To the Members of
Bhagyanagar Properties Limited
The Directors have pleasure in presenting the 12th Annual Report of your Company andthe Audited financial statements for the financial year ended 31 st March 2018 togetherwith Auditors' Report thereon.
The performance of the Company during the year has been as under:
| || || |
(Amount in Rs)
|Particulars ||Standalone ||Consolidated |
| ||2017-18 ||2016-17 ||2017-18 ||2016-17 |
|Sales and other Income ||14338816 ||24898456 ||14338816 ||24898456 |
|EBIDTA ||6603562 ||14233242 ||6457494 ||14206552 |
|LESS : || || || || |
|Depreciation ||102111 ||91488 ||153361 ||228629 |
|Interest and Finance charges ||208790 ||173474 ||208790 ||173796 |
|Profit before Taxation ||6292661 ||13968280 ||6095343 ||13804127 |
|Provision for Taxation : Current Tax ||1195706 ||2655970 ||1195706 ||2655970 |
|MAT Credit Entitlement ||(259226) ||- ||(259226) ||- |
|Taxes for earlier years ||207303 ||11280 ||238083 ||11280 |
|Profit after Tax ||5148878 ||11301030 ||4920780 ||11136877 |
|Add: Other Comprehensive Income ||- ||- ||- ||- |
|Total Comprehensive Income ||5148878 ||11301030 ||4920780 ||11136877 |
|Less: Minority Interest (Current year's Profit/(loss)) ||- ||- ||(44082) ||(36194) |
|Surplus brought forward from previous year ||8763670 ||(2537360) ||9252630 ||(1624986) |
|Add: MAT credit of earlier years ||2815839 ||- ||2815839 ||- |
|Add: Profit / (Loss) of earlier years on acquisition of subsidiaries ||- ||- ||- ||(295455) |
|Balance available for appropriation ||16728387 ||8763670 ||17033330 ||9252630 |
|APPROPRIATION: || || || || |
|Balance c/f to Balance Sheet ||16728387 ||8763670 ||17033330 ||9252630 |
PERFORMANCE AND OPERATIONS:
The Company is into initial stage of operations. During the year 2017-18 the Company'stotal sales and other income stood at Rs.14338816 and Profit Before Taxation (PBT) ofRs.6292661 and Profit after Tax (PAT) of Rs. 5148878.
The Company and its subsidiaries has sizeable land bank in and around Hyderabad. Inview of the rapid growth of e-commerce as well as information technology companies inHyderabad the Company has set up a Warehouse at Gachibowli Hyderabad with around 61000Sq.ft. and will be adding further warehouse space. Currently the following are keytenants among others viz. Amazon India Flipkart Blue Dart Big Basket Storespace FoodJunction. Your Company is also planning to set up co-working space for IT around 30000Sq.ft. with high standard facilities. Further your company has entered into LeaseAgreement with various parties for lease of the Company's part open land and the revenueearning is expected to increase substantially during the current financial year 2018-19.
The Company has the following subsidiary companies as on 31.03.2018. Further there hasbeen no material change in the nature of business of the subsidiaries.
|Sl. No. ||Name of Subsidiary ||Percentage of shareholding (%) |
|1 ||Scientia Infocom India Private Limited ||76.00 |
|2 ||Metropolitan Ventures India Limited ||100.00 |
Further your Company acquired Masanto Containers Pvt Ltd as 100% subsidiary which isholding land to the extent of 2.13 Acres at Nacharam IDA Hyderabad.
In terms of proviso to sub section (3) of Section 129 of the Act 2013 read withCompanies (Accounts) Rules 2014 the salient features of the financial statement of thesubsidiaries and Associates is set out in the prescribed Form AOC-1 which forms part ofthe annual report.
CONSOLIDATED FINANCIAL STATEMENTS:
The consolidated financial statements annexed prepared and in accordance with theAccounting Standards 21 and 23 as prescribed under Section 133 of the Companies Act 2013read with Rule 7 of Companies (Accounts) Rules 2014 and Guidelines issued by Securitiesand Exchange Board of India ("SEBI") also forms part of this Annual Report.
