KSK Energy Ventures Ltd.
|BSE: 532997||Sector: Infrastructure|
|NSE: KSK||ISIN Code: INE143H01015|
|BSE 00:00 | 15 Jan||KSK Energy Ventures Ltd|
|NSE 05:30 | 01 Jan||KSK Energy Ventures Ltd|
|BSE: 532997||Sector: Infrastructure|
|NSE: KSK||ISIN Code: INE143H01015|
|BSE 00:00 | 15 Jan||KSK Energy Ventures Ltd|
|NSE 05:30 | 01 Jan||KSK Energy Ventures Ltd|
Your Directors have the pleasure in presenting the Nineteenth Annual Report togetherwith the audited statements of accounts for the year ended 31 March 2019.
The financial performance of your Company for the year ended 31 March 2019 issummarized below:
During the year under review income of the Company stood at Rs.17.40 million. Withhigher impairement of investments and receivables and decrease of other income theCompany reported a loss of Rs. 7319.14 million.
During the year under review the consolidated revenue of the group has decreased byRs. 29416.66 million as a result of deconsolidation of Sai Wardha Power GenerationLimited VS Lignite Power Private Limited and KSK Mahanadi Power Company Limited pursuantto lenders decision of change in management. As a result operating profit has alsodecreased by Rs. 5527.6 million. With lower finance cost and depreciation and lower otherincome loss before tax for the year stood at Rs. 3558.61 million.
Review of Business
The operational and financial performance of each of the power plants for the financialyear 2018-19 has been outlined in the "Management Discussion and AnalysisReport".
Material changes and commitments
Sai Wardha Power Generation Limited Sai Regency Power Corporation Private Limited andSai Lilagar Power Generation Limited are under Corporate Insolvency Resolution Process("CIRP"). The Lenders Consortium at KSK Mahanadi Power Company Limited alongwith Lenders consortium at the Water and Railway infrastructure SPVs have invoked theshares pledged with them as security for the financial facilities.
The above mentioned events had substantial impact on the financial position of theCompany.
Further there is no change in the nature of business of the Company.
The paid up equity share capital as on 31 March 2019 was Rs.4239.86 million comprisingof 423985744 (Forty Two Crore Thirty Nine Lakh Eighty Five Thousand and Seven HundredForty Four)equity shares of Rs.10/- each.
Subsidiaries / Joint Ventures / Associates
Details of major subsidiaries of the Company and their business operations during theyear under review are covered in the Management Discussion and Analysis Report.
As per the provisions of Section 129 of the Companies Act 2013 (hereinafter referredto as "Act") read with Companies (Accounts) Rules 2014 a separate statementcontaining the salient features of the financial statements of the SubsidiaryCompanies/Associate Companies/Joint Ventures has been provided in Form AOC-1.
The consolidated financial statements of the Company which includes the results of itssubsidiaries associates and joint ventures are included in this Annual Report.
Pursuant to the provisions of Section 136 of the Act the financial statementsincluding consolidated financial statements are being made available on the website of theCompany www.ksk.co.in.The financial statements of subsidiary companies will be availablefor inspection during business hours at the registered o ce of the Company and also on thewebsite of the Company.
Policy for determining material subsidiaries of the Company is available on the websiteof the Company at the link: http://www.ksk.co.in/ourpolicies.php.
Companies which have become or ceased to be Subsidiaries Joint Ventures or AssociateCompanies during the year
During the year financial creditors of Sai Regency Power Corporation Private Limited(Sai Regency) have led the petition for a Corporate Insolvency Resolution process("CIRP") under the Insolvency and Bankruptcy Code 2016 at National Company LawTribunal Chennai ("NCLT") and same has been admitted by NCLT on 27 March 2019.Consequent to this the Company has lost control in Sai Regency and it ceased to beSubsidiary of the Company.
