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Kalpataru Power Transmission Ltd.

BSE: 522287 Sector: Infrastructure
NSE: KALPATPOWR ISIN Code: INE220B01022
BSE 00:00 | 27 Jan 499.50 -24.35
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NSE 00:00 | 27 Jan 500.20 -24.15
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OPEN 525.00
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VOLUME 17059
52-Week high 591.10
52-Week low 332.30
P/E 20.09
Mkt Cap.(Rs cr) 7,438
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 525.00
CLOSE 523.85
VOLUME 17059
52-Week high 591.10
52-Week low 332.30
P/E 20.09
Mkt Cap.(Rs cr) 7,438
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kalpataru Power Transmission Ltd. (KALPATPOWR) - Director Report

Company director report

DEAR MEMBERS

Your Directors are pleased to present the 41st ANNUALREPORT of Kalpataru Power Transmission Limited ("the Company")together with the Audited Financial Statements (standalone and consolidated) for thefinancial year ended 31 March 2022.

financial highlights

(Rs in Crores)

Particulars Consolidated Standalone
2021-22 2020-21 2021-22 2020-21
Revenue from Operations 14777.38 12949.44 7061.80 7670.70
Profit before Depreciation Tax and amortisation expense 882.15 1141.27 609.31 777.57
Less: Depreciation and amortisation expenses 350.78 373.45 104.75 114.60
Profit before Tax and Exceptional Items 531.37 767.82 504.56 662.97
Exceptional items 184.93 209.64 217.41 168.35
Share of Profit / (Loss) from Joint Venture (19.89) (32.21) - -
Tax Expense 161.35 283.21 206.61 216.10
Profit for the period 535.06 662.04 515.36 615.22
Other Comprehensive Income (net of tax)
Items that will be reclassified subsequently to Profit or Loss 43.39 8.89 5.06 15.50
Items that will not be reclassified subsequently to Profit or Loss 0.53 0.70 0.43 (0.07)
Total Comprehensive Income for the period 578.98 671.63 520.85 630.65
Retained Earnings - Opening balance 2473.55 1943.35 2678.49 2201.00
Add: Profit for the period 540.30* 671.02* 515.36 615.22
Less: Dividends 34.45 0.63 22.34 -
Less: interim Dividend - 126.57 - 126.57
Less: Transfer to General Reserve 10.00 12.25 10.00 10.00
Less: Transfer to Capital Redemption Reserve - 1.16 - 1.16
Less: Transfer to other reserves 0.20 0.21 - -
Retained Earnings - Closing balance 2969.20 2473.55 3161.51 2678.49

* Profit for the year attributable to Owners of the Company

OUR RESPONSE TO COVID-19

The world has learnt to live with COVID-19. With remarkable vaccinationdrive the second and third wave of COVID-19 was appropriately mitigated in India and theIndian Economy has shown significant improvement in the last year.

First few months of 2021-22 were under the second wave of COVID-19during which India as well as the world was devastated with the loss of lives. YourCompany promptly reacted by providing the required support to its employees community andthe clients. Our people are our biggest strength and protecting their health and wellbeing is crucial to us. In the last week of November 2021 the emergence of Omicron a newvariant of SARS CoV2 brought third wave of COVID-19 in India.

Under its Kalpa Aapda Seva Project your Company activated its CSRinterventions to join hands with government machinery to combat and contain the impact ofCOVID-19. It carried out various CSR Programs like construction of well equipped 16 beddedchildren's ward combined with an imported oxygen generation plant and mobile x-raymachine vaccination drives distribution of dry ration kits to the needy and poormurtikars of Mumbai etc. The Company also distributed oxygen concentrators to thegovernment hospitals during the 2nd wave as well as before the onset of 3rdwave to equip the public administration to combat with COVID-19. For our partners -vendors suppliers and subcontractors who have been most exposed to the crisis we shortenthe lead time for payments with systematic immediate payments. Your Company have ensuredthat all our subcontractor workers were retained at site with required hygiene standardsat labour camps with daily needs as per government guidelines.

OPERATIONAL HIGHLIGHTS

First quarter of the financial year was mostly under lockdown imposedfor containment of novel Corona virus (COVID-19). However your Company continued with itsrobust performance during the year.

During 2021-22 the Standalone revenue of your Company decreased byabout 7.94 % to Rs 7061.80 Crores as against Rs 7670.70 Crores in the previous financialyear. Total Export revenue (including overseas projects) was Rs 2594.65 Crores or approx.36.74% of revenues.

The Standalone net profit for the year decreased by 16.23% to Rs 515.36Crores as against Rs 615.22 Crores in the previous financial year.

Your Company has supplied 152580 MTs of Transmission Line Towersduring the year under review.

Your company has a standalone order book (including Linjemontage IGrastorp AB and Fasttel Engenharia S.A.) of more than Rs 15750 Crores. Your Company hasreceived Orders in excess of Rs 8150 Crores [including orders received by LinjemontageIGrastorp AB (Rs 985 Crores) and Fasttel Engenharia S.A. (Rs 283 Crores)] in the current FY2021-22.

The consolidated revenue of your Company increased by about 14.12% toRs 14777.38 Crores as against Rs 12949.44 Crores in the previous financial year.

The consolidated net profit for the year decreased by about 19.18% toRs 535.06 Crores as against Rs 662.04 Crores in the previous financial year.

