awards
ET Now - CSR Awards Innovation in CSR Practices

 

Annual evaluation of Board's performance

In tenns of the provisions of the Act read with Rules issued thereunderand the LODR 2015 the Board of Directors had carried out the annual perfonnanceevaluation of the entire Board Committees and all the Directors based on the criterialaid down by the Nomination and Remuneration Committee. The criteria for evaluation of theBoard perfonnance have been mentioned in the Corporate Governance Report.

Number of meetings of the Board

The details of the number of Board meetings of your Company are set outin the Corporate Governance Report which fonns part of this Report.

In tenns of requirements of Schedule IV of the Act a separate meetingof Independent Directors was held on March 20 2018 to review the perfonnance ofNon-independent Directors (including the Chainnan) the entire Board and quality quantityand timelines of the flow of infonnation between the Management and the Board.

Directors' Responsibility Statement

To the best of knowledge and belief and according to the infonnationand explanations obtained by them your Directors make the following statement pursuant toSection 134(3)(c) read with section 134 (5) of the Act and confinn that:

i) In the preparation of the annual accounts for the year ended March31 2018 the applicable accounting standards read with requirements set out underSchedule III to the Act have been followed and there are no material departures from thesame;

ii) The Directors have approved the accounting policies and the samehave been applied consistently and have made judgment and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company asat March 31 2018 and of the profit of the Company for the year ended on that date;

iii) Proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv) The annual accounts have been prepared on a ‘goingconcern' basis;

v) Proper internal financial controls are followed by the Company andthat such financial controls are adequate and are operating effectively; and

vi) Proper systems to ensure compliance with the provisions of allapplicable laws are in place and such systems are adequate and operating effectively.

Auditors and Auditors' Reports

Statutory Auditors

The Shareholders of the Company pursuant to the provisions of Section139 of the Act and the Companies (Audit and Auditors) Rules 2014 have appointed M/s. S RB C & Co. LLP Chartered Accountants Mumbai (Finn Registration No.324982E/E300003) as the Statutory Auditors to hold office till the conclusion of the 29thAnnual General Meeting (‘AGM') of the Company to be held for FY 2021-22. Theyhave confinned that they are not disqualified from continuing as Auditors of the Company.The provision for ratification of appointment of the statutory auditors at every AGM hasbeen withdrawn with effect from May 072018 pursuant to the Companies Amendment Act 2017.Hence the resolution for ratification of the appointment of statutory Auditors is notincluded in the notice of Annual General Meeting.

The Auditors' Reports on Standalone Financial Statements (SFS) andConsolidated Financial Statements (CFS) for the financial year 2017-18 do not contain anyqualification reservation or adverse remark except the following :

Remark :Annexure 1 - Statement on matters specified in paragraphs 3 and4 of the Companies (Auditor's report) Order 2016 Para -(i) (c)

According to the infonnation and explanations given by the managementthe title deeds of immovable properties included in property plant and equipment are heldin the name of the Company except for title deed in case of two buildings (Gross Block ofRs. 151.64 Lakh Net Block Rs. 143.77 lakh) for which transfer deed is yet to be executedin the name of the Company.

Reply :The Building lias been constructed on the freehold land whichwas purchased from APMC Pune. The transfer of the said building to the Company is pendingsubject to approval of the APMC Pune. Since there is long pending litigation among theAPMC Members the NOC/approval is pending. The Company fully possesses the said Building.All the documents for registration in the name of the Company have already been submittedto the concerned authorities and regular follow-up is being made.

Second building at Hilla Heights Mumbai also is in possession of theCompany. Necessary docmnents to transfer the same in the name of the Company are beingorganized.

Remark : Annexure 1 - Statement on matters specified in paragraphs 3and 4 of the Companies (Auditor's report) Order 2016 Para - (vii) (a)

Statutory dues have been regularly deposited with the appropriateauthorities though there has been a slight delay in a few cases.

Reply: There were delays in payment of VAT Professional tax andService tax in certain cases due to unavoidable circumstances. However the same had beenregularized and the dues have been paid during the year. The necessary precautions havebeen taken to ensure that no such delays happen in future.

Cost Auditors

The Board of Directors had appointed M/s CY &Associates CostAccountants as the Cost Auditors of yom Company for the financial year 2017-18 toconduct the audit of cost records of your Company for its Construction segment.

There are no qualification(s) reservation(s) or adverse remark(s) inthe Cost Audit Report for the financial year ended March 31 2018.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 yom Companyhad appointed M/s.

S. Anantha & Ved LLP(LLPIN: AAH8229) Practicing CompanySecretaries to conduct the Secretarial Audit of yom Company. The Secretarial Audit Reportis annexed herewith as Annexure - IV to this Report.

There are no observations / remarks or qualifications in theSecretarial Audit Report for FY2017-18 except the following:

The Company had received the letter from National Stock Exchange ofIndia Limited (NSE) for non-disclosure of the Dividend Distribution Policy in the AnnualReport of F.Y. 20 lb- 17 and had instructed the Company to issue the same as an addendumto the Annual Report of F.Y.2017-18. The Company has complied with the Reg. 43 Abyinserting an addendum to the Annual Report FY2018.

Reply :The Company has inserted Dividend Distribution Policy as anAnnexure X to the Board's Report in compliance with the instructions of NSE.

The Dividend Distribution Policy is also available on the website ofthe Company www.ashokabuildcon.com incompliance with the Reg. 43A of the Listing Regulations.

Internal Auditors

M/s. Patil Hiran Jajoo Chartered Accountants have been appointed asInternal Auditors of the Company and the reports of

the Internal Auditors are reviewed by the Audit Committee from time totime. The observations and suggestions of the Internal Auditors are reviewed and necessarycorrective/preventive actions are taken in consultation with the Audit Committee.

Audits and internal checks and balances

M/s S R B C & Co. LLP Chartered Accountants audit the accounts ofthe Company. The Company has independent internal auditors who review internal controlsand operating systems and procedures. A dedicated Legal Compliance ensures that theCompany conducts its businesses with legal statutory and regulatory compliances. TheCompany has instituted a legal compliance prograimne in conformity with requirements ofthe Act to ensure that there exists a system which is adequate and operates effectivelyand efficiently. This system covers various statutes such as industrial and labom lawstaxation laws corporate and securities laws and health safety and enviromnentregulations.

As per Section 148 and other applicable provisions of the Act read withCompanies (Audit and Auditors) Rules 2014 the Board of Directors of yom Companyappointed M/s. CY & Associates Cost Accountants (Finn Registration No. 000334) asthe Cost Auditors for the financial year 2018-19 on the recommendations made by the AuditCoimnittee. The remuneration proposed to be paid to the Cost Auditor is subject to theratification by the members at the ensuing AGM would not exceed Rs.540000/- (RupeesFive Lakh Forty Thousand only) plus applicable taxes and reimbursement of out of pocketexpenses. As required under the Act the remuneration payable to the Cost Auditors isrequired to be placed before the Members in a general meeting for their ratification.Accordingly a Resolution seeking Member's ratification for the remuneration payableto M/s CY & Associates Cost Accountants is included in the Notice convening theAnnual General Meeting.

The consent has been received from M/s. CY & Associates CostAccountants to act as the Cost Auditors of yom Company for the financial year 2018-19along with a certificate confirming their independence. As required under the Act aresolution seeking members' approval for the ratification of the remuneration payableto the Cost Auditors fonns part of the Notice convening 25th Annual GeneralMeeting.

Familiarisation Programme for Independent Directors

Pursuant to the requirement of Regulation 25(7) of the LODR 2015 theCompany needs to formally arrange Induction or Familiarization Prograimne for IndependentDirectors to familiarize them with their role rights and responsibility as Directors theworking of the Company nature of the industry in which the Company operates businessmodel etc. The details are mentioned in the Report on Corporate Governance which is a partof this annual report.

