The Board of Directors are pleased to present the 11th Annual Reportalong with the Audited Financial Statements (standalone and consolidated) of the Companyfor the financial year ended 31st March 2018.
1. FINANCIAL RESULTS
The performance of the Company for the financial year ended March312018 is summarized below:
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31st March 2018
31st March 2017
|Revenue from operations || |
|Other Income || |
|Profit/ Loss before finance cost depreciation exceptional items and tax || |
|Less: || || |
|Finance cost || |
|Depreciation and amortization expense || |
|Profit/ Loss before tax || |
|Tax expense || |
|Profit/ Loss after tax || |
|Other Comprehensive Income Items that will not be reclassified to profit and loss || |
|Total Comprehensive Income for the year || |
2. REVIEW OF OPERATIONS
During the year Company achieved Gross Income of Rs 240.98 lacsagainst Rs 365.11 achieved during the previous year. The net profit for the year declinedto Rs 27.27 lacs as compared to Rs 155.97 lacs in the previous year. As at 31st March2018 the Net worth of the Company increased to Rs 31932.48 lacs from Rs 31905.21 lacsas at 31 st March 2017.
Your Company's step-down subsidiaryJITF Water Infrastructure Limited(JWIL) carrying on the business of Water Infrastructure has continued to execute theprojects in hand. These projects relate to water sector involving intake well watertreatment plant overhead tanks distribution network house-hold connections raw watersupply to power plants and effluent treatment plants. JWIL has gained considerableexperience in building and operating Common Effluent Treatment Plant at Sitarganj and thisexperience can be channelized to make further inroads in this sector.
Further to augment the business of the Company JITF UrbanInfrastructure Services Limited (JUISL) the unlisted material subsidiary
of the Company has entered into a strategic Investment Agreement onJuly 16 2018 with Technomechanical Services Private Limited (TSPL) pursuant to whichJUISL has agreed to transfer up to 49% (Forty Nine Percent) shareholding in JWIL in favourof TSPL or its designated representatives. Flowever JUISL shall continue to hold 51%(Fifty One Percent) of the paid-up share capital of JWIL along with the right to appointthe majority of directors of the JWIL.
Another step-down subsidiary JITF Urban Infrastructure Limited (JUIL)is engaged in municipal solid waste management (MSW) & waste to energy (WtE) business.JUIL through its subsidiary has installed the country's first WtE facility at Okhla NewDelhi wherein the company is processing 1950 TPD of municipal solid waste and generating16 MW of clean renewable energy.
JUIL has currently been allotted 3 WtE projects in the state of AndhraPradesh 2 WtE projects in Rajasthan & one each in Gujrat & Delhi region. InAndhra Pradesh at Guntur & Vishakhapatnam cluster the company will process 1200 TPDof Municipal Solid Waste (MSW) and will generate
15 MW each of clean energy while at Tirupati cluster the Company willprocess 400 TPD of MSW and will generate 6 MW of clean energy. Similarly in Delhi itwill be the largest WtE project in India which will process 2400 TPD of MSW and willgenerate 25 MW of renewable energy.
During the current year apart from completing the ongoing projectsthe company intends to focus on getting new orders for further growth of the Company.
During the financial year 2017-18 Jindal Rail Infrastructure LimitedQRIL) could not achieve optimal capacity utilization on account of rolling back of wagonpurchases by both Indian Railways and private sector in the past year. Indian Railwayspostponed its annual procurement programme for wagons due to various policy changes onaccount of introduction of GST. The overall performance of JRIL during the financial year2017-18 was subdued because of delays in placement of orders by the Indian Railways anddue to low order book till last quarter. However last quarter has witnessed a gradualpickup in demand. With the company winning new orders its order book has risen. Atpresent orders for 878 wagons are under various stages of execution. Hence performanceis expected to improve going ahead. JRIL is also pursuing a de-risking strategy throughdiversification. In order to reduce dependence on wagon segment JRIL has received adevelopmental order for 2 nos Locomotive Shell Assembly from DMW Patiala.
To cater to the working capital requirement the Board of Directorsexpress that the profits of the company be retained and therefore do not recommend anydividend for the financial year 2017-18.
4. MATERIAL CHANGES AFFECTING THE COMPANY
There have been no material changes and commitments affecting thefinancial position of the company between the end of the financial year and date of thisreport. There has been no change in the nature of business of the company.
