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Madhucon Projects Ltd.

BSE: 531497 Sector: Infrastructure
NSE: MADHUCON ISIN Code: INE378D01032
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VOLUME 4247
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OPEN 5.30
CLOSE 5.17
VOLUME 4247
52-Week high 12.95
52-Week low 4.77
P/E
Mkt Cap.(Rs cr) 38
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Madhucon Projects Ltd. (MADHUCON) - Director Report

Company director report

Your Directors have pleasure in presenting the 31st Annual Report of the Companytogether with the Audited Financial Statements for the year ended March 31 2021.

1. FINANCIAL SUMMARY (Rs. in Lakhs)

Standalone Year ended Consolidated Year ended
S. No. Particulars 31.03.2021 31.03.2020 31.03.2021 31.03.2020
(Audited) (Audited) (Audited) (Audited)
1 Income from Operations:
(a) Net Sales/ Income from Operations 64655.05 54682.00 90916.23 73413.09
(b) Other income 7190.97 787.07 12484.10 4603.57
Total Income 71846.02 55469.07 103400.33 78016.65
2 Expenses:
(a) Cost of Materials Consumed 63442.04 51044.53 88842.92 60650.21
(b) Changes in Inventory of Finished goods
Work-in-Progress and stock-in-trade - - 889.61 1496.42
(c) Employee benefits expense 1728.40 2196.78 2792.85 3530.72
(d) Other expenses 10288.63 2536.45 1994.51 3047.03
(e) Financial Costs 847.22 1343.22 24570.33 15028.49
(f) Depreciation and amortization expense 595.97 836.52 12871.32 7157.74
Total Expenses 76902.26 57956.80 131961.54 90910.61
3 Profit/(Loss) Before Exceptional Items (1-2) (5056.25) (2487.73) (28561.21) (12893.96)
4 Exceptional ItemsShare of (Loss) from Associate Company - 22727.00 982.39 97027.06
5 Profit/(Loss) Before Tax (3-4) (5056.25) (25214.73) (27578.82) (109921.02)
6 Tax Expense
Current Tax - - - -
Income Tax Refund Received -(5392.23) - -(5392.23) -
c) Deferred Tax 3982.68 (3656.98) 3982.68 1583.67
Total Tax (a+b) (1409.55) (3656.98) (1409.55) 1583.67
7 Net Profit/(Loss) After Tax (5-6) (3646.70) (21557.75) (26169.29) (111504.69)
Share of Loss transferred to Non-Controlling Interest - - (2830.05) (4921.29)
Profit/(Loss) after Tax after Non-Controlling Interest (3646.70) (21557.75) (23339.24) (106582.94)
Share of Profit or Loss from Associated Companies - - - -
Profit/(Loss) after Tax after Share of Minority
Interest & Associated Companies (3646.70) (21557.75) (23339.24) (106582.94)
8 Other Comprehensive Income (35.65) 71.00 (35.65) 204.36
Share of Other Comprehensive Income
transferred to Non-Controlling Interest - - - 0.01
9 Total Comprehensive Income (7+8) (3682.35) (21 486.75) (23374.90) (106378.57)
10 Paid up equity share capital (Face Value of Rs.1/- each) 737.95 737.95 737.95 737.95
11 Other Equity 55588.59 52604.48 (190160.04) (243839.86)
12 (i) Earning per share of Rs.1/- each (not annualized)
(a) Basic (4.94) (29.21) (31.63) (144.43)
(b) Diluted (4.94) (29.21) (31.63) (144.43)

2. Extract of Annual Return:

In accordance with Section 92(3) of the Companies Act 2013 and Rule 12(1) of theCompanies (Management and Administration) Rules 2021 the requirement of attachingextract of annual return in MGT 9 with the Board's report is done away with. The Annualreturn as reffered in section 134(3)(a) of the Act for the financial year ended 31stMarch 2021 is available on the website of the Company at www.madhucon.com/investor/AnnualReturn.

3. Indian Accounting Standards:

The Company has followed Indian Accounting Standards and accounting principlesgenerally accepted in India in preparation of financial statements for the financial year2020-21.

4. Reserves: [Section 134(3)(J)]:

Company has not transferred any amount to reserves due to the loss.

5. Dividend: [Section 134(3)(K)]

No dividend was declared on equity shares for the year ended 31.03.2021 due to Loss.

6. Board Meetings:

During the Financial Year under review the Board has 4 (Four) times i.e. on 30th July2020 14th September 2020 13th November 2020 and 12th February 2021 The details withrespect to Committee meetings and attendance there at as required under the SecretarialStandard-1 issued by the Institute of Company Secretaries of India have been provided inthe Corporate Governance Report forming part of this Annual Report.

7. Directors' Responsibility Statement:

Pursuant to the requirement under section 134(3) (c) of the Companies Act 2013 it ishereby confirmed: i. That in the preparation of annual accounts for the financial yearended 31st March 2021; the applicable Accounting Standards have been followed along withproper explanation relating to material departures. ii. That the Directors have selectedAccounting Policies and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company at the end of the financial year and of the profit or loss of the Company forthat period. iii. That the Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting frauds and other irregularities. iv. That the Directors have prepared the annualaccounts for the year ended 31st March 2021 on a “Going Concern” basis.

v That the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively. vi. That the directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems are adequate and operatingeffectively.

8. Adequacy of Internal Financial Control:

The Company has structured and implemented framework for Internal Financial Controls(“IFC”) in terms of the explanation to Section 134(5) (e) of the Companies Act2013. The Board of Directors of the Company is of the opinion that the Company has soundIFC for the year 2020-21.The Company is continuously monitoring and identified the gaps ifany and implements improved controls wherever the effect of such gaps would have amaterial effect on the Company's operations.

9. Declaration from Independent Directors on Annual Basis:

The Company has received Declarations of independence as stipulated under section149(7) of Companies act 2013 and regulation 25 of the listing regulations from Independentdirectors confirming that he /she is not disqualified from continuing as independentDirector the same annexed to this report as ANNEXURE-VI.

10. Nomination and Remuneration Policy:

The Nomination and Remuneration Committee has laid down the policy for Remuneration ofDirectors KMP & other Employees and the criteria has been formulated by the Committeefor determining qualifications positive attributes and independence of a Director. TheCompany's policy on Directors' appointment and remuneration and other matters provided inSection 178(3) of the Act has been disclosed in the Corporate Governance Report.

11. Share Capital:

The paid up share capital is Rs. 73794940/- of Rs.1/-each. There were no otherchanges that have been made in the share capital of the Company during the year underreview. The Details of Share Capital are mentioned at Notes-2.15 of the FinancialStatements.

12.Particulars of Loans Guarantees or Investments under Section 186 of the CompaniesAct 2013:

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

13. Related Party Transactions:

The transactions entered with the related parties by the Company for the year underreview with respect to rendering of services were on arm's length basis and in theordinary course of business. Hence Section 188(1) is not attracted to the Company. Thusdisclosure in Form AOC-2 is not applicable to the Company. There are no material relatedparty transactions during the year under review with the promoters Directors or KeyManagerial Personnel.

14. Management Discussion & Analysis Report:

The Company is a well-established Construction Company and a leading Contractor inexecuting projects in various sectors Transportation (National & State HighwaysRoads Railways & Ports Irrigation & Water Resources Buildings & PropertyDevelopment Mining (Coal & other Minerals) Energy (Generation Transmission &Distribution) and other Infrastructure Projects. Further information on the Company'sBusiness and the developments opportunities and outlook of the Company and the industryin which it operates are discussed in detail in the Management Discussion & Analysiswhich is enclosed in ANNEXURE I.

15. Material Changes and commitments affecting the financial position of the Company:

There are no material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year to which the financial statementsrelate and the date of this report.

16. Particulars regarding Energy Consumption Technology Absorption and ForeignExchange Earning and Outgo:

The particulars prescribed under Section 134 of the Companies Act 2013 read with Rule8 (3) of the Companies (Accounts) Rules 2014 relating to Conservation of EnergyTechnology Absorption Foreign Exchange Earnings and Outgo are furnished as ANNEXURE II tothis report.

17. Risk Management:

Periodic assessments to identify the risk areas are carried out and management isbriefed on the risks in advance to enable the Company to control risk through a properlydefined plan. The risks are taken into account while preparing the annual business planfor the year. The Board is also periodically informed of the business risks and theactions taken to manage them.

18. Corporate Social Responsibility (CSR) Policy:

Pursuant to the provisions of Section 135 and Schedule VII of the Companies Act 2013CSR Committee of the Board of Directors was formed to recommend; a) The policy onCorporate Social Responsibility (CSR) and b) Implementation of the CSR Projects orPrograms to be undertaken by the Company as per CSR Policy by the Board of Directors.

Annual Report on CSR in the prescribed format is enclosed in ANNEXURE III.

19.M/s Simhapuri Energy Limited - NCLT Matter:

State Bank of India (SBI) has filed a petition against SEL before National Company LawTribunal (NCLT) Hyderabad Bench Vide No. CP (IB) No. 13/7/HDB/2020 for initiation of CIRPand the same was admitted by appointing IRP and the process is in progress.

20. Formal Annual Evaluation:

In compliance with the Companies Act 2013 and Regulation 17(10) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the performance evaluation ofthe Board was carried out during the year under review.

21. Report on the Performance/Financial Position of the Subsidiaries /Associates/JointVentures Companies:

A separate statement containing the salient features of the financial statements of thesubsidiary Companies/ Associate Companies/Joint Ventures is prepared in Form AOC-1 as perthe provisions of Section 129 of the Companies Act 2013 read with Companies (Accounts)Rules 2014 as Amended and is attached to Financial Statements.

22. Consolidation of Accounts:

In compliance with Regulation 33 of the SEBI (LODR) Regulations 2015 and in compliancewith the provisions of the Companies Act 2013 and the Ind AS 28 Investments in Associatesand joint ventures and Ind AS 110 Consolidated Financial Statements Your Directors havepleasure in attaching the consolidated financial statements for the financial year endedMarch 31 2021 duly audited by the Statutory Auditors which forms part of the AnnualReport. The Annual Accounts of the Subsidiary Companies and the related information willbe made available to shareholders who may be interested in obtaining the same at anypoint of time as they have been kept for inspection by any shareholder at the RegisteredOffice of the Company and also at its Subsidiary Companies.

23. Details of Directors and Key Managerial Personnel appointed and resigned during theYear. a) Change in Key Managerial Personnel during the year:

1. Mr. K. Venkateswarlu was appointed as Chief Financial Officer of the Company w.e.f.01-07-2020.

2. Mrs. Rajani Kamatham had resigned as the Company Secretary of the Company w.e.f.30-08-2020.

3. Mr. M S Sivanand was appointed as Company Secretary of the Company w.e.f.07-10-2020.

b) Change in Directors during the year:

1. Mr. Madhu Malampati was appointed as Non-Independent and Non-Executive Director ofthe Company with effect from 01-04-2020.

2. Ratification for the Re-appointment of Sri. Mohammad Shafi (DIN: 07178265) as WholeTime Director of the Company.

3. Ratification for the Re-appointment of Sri Ramadas Kasaraneni (DIN: 02182093) as anIndependent Director and Chairman of the Company:

24. CEO and CFO Certification :

In accordance with the Regulation 17(8) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Managing Director & C.E.O. and Chief FinancialOfficer of the Company have submitted a certificate for the year ended 31st March 2021 tothe Board of Directors which forms part of the Annual Report.

25.Vigil Mechanism / Whistle Blower Policy:

The Company has established Vigil Mechanism for Directors / Employees to report theirgenuine concerns or grievances. The Audit Committee of the Company oversees the vigilMechanism through the Committee. It provides for adequate safeguards against victimizationof directors/ employees who avail of the mechanism. It also provides for direct access tothe Chairman of the Audit Committee. In case of repeated frivolous complaints thesuitable action will be initiated by the Chairman of the Audit Committee.

26. Disclosure under the Sexual Harassment of Women at Workplace (PreventionProhibition And Redressal) Act 2013:

The Company hmas in place an Anti-Sexual Harassment Policy in line with therequirements of The Sexual Harassment of Women at the Workplace (Prevention Prohibition& Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.

During the financial year 2020-21 the Company received no complaints on sexualharassment.

27. Significant and Material Orders passed by the Regulators or Courts or Tribunals:

There are no significant and material orders passed by the Regulators/ Courts/Tribunalsthat would impact the going concern status of the Company and its future operations.