Your Company's business continuity plan and technology backedsystems & processes have helped your Company to ensure execution across all projectsamidst 2nd and 3rd wave of COVID-19 and therefore there was nomaterial adverse impact of COVID-19 on operations or finances of the Company during the FY2021-22.

AMALGAMATION OF JMC PROJECTS (INDIA) LIMITED WITH THE COMPANY

The Board of Directors of the Company and JMC Projects (India) Limited(JMC) in their respective meetings held on 19 February 2022 approved the scheme ofamalgamation which inter-alia provides for the merger of JMC with the Company (Scheme).The Scheme is subject to receipt of necessary approvals from the Hon'ble NationalCompany Law Tribunal stock exchanges the Securities and Exchange Board of Indiashareholders creditors and such other authorities as may be required. This merger bringstogether two leading organisations with unique sets of capabilities and complementarybusinesses in the current attractive EPC markets. The merger will accelerate growth andenhance value creation for all stakeholders. Pursuant to the Scheme JMC'sshareholders (other than the Company itself) will be allotted one share of the Companyagainst every four shares held by them in JMC. The merger of the Company and JMC is asignificant milestone as both the entities come together to drive the next phase ofgrowth and value creation. The combined businesses present a significant opportunity toincrease scale and relevance both in India and international EPC market.

AWARDS & RECOGNITION

Your Company has been honoured with various Awards accolades andrecognitions during the year under review some of which are elaborated hereunder:

Your Company's manufacturing facility at Raipur has received Gold Award formanufacturing excellence at imeXi - 2021 by Kaizen Hansei in appreciation of its effortstowards building a sustainable improvement based culture of operational excellence.

Your Company's Raipur Plant Team was conferred with Meritorious Award in thecategory "involving people through Quality concepts to make India Global Leader"by Quality Circle Forum of India (QCFI) at National Convention on Quality Concepts 2021.

• Your Company's Raipur plant won Gold Category Award in Kaizencompetition theme "Cycle Time Reduction Through Low Cost Automation" at eventorganised by Convention Quality Circle Forum of india Bhilai Chapter (CCQC - 2021) byVirtual Platform.

About 18 Supervisors of your Company got felicitated in Construction industryDevelopment Council (CiDC) - Vishwakarma Award 2022.

Your Company's Raipur manufacturing plant has won Best Hazardous managementCompany award by CII - SR (Confederation of Indian industry). Further similar award wasconferred for domestic Transmission Line Project - 400 kV Quad Line from YTPS to KalaburgiSS. This award has been conferred for maintaining and attaining high standard of HazardousWaste Management in the plant. KPTL has been included in the list of organisations whichhave been sustaining high level of standard for the compliance of Hazardous WasteManagement system.

• Your Company's Gandhinagar manufacturing plant was declared Platinum Winnerat 5th Cii National competition on Lean (Category - Deployment of Lean inOperations / Plant).

Your Company's Gandhinagar plant won 'Silver Certificate of Merit' at IndianManufacturing Excellence Award-2021. The assessment was conducted by Frost & Sullivanacross all manufacturing & related functions.

Silver Trophy was conferred to the Company's Gandhinagar manufacturing plant atthe NSC india Award 2021 by the National Safety Council set up by the Ministry of LabourGovt. of India.

Your Company's Padampur power plant received Appreciation Award from BoilerDepartment of Government of Rajasthan towards safe practices under medium scale industryin Mar-22. It also received Gaurav samman from Government of Rajasthan towards excellentservice during COVID - 19.

Your Company received appreciation letter from one of its Client for remarkableperformance in execution of NEGG Project Part - A of Guwahati - Numaligarh PipelineProject as the pipeline traverses through difficult terrains and execution entails workamidst adverse climate conditions. KPTL achieved a remarkable milestone of about 174welding joints (2168 mtr.) in a day which was appreciated by Client as extraordinaryperformance amongst all contractors.

• The British Safety Council appreciated the Company's Morogoro-Makutupora220 kV Project at Tanzania for best safety practices at British Safety Council award.

The Royal Society for the Prevention of Accidents at RoSPA -UK Health & SafetyAwards 2021 granted

a) Silver Award to the Company's 500 kV Transmission line work at TajikistanProject;

b) Silver Award to the Company's 225 kV D/CSikasso-Bougouni-Sanankoroba-Kodialani- Dialakorobougou Transmission Line work at MaliProject;

c) Silver Award to the Company's 220 kV Sub-station works at Burundi Project and

d) Bronze Award to the Company's 220 kV Transmission Line works at TanzaniaProject.

• Your Company was conferred with the Special Appreciation Award for"Achievement in Electrification in Railways" at 3rd Rail AnalysisInnovation & Excellence Summit 2022.

• The project management consultant of our client in one of the Railway Projectissued appreciation letter for implementing best SOPs for all the site activities and foradhering to Zero Rework Policy by which KPTL's execution Team have saved time ofrework.

• Various Clients of your Company recognised its ESG practices and provided belowcertificates of appreciation.

- GAIL (India) Limited granted Certificate of Appreciation to your Company forobserving excellence in safety standard practices during construction and laying of 226.6km * 24" Steel Gas Pipeline Mumbai - Nagpur Pipeline Project.

- Engineers india Limited appreciated on achieving 2 Million safe man hours without anyLoss Time Accident between May 2018 to July 2021 during the execution of Kochi - SalemLPG Pipeline Project.

- Bharat Gas Resources appreciated on achieving 1 Million safe man hours betweenJanuary 2021 to February 2022 during pipeline laying and Associated works in Ahmednagarand Aurangabad district of Maharashtra State.

- Mecon Limited working as consultant on GAIL Project appreciated on achieving 3.5Million safe man hours without any LTI between April 2018 to March 2022 during theexecution of Bokaro - Angul - JHBDPL Pipeline Project.

- Tractebel Engineering issued certificate of appreciation for maintaining HighStandard of Environmental & Social Compliances at 220 kV GEiTA-NYAKANZAi Transmissionline project at Tanzania.

- Ministry of Environment and Sustainable development Senegal as well as CIMAInternational recognised KPTL's efforts in the monitoring control and supervision ofconstruction work in St. Louis and Tobene transmission line and substation works andmaintaining and following the high standard of Environmental & Social Compliances.

- The passage Home of saint augustin for the Children in the street situationappreciated KPTL for its social intervention during execution of Burundi Project bycarrying out various community development initiatives.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF YOURCOMPANY

There are no material changes and commitments affecting the financialposition of your Company which has occurred between end of financial year 2021-22 and thedate of Directors' Report.

DIVIDEND

Your Directors are also pleased to recommend dividend for the yearended 31 March 2022 @ Rs 6.50 (325%) per equity share of Rs 2 each in line with DividendDistribution Policy of the Company.

TRANSFER TO RESERVES

Your Company has transferred following amounts to various reservesduring the financial year ended 31 March 2022:

Amount transferred to Amount in Rs Crores
General Reserve 10

PERFORMANCE AND FINANCIAL POSITION OF EACH SUBSIDIARIES ASSOCIATES ANDJOINT VENTURE COMPANIES

A statement containing the salient features of financial statements ofthe subsidiary associates and joint venture companies in terms of provisions of Section129(3) of the Companies Act 2013 in the prescribed Form AOC-1 is annexed to ConsolidatedFinancial Statements and hence not repeated here for the sake of brevity.

The brief details of the activities carried out by key / newsubsidiaries of your Company is provided below.

• JMC projects (India) Limited ("JMC projects" or"JMC")

JMC Projects (India) Limited ("JMC Projects" or"JMC") is a leading construction company in India with over INR 5350 Croresrevenue having presence in South Asia East Asia East Africa and West Africa. It iscertified under Quality Management System (QMS) confirming to ISO 9001:2015 EnvironmentalManagement System (EMS) conforming to ISO 14001:2015 and Occupational Health & SafetyManagement system (OHSMS) conforming to ISO 45001:2018 at all offices and projects.

The Company's presence spans across residential complexes andtownships hospitals hotels commercial complexes institutions factories and buildingswater supply and irrigation projects roads and highways airports flyovers and elevatedcorridors metro rail and other urban infrastructure projects industrial units and powerplants. JMC's integrated capabilities span the spectrum of 'EPC' solutions withSafety Quality and On- time delivery as the 3 pillars.

Over three decades of a strong customer-focused approach and a sharpfocus on world-class quality have enabled JMC to maintain a leadership position in itsmajor lines of business. Characterised by professionalism high standards of corporategovernance and sustainability JMC continues to evolve seeking better ways of engineeringto meet emerging challenges leveraging the power of People- Processes-Technology (PPT).

For the 2021-22 JMC has received new contracts of more than Rs 10000Crore including projects in Maldives Ethiopia and Ghana. As of 31 March 2022 theaggregate value of orders on hand of JMC stands at approx. Rs 17100 Crore. YourCompany's shareholding in JMC stands at 67.75% during the year under review.

• Shree Shubham Logistics Limited ("SSLL"):

SSLL provides agri-storage infrastructure along with a wide range ofvalue-added services like preservation maintenance & security (PMS) testing &certification collateral management & pest control activities. It manages andoperates warehouses (Owned Hired Third Parties and Public Private Partnership (PPP)model) across 7 Indian states including Rajasthan Gujarat Madhya Pradesh MaharashtraHaryanaUttar Pradesh & Karnataka. During the year under review SSLL has beenappointed as Service Provider by:

a) Madhya Pradesh State Warehousing and Logistics Corporation (MPWLC)for Preservation Maintenance and Security (PMS) of food grain stocks in 34 CAPS (Coverand Plinth) locations in 9 different districts of Hosangabad (Narmda Puram) and Sagarregion in the state of Madhya Pradesh.

b) Haryana State Co-operative & Marketing Federation Limited(HAFED) for Preservation Maintenance and Security (PMS) of food grain stocks in 9locations (Cover and Plinth) in 5 districts in the state of Haryana.

c) Haryana State Warehousing Corporation (HSWC) for PreservationMaintenance and Security (PMS) of food grain stocks in 2 Clusters at 11 locations in thestate of Haryana.

In aggregate SSLL is managing more than 450 warehouses with acumulative storage capacity exceeding 13 Million SFT. SSLL is a wholly owned subsidiary ofthe your Company.

Linjemontage I Grastorp AB ("LMG"):

LMG a Swedish EPC company headquartered in Grastorp Sweden along withits two wholly owned subsidiaries were acquired (85% equity stake) by the Company'swholly owned subsidiary in Sweden namely Kalpataru Power Transmission Sweden AB in April2019. During the year under review LMG along with its two subsidiaries has bagged Ordersof approx. Rs 985 Crores and has an Order Book of approx. Rs 1293 Crores as on 31 March2022. This year the performance of the Company has been exceptional in terms of overallgrowth and profitability of the Company. Whilst on one side it has further strengthenedits position in the Swedish market and achieved a significant growth in revenue it hascontinued to observe an exceptional growth in profit. This is result of continuedoperational efficiency better procurement and ability to deliver projects better thanplanned. LMG continues to add more capabilities like entry into 400 kV transmission linesbusiness underground cabling expanding its presence to many regions in sweden includingNorth of sweden and adding new services. The team size at LMG has also been scaled up andit has emerged as one of the top suppliers in terms of quality of service and safety.