However to further augment the business of the Company JITF UrbanInfrastructure Services Limited (JUISL) the unlisted material subsidiary of the Companyhas entered into a strategic Investment Agreement on July 16 2018 with TechnomechanicalServices Private Limited
(TSPL) pursuant to which JUISL has agreed to transfer up to 49% (FortyNine Percent) shareholding in JITF Water Infrastructure Limited (JWIL) in favour of TSPLor its designated representatives. However JUISL shall continue to hold 51% (Fifty OnePercent) of the paid-up share capital of JWIL along with the right to appoint the majorityof directors of the JWIL.
5. TRANSFER TO RESERVES
No amount has been transferred to the General Reserve during the year.
6. SHARE CAPITAL
The paid-up Equity Share Capital as at March 31 2018 stood at Rs514.07 lacs . During the year under review the Company has not issued any: a) shares withdifferential voting rights b) sweat equity shares c) equity shares under Employees StockOption Scheme.
7. EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure- 2 to this Report.
8. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report as stipulated underRegulation 34 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations2015 forming part of this report has been given under separate section in the AnnualReport.
9. FINANCIAL STATEMENTS
The audited Financial Statements of the Company which form a part ofthis Annual Report have been prepared pursuant to Regulation 33 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 in accordance with theprovisions of the Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules2014.
Audited annual consolidated financial statements forming part of theAnnual report have been prepared in accordance with Companies Act 2013 Indian AccountingStandards (Ind AS) 110 -'Consolidated Financial Statements' and Indian AccountingStandards (Ind AS) 28 - 'Investments in Associates and Joint Ventures' and all other IndAS provisions as may be applicable notified under Section 133 of Companies Act 2013 readwith Companies (Indian Accounting Standards) Rules 2015 and as amended from time to time.
10. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
Your Company has the following subsidiaries:
1. JITF Urban Infrastructure Services Limited
1. Jindal Rail Infrastructure Limited
2. JITF Water Infrastructure Limited
3. JITF Urban Infrastructure Limited
4. JITF Water Infra (Naya Raipur) Limited
5. JITF ESIPL CETP (Sitarganj) Limited
6. JITF Industrial Infrastructure Development Company Limited
7. Timarpur-Okhla Waste Management Company Limited (Formerly known as 'Timarpur-OkhlaWaste Management Company Pvt. Limited")
8. JITF Urban Waste Management Qalandhar) Limited
9. JITF Urban Waste Management (Bathinda) Limited
10. JITF Urban Waste Management (Ferozepur) Limited
11. Jindal Urban Waste Management (Tirupati) Limited
12. Jindal Urban Waste Management (Guntur) Limited
13. Jindal Urban Waste Management (Visakhapatnam) Limited
14. Jindal Urban Waste Management (Jaipur) Limited
15. Jindal Urban Waste Management Codhpur) Limited
16. Jindal Urban Waste Management (Ahmedabad) Limited
11. PERFORMANCE OF SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
During the year the Board of Directors reviewed the affairs of thesubsidiary companies.
Pursuant to provisions of Section 129(3) of the Companies Act 2013 astatement containing salient features of the Financial Statements of the Company'ssubsidiaries in Form AOC-1 is attached to the Financial Statements of the Company.
In accordance with the provisions of Section 136 of the Companies Act2013 the standalone Financial Statements of the company the Consolidated FinancialStatements along with relevant documents and separate audited accounts in respect ofsubsidiaries are available on the website of the company i.e. www.jindalinfralogistics.com.
The annual accounts of these subsidiaries and the related informationwill be made available to any member of the Company / its subsidiaries seeking suchinformation and are available for inspection by any member of the Company / itssubsidiaries at the Registered Office of the Company. The annual accounts of the saidsubsidiaries will also be available for inspection at the Corporate Office/ Registeredoffice of the respective subsidiary companies and is also available on our website
www.jindalinfralogistics.com. These documents will also be availablefor inspection during business hours at our registered office.
The Policy for determining Material Subsidiaries adopted by yourBoard in conformity with Regulation 16(c) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 can be accessed on the Company's website at http://www.jindalinfralogistics.com/policypdf/POLICY-FOR DETERMINING-MATERIAL -SUBSIDIARIES.pdf.
12. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134 of the Companies Act2013 with respect to Directors' Responsibility Statement it is hereby confirmed by theBoard of Directors: -
a. that in the preparation of the annual accounts for the financialyear ended 31 stMarch 2018 the Indian Accounting Standards (IND AS) had been followedalong with proper explanation relating to material departures;
b. that they had selected such accounting policies and applied themconsistently and made judgments and estimates that were 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 and of the profit of the Company for the year ended on that period;
c. that they had taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of the Companies Act2013 for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
d. that they had prepared the accounts for the financial year ended31st March 2018 on a 'going concern' basis;
e. that they had laid down internal financial controls to be followedby the Company and that such internal financial controls are adequate and are operatingeffectively; and
f. that they had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
13. SECRETARIAL STANDARDS
The Directors state that applicable Secretarial Standards i.e. SS -1and SS - 2 relating to "Meetings of the Board of Directors'and "GeneralMeetings' respectively have been duly followed by the Company.
14. DECLARATION BY INDEPENDENT DIRECTORS
The Company has received Declaration of Independence from allIndependent Directors as stipulated under Section 149(7) of the Companies Act 2013 andRegulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 confirming that they meet the criteria of Independence.
15. DIRECTORS AND KEY MANAGERIAL PERSONNEL
As per the provisions of the Companies Act 2013 and Articles ofAssociation of the Company Mr. Neeraj Kumar Non - Executive Director (DIN :01776688) ofthe company retire by rotation at the ensuing Annual General Meeting and being eligibleoffer himself for re-appointment. The Board of Directors on the recommendation of theNomination and remuneration Committee has recommended his re-appointment.
The brief details relating to Mr. Neeraj Kumar is furnished in theexplanatory statement to the notice of the ensuing AGM under the head "DirectorsSeeking Appointment / Re-appointment at this Annual General Meeting".
As on 31.03.2018 Composition of the Board was as follows:
|DIN No ||Name of Director ||Position of Directorship |
|01431428 ||Mr. Rakesh Kumar Grover ||Managing Director |
|01776688 ||Mr. Neeraj Kumar ||Non-Executive Director |
|00005349 ||Dr. Raj Kamal Agarwal ||Independent Director |
|05112440 ||Mr. Girish Sharma ||Independent Director |
|00131460 ||Mr. Dhananjaya Pati Tripathi ||Independent Director |
|07586927 ||Ms. Veni Verma ||Non-Executive Director |
Mr. Rakesh Kumar Grover has resigned from the post of Managing Directorof the Company w.e.f. 03.08.2018. The Board placed on record the appreciation for theservices rendered by him during his tenure with the company.
Mr. Amarendra Kumar Sinha has been appointed as Whole-Time Director ofthe Company w.e.f 3rd August 2018.
Mr. Naresh Kumar Agarwal who was appointed on 29th May 2017 as ChiefFinancial Officer (CFO) of the Company is no longer holding the position of CFO of theCompany w.e.f. 31st July 2018. The Board placed on record the appreciation for theservices rendered by him during his tenure with the company.
Further Mr. Anuj Kumar who is a qualified Chartered Accountant andpossess relevant skills has been appointed as CFO of the Company w.e.f. 31 st July 2018.
In view of the recent notification of the SEBI (LODR) AmendmentRegulations 2015 the Company seeks consent of the members by way of special resolutionfor continuation of appointment of Mr. D.P. Tripathi aged 76 years as an IndependentDirector upto the expiry of his present term of office i.e. 04th September 2021.
Policy on Directors' Appointment and Remuneration
The Nomination and Remuneration Committee selects the candidate to beappointed as the Director on the basis of the needs and enhancing the competencies of theBoard of the Company.
The current policy is meant to have a balance of executive andnon-executive Independent Directors to maintain the independence of the Board andseparates its functions of governance and management.
The composition of Board of Directors during the year ended March 312018 are in conformity with Regulation 17 of the SEBI (Listing Obligations and DisclosuresRequirements) Regulations 2015 (SEBI Listing Regulations) read with Section 149 of theCompanies Act 2013.
The policy of the Company on directors' appointment including criteriafor determining qualifications positive attributes independence of a director and othermatters as required under sub-section (3) of Section 178 of the Companies Act 2013 andthe remuneration paid to the directors is governed by the Nomination and RemunerationPolicy of the Company.
16. FORMAL ANNUAL EVALUATION
The Company has devised a Policy for performance of the Board itsCommittees and of individual Directors which includes criteria for performance evaluationof non-executive directors and executive directors under section 178(1) of the CompaniesAct 2013. This may be accessed at the link http://www.jindalinfralogistics.com/policypdf/Performance-Evaluation.pdf.
On the basis of the Policy for performance evaluation of IndependentDirectors Board Committees and other Directors a process of evaluation was followed bythe Board for its own performance and that of its Committees and individual Directors. Thedetails of same have been given in the report on corporate governance annexed hereto.