The Lenders Consortium at KSK Mahanadi Power Company Limited (KSK Mahanadi) along withLenders consortium at the Water and Railway infrastructure SPVs have invoked the sharespledged with them as security for the financial facilities and as a result all threeCompanies and Sai Power Pte. Ltd. subsidiary of KSK Mahanadi have ceased to beSubsidiaries and Associate Company respectively.
Further financial creditor of Sai Lilagar Power Generation Limited ("SaiLilagar") Subsidiary of the Company has led petition for a CIRP before NCLTHyderabad Bench under Section 7 of the Insolvency and Bankruptcy Code 2016("IBC") and the same has been admitted by NCLT on 11th July 2019.Consequent tothis the Company has lost control in Sai Lilagar and it ceased to be Subsidiary of theCompany.
Pursuant to SEBI (LODR) Regulations 2015 (hereinafter referred to as "ListingRegulations") a detailed report on Corporate Governance is given in this AnnualReport. A certificate from the Statutory Auditors of the Company regarding compliance withconditions o f Corporate Governance is attached to the Corporate Governance report.
Management Discussion and Analysis Report
A Management Discussion and Analysis report in terms of regulation 34 of ListingRegulations is provided in a separate section and forms an integral part of this AnnualReport.
Directors and Key Managerial Personnel
Independent Directors & Non-Executive Directors
Mr. Abhay M Nalawade Independent Director and Mrs. Kusuma Mani Kumari Non-ExecutiveDirector have resigned with effect from 05 March 2019 and 30 May 2018 respectively.
Mr. T.L. Sankar expired on 26 December 2018. Mr. K.A. Sastry has vacated his o ce ofWhole-time Director pursuant to provisions of Section 167(1)(b) of the Companies Act 2013with effect from 11 August 2018.
Mr. K. Bapi Raju and Ms. Alankrita Soni have been appointed as Additional Directors ofthe Company with effect from30 May 2018 and Mr. N.S Ramachandran has been appointed asAdditional Director with effect from 30 May 2019. Ms. Alankrita Soni Mr. Abhay Nalawadewere appointed as Independent Directors for a term of five years and Mr. K. Bapi Raju wasappointed as Director at the Annual General Meeting on 29th September 2018.
Mr. N.S Ramachandran is proposed to be appointed as Independent Director for a term offive years under the provision of section 160 of the Act at the ensuing Annual GeneralMeeting.
In accordance with the provisions of Section 152(6) of the Act Mr. K. Bapi RajuDirector retires by rotation at the forthcoming Annual General Meeting and being eligibleo ered himself for re-appointment.
Brief pro les of Mr. N.S. Ramachandran and Mr. K. Bapi Raju are given in noticeconvening the Nineteenth Annual General Meeting for reference of shareholders.
During the year Non-Executive Directors of the Company had no pecuniary relationshipor transactions with the Company.
The Company has received declaration from all Independent Directors of the Company conrming that they meet the criteria of independence as prescribed under the applicableprovisions of Section 149 of the Act and under Listing Regulations.
Key Managerial Personnel
Mr. V. Sambasiva Rao Chief Financial Officer and Mr. M.S. Phani Sekhar CompanySecretary have resigned with effect from 30 May 2018.
Mr. Ranjith Kumara Shetty has been appointed as Company Secretary and ComplianceOfficer and Mr. Manjul Saha has been appointed as Chief Financial Officer with effect from30 May 2018 and 10 November 2018 respectively.
Meetings of the Board
The Board met five (5) times during the year. The details are given in CorporateGovernance report that forms part of this Annual report.
As per the provisions of the Act and Listing Regulations the Board carried out annualevaluation of the Board's performance its Committees and individual Directors.
Board performance evaluation evaluation of Committees and individual Directors iscarried out through a questionnaire encompassing upon various areas that provide aninsight and feedback into the functioning of the Board its Committees individualDirectors and areas of development.
In a separate meeting of independent directors performance of non-independentdirectors performance of the Board as a whole performance of the Chairman and qualityquantity and timeliness of flow of information between the Company management and theBoard was evaluated.
In terms of the provisions of Section 178(3) of the Act and Regulation 19 read withSchedule II Part D of Listing Regulations the Nomination and Remuneration Committee isresponsible for formulating the criteria for determining qualifications positiveattributes and independence of a Director.
The Nomination and Remuneration Committee is also responsible for recommending to theBoard a policy relating to the remuneration of the Directors Key Managerial Personnel andSenior Management.
The Remuneration Policy is annexed herewith as Annexure I and the same form partof this Report.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is annexed herewith and marked as Annexure II.
Particulars of Employees
The particulars of employees as required to be disclosed pursuant to the provisions ofSection 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 as amended is annexed herewith andmarked as Annexure III to this Report.
Directors' Responsibility Statement
In terms of Section 134(3)(c) and 134(5) of the Act your Board of Directors to thebest of their knowledge and ability con rm that:
in the preparation of annual financial statements the applicable accounting standardshave been followed and there are no material departures;
they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of a airs of the Company at the end of the financial year and of the loss ofthe Company for that period;
proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;
annual financial statements have been prepared on a going concern basis;
they have laid down internal financial controls to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively;
proper systems are in place to ensure compliance with the provisions of all applicablelaws and that such systems were adequate and operating effectively.
The Audit Committee of the Company constituted in terms of Section 177(1) of the Actand Regulation 18 of the Listing Regulations comprises of - Mr. N.S Ramachandran Ms.Alankrita Soni and Mr. S. Kishore as on date of this report. Terms of reference meetingsand attendance particulars of the Audit Committee are included in the Corporate GovernanceReport forming an integral part of this Annual Report.
Corporate Social Responsibility Committee
KSK has been pursuing CSR activities long before they were made mandatory under theAct. The Group's sustainability initiatives towards community are essentially focused onfive thrust areas:
In compliance with requirements of Section 135 of the Act the Company has laid down aCSR Policy. The composition of the Committee contents of CSR Policy and report on CSRactivities carried out during the financial year ended 31 March 2019 in the formatprescribed under Rule 8 of Companies (Corporate Social Responsibility Policy)Rules 2014is annexed herewith as Annexure IV. The CSR Committee has not met during the year.
M/s. Jawahar and Associates Chartered Accountants Hyderabad (ICAI Firm RegistrationNo. 001281S) have been appointed as Statutory Auditors of the Company to hold o ce fromthe conclusion of the 17th Annual General Meeting held on 25th September 2017 for 5consecutive years till the conclusion of the 22nd Annual General Meeting of the Company inthe calendar year 2022 (subject to rati cation by the shareholders at each Annual GeneralMeeting if so required under the Act).
Companies Amendment Act 2017 omitted the first proviso to Section 139 of CompaniesAct 2013 that requires rati cation of appointment of auditor at every annual generalmeeting.
Explanation to Statutory Auditors' Qualification / Comment on the Company's financialstatements
The Auditors' Qualification has been appropriately dealt with in Note No. 2.616(v) 33to 36 of the Notes to the standalone audited financial statements and in Note No. 2.4831(ii) 43 to 45 of the Notes to the consolidated audited financial statements. TheAuditors' Report is enclosed with the financial statements in this Annual Report.
Secretarial Audit Report
Pursuant to Section 204 of the Act read with the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company had appointed Mr. V. PavanaSrinivasa Rao Practising Company Secretary Hyderabad to undertake Secretarial
Audit of the Company for the financial year 2018-19. The Secretarial Audit Report inform MR-3 received from him is annexed herewith as Annexure V to this Report.
There is no qualification reservation adverse remark or disclaimer by the SecretarialAuditor in his Secretarial Audit Report and hence no explanation or comments of the Boardis required in this matter.
The Company is not required to maintain cost records and cost audit as per section 148of the Companies Act 2013 and the rules framed thereunder.