• Fasttel Engenharia S.A. ("Fasttel"):

Fasttel Engenharia S.A. is an established EPC player with more than 35years of presence bringing energy and development to the extremes of Brazil havingfootprints in more than 20 Brazilian states. It has delivered more than 2000 kilometersof transmission lines upto 750kV and more than 50 substations up to 500 kV Voltage level.Fasttel is a team of more than 2000 professionals spread across Brazil. The organisationcombines a proven record of accomplishment and professional skills woven together with aculture of trust & caring. Fasttel is working with various reputed customer/developers across the Brazil like ABB WEG GE SIEMENS Alupar CEEE COPEL ISA CTEEPCEMIG CPFL Eletrobras FURNAS TAESA etc. Your Company holds 51% equity shares inFasttel Engenharia S.A. through its wholly owned subsidiary namely Kalpataru Power DOBrasil Participacoes Ltda.

• Kalpataru IBN Omairah Contracting Company Limited("KIOCL")

KioCL is a joint venture of the Company with iBn omairah ContractingCompany limited in the Kingdom of saudi Arabia wherein the Company is holding 65% equityshares of KIOCL. During the year under review KIOCL has been awarded Project forconstruction of one 380 kV Double Circuit overhead transmission line verticalconfiguration latticed steel towers from existing Yanbu City (YCNT) 380/110Kv Substationto the existing Umlujj North (UMN) 380/132Kv BSP Substation. The Project is progressingwell and is expected to be commissioned within contractual timeline.

• Kalpataru Power Transmission Chile SpA ("KPCSA"):

During the year under review KPCSA was incorporated in the Republicof Chile as a wholly owned subsidiary of the Company to foray into similar business asthat of the Company in the LATAM market.

During the year under review one new Company namely

KPCSA was incorporated as Wholly Owned Subsidiary of your

Company. Further Fasttel became 51% step-down subsidiary of theCompany w.e.f. 07 April 2021.

Accordingly as on the date of this Report your Company has 27 directand indirect subsidiaries and 1 joint venture Company.

Pursuant to provisions of Section 129 of the Companies Act 2013 yourCompany shall place Consolidated Financial statements before the members for its approval.Further pursuant to provisions of Section 136 of the Companies Act 2013 your Companywill make available the Annual Accounts of the Subsidiary Companies and the relatedinformation to any Members of the Company who may be interested in obtaining the same. TheAnnual Accounts of the Subsidiary Companies are also uploaded on the website of theCompany i.e. www.kalpatarupower.com and will also be kept open for inspection atthe Registered Office of your Company and that of the respective Subsidiary Company.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in attaching the Audited ConsolidatedFinancial Statements for the year under review pursuant to Companies Act 2013 and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The ConsolidatedFinancial Statements presented by your Company have been prepared as per Ind AS andinclude the financial results of its Subsidiary Companies Associates and Joint VentureCompanies.

DIVESTMENT / MONETISATION OF TRANSMISSION LINE

SpV's

During the year under review your Company and Techno Electric andEngineering Company Limited (Techno) completed the sale and transfer of ~49% of the totalequity shares of Kohima-Mariani Transmission Limited (23% by the Company and 26% by theTechno) with an agreement to sell the balance 51% after obtaining requisite regulatory andother approvals and in a manner consistent with transmission service agreement to apraavaenergy private limited (formerly known as CLP India Private Limited).

NON-CONVERTIBLE DEBENTURES

During the year under review your Company raised Rs 200 Crores by wayof issuance of Non-Convertible Debentures.

DIRECTORS

At the 40th Annual General Meeting held on 15 July 2021the shareholders approved the re-appointment of and remuneration payable to Mr. SanjayDalmia (DIN: 01229696) as an Executive Director of the Company.

During the year under review Mr. Imtiaz Kanga (DIN: 00136272)Non-Executive Non-Independent Director of the Company resigned from the Board w.e.f. 19April 2021 due to personal reasons driven by some family commitments.

Further during the year under review the Company appointed Dr.Shailendra Raj Mehta (DIN: 02132246) as an Additional Independent Director of the Companyfor a period of 5 years commencing from 03 August 2021 subject to approval of theshareholders. In this regards the shareholders pursuant to the postal ballot notice dated11 February 2022 approved the appointment of Dr. Shailendra Raj Mehta.

The Company issued postal ballot notice dated 11 February 2022 forappointment of Mr. Mofatraj P Munot as a Non- Executive Director not liable to retire byrotation. Subsequently Mr. Mofatraj P. Munot vide letter dated 22 March 2022 informedthe Company that he was not inclined to be appointed as a Non-Executive Director of theCompany for an indefinite period and consequently he withdrew his consent to be appointedon such terms. Accordingly the resolution proposed at item no. 2 of the above statedpostal ballot notice became infructuous. Therefore the tenure of Mr. Mofatraj P Munot asan Executive Chairman of the Company expired on 31 March 2022 and he ceased to beDirector of the Company from the closing hours of 31 March 2022.

