MEP Infrastructure Developers Ltd.
|BSE: 539126||Sector: Infrastructure|
|NSE: MEP||ISIN Code: INE776I01010|
|BSE 00:00 | 05 Mar||17.60||
|NSE 00:00 | 05 Mar||17.60||
|Mkt Cap.(Rs cr)||323|
|Mkt Cap.(Rs cr)||322.87|
MEP Infrastructure Developers Ltd. (MEP) - Director Report
Company director report
Your Directors present their Seventeenth Annual Report together withAudited Financial Statements of your Company for the Financial Year ended 31stMarch 2019.
* The Board has recommended payment of Dividend of ` 0.30 per equityshare of ` 10/- each on 183446051 equity shares.
PERFORMANCE OF THE COMPANY
On standalone basis revenue from operations and other income forthe financial year under review were ` 188229.67 Lakhs as against ` 149088.00 Lakhsfor the previous financial year registering an increase of ` 39141.67 Lakhs mainly due torevