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Man Infraconstruction Ltd.
|BSE: 533169||Sector: Infrastructure|
|NSE: MANINFRA||ISIN Code: INE949H01023|
|BSE 15:34 | 17 Dec||38.55||
|NSE 15:31 | 17 Dec||38.70||
|Mkt Cap.(Rs cr)||954|
|Mkt Cap.(Rs cr)||954.11|
Man Infraconstruction Ltd. (MANINFRA) - Director Report
Company director report
Your Directors have pleasure in presenting Sixteenth Annual Report on the operations ofthe Company together with the Audited Financial Statements for the financial year ended 31stMarch 2018.
1. FINANCIAL STATEMENTS & RESULTS:
a. FINANCIAL RESULTS:
The Company's performance for the year ended 31st March 2018 as compared tothe previous financial year is summarized below:
The financial statements for the year ended 31st March 2018 have beenprepared in accordance with ind AS (indian Accounting Standards).
The Company's business is mix of Engineering Procurement and Construction (EpC) &asset ownership/ Real Estate. Various development/re-development projects are also beingexecuted by Company and its subsidiaries/associates in mumbai.
c. OPERATING PERFORMANCE ONGOING PROJECTS & STATE OF AFFAIRS:
Despite the challenging environment of the global as well as the indian economy theCompany has performed exceptionally well and the performance highlights are as under:
The Company achieved a turnover (net of VAT) of ' 19286.71 Lakhs (on consolidatedbasis ' 65160.19 Lakhs) during the year as against previous year's turnover (net of Vat)of ' 15839.47 Lakhs (on consolidated basis ' 45171.46 Lakhs) showing increase by 21.76%(on consolidated basis 44.25%) and has earned a Profit after Tax (PAT) of ' 7367.04 Lakhs(on consolidated basis ' 6652.58 Lakhs) as against previous year's Profit of ' 5962.15Lakhs (on consolidated basis ' 5301.13 Lakhs) showing increase by 23.56% (on consolidatedbasis 25.49%).
d. REPORT ON PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES:
A report on the performance and financial position of each of the subsidiariesassociates and joint venture entities for the financial year ended 31st march2018 as per the Companies Act 2013 is provided as Annexure A to the consolidatedfinancial statement and hence not repeated here for the sake of brevity. The Policy fordetermining material subsidiaries as approved may be accessed on the Company's website atthe link:
Additional information on subsidiaries/Associates / Joint venture Companies:
Man Vastucon LLP ('Man Vastucon'): man Vastucon is engaged in the business of realEstate. man Vastucon is undertaking a mega real estate development project at mahajanwadiwithin the jurisdiction of mira Bhayandar Municipal Corporation. The Company holds 99.99%stake in man Vastucon.
Atmosphere Realty Private Limited ('ARPL'): ARPL is engaged into the business of RealEstate. The construction work of its real estate project namely 'Atmosphere' in mulund(W) mumbai is in full swing and Phase i is nearing Completion. ARPL has received goodresponse to the Project. The Company holds 17.50% stake in ARPL.
Man Aaradhya Infraconstruction LLP ('Man Aaradhya'): man
Aaradhya is engaged into the business of Real Estate. The Company has completed theconstruction of new buildings in Ghatkopar West mumbai and has received good response.The Company holds 98.00% stake in Man Aaradhya.
Manmantra Infracon LLP ('Manmantra'): manmantra is engaged in the business of realestate development and has completed a residential project namely "AaradhyaSignature" at Sion (W) Mumbai. The Company holds 60.00% stake in manmantra.
MICL Realty LLP ('MICL Realty'): MICL Realty LLP is engaged into the business of RealEstate and is undertaking redevelopment project(s) at Ghatkopar (E) Mumbai. The Companyhas commenced the construction of new buildings. The Company holds 46.00% stake in MICLRealty.
MICL Developers LLP ('MICL Developers'): MICL Developers LLP is engaged into thebusiness of Real Estate and is undertaking redevelopment project(s) at Vikhroli mumbai.The Company holds 99.99% stake in MICL Developers.
Man Projects Limited ('MPL'): MPL is engaged into the business of providing CivilConstruction Services. The Company holds 51% stake in Man Projects Limited. MPL isefficiently executing work for development of the fourth container terminal at JawaharlalNehru Port (JNPT) Mumbai india for Bharat Mumbai Container terminal private Limited asper order received.
Manaj Tollway Private Limited ('MTPL'): MTpL was executing a 41 km road project beingfour lanning of Hadapsar Saswad Belsar Phata Road project at S.H. 64 Taluka PurandarDistrict pune and such other additional or incidental works on 'Design - Build - Finance -Operate - Transfer' (DBFOT) basis for 'Public Works Department' (PWD) Government ofMaharashtra. in March 2015 MTPL has submitted a Termination Notice to PWD on account offailure of PWD to acquire and hand over land for road construction and unresolved matterson forest clearance and has stopped the work. MTPL has claimed costs incurred andcompensation in line with the terms and conditions of the Concession Agreement from PWD.MTPL had filed arbitration petition before the Arbitral Tribunal and the Honourable HighCourt has appointed a Sole Arbitrator. The arbitration process is in progress. MTPL hasbeen legally advised that it has a strong case on merits to recover such claims.
Man Realtors and Holdings Private Limited (MRHPL): During the financial year underreview the Company transferred 805616 Equity Shares comprising of 18.75% voting rightsof MRHPL resulting to reduction in its shareholding to 66%. MRHPL is engaged in businessof real estate and is undertaking a redevelopment project(s) at Naidu Colony Ghatkopar(E) Mumbai.
During the year under review Man Chandak Realty LLP was incorporated to undertake RealEstate business. The Company holds 50% stake in the said LLP.
The Board in its Meeting held on 29th May 2017 declared an interim Dividend' 0.54 per share (i.e. 27 %) on the Equity Shares of ' 2/-which was paid to the entitledShareholders on 16th June 2017. The dividend payout including dividenddistribution tax was ' 1452.85 Lakhs. The Company's dividend policy is based on the needto balance the twin objectives of appropriately rewarding the shareholders with dividendand conserving the resources to meet the Company's growth.
e. TRANSFER OF UNPAID/ UNCLAIMED DIVIDEND AND EQUITY SHARES TO IEPF:
in terms of the provisions of i nvestor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2016 / investor Education and Protection Fund(Awareness and Protection of investors) Rules 2001 ' 0.66 Lakhs of unpaid/
unclaimed dividends and 1994 equity shares on which dividend for seven consecutiveyears was unpaid/ unclaimed; were transferred during the year to the investor Educationand Protection Fund.
f. CONSOLIDATED FINANCIAL STATEMENTS:
in accordance with the provisions of Section 129(3) of the Companies Act 2013 andRegulation 34 of the Listing Regulations the Consolidated Financial Statements forms partof this Annual Report and shall also be laid before the ensuing Annual General Meeting ofthe Company. The Consolidated Financial Statements have been prepared in accordance withthe indian Accounting Standards (ind AS) notified under Section 133 of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014.
g. REVISION OF FINANCIAL STATEMENT:
There was no revision of the financial statements for the year under review.
h. TRANSFER TO RESERVES:
The Board hasn't recommended any amount to be transferred to the reserves for thefinancial year under review.
i. DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT 2013:
No material changes and commitments which could affect the Company's financial positionhave occurred between the end of the financial year of the Company and date of thisreport.
j. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate. During the year under review no material orserious observation has been received from the internal Auditors of the Company forinefficiency or inadequacy of such controls.
k. PARTICULAR OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES:
All Related Party Transactions entered by the Company during the financial year were inthe ordinary course of business and on an arm's length basis. The details of materialrelated party transactions i.e. transactions exceeding 10% of the annual consolidatedturnover as per the last audited financial statements are furnished in Annexure I andforms part of this Report. Further details of related party transactions entered by theCompany as required under Ind AS 24 are available in notes to the standalone financialstatements section of the Annual Report and forms part of this Report. in addition to thesame the related party transaction(s) entered into by the Company in ordinary course ofbusiness is with respect to
purchase of ready mix concrete of ' 193.92 lakhs from Nuvoco Vistas Corporation Limited(formerly known as Lafarge (india) Limited and proposed purchase of residential flat inTrump Tower Mumbai for ' 1450.00 Lakhs from Lodha Developers Limited; wherein Mr. BerjisDesai is Director.