The details of programme for familiarisation of Independent Directorswith the Company their roles rights responsibilities in the Company nature of theindustry in which the Company operates and related matters have been uploaded on thewebsite of the Company at the link http://www.jindalinfralogistics.com/policypdf/Familiarization-Programme-of-Independent-Dir ectors.pdf.
17. CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of CorporateGovernance and adhere to the Corporate Governance requirement set out by SEBI. The reporton Corporate Governance as stipulated under the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 forms an integral part of this Report. The requisitecertificate from the Auditors of the company confirming compliance with the conditions ofCorporate Governance is attached to this report on Corporate Governance.
18. CONTRACTS AND ARRANGEMENT WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Companyduring the financial year with related parties were in the ordinary course of business andon an arm's length basis.
During the year the Company had entered into material contract /arrangement / transaction with subsidiary of the Company. The Policy on materiality ofrelated party transactions and dealing with related party transactions as approved by theBoard may be accessed on the Company's website at the link:http://www.jindalinfralogistics.com/policypdf/POLICY%200N%20 RELATED%20PARTY%20TRANSACTIONS.pdf.
The details of the transactions with related parties are provided inthe notes to accompanying standalone financial statements.
19. RISK MANAGEMENT POLICY
The Company's robust risk management framework identifies and evaluatesbusiness risks and opportunities. The Company recognizes that these risks need to bemanaged and mitigated to protect its shareholders and other stakeholders interest toachieve its business objectives and enable sustainable growth. The risk frame work isaimed at effectively mitigating the Company's various business and operational risksthrough strategic actions. Risk management is embedded in our critical businessactivities functions and processes. The risks are reviewed for the change in the natureand extent of the major risks identified since the last assessment. It also providescontrol measures for risks and future action plans.
20. AUDITORS & THEIR REPORT
(A) STATUTORY AUDITORS
M/s Lodha & Co Chartered Accountants (ICAI Firm Registration No.301051E) were appointed as Statutory Auditors of your Company at the Annual GeneralMeeting held on 25th September 2017 for a term of five years. As per the provisions ofSection 139 of the Companies Act 2013 the appointment of Auditors is required to beratified by Members at every Annual General Meeting. They have confirmed that they are notdisqualified from continuing as Statutory Auditors of the company.
Flowever pursuant to Companies Amendment Act 2017 enforced on 7thMay 2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors isno longer required to be ratified at every Annual General Meeting.
Auditors' remarks in their report read with the notes to accountsreferred to by them are self-explanatory. There have been no fraud reported by theStatutory Auditors of the Company.
(B) SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act 2013read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 the Board had appointed M/s Pankaj Kantha & Co. Practising CompanySecretaries to conduct Secretarial Audit of the Company for the financial year 2017-18.The Secretarial Audit Report for the financial year ended 31st March 2018 is annexedherewith marked as Annexure - 1 to this Report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QUALIFICATIONRESERVATION OR ADVERSE REMARK OR DISCLAIMER MADE
i. Auditors' Report
There have been no fraud qualification reservation or adverse remarkreported by the Statutory Auditors of the Company.
ii. Secretarial Auditor's Report
There are no qualification reservation or adverse remark reported bythe Secretarial Auditors in their report.
21. INTERNAL CONTROL AND INTERNAL AUDIT SYSTEM
Your company has put in place strong internal control systems in linewith globally accepted practices. The processes adopted by the Company are best in classand commensurate with the size and nature of operations. All major business activitieshave been well defined and mapped into the ERP system and the controls are continuouslyreviewed and strengthened as per the business need.
The Company has adopted risk based framework which is intended forproper mitigation of risks. The major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuous basis.
The Company has employed experienced professionals to carry out theinternal audits to review the adequacy and compliance to the laid down procedures tomanage key risks.
The Audit Committee of the Board regularly reviews the adequacy &effectiveness of internal audit environment and implementation of internal auditrecommendations including those relating to strengthening of Company's risk managementpolicies & systems.
Your Company's philosophy is of zero tolerance towards all applicablelegal non-compliances.
22. DISCLOSURES MEETING OF THE BOARD
During the year under review the Board of Directors met Four (4) times:
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|Board Meetings || |
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The composition of Board of Directors during the year ended March312018 is in conformity with Regulation 17 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations 2015 read with Section 149 of theCompanies Act 2013. For further details please refer report on Corporate GovernanceReport attached with this annual report.
As on 31.03.2018 the Audit Committee comprises of Directors namelyMr. Dhananjaya Pati Tripathi (Chairman) Mr. Girish Sharma Dr. Raj Kamal Agarwal and Mr.Rakesh Kumar Grover as other members.