Mr. Mofatraj P Munot vide the said letter also expressed hiswillingness to be appointed as Non-Executive Chairman of the Company for a period notexceeding five years as may be recommended by the Nomination and remuneration Committeeand the Board of Directors of the Company. at the recommendation of Nomination andremuneration Committee the Board of Directors at its meeting held on 22 March 2022approved his appointment as Non-Executive Chairman of the Company for a period of 5 yearssubject to approval of shareholders to be obtained by means of special resolution passedthrough postal ballot. The shareholders of the Company pursuant to the postal ballotnotice dated 22 March 2022 approved his appointment as Non-Executive Chairman for aperiod of 5 years w.e.f 2 May 2022.

Your Board is of the opinion that the Independent Director appointedduring the year possess integrity requisite expertise experience and proficiency and thesame is given in the Corporate Governance Report.

Your Company has received declarations from all the IndependentDirectors confirming that they meet with the criteria of independence as prescribed underSection 149(6) of the Companies Act 2013 and under Regulation 16 (1) (b) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 and they haveregistered their names in the Independent Director's Databank. Further pursuant toSection 164(2) of the Companies Act 2013 all the Directors have provided declarations inForm DIR- 8 that they have not been disqualified to act as a Director.

In terms of Section 152 of the Companies Act 2013 Mr. Manish Mohnot(DIN: 01229696) being the longest in the office shall retire by rotation at the ensuingAGM and being eligible offers himself for reappointment. The Board of Directors of theCompany at the recommendation of Nomination and Remuneration Committee has recommended forhis reappointment.

A brief resume of Mr. Manish Mohnot being re-appointed as a Directorliable to retire by rotation along with the nature of his expertise his shareholding inyour Company and other details as stipulated under Regulation 36 (3) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is appended as an annexure tothe Notice of the ensuing Annual General Meeting.

BOARD MEETINGS

During the year under review the Board met 8 times on 11 May 202115July 202103 August 202130 October 2021 11 February 2022 19 February 2022 02March 2022 and 22 March 2022.

The number of Meetings of the Board that each Director attended isprovided in the Report on Corporate Governance appended to and forming part of thisReport.

COMMITTEES

In order to adhere to the best corporate governance practices toeffectively discharge its functions and responsibilities and in compliance with therequirements of applicable laws your Board has constituted several Committees includingthe following:

• Audit Committee

• Nomination and remuneration Committee

• Stakeholder's Relationship Committee

• Corporate Social Responsibility Committee

• Risk Management Committee

• Share Transfer Committee

• Executive Committee

The details with respect to the compositions powers roles terms ofreference etc. of relevant Committees are given in detail in the 'Report on CorporateGovernance' of your Company which forms part of this Report. The dates on which Meeting ofBoard Committees were held during the financial year under review and the number ofMeetings of the Board Committees that each director attended is provided in the 'Report onCorporate Governance'. The minutes of the meetings of all Committees are circulated to theBoard for discussion and noting.

During the year all recommendation of the committees were approved bythe Board.

KEY MANAGERIAL PERSONNEL (KMP)

Mr. Manish Mohnot Managing Director & CEO Mr. Ram Patodia ChiefFinancial Officer and Mr. Rajeev Kumar Company secretary are the Key managerial personnel(KMps) as per provisions of Companies Act 2013. There has been no change in KMP duringthe year under review.

Mr. Rajeev Kumar tendered his resignation as Company Secretary andCompliance Officer w.e.f close of working hours of 31 May 2022. The Board appointed Mr.Krunal Shah Sr. Manager (F&A) and a member of the Institute of Company Secretaries ofIndia as an Interim Compliance Officer w.e.f 1 June 2022

CORPORATE GOVERNANCE

Your Company believes that robust Corporate Governance practices arecritical for enhancing and retaining stakeholder's trust and confidence. Your Companyalways ensures that its performance goals and targets are achieved in compliance with itssound corporate governance practices. The efforts of your Company are always focused onlong-term value creation. Inherent to such an objective is to continuously engage anddeliver value to all its stakeholders including members customers partners employeeslenders and the society at large.

The Report on Corporate Governance as stipulated under Regulation 34of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isattached. The Report on Corporate Governance also contains certain disclosures requiredunder Companies Act 2013 for the year under review.

A certificate from M/s. B S R & Co. LLR Statutory Auditors of theCompany confirming compliance to the conditions of Corporate Governance as stipulatedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexedto Report on Corporate Governance.

MANAGEMENT DISCUSSION AND ANALYSIS

As per Regulation 34 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a separate section on Management Discussion and AnalysisReport outlining the business of your Company forms part of this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

Your Company has always been at the forefront of philanthropicactivities way before the provisions of Companies Act 2013 made it a compulsoryrequirement. The Company carried out CsR activities either directly or through theKalpataru Foundation & Kalpataru Welfare Trust. Our CSR vision is to enhance thequality of life of people from marginalised and vulnerable sections of society in thecommunities we operate in. Through innovative need-based and sustainable projects westrive towards empowering the communities. Since our Site locations are in remotelocations we give special focus while selecting projects that will have long term impactin that area. We ensure that we leave social footprints in whichever location we work in.The Company cherishes the Kalpataru Spirit of maximising societal value for needy and thisis evident with our impactful projects being run near our office and Plant locations inMumbai Raipur & Gandhinagar.