As per the requirement under the Securities and Exchange Board of india (Listingobligations and Disclosure Requirements) Regulations 2015 ("SEBI Regulations")approval of the Audit Committee was received for all the Related party transactions. Asper the Regulation 23(8) of the SEBI regulations the Company has sought approval ofshareholders for passing necessary resolution through postal ballot the results of whichhave been declared on 20th September 2017. The Policy on dealing with RelatedParty transactions may be accessed on the Company's website at the link:
1. PARTICULARS OF LOANS GUARANTEES INVESTMENTS AND SECURITIES:
particulars of loans given investments made guarantees given and securities providedas covered under the provisions of Section 186 of the Companies act 2013 have beendisclosed in the notes to the standalone financial statements forming part of the annualreport. (please refer to 2.02 and 2.04 to the standalone financial statement).
2. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL:
a. BOARD OF DIRECTORS:
The constitution of the Board of Directors is in accordance with Section 149 of theCompanies act 2013 and regulation 17 of the Listing regulations. During the year underreview no changes occurred in the composition of the Board of Directors of the Company.
pursuant to the provisions of Section 152 of the Companies act 2013 Mc parag K. Shah(DiN: 00063058) is liable to retire by rotation at the ensuing annual General meeting ofthe Company and being eligible has offered himself for re-appointment.
necessary resolution for his re-appointment is included in the notice of 16thAGM for seeking approval of Members. The Directors recommend his re-appointment for yourapproval.
a brief resume and particulars relating to him is given separately as an annexure tothe AGM notice.
b. DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
The Company has received and taken on record the declarations received from theindependent Directors of
the Company in accordance with the Section 149(6) of the Companies Act 2013 confirmingtheir independence and pursuant to regulation 25 of the Listing regulations.
3. DISCLOSURES RELATED TO BOARD COMMITTEES AND
a. BOARD MEETINGS:
The Board of Directors met four times during the financial year under review. Thedetails of the Board meetings and the attendance of Directors thereat are provided in theCorporate Governance report forming part of the Annual report.
Additionally a separate meeting of independent Directors was held on 29thmay 2017 in compliance with the requirements of Schedule IV of the Companies Act 2013 andthe provisions of SEBI (Listing obligations and Disclosure Requirements) Regulations2015.
b. DIRECTOR'S RESPONSIBILITY STATEMENT:
in terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the Company for the year ended 31st march 2018 theBoard of Directors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation and there was no material departures;
b. such accounting policies have been selected and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at 31st march2018 and of the profit of the Company for that year;
c. proper and sufficient care was 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;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
c. AUDIT COMMITTEE:
The Audit Committee constituted by the Board of Directors of the Company in accordancewith the provisions of Section 177 of the Companies Act 2013 read with Regulation 18 ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirement)regulation 2015 comprises of:
The Members of the Audit Committee are financially literate and have requisiteaccounting and financial management expertise. The terms of reference of the auditCommittee and the particulars of meetings held and attendance thereat are mentioned in theCorporate Governance report forming part of the annual report.
d. NOMINATION AND REMUNERATION COMMITTEE:
The composition of the Nomination and Remuneration Committee is in conformity with theprovisions of the Section 178 of the Companies act 2013 and pursuant to Regulation 19 ofthe Listing Regulations. The Nomination and remuneration Committee comprises:
The terms of reference of the Nomination and remuneration Committee and the particularsof meetings held and attendance thereat are mentioned in the Corporate Governance reportforming part of the annual report.
The Company has Nomination and Remuneration policy which provides the criteria fordetermining qualifications positive attributes independence of a Director and policyrelating to remuneration for Directors Key Managerialpersonnel and other employees inaccordance with the provisions of Section 178 of the Companies act 2013. The Nominationand Remuneration Policy of the Company is hosted on the Company's Website at:
e. STAKEHOLDERS RELATIONSHIP COMMITTEE:
During the year under review Stakeholder's relationship Committee is duly constitutedcomprising of Mr. Berjis Desai as its Chairman Mr. Parag Shah and Mr. Suketu Shah as theCommittee Members respectively. The Company Secretary acts as the Secretary of theStakeholders' Relationship Committee. The terms of reference of the Stakeholders'relationship Committee and the particulars of meetings held and attendance thereat arementioned in the Corporate Governance report forming part of the annual report.
f. VIGIL MECHANISM POLICY:
The Board of Directors of the Company has pursuant to the provisions of Section 177(9)of the Companies act 2013 read with rule 7 of the Companies (Meetings of Board and itsPowers) rules 2014 established Vigil Mechanism Policy-Whistle Blower Policy for Directorsand employees of the Company to provide a mechanism which ensures adequate safeguards toemployees and Directors from any victimization on raising of concerns of any violations oflegal or regulatory requirements incorrect or misrepresentation of any financialstatements and/or reports etc.