Pursuant to the resignation of Mr. Rakesh Kumar Grover on 03.08.2018the Audit Committee has been reconstituted with the following Members:
1. Mr. Dhananjaya Pati Tripathi Chairman
2. Mr. Girish Sharma Member
3. Dr. Raj Kamal Agarwal Member
4. Mr. Amarendra Kumar Sinha Member
The Chairman of the Committee is an Independent Director.The Memberspossess adequate knowledge of Accounts Audit Finance etc. The composition of the AuditCommittee is in conformity with the requirements as per the Section 177 of the CompaniesAct 2013 and Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
Four Meeting of Audit Committee were held during the year. Theparticulars of the Meeting held are detailed in the Corporate Governance Report whichforms part of this Report.
During the year all the recommendations made by the Audit Committeewere accepted by the Board.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination & Remuneration Committee comprises of Directorsnamely Mr. Dhananjaya Pati Tripathi (Chairman) Ms. Veni Verma Dr. Raj Kamal Agarwal asother members.
The Chairman of the Committee is an Independent Director. Thecomposition of the Nomination & Remuneration Committee is in conformity with therequirements of Section 178 of the Companies Act 2013 and SEBI Listing Regulations.
During the year ended 31st March 2018 the committee met 1 (once) on29th May 2017. For further details please refer report on Corporate Governance Reportattached with this annual report.
STAKEHOLDER RELATIONSHIP COMMITTEE
The Stakeholder Relationship Committee comprises of Directors namelyMs. Veni Verma(Chairman) Mr. Dhananjaya Pati Tripathi Mr. Rakesh Kumar Grover as othermembers.
Pursuant to the resignation of Mr. Rakesh Kumar Grover on 03.08.2018the Stakeholder Relationship Committee has been reconstituted with the following Members:
1. Ms. Veni VermaChairman
2. Mr. Amarendra Kumar Sinha Member
3. Mr. Dhananjaya Pati Tripathi Member
The Chairman of the Committee is an Independent Director. Thecomposition of the Stakeholder Relationship Committee is in conformity with therequirements of Section 178 of the Companies Act 2013 and SEBI Listing Regulations.
During the year under review the Stakeholder Relationship Committee metThirteen (13) times.
For further details please refer report on Corporate Governance Reportattached with this annual report.
23. VIGIL MECHANISM
The Vigil Mechanism of the Company which also incorporates a whistleblower policy in terms of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Protected disclosures can be made by a whistle blower through ane-mail or a letter to the Compliance Officer or Managing Director or to the Chairman ofthe Audit Committee.
The Policy on vigil mechanism and whistle blower policy may be accessedon the Company's website at the link: http://www.jindalinfra
24. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN ANDSECURITIES PROVIDED
Particulars of loans given investments made guarantees given andsecurities provided along with the purpose for which the loan or guarantee or security isproposed to be utilized by the recipient are provided in the standalone financialstatement (Please refer to Notes to the standalone financial statement).
25. PARTICULARS REGARDING CONSERVATION OF ENERGY ETC.
As your Company is not engaged in any manufacturing activity theparticulars relating to conservation of energy and technology absorption as mentioned inthe Companies (Accounts) Rules 2014 are not applicable to it. However emphasis isplaced on employing techniques that result in the conservation of energy. There were noforeign exchange earnings and expenditure of your Company during the Financial Year.
26. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The details of employee whose particulars are required to be furnishedunder Section 197(12) of the Companies Act 2013 read with Rules 5(1) 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isprovided at Annexure - 3.
27. PUBLIC DEPOSITS
During the year ended March 31 2018 the Company has not accepted anypublic deposits and no amount on account of principal or interest on public deposits wasoutstanding as on 31st March 2018.
28. ANY SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS ORCOURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
During the Financial Year there are no significant material orderspassed by the Regulators or Courts or Tribunals impacting the going concern status andcompany's operations in future.
29. THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has adopted a policy for prevention of Sexual Harassment ofWomen at workplace and has formed a Committee for implementation of said policy. Nocomplaint of harassment was received during the year.
Your Directors express their grateful appreciation to concernedDepartments of Central / State Governments Financial Institutions & BankersCustomers and Vendors for their continued assistance and co-operation. The Directors alsowish to place on record their deep sense of appreciation for the committed services of theemployees at all levels. We are also grateful for the confidence and faith that you havereposed in the Company as its member.
For and on behalf of the Board
Raj Kamal Agarwal
Place: New Delhi Dated : 3rd August 2018