As per the provisions of Section 136 of the Companies Act 2013 the Company has placedseparate audited accounts of its subsidiaries on its website www.bhagyanagarproperties.com and copy of separate audited financial statements of its subsidiaries will be providedto the shareholders at their request.
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2relating to Meetings of the Board of Directors' and General Meetings'respectively have been duly followed by the Company.
The Company's issued subscribed and paid up capital as on 31.03.2018 is Rs.63990000divided into 31995000 equity shares of face value of Rs.2/- each.
The Board considering the Company's performance and financial position for the yearunder dividend for the financial year 2017-18.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion and Analysis forms an integral part of this Report and givesdetails of the overall industry structure developments performance and state of affairsof the Company's business internal controls and their adequacy risk management systemsand other material developments during the financial year.
Management Discussion and Analysis Report is presented in a separate section forms partof the Annual Report as Annexure-II.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto the Directors' Responsibility Statement the Board of Directors of the Company herebyconfirms:
(a) That the preparation of the annual accounts for the financial year ended 31stMarch 2018 the applicable accounting standards have been followed along with properexplanation relating to material departures;
(b) That the directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year 31st March 2018 and of the profit and loss of the company for that period;
(c) That the directors have taken proper and sufficient care 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;
(d) That the directors have prepared the annual accounts for the financial year 31stMarch 2018 on a going concern basis; and
(e) That the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
The Independent Directors have submitted the declaration of independence as requiredpursuant to sub-section (7) of section 149 of the Companies Act 2013 stating that theymeet the criteria of independence as provided in sub-section(6) of Section 149.
NOMINATION AND REMUNERATION POLICY:
The Board has on the recommendation of the Nomination
& Remuneration Committee framed a policy which lays down a framework in relation toselection appointment and remuneration to Directors Key Managerial Personnel and SeniorManagement of the Company. The details of Nomination and Remuneration Committee andnotrecommended Policy are stated in the Corporate Governance Report.
PARTICULARS OF LOANS GUARANTEES OR SECURITIES OR INVESTMENTS:
The details of Loans Guarantees Securities and Investments made during the financialyear ended 31st March 2018 are given in the notes to the Financial Statements incompliance with the provisions of Section 186 of the Companies Act 2013 read withCompanies (Meetings of Board and its Powers) Rules 2014.
RELATED PARTY TRANSACTIONS:
All transactions entered with related parties for the year under review were on arm'slength basis and in the ordinary course of business and that the provisions of Section 188of the Companies Act 2013 and the Rules made thereunder are not attracted. Thusdisclosure in form AOC-2 in terms of Section 134 of the Companies Act 2013 is notrequired. Further there are no material related party transactions during the year underreview with the Promoters Directors or Key Managerial Personnel. The policy onmateriality of Related Party Transactions as approved by the Board of Directors has beenuploaded on the Company's website www.bhagyanagarproperties.com.
EXTRACT OF ANNUAL RETURN:
The Extracts of Annual Return as per the provisions of Section 92 of the Companies Act2013 and Rule 12 of Companies (Management and Administration) Rules 2014 in Form MGT-9are enclosed as Annexure - III to this Report.
PARTICULARS IN RESPECT OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGNEXCHANGE EARNINGS AND OUTGO:
The information on conservation of energy technology absorption foreign exchangeearnings and outgo required to be disclosed under Section 134(3)(m) of the Companies Act2013 read with Rule 8 of the Companies (Accounts) Rules 2014 are provided in theAnnexure-I forming part of this Report.
RISK MANAGEMENT POLICY:
In terms of the requirement Section 134(3)(n) and Regulation 21 of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 read with relevant provisions of the Companies Act 2013 the Company has developed andimplemented the Risk Management Policy. The Audit Committee has additional oversight inthe area of financial risks and controls. Major risks identified by the businesses andfunctions are systematically addressed through mitigating actions on a continuing basis.The development and implementation of risk management policy has been covered in themanagement discussion and analysis which forms part of this report. At present the
Company has not identified any element of risk which may threaten the existence of thecompany.