Related party transactions

All Related Party Transactions that were entered into during thefinancial year were in compliance with the requirement of the Act and the Rules framedthereunder and LODR 2015. All Related Party Transactions are placed before the AuditCommittee the Board of Directors and Shareholders as the case may be for approval.During the financial year 2017-18 your Company entered into transactions with relatedparties as defined under Section 2(76) of the Act read with the Companies (Specificationof Definitions Details) Rules 2014 which were in the ordinary course of business and onann's length basis and in accordance with the provisions of the Act Rules issuedthereunder and Regulation 23 of the LODR 2015.

During the financial year 2017-18 there were no materially significantRelated Party Transactions entered into by the Company with Promoters Directors KeyManagerial Personnel which may have a potential conflict with the interest of the Companyat large. However the Company had entered into materially significant related partytransactions with Ashoka Ranastalam Anandapuram Road Limited a step down subsidiary forrendering services on EPC basis worth Rs. 1170 Crore.

The details of the related party transactions are set out in Note No.44 to the standalone financial statements fonning part of tills Annual Report.

The Fonn AOC-2 pursuant to Section 134(3)(h) of the Act read with Rule8(2) of the Companies (Accounts) Rules 2014 in respect of disclosure ofcontracts/arrangements with related parties under section 188 is set out as Annexure II tothis Report.

Particulars of loans given investments made guarantee given andsecurities provided under Section 186 of the Act

The details of loans guarantees and investments under Section 186 ofthe Act read with the Companies (Meetings of Board and its Powers) Rules 2014 are asfollows:

A. Details of investments made by the Company in equity/ preferenceshares and compulsorily convertible debentures as on March 31 2018 (includinginvestments made in the previous years) are mentioned in Note No. 4 to the standalonefinancial statements.

B. Details of loans given by the Company to its

Subsidiaries Associates as on March 31 2018 are mentioned in Note No.34 to the standalone financial statements.

C. Details of guarantees issued by the Company are as follows:

(Rs. in Lakh)

Name of entity

March 312018

Ashoka Highways (Bhandara) Limited

30294.00

Ashoka GVR Mudhol Nipani Roads Limited

24125.99

Total

54419.99

 

Risk Management

Your Company recognises that risk is an integral part of business andis committed to manage the risk in a proactive and efficient manner. Your Company has arisk management policy in place. Major risks like operational strategic resourcessecurity industry regulatory & compliance risks are identified and aresystematically addressed through mitigating actions on a continuing basis. The Company haslaid down procedures to inform Board Members about the Risk Assessment and mitigationprocedure which are periodically reviewed and discussed by the Board and relevant stepsare taken for mitigation of such risks.

Secretarial Standards issued by the Institute of Company Secretaries ofIndia (ICSI)

The Directors state that applicable Secretarial Standards i.e. SS-1SS-2 and SS-3 relating to ‘Meetings of the Board of Directors' ‘GeneralMeeting' and ‘Dividend' respectively have been duly followed by theCompany.

Extract of Annual Return

The details fonning part of the extract of the Annual Return in FonnMGT- 9 in accordance with Section 92(3) of the Act read with the Companies (Management andAdministration) Rules 2014 are set out herewith as Annexure V to this Report.

Corporate Social Responsibility

The Company continues to believe in operating and growing its businessin a socially responsible way. This belief fonns the core of the CSR policy of the Companythat drives it to focus on holistic development of its host community and immediate socialand enviromnental surroundings qualitatively. Hence in Accordance with the requirements ofSection 135 of the Act your Company lias constituted a Corporate Social ResponsibilityCommittee ("CSR Committee"). The composition and tenns of reference of the CSRCommittee are provided in Corporate Governance Report. The Company has framed CorporateSocial Responsibility policy which is available at www. ashokabuildcon.com. The Companywas required to spend Rs. 3.66 crore on CSR activities. However the Company has spent Rs.0.96 crore. The reasons for not spending full amount towards CSR are as follows:

The Company's CSR initiatives usually involve getting the feedbackfrom community like Project affected people people around various Project sites of theCompany villages and their requirements. The Company then puts in place a mechanism toensure maximum benefit to the community. The Company allocates and spends the amount withdue care and observation as per requirement of CSR activities undertaken by the Company.The scope of CSR activities has been enlarged to cover almost all the activities duringthe year. The Company had reviewed various Projects for doing CSR activities however theCompany could not finalize the desired Project due to the fact that specific objects couldnot have been achieved from those Projects. Going forward the Company will endeavour tospend amount on CSR activities to achieve the Objects of the CSR Policy of the Company.Annual Report on CSR activities as required under the Companies (Corporate SocialResponsibility Policy) Rules 2014 has been annexed as Annexure VI to this report.

Policy on prevention of sexual harassment

The Company has in place Anti Sexual Harassment Policy in line with therequirements of The Sexual Harassment of Women at the Workplace (Prevention Prohibition& Redressal) Act 2013. All employees (pennanent contractual temporary trainees)are covered under this Policy. The Company has provided a safe and dignified workenviromnent for employee which is free of discrimination. The objective of this policy isto provide protection against sexual harassment of women at workplace and for redressal ofany such complaints of harassment. Internal Complaints Committee (ICC) has been set up toredress the complaints received if any.

Disclosure as per Section 22 of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 is given below.

Pursuant to the requirements of Section 22 of Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013read with the Rulesthereunderjt is hereby declared that the Company lias not received any complaint of sexualharassment during the year under review. Further the Company conducts awareness programmeat regular interval of time.

Disclosure under section 134 (3) (1) of the Act

Except as disclosed elsewhere in this report there have been nomaterial changes and commitments which can affect the financial position of the Companybetween the end of the financial year of the Company and date of this report.

Conservation of energy technology absorption foreign exchangeearnings and outgo

The information on Conservation of Energy Technology AbsorptionForeign Exchange Earnings and Outgo as stipulated under section 134 of the Act read withthe Companies (Accounts) Rules 2014 is as follows :

(A) Conservation of energy

The Company does not have any manufacturing facility; the otherparticulars required to be provided in tenns of Section 134(3)(m) of the Act read withRule 8 of the Companies (Accounts) Rules 2014 are not applicable.

Nevertheless during the period the Company continued its endeavor toconserve energy tlnough various modes. Energy conservation continues to be a focus areafor the Company. Energy conservation measures are meticulously followed and conform to thehighest standards.

Particulars Remarks
i Steps taken or impact on conservation of energy In view of business activities of the Company no substantial steps are required to be taken for conservation of energy other than those are actually implemented by the Company
ii Steps taken by the Company for utilizing alternate source of energy In view of business activities of the Company no substantial steps are required to be taken for conservation of energy other than those are actually implemented by the Company
iii The capital investment on energy conservation equipment -

 

(B) Technology Absorption Adoption and Innovation Efforts madeBenefits derived Import of Technology:

Particulars Remarks
I the efforts made towards technology absorption No specific efforts made other than in the ordinary course of execution of the Project.
II the benefits derived like product improvement cost reduction product development or import substitution N.A.
Ill in case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year N.A.
a. the details of technology imported N.A.
b. the year of import N.A.
c. Whether the technology fully absorbed N.A.
d. If not fully absorbed areas where absorption lias not taken place reasons thereof N.A.
IV The expenditure on Research and Development Nil

 

(C) DETAILS OF FOREIGN EXCHANGE EARNINGS AND EXPENSES

i) The earnings in foreign currency amounted to Rs.563.79 Lakh duringthe year under review.

ii) The expenses in foreign exchange are Rs.9.61 lakh in respect of theforeign travel.

Details on Internal Financial Controls

The Company has in place adequate internal financial controls some ofwhich are outlined below.