28. Deposits:

The Company had not accepted or invited any Deposits and consequently no deposit hasmatured / become due for re payment as on 31st March 2021

29.Audit Committee:

Four meetings of the Audit Committee were held during the year. The details pertainingto composition of Audit Committee are included in the Corporate Governance Report

30 . Stakeholders' Relationship Committee:

The Committee focuses on shareholders' grievances and strengthening of investorrelations. The Committee coordinates the services of the Registrars and Share TransferAgent and recommends measures for providing efficient services to investors. The Committeespecifically looks into investor complaints like transfer/ transmission/transposition ofshares and other related issues. There were no complaints pending for redressal as at 31stMarch 2021. The details pertaining to composition of Stakeholders Relationship Committeeare given in the Corporate Governance Report.

31.Statutory Auditors and their Report:

P. Murali & Co. Chartered Accountants (FRN 007257S) were reappointed as StatutoryAuditors of the Company for the Financial Year 2020-21. M/s. P. Murali & Co.Chartered Accountants (FRN 007257S) expressed their willingness to be reappointed for thefinancial year 2021-22 and to hold the office up to the conclusion of the next AnnualGeneral meeting if they are reappointed at this Annual General Meeting. They havefurnished a certificate to the effect that their proposed appointment if made will be inaccordance with the limits specified under 141(1) (g) of the Companies Act 2013.

32. Cost Auditors:

The Board of Directors on recommendation of Audit Committee re-appointed BVR &Associates Cost Accountants (Registration No. 000453) as the Cost Auditors of the Companyto conduct audit of cost records made and maintained by the Company pertaining to WorksContracts Construction of Roads etc. for financial year commencing on 1st April 2020and ending on 31st March 2021.

33.Internal Auditors:

Mr. J Ramakrishna Raju acting as Internal Auditor for the Company and have submittedquarterly reports for the financial year 2020-21 to the Board and there are no materialadverse comments.

34.Secretarial Auditors and Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s Venkata Krishna& Associates Company Secretaries (ACS 53083 and CP No.19542) has been appointed asSecretarial Auditors of the Company for the financial year 2020-21 to carry out theSecretarial Audit and issue report thereon. Secretarial Audit report as issued by M/sVenkata Krishna & Associates Company Secretaries is annexed to this Report asANNEXURE IV.

35. Listing With Stock Exchanges:

The Company's securities have been listed with Bombay Stock Exchange (BSE) NationalStock Exchange (NSE) and Luxembourg Stock Exchange. Listing fee has been paid to BSE andNSE within the prescribed time limit as set in Regulation 14 of Listing Regulations forthe Financial Year 2020-2021.

36. Particulars Of Employees:

The Company has not employed any individual whose remuneration falls within the purviewof the limits prescribed under the provisions of Section 197 of the Companies Act 2013read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

The ratio of the remuneration of each Director to the median employee's remunerationand other details in terms of Section 197(12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are enclosed in ANNEXURE V and forms part of this Report.

37.Depository mSystem :

As the Members are aware your Company's shares are tradable compulsorily in electronicform and your Company has established connectivity with Central Depository Services(India) Limited (CDSL) & National Securities Depository Limited (NSDL). In view of thenumerous advantages offered by the depository system the members are requested to availthe facility of Dematerialization of the Company's shares on CDSL or NSDL. The ISINallotted to the Company's Equity shares is INE 378D01032 38.Prevention of Insider Trading:

Your Company has in place code of conduct to regulate monitor and report trading bydesignated persons and code of practices and procedures for fair disclosure of unpublishedprice sensitive information which is in adherence to the SEBI (Prohibition of insidertrading) Amendment Regulations 2018. The disclosures received pursuant to this code andthe Regulations are disseminated to the Stock Exchanges within prescribed time limit. TheReport of compliance officer was placed before the Board. The code is available at thecompany's website at the following link www.madhucon.com. All the Board Members and thedesignated employees have confirmed the compliance with the Code

39.Corporate Governance and Shareholders Information: As per SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 a Report on Corporate Governance formingpart of this Report together with the Auditors' Certificate regarding the compliance ofthe conditions of Corporate Governance is given in a separate section in the Annual Reportas

Annexure-VI. 40. Appreciations:

The Directors wish to express their appreciation for the assistance and continuedco-operation received from the Central and State Governments Banks FinancialInstitutions JV partners clients consultants subcontractors Customers Suppliers andalso the Directors wish to thank all the employees for their dedicated contributionsupport and continued cooperation throughout the year at all levels.

For and on behalf of the Board of Madhucon Projects Limited
(N. Seethaiah) (Mohammad Shafi)
Managing Director Whole-time Director
DIN: 00784491 DIN: 07178265
Place : Hyderabad
Date : 13-08-2021

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