Whistle Blower Policy/Vigil Mechanism
The Company has formulated a Whistle Blower Policy and has established a VigilMechanism for employees including Directors of the Company to report genuine concerns. Theprovisions of this policy are in line with the provisions of Section 177(9) of the Act andRegulation 22 of Listing Regulations.
The whistle blower policy is available on the Company's website at thelink:http://ksk.co.in/pdfs/Whistle-Blower-Policy.pdf.
Your Directors have not recommended any dividend on equity shares for the year underreview.
Transfer to Reserves
No amounts were proposed to be transferred to reserves for the year under review.
Deposits from Public
The Company has not accepted any deposits from the public falling within the ambit ofSection 73 of the Act and the Companies(Acceptance of Deposits) Rules 2014.
Details of significant and material orders passed by the Regulators or Courts orTribunals
Apart from the National Company Law Tribunal orders on Corporate Insolvency ResolutionProcess of Subsidiaries mentioned in this report there are no significant and materialorders passed by the Regulators or Courts or Tribunals which would impact the goingconcern status of the Company and its future operations.
Internal Control Systems
Your Directors believes that the Company's internal financial controls with referenceto financial statements were adequate and effective during the financial year 2018-19.
Loans Guarantees or Investments under Section 186 of the Act
Particulars of loans given investments made guarantees given and securities providedare detailed in notes to the financial statements.
Contracts and arrangements with Related Parties
The Board has approved a policy for Related Party Transactions which has been posted onthe Company's website at the weblinkhttp://ksk.co.in/ourpolicies.php
There are no materially significant related party transactions made by the company withrelated parties which may have potential conflict with interest of the company at large.As a matter of policy your Company carries out transactions with related parties on anarms' length basis.
Accordingly particulars of contracts or arrangements with related parties referred toin Section 188(1) along with the justification for entering into such contract orarrangement in Form AOC-2 does not form a part of this report.
Further the Company has not entered into any contract or arrangement or transactionwith its related parties which is not at arm's length during the financial year 31 March2019. Suitable disclosure as required by the Indian Accounting Standards as applicable hasbeen made in the notes to the financial statements.
Risk Management Policy
The Company's policy for Risk Management is to apply best practice in identifyingevaluating and cost-e ectively controlling risks to ensure that any residual risks are atan acceptable level. Whilst it is not possible to eliminate risk absolutely the ort isunderway to actively promote and apply best practices at all levels and to all itsactivities including its dealing with external partners.
Extract of Annual Return
The extract of Annual Return in the prescribed format as per the provisions of Section92(3) oftheCompaniesAct 2013 and Rule 12 of the Companies (Management and Administration)Rules 2014 is enclosed herewith as an Annexure VI.
Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013
The company has complied with provisions relating to the constitution of InternalComplaints Committee under the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
There were no complaints received pursuant to the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 for the year ended 31 March2019.
Details of Conservation of Energy Technology Absorption Foreign Exchange Earnings andOutgo
A. Conservation of Energy:
1) Steps taken or impact on conservation of energy: -N.A.
2) Steps taken by the Company for utilizing alternate sources of energy: -N.A.
3) The Capital investment on energy conservation equipments: -N.A. B. TechnologyAbsorption: i. The E orts made towards technology absorption: NIL ii. The Bene ts derivedlike product improvement cost reduction product development or import substitution: NILiii. Details of technology imported during the past 3 years: No technology has beenimported during the past 3 years. a. The details of technology import: -NIL b. The year ofimport: -NIL c. Whether the technology has been fully absorbed: -NIL d. If not fullyabsorbed areas where absorption has not taken place and the reasons thereof: - NIL iv.The expenditure incurred on Research and Development: -N.A.
C. Foreign Exchange Earnings and Outgo:
Your Directors would like to place on record their grateful appreciation for theassistance and co-operation received from the Financial Institutions Banks Government ofIndia State Government Government Authorities Customers Vendors and Shareholders. YourDirectors also wish to place on record their deep sense of appreciation for the servicesof the employees of the Company. We look forward to their continued support in the future.