Your Company has formed the CSR Committee as per the requirement of theCompanies Act 2013. On recommendation of CSR Committee the Board of Directors' ofyour Company has approved the CSR Policy which is available on the website of your Companyat www.kalpatarupower.com. The brief outline of the Corporate Social Responsibility(CSR) Policy of your Company and the initiatives undertaken by your Company on CSRactivities during the year are set out in Annexure A of this report in the formatprescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014 (asamended from time to time).

BUSINESS RESPONSIBILITY REPORT

As stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Business Responsibility Report (BRR) describing theinitiatives taken by the Company from an environmental social and governance perspectiveforms part of this Annual Report.

VIGIL MECHANISM

The details of Vigil mechanism ("Whistle Blower Policy") ofthe Company are given in the 'Report on Corporate Governance' appended to andforming part of this Report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Internal Financial Controls are an integrated part of the riskmanagement process addressing financial risks and financial reporting risks. The Boardhas adopted policies and procedures for ensuring the orderly and efficient conduct of itsbusiness including adherence to the Company's policies the safeguarding of itsassets the prevention and detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial disclosures.

Assurance on the effectiveness of internal financial controls isobtained through management reviews continuous monitoring by functional experts andtesting of the internal financial control systems by the internal auditors during thecourse of their audits. We believe that these systems provide reasonable assurance thatour internal financial controls are designed effectively considering the nature of ourindustry and are operating as intended.

STATUTORY AUDITORS AND AUDITORS' REPORT

M/s. B S R & Co. LLP (Firm Registration No. 101248W/W- 100022)Chartered Accountants have been appointed as Statutory Auditor's of the Company atthe 37th annual General Meeting held on August 7 2018 to hold office from theconclusion of 37th annual General meeting (AGM) till the conclusion of the 42ndannual General meeting of the Company subject to compliance of the various provisions ofCompanies Act 2013.

The Statutory Auditors of the Company has issued Audit Reports on theStandalone and Consolidated Annual Financial Statement of the Company with unmodifiedopinion. There were no qualifications reservation or adverse remark or disclaimer made byStatutory Auditor in their reports on the Standalone Annual Financial Statement.

The explanations of your Board of Directors in relation to remarksappearing in para (xxi) of Annexure A to Independent Auditor's Report under Companies(Auditor's Report) Order 2020 (CARO) issued by Statutory Auditors of the Company onconsolidated financial statements as a result of remarks by respective statutory auditorsof Kurukshetra Expressway Private Limited ("KEPL" or "Concessionaire")a joint venture of JMC Projects (India) Ltd. ("JMC" a subsidiary of theCompany) and Wainganga Expressway Private Limited ("WEPL") a whollyowned subsidiary of JMC are as under:

Name of the Company Clause no. of caro Remarks appearing in the consolidated CARo Explanation
kepl Clause (ix)(a) According to the information and explanations given to us and as per the books of accounts and records examined by us read with the fact that the project has been terminated and there are no operations in our opinion the company has defaulted in the repayment of loans and payment of interest thereon to its lenders as and when the same were due and hence the facilities granted by the banks / NBFC have been classified as Non-Performing Assets (NPA). The details w.r.t. the amount of borrowing and interest overdue may be referred to at Note No. 11 of the accompanying financial statements. KEPL a joint venture (49.57%) of JMC Projects (India) Ltd ("JMC") served a notice of termination of Concession Agreement ("CA") vide letter dated 7 October 2021 to the National Highways Authority of India ("NHAI") on account of continuous disruption and blockade of traffic at National Highway-71 due to farmer agitation with stoppage of toll collection that resulted into cash losses. The provisions of Concession Agreement provide for termination where events which are not in control of KEPL and obliges NHAI paying KEPL for repayment of Debt Due along with Adjusted Equity after necessary adjustments. Pending receipt of final termination payment from NHAI KEPL could not pay the loan and interest to its lenders in october 2021 and consequently the outstanding amount of loan and interest was classified as NPA (Non-performing asset) by the lenders.
Clause (xvii) The company has incurred cash losses of Rs 3857.11 Lacs & Rs 5652.68 Lacs respectively in the current as well as the immediately preceding previous year. Upon receipt of termination payment and other claims filed against NHAI KEPL believes that it will be able to meet its liabilities. KEPL has received a copy of the letter dated 3 February 2022 from an Independent Engineer ("IE") appointed by NHAI in which the IE has sought to limit the amount payable (net of other deductions) as "Termination Payment". KEPL do not agree to it.
Clause (xix) On the basis of the financial ratios ageing and expected dates of realisation of assets and payment of financial liabilities other information accompanying the financial statements and our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions indicate that a material uncertainty exists as on the date of the audit report indicating that the company may not be able to meet its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. However as represented to us the company is reasonably sure of receiving the amount of claims and shall be able to meet the liabilities though with some delay.
Although JMC and other promoter of KEPL have jointly and severally given 'shortfall undertakings' to the Senior Lenders in case there is any shortfall between amounts received from NHAI and that payable by KEPL to its lenders however upon receipt of termination payment and other claims filed against NHAI and based on management's assessment and legal advise KEPL believes that it will be able to meet its liabilities.
JMC has made provision for impairment of its entire Equity investment in KEPL expected credit loss against the entire amount of loan given (including amount paid on behalf of other promoter) to KEPL and potential shortfall if any.
JMC has made above impairment / provisions without prejudice to its and KEPL legal rights and claims against NHAI and will continue to pursue these amounts against KEPL. Further it will seek KEPL to pursue their claims and termination payment against NHAI notwithstanding the above recognition.
WEPL Clause (ix)(a) According to the information and explanations given to us and as per the books of accounts and records examined by us in our opinion the company has defaulted in the repayment of loans and payment of interest thereon to its lenders as and when the same were due there were delay of 90 days during the year As at the reporting date the aggregate amount of default pertaining to interest and principal aggregated to Rs 772.80 Lacs and Rs 1222.60 Lacs respectively for which the details may be referred to at Note No. 9(a) of the accompanying financial statements. WEPL a wholly owned subsidiary of JMC has been incurring losses due to development of alternate routes changes in rules /regulations/ policies by the Government and NHAI. WEPL has initiated arbitration proceedings against NHAI as per the provisions of the Concession Agreement (executed with NHAI) for losses suffered by it on account of aforesaid reasons (including breach of contractual obligations) and sought reliefs in relation to waiver of premium payment compensation for future shortfall etc. As the matter is currently sub-judice and losses suffered due to aforesaid reasons there have been delay in payments to lenders. Having said that while there have been substantial reduction in toll revenue due to traffic diversion to alternate routes economic slowdown etc. WEPL has been paying its debt obligations through its accruals which is further supplemented by infusion of funds from internal accruals by JMC to maintain the loan account of the lenders as Standard as per the RBI Guidelines.

SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013your Company had appointed Mr. Urmil Ved Practicing Company Secretary Gandhinagar asits Secretarial Auditor to conduct the Secretarial Audit of your Company for FY 2021-22.The Report of the Secretarial Auditor for the FY 2021-22 is annexed to this report as AnnexureB.

There were no qualifications reservation or adverse remark ordisclaimer made by Secretarial Auditor in its report.

COST AUDITOR

The Company has maintained cost records as specified by CentralGovernment under section 148(1) of Companies Act 2013 and such records have been auditedby the Cost Auditor pursuant to Companies (Cost Records and Audit) Rules 2014.

Pursuant to the provisions of Section 148 of the Companies Act 2013read with Rule 14 of the Companies (Audit and Auditors) Rules 2014 the cost records inrespect of Electricity and Steel products of the Company need to be audited. In complianceto the above the Board of Directors upon the recommendation of the Audit Committeeappointed M/s. K. G. Goyal & Associates Cost Accountants as the Cost Auditor of yourCompany for the 2021-22.

RISK MANAGEMENT FRAMEWORK

Your Company has an elaborate Risk Management Framework which isdesigned to enable risks to be identified assessed and mitigated appropriately. YourCompany monitors manages and reports on the principal risks and uncertainties that canimpact its ability to achieve its strategic objectives. Your Company's SOPsOrganisational structure management systems code of conduct policies and Valuestogether govern how your Company conducts its business and manage associated risks. YourCompany also has a separate Bribery Risk assessment framework which also defines the keymitigation actions.

The Risk Management framework enables the management to understand therisk environment and assess the specific risks and potential exposure to the Companydetermine how to deal with these risks to manage overall potential exposure monitor andseek assurance of the effectiveness of the management of these risks and intervene forimprovement where necessary and report throughout the management chain upto the RiskManagement Committee on a periodic basis about how risks are being monitored managedassured and improvements are made.

PARTICULARS OF REMUNERATION

A. The ratio of the remuneration of each director to the medianemployee's remuneration and other details in terms of Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 as amended from time to time are forming part of thisreport as Annexure Cl.

B. In terms of the provisions of Section 197(12) of the Act read withRule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 a statement showing the names of the top ten employees in terms ofremuneration drawn and names and other particulars of the employees drawing remunerationin excess of the limits set out in the said rules forms part of this Report.

Having regard to the provisions of the second proviso to Section 136(1)of the Act and as advised the Annual Report excluding the aforesaid information is beingsent to the members of the Company. The said Annexure is open for inspection at theRegistered office of your Company. Any member interested in obtaining copy of the same maywrite to Company Secretary/Compliance Officer.

PERFORMANCE EVALUATION

The criteria for performance evaluation and the statement indicatingthe manner in which formal annual evaluation of the Board its Committee and of individualDirectors has been made are given in the "Report on Corporate Governance"Which forms part of this Report.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION INCLUDING CRITERIAFOR DETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES AND INDEPENDENCE OF A DIRECTOR

Your Company's policy on remuneration for the Directors' Keymanagerial personnel and other employees is placed on website of the Company at https://kalpatarupower.com/corporate-governance/. this policy is directed towards establishing reasonable andsufficient level of remuneration to attract retain and motivate Directors & employeesof the quality required to run the Company successfully. This Policy is in consonance withexisting industry practice. There has been no change in the said Policy during the yearunder review. The sitting fees for the meetings of the Board and its various Committeesthereof has been amended by the Board at its meeting held on 14 May 2022.

Your Company's policy on Directors' appointment includingcriteria for determining qualifications positive attributes independence of a directoris placed on website of the Company at https://kalpatarupower.com/corporate governance/.this policy sets out the guiding principles for the Nomination and Remuneration Committeeto identify persons who are eligible to be appointed as Directors and to determine theindependence of a candidate at the time of considering his/her appointment as anIndependent Director of the Company. The Policy also provides for the criteria andqualification in evaluating the suitability for appointment as Director & in SeniorManagement that are relevant for the Company's operations. There has been no changein the said Policy during the year under review.

CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEINFLOW & OUTFLOW

Information required to be disclosed under Section 134(3)(m) of theCompanies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is annexedhereto as Annexure D and forms part of this Report.

DIVIDEND DISTRIBUTION POLICY

In terms of Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) (Second Amendment) Regulations 2016 your Company hasformulated Dividend Distribution Policy and the same is also available on the website ofthe Company i.e.https://kalpatarupower.com/corporate-governance/.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

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 utilised by the recipient are provided in the standalone financialstatement (Please refer to Note No. 37 to the Standalone Financial Statements).

ANNUAL RETURN

The annual return of the Company as on 31 March 2022 is available onthe website of Company i.e. www.kalpatarupower.com

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Companyduring the financial year with related parties were in its ordinary course of business andon an arm's length basis. During the year the Company had not entered into anycontract / arrangement / transaction with related parties which could be consideredmaterial in accordance with the policy of the Company on materiality of related partytransactions or which is required to be reported in Form No. AOC-2 in terms of Section134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts)Rules 2014.

The policy on materiality of Related Party Transactions is uploaded onthe website of your Company and the link for the same is provided in the ‘Reporton Corporate Governance'.

There were no materially significant related party transactions whichcould have potential conflict with interest of the Company at large.

Attention of Members is drawn to the disclosure of transactions withrelated parties set out in Note No. 41 of Standalone Financial Statements forming part ofthe Annual Report.

DISCLOSURE UNDER SECTION 22 OF THE SEXUAL HARASSMENT OF WOMEN ATWORKPLACE (PREVENTION PROHIBITION And REDRESSAL) ACT 2013

Your Company has zero tolerance towards any action of any executivewhich may fall under the ambit of 'Sexual Harassment' at workplace and is fullycommitted to uphold and maintain the dignity of every women working in your Company. TheAnti Sexual Harassment Policy provides for protection against sexual harassment of womenat workplace and for prevention and redressal of such complaints.

Your company has complied with provisions relating to the constitutionof internal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. There were no complaints pending as onthe beginning of the financial year and no new complaints were received during thefinancial year under review.

ANTI-BRIBERY MANAGEMENT SYSTEM

As an organisation your Company places a great importance in the waybusiness is conducted and the way each employee performs his/her duties. Your Companyencourages transparency in all its operations responsibility for delivery of resultsaccountability for the outcomes of actions participation in ethical business practicesand being responsive to the needs of our people and society. Towards this end yourCompany has laid down a Kalpataru Code of Conduct ("KCoC") applicable to all theemployees of your Company. The Code provides for the matters related to governancecompliance ethics and other matters. Your Company has adopted strong anti-briberyanti-corruption policy and practices and has also been certified with ISO- 37001 forestablishing Anti Bribery Management System across the organisation.

STATEMENT OF DIRECTORS' RESPONSIBILITY

Pursuant to requirement under Section 134(3)(c) of the Companies Act2013 (Act) your Directors' confirm that:

(a) in the preparation of the annual accounts for the year ended on 31March 2022 the applicable accounting standards read with requirement set out underSchedule III to the Act have been followed and there are no material departures from thesame;

(b) they 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 As at 31 March 2022 andof the profit of the Company for the year ended on that date;

(c) they have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

(d) they had prepared the annual accounts on a going concern basis;

(e) they had laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and are operatingeffectively and;

(f) they had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.

Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the internalstatutory and secretarial auditors and external consultants including audit of internalfinancial controls over financial reporting by the statutory auditors and the reviewsperformed by management and the relevant board committees including the audit committeethe board is of the opinion that the Company's internal financial controls wereadequate and effective during FY 2021-22.

The Directors have devised proper systems to ensure compliance with theprovisions of all applicable Secretarial Standards and that such systems are adequate andoperating effectively.

SECRETARIAL STANDARDS

The Company has followed the applicable Secretarial Standards i.e. SS-1and SS-2 relating to 'Meetings of Board of Directors' and 'General Meetings'respectively.

GENERAL

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

• Details relating to deposits covered under Chapter V of the Companies Act 2013.

Issue of equity shares with differential rights as to dividend voting or otherwise.

Issue of shares (including sweat equity shares) to employees of the Company under anyscheme or any stock options scheme.

Neither the Managing director nor the whole-time directors of the Company receive anyremuneration or commission from any of its subsidiaries.

No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.

• No fraud has been reported by the Auditors to the Audit Committee or the Board.

• There has been no change in the nature of business of the Company.

• there is no proceeding pending under the insolvency and Bankruptcy Code 2016.

• there was no instance of onetime settlement with any Bank or FinancialInstitution.

ACKNOWLEDGEMENT

Your Directors regret the loss of lives due to COVID-19 pandemic andare deeply grateful and have immense respect for every person who risked his/her life andsafety to fight this pandemic.

Your Directors also take this opportunity to thank all the Governmentand Regulatory Authorities Financial Institutions Banks Debenture holders and DebentureTrustee JV Partners Consortium Partners' Customers Vendors Suppliers Sub-Contractors and Members and all other stakeholders for their valuable continuous support.

The Board of directors wish to place on record their sincereappreciation for the committed services by the Company's executives staff andworkers. Your Directors also appreciate and acknowledge the confidence reposed in them bymembers of the Company.

On behalf of the Board of Directors

Place: Mumbai Mofatraj P Munot
Date: 14 May 2022 Chairman
DIN: 00046905

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