The employees of the Company have the right to report their concern or grievance to theChairman of the audit Committee. The Company is committed to adhere to the higheststandards of ethical moral and legal conduct of business operations. The Whistle BlowerPolicy is hosted on the Company's website at:
g. RISK MANAGEMENT POLICY:
risks are events situations or circumstances which may lead to negative consequenceson the Company's businesses. risk management is a structured approach to manageuncertainty. The Board has adopted a Risk Management Policy for all its business divisionsand corporate functions and the same have embraced in the decision making to ease the riskinvolved. Key business risks and their mitigation are considered in day-to-day working ofthe Company and also in the annual/strategic business plans and management reviews.
h. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
The Corporate Social Responsibility Committee (CSR Committee) is duly constitutedcomprising Mr. Berjis Desai as the Chairman Mr. Parag Shah and Mr. Dharmesh Shah as othermembers. The said Committee has been entrusted with the responsibility of formulating andrecommending to the Board Corporate Social responsibility policy (CSR policy) indicatingthe activities to be undertaken by the Company monitoring the implementation of theframework of the CSR policy and recommending the amount to be spent on CSR activities. Thedetails in regards to CSR activities have been prescribed in Annexure II.
The CSR policy of the Company is available on the Company's web-site and can beaccessed in the link provided herein below:
i. ANNUAL EVALUATION OF DIRECTORS COMMITTEE AND BOARD:
Nomination and remuneration Committee of the Board has formulated a performanceEvaluation Framework under which evaluation of the performance of Board as a whole itscommittees and the individual directors was carried out. The Independent Directors attheir meeting considered and evaluated the performance of Board and non-independentDirectors. The Board subsequently evaluated performance of the Board the Committees andIndependent Directors; without participation of the concerned Director. The Nomination andRemuneration Committee has approved the policy relating to evaluation of every director'sperformance. Accordingly evaluation of all directors was carried out.
j. DETAILS WITH RESPECT TO THE PROGRAMME FOR FAMILIARISATION OF INDEPENDENT DIRECTORS:
The familiarization programme aims to provide independent Directors with the industryscenario the socio-economic environment in which the Company operates the businessmodel the operational and financial performance of the Company significant developmentsso as to enable them to take wel l informed decisions in a timely manner. Thefamiliarization programme also seeks to update the Directors on the rolesresponsibilities rights and duties under the Act and other statutes.
The details of programme for familiarisation of independent Directors are put up on thewebsite of the Company at the link:
k. INTERNAL CONTROL SYSTEMS:
Adequate internal control systems commensurate with the nature of the Company'sbusiness and size and complexity of its operations are in place has been operatingsatisfactorily. internal control systems comprising of policies and procedures aredesigned to ensure reliability of financial reporting timely feedback on achievement ofoperational and strategic goals compliance with policies procedure applicable laws andregulations and that all assets and resources are acquired economically used efficientlyand adequately protected.
l. PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197(12) of the Act read with Rule 5 of theCompanies (Appointment and Remuneration of Managerial personnel) Rules 2014 ('the Rules')in respect of employees of the Company is annexed and marked as Annexure III to thisReport .
pursuant to the provisions of Section 136(1) of the Act the financial statements arebeing sent to the Members and others entitled thereto excluding the information onemployees' particulars specified under Rule 5(2) & (3) of the Rules. The same areavailable on the website of the Company viz. www.maninfra.comand for inspection by the Members at the Registered Office of the Company during businesshours on working days of the Company up to the date of the ensuing Annual General Meeting.Any Member interested in obtaining a copy thereof may write to the Company Secretary.
m. CODE OF CONDUCT:
pursuant to SEBi Regulation the declaration signed by the Managing Director affirmingthe compliance of Code of Conduct by the Directors and senior management personnel for theyear under review is annexed to and forms part of the Corporate Governance Report.
n. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report for the year under review as requiredpursuant to the provisions of Schedule V of the SEBI Regulations; forms part of thisAnnual Report.
4. AUDITORS AND REPORTS:
The matters related to Auditors and their Reports are as
a. OBSERVATIONS OF STATUTORY AUDITORS ON ACCOUNTS FOR THE YEAR ENDED 31stMARCH 2018:
The auditor's report for the financial year ended 31st March 2018 does notcontain any qualification reservation or
adverse remark and therefore do not call for any further explanation or comments fromthe Board under Section 134(3) of the Companies Act 2013.
b. FRAUD REPORTING:
During the year under review there were no instances of fraud falling within thepurview of Section 143 (12) of the Companies act 2013 and rules made thereunder byofficers or employees reported by the Statutory Auditors of the Company during the courseof the audit conducted.
c. SECRETARIAL AUDIT REPORT FOR THE YEAR ENDED 31st MARCH 2018:
provisions of Section 204 read with Section 134(3) of the Companies act 2013 mandatesto obtain Secretarial audit Report from practicing Company Secretary. M/s. Rathi andassociates Company Secretaries had been appointed to undertake the Secretarial audit andissue Secretarial Audit Report for the financial year 201718. Secretarial audit reportissued by M/s. Rathi and associates Company Secretaries in Form Mr-3 for the financialyear 2017-18 forms part of this report. The said report does not contain any observationor qualification requiring explanation or comments from the Board under Section 134(3) ofthe Companies act 2013.
d. STATUTORY AUDITORS:
pursuant to provisions of Section 139 of the Companies act 2013 the shareholders ofthe Company at the 15th annual General meeting appointed M/s. Nayan parikh& Co. Chartered accountants as Statutory auditors for a period of Five years subjectto ratification by Shareholders at each AGM.
As per Section 40 of the Companies (amendment) act 2017 read with amendment to theCompanies (audit and Auditors) Rules 2014 as notified on 7th May 2018 thefirst proviso of Sub Section 1 of Section 139 with respect to Ratification of Appointmentof Auditor at each Annual General Meeting has been omitted. The Company has received theireligibility letter to act as Statutory auditors of the Company pursuant to the provisionsof 139 of the Companies act 2013.
e. COST AUDITORS:
pursuant to the provisions of Section 148 of the Companies Act 2013 read withNotifications/Circulars issued by the Ministry of Corporate affairs from time to time asper the recommendation of the audit Committee the Board of Directors at their meetingdated 29th May 2017 appointed M/s. Shekhar Joshi & Co. (firm Registrationnumber 100448) Cost accountants as the Cost Auditors of the Company for the financialyear
2017-18. The Cost Audit Report for FY 2017-18 will be filed within the prescribedperiod under the Companies act 2013.
in respect of FY 2018-19 the Board based on the recommendation of the audit Committeehas approved the appointment of M/s. Shekhar Joshi & Co. (firm Registration number100448) Cost accountants as the cost auditors of the Company. A resolution forratification of the remuneration to be paid for such appointment is included in the noticeof the ensuing annual General Meeting.
f. INTERNAL AUDIT AND CONTROL:
M/s. aneja associates Chartered accountants internal auditors of the Company havecarried out audit as per scope of work finalized with the Audit Committee. The findings ofthe Internal Auditors are discussed on an ongoing basis in the meetings of the auditCommittee and corrective actions are taken as per the directions of the audit Committee.
5. OTHER DISCLOSURES:
other disclosures as per provisions of Section 134 of the act read with Companies(accounts) Rules 2014 are furnished as under:
a. EXTRACT OF ANNUAL RETURN:
pursuant to the provisions of Section 134(3)(a) of the Companies act 2013 Extract ofthe annual Return for the financial year ended 31st March 2018 made under theprovisions of Section 92(3) of the act is attached as Annexure IV which forms part of thisReport.
b. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
The particulars as required under the provisions of Section 134(3)(m) of the Companiesact 2013 read with Rule 8 of the Companies (accounts) Rules 2014 in respect ofconservation of energy technology absorption foreign exchange earnings and outgo etc.are furnished in Annexure V which forms part of this Report.
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the act.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.
4. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (prevention prohibition andredressal) Act 2013.
Your Board wishes to thank all the shareholders for the confidence and trust they havereposed in the Company. Your Board similarly expresses gratitude for the co-operationextended by the banks financial institutions government authorities and otherstakeholders. Your Board acknowledges with appreciation the invaluable support providedby the Company's auditors business partners and investors.
Your Board records with sincere appreciation the valuable contribution made byemployees at all levels and looks forward to their continued commitment to achieve furthergrowth and take up more challenges that the Company has set for the future.