Your Company has adopted accounting policies which are in line with theAccounting Standards prescribed in the Companies (Accounting Standards) Rules 2006 thatcontinue to apply under Section 133 and other applicable provisions of the Act read withRule 7 of the Companies (Accounts) Rules 2014 to the extent applicable. These are inaccordance with generally accepted accounting principles in India including IndianAccounting Standards (IND AS). Changes in policies if any are approved by the AuditCommittee in consultation with the Auditors.

The policies to ensure uniform accounting treatment are prescribed tothe subsidiaries of your Company. The accounts of the subsidiary companies are audited andcertified by the respective Auditors of the Subsidiaries for consolidation.

Your Company operates in a Tally ERP system and has many of itsaccounting records stored in an electronic form and backed up periodically. Your Companyis in the process of implementing new ERP (SAP) from financial year 2018-19.

The Management periodically reviews the financial performance of yourCompany against the approved plans across various parameters and takes appropriate actionwherever necessary. Internal Auditors have been appointed who report on quarterly basis onthe processes and system of accounting of the Company. The observations if any of theInternal Auditors are resolved to their satisfaction and are implemented across all thesites. During the year the internal financial controls were reviewed and tested by areputed linn of Chartered Accountants who report on quarterly basis on the process andsystems of accounting and other operational processes of the Company. The main thrust ofinternal audit is to test and review controls appraisal of risks and business processesbesides benclunarking controls with best practices in the industry.

Particulars of Employees

Disclosures pertaining to remuneration and other details as requiredunder Section 197(12)of read with Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 are provided as Annexure III to this Report.

In terms of the provisions of Sectionl97(12) of read with Rules5(2) and5(3) of the Companies)Appointment and Remuneration of Managerial Personnel) Rules 2014astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits set out in the said rules forms part of this Annual Report and isprovided as Annexure III to this Report.

Management Discussion and Analysis

Management Discussion and Analysis is given in a separate sectionforming part of this Report.

Corporate Governance

The report on Corporate Governance as stipulated under the LODR 2015forms an integral part of this report and the requisite Certificate duly signed by thepracticing Company Secretary confirming compliance with the conditions of CorporateGovernance is attached to this report.

BUSINESS RESPONSIBILITY REPORT

As stipulated under the LODR 2015 the Business Responsibility reportdescribing the initiatives taken by the Company from enviromnental social and governanceperspective is attached as part of the Annual Report as Annexure IX to this Report.

General

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

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividendvoting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of theCompany under any scheme;

4. Receipt of any remuneration or commission by the Managing Directorthe Whole-time Directors of the Company from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern status and Company's operations infuture.

6. No fraud has been reported by the Auditors to the Audit Committee orthe Board.

7. The Company does not have any scheme of provision of money for thepurchase of its own shares by employees or by trustees for the benefit of employees.

8. Secretarial Standards issued by the Institute of Company Secretariesof India (ICSI).

9. The Company complies with the Secretarial Standards issued by ICSIone of the premier professional bodies in India. Acknowledgement

Your Directors take this opportunity to thank various GovernmentAuthorities including National Highways Authority of India Ministry of Road Transport& Highways. Public Works Departments Road Development Corporations of the variousStates Power Distribution Corporations of various States where we have operations.Central and State Governments for their support continuous co-operation and guidance.

Your Directors also thank the Ministry of Corporate Affairs BSELimited National Stock Exchange of India Limited Regulatory Authorities FinancialInstitutions and Banks including EXIM Bank Credit Rating Agencies ShareholdersContractors vendors and business associates for their continuous support during the yearand look forward for their support in future as well.

The Directors would also like to place on record their appreciation forthe contribution and dedication of the employees of the Company at all levels to theCompany's growth.

For and on behalf of the Board of Directors
Sd/-
(Ashok Katariya)
Place: Mumbai Chairman
Date: May 292018 DIN:00112240