During the year under review pursuant to the provisions of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the evaluation ofperformance of all Directors is undertaken annually. The company has implemented a systemof evaluating performance of the Board of Directors and of its Committees and individualDirectors on the basis of a structured questionnaire which comprise evaluation criteriataking into consideration various performance related aspects. The Board of Directors haveexpressed their satisfaction with the valuation process.
Shri Devendra Surana Director of the Company will retire by rotation at this AnnualGeneral Meeting and being eligible offers himself for re-appointment.
Ms.Shresha Surana appointed as Additional Director on 26.05.2018 and holding officetill the conclusion of this Annual General Meeting and also is eligible for appointment asDirector. The Board recommends for appointment as Director accordingly the resolutionseeking approval of the members has been included in the Notice of this Annual GeneralMeeting.
Further Shri D.Venkata Subbaiah and Dr.R.N.Sreenath Independent Directors whoattained the age above 75 years are being appointed as Non-Executive Independent Directorsthrough Special Resolution by shareholders at this Annual General Meeting pursuant to SEBI(Listing Obligations and Disclosure Requirements) (Amendment) Regulations 2018.
The brief particulars of the Directors seeking appointment /re-appointment at thisAnnual General Meeting are being annexed to the Corporate Governance Report.
Pursuant to the provisions of Section 203 of the Act Shri Narender Surana DirectorShri Devendra Surana Whole-Time Director and Shri. Rohit Jain Company Secretary wereformalized as the Key Managerial Personnel of the Company.
In compliance to the provisions of Companies Act 2013 and SEBI Listing Regulationsthe Company has constituted various Committees of the Board. The details on Composition ofthe Committee Attendance of the Directors at the Committee Meeting and terms of referenceof the Committee has been provided in the Corporate Governance Report.
During the financial year under review 5 (Five) Board Meetings were convened and held.The details of which are given in the Corporate Governance Report. The intervening gapbetween the meetings was within the period of 120 days as prescribed under the CompaniesAct 2013 and the Listing Regulations.
The Company has not accepted any deposits from public in terms of Section 73 of theCompanies Act 2013 and as such no amount on account of principal or interest on publicdeposits was outstanding as on the date of the balance sheet.
M/s. Luharuka & Associates Chartered Accountants were appointed as StatutoryAuditors of your Company at the Annual General Meeting held on 26th September 2017 for aterm of five consecutive years. As per the provisions of Section 139 of the Companies Act2013 the appointment of Auditors is required to be ratified by Members at every AnnualGeneral Meeting.
In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to beratified at every Annual General Meeting. M/s. Luharuka & Associates CharteredAccountants have confirmed that they are not disqualified from continuing as Auditors ofthe Company.
There are no qualifications reservations or adverse remarks made by M/s. Luharuka& Associates Chartered Accountants Statutory Auditors in their report for theFinancial Year ended 31st March 2018.
The Statutory Auditors have not reported any incident of fraud to the Audit Committeeof the Company in the year under review.
The Board of Directors of the Company have re-appointed M/s Sekhar & Co. CharteredAccountants as Internal Auditors to conduct Internal Audit of the Company for theFinancial Year ended 31st March 2019.
The Board of Directors subject to the approval of the Central Government re-appointedM/s BVR & Associates Cost Accountants holding certificate of practice No.16851 asCost Auditor for conducting the Cost Audit for the financial year 2018-19. Subject toSection 148 of the Companies Act 2013 read with Companies (Cost Records and Audit) Rules2014 issued by the MCA the Audit Committee recommended their re-appointment. The Companyhas also received a letter from the Cost Auditor stating that the appointment if madewill be within the limits prescribed pursuant to the Section 141 of Companies Act 2013.
The Company has implemented the procedures and adopted practices in conformity with theCode of Corporate Governance as per the requirements of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. A separate report on corporate governancepractices followed by the Company together with a Certificate from the Company's Auditorsconfirming compliances forms an integral part of this Report.
The Company has adopted a Whistle Blower Policy establishing vigil mechanism toprovide a formal mechanism to the Directors and employees to report concerns aboutunethical behavior actual or suspected fraud or violation of Code of Conduct and Ethics.It also provides for adequate safeguards against the victimization of employees who availof the mechanism and provides direct access to the Chairperson of the Audit Committee inexceptional cases.
It is affirmed that no personnel of the Company has been denied access to the AuditCommittee. The policy of vigil mechanism is available on the Company's website. TheWhistle Blower Policy aims for conducting the affairs in a fair and transparent manner byadopting highest standards of professionalism honesty integrity and ethical behavior.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Ms. Rakhi Agarwal Company Secretary in Practice as Secretarial Auditors toconduct Secretarial audit of the company for the financial year ended March 31 2018.
The Secretarial Audit Report issued by Ms. Rakhi Agarwal Company Secretary in Practicein Form MR-3 is enclosed as Annexure - IV to this Annual Report.
The Secretarial Audit Report does not contain any qualifications reservation oradverse remarks.
PARTICULARS OF EMPLOYEES
The Company has not employed any individual whose remuneration falls within the purviewof the limits prescribed under the provisions of Section 197 of the Companies Act 2013read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.
PARTICULARS OF REMUNERATION
The remuneration and perquisites provided to the employees and Management are at parwith the industry levels. The remunerations paid to the Whole-time Director and seniorexecutives are reviewed and recommended by the Nomination and Remuneration Committee.
(i) The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year;
|Name of the Director ||Ratio to Median Remuneration |
|Shri Devendra Surana WTD ||0 |
(ii) The percentage increase in remuneration of each director Chief Financial OfficerChief Executive
Officer Company Secretary or Manager if any in the financial year;
*Resigned w.e.f 30/06/2018
(iii) The percentage increase in the median remuneration of employees in the financialyear 7.75%
(iv) The number of permanent employees on the rolls of company 8.
(v) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration;
The average increase in salaries of employees other than managerial personnel in2017-18 was 23.62%. Percentage increase in the managerial remuneration for the year wasNil.
(vi) Affirmation that the remuneration is as per the remuneration policy of the company- Yes.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal audit function process owners undertake corrective action in theirrespective areas and thereby strengthen the controls. Significant audit observations andcorrective actions thereon are presented to the Audit Committee of the Board.
CHANGE IN NATURE OF BUSINESS
There is no change in nature of business of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT:
There are no significant and material orders passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
MATERIAL CHANGES AND COMMITMENTS
There are no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year 31st March 2018 to which thefinancial statements relates and the date of signing of this report.
The industrial relations of the Company continued to be harmonious during the yearunder review.
POLICY ON SEXUAL HARRASSEMENT
The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplacein accordance with The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.
The Internal Complaints Committee (ICC) has been setup to redress complaints receivedregarding sexual harrassement. During the period under review no complaint was receivedby the ICC.
Your Directors wish to place on record their appreciation to employees at all levelsfor their hard work dedication and commitment. The enthusiasm and unstinting efforts ofthe employees have enabled the Company to remain at the forefront of the industry despiteincreased competition from several existing and new players.
Statements in the Board's Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward-lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed the in the statement. Important factors thatcould influence
Company's operations include global and domestic demand and supply conditions affectingselling prices of finished goods input availability and prices changes in governmentregulations tax laws economic developments within the country and other factors such aslitigation and industrial relations.
The Directors take this opportunity to place on record their sincere thanks to thesuppliers customers strategic partners Banks and Financial Institutions InsuranceCompanies Central and State Government Departments and the shareholders for their supportand co-operation extended to the Company from time to time. Directors are pleased torecord their appreciation of the sincere and dedicated services of the employees andworkmen at all levels.
|For and on behalf of the Board of Directors || |
|NARENDER SURANA ||DEVENDRA SURANA |
|DIRECTOR ||WHOLE-TIME DIRECTOR |
|DIN-00075086 ||DIN-00077296 |
|Place: Secunderabad || |
|Date: 06.08.2018 || |