(AT THE 42 AGM-14.09.2018)
I am delighted to welcome you all on the occasion of 42 Annual General Meeting of yourcompany. It gives me immense pleasure to present before you the Annual Report for thefinancial year 2017-18. This has been a year of transition for IRCON during which we havenot only maintained business growth profitability productivity and order bookconsolidation but also exercising listing of the company through part disinvestment ofholding by Government of India.
Financial Year 2017-18 was the remarkable year in terms of business growth.
The total Income / Turnover of your Company has registered an increase of 26.70% toRs.4123 crore in 2017-18 as compared to Rs.3254 crore in 2016-17 and Profit after taxhas increased by approx. 6% from Rs.369 crore to Rs.391 crore during the correspondingperiod. About 95% of the total income i.e. Rs.3896 crore has risen from operations outof which about 15.43% i.e. Rs.601 crore has been contributed by foreign projects.
On a consolidated basis your Company has recorded a turnover of Rs.4212.40 crore andconsolidated PAT of
Rs.411.62 crore during the financial year ended 31 March 2018.
The Company has already paid an interim dividend of Rs.95.15 crore for the financialyear 2017-18 and now proposes final dividend amounting to Rs.97.25 crore i.e. 103% of thepaid-up share capital. Thus the total dividend for 2017-18 would sum up to Rs.192.40crore which is 204% of the paid-up share capital and 49.22% of the post-tax profits. Afterthe proposed final dividend the cumulative dividend to shareholders for the year 2017-18will amount to Rs.1492.31 crore.
During the year the authorized share capital has been increased from Rs.100 crore toRs.400 crore. Your Company had bought back 4928426 equity shares of President of Indiaat a price of Rs.386.72/- per equity share amounting to Rs.190.59 crore. Subsequent tobuy back of shares the paid-up share capital of the Company stood reduced from Rs.98.98crore to Rs.94.05 crore w.e.f. 26 December 2017.
Performance under MoU
With robust all-round performance your company is expected to achieve the"Excellent" rating for the MoU signed with the Government of India for the year2017-18 after a gap of 4 years.
Listing with Stock Exchange
After the announcement of the listing of shares of Ircon in the budget for the 2017-18by the Government of India DIPAM Ministry of Finance the process of disinvestment ofapprox. 10.53% of post paid-up share capital by the President of India has commenced.Ircon will not receive any proceeds from the Offer and all proceeds shall go to theGovernment of India however it will have the benefits of listing the Equity Shares onthe Stock Exchanges.
The Issue/Offer opening date is 17 September 2018 and the closing date is 19 September2018. Price Band for the offer fixed by the Government of India & the Company inconsultation with BRLM is Rs.470 to Rs.475 per Equity Share. A discount of Rs.10 per shareon the offer price has been allowed to the eligible Employees and retail individualinvestors. The bids can be made in lot size of 30 Equity Shares.
The Company is likely to be listed by 28 September 2018.
During 2017-18 Your Company has commissioned two foreign projects in Bangladesh andthree projects in India. So far it had completed more than 127 projects in more than 24countries across the globe and 380 projects in various states in India as on 31 March2018.
During the year your Company has secured eleven projects in India of total valueamounting to Rs.6106 crores. Concerted efforts are being made to secure contracts inBangladesh Thailand Nepal Turkey Ghana Sri Lanka and Malaysia. After the closure ofthe financial year the Company has also secured many projects in India major of which isconstruction of Eight lane Vadodra Kim Expressway (Package-II) on HAM basis from NHAI inthe state of Gujarat for a total value of Rs.1865 crore. Your Company has entered into aMemorandum of Understanding on 26 March 2018 with the Rail Land Development Authority(RLDA) for transfer of lease hold rights to Ircon for commercial development on the landparcel admeasuring 4.3 (four point three) Hectare at Bandra East Mumbai Maharashtraagainst the payment of Upfront Lease Premium. In consideration of its roles andresponsibilities Ircon shall be entitled to receive from RLDA an amount equivalent to atotal of 3% (three percent) of the Upfront Lease Premium.
Our Order Book as of March 31 2018 was 22407 crores which translates intoapproximately six times our total operating revenue in Fiscal Year 2018 and we believe itprovides evidence of our healthy revenue profile.
We believe that growth in our Order Book position is a result of our track record ofsuccessful execution of our projects which has led to our ability to successfully bid andwin new projects. The growth of our average size new orders together with our diversifiedbusiness activities in infrastructure projects across transportation engineering andbuilding construction limits the risks associated with any particular industry whilesimultaneously helping us to benefit from the synergies of operating in diverse businesssectors. Further our track record of executing projects within the specified timelineshas also helped us minimize cost overruns.
In view of healthy order book and huge investment taking place in infrastructureprojects in India I am confident that the accelerated growth will continue in years tocome.
Subsidiary and Joint Venture Companies
As on 31 March 2018 Ircon had four wholly owned subsidiary companies viz. IrconInfrastructure & Services Limited Ircon PB Tollway Limited Ircon Shivpuri GunaTollway Limited and Ircon Davanagere Haveri Highway Limited. After the close of the yearone wholly owned subsidiary of the Company by the name of Ircon Vadodara Kim ExpresswayLimited got incorporated on 16 May 2018.
Your Company holds 50% equity stake with Soma Tollways Private Limited in Ircon SomaTollway Private Limited (Joint venture Company) and 50 % stake with RLDA in IRSDC. YourCompany also holds 26% equity stake in five other joint venture companies viz. CERLCEWRL MCRL JCRL and BRPL incorporated mainly for coal connectivity projects in theStates of Chhattisgarh Jharkhand Odisha.
Your company considers its employees as valued assets and focuses on welfare of itsemployees including minorities and women employees together with focus on acquiring besttalent with required skills to cater to its manpower needs. During the year 2017-18 329employees [104 regular 14 on deputationists and 211 employees on contract basis(including service contract)] were appointed. Out of these new recruits 112 employees aretechnically and professionally qualified.
Corporate Governance CSR and Sustainability
Your Company is committed to good governance and complies with the requirements ofcorporate governance under the DPE Corporate Governance Guidelines other legalrequirements. During the year your Company has spent an amount of Rs.8.73 crore towardsCorporate Social Responsibility (CSR) initiatives. The CSR initiatives aimed atconducting business in a sustainable manner broadly comprise of activities in the fieldof health sanitation education employment enhancing education including education fordifferently abled environment infrastructure development launching CSR mobileapplication to provide information about the various activities undertaken under CSR etc.
I take this opportunity to express my sincere thanks and gratitude to my colleagues onthe Board of Directors for their valuable guidance and advice in the management of theCompany. I am also thankful for the whole-hearted support received from the Ministry ofRailways Government of India DIPAM other Ministries and Departments of Government ofIndia our shareholders financial institutions banks CAG Statutory Cost &Secretarial Auditors and look forward for their continued support in Company's futureendeavors. I on behalf of the entire Board of Directors sincerely thank all theemployees of Ircon at all levels and would like to place on record the appreciation of theBoard for the hard work and dedication of all the employees.
| ||(S.K. Chaudhary) |
| ||Chairman & Managing Director |
|Place : New Delhi || |
|Date : 14 ||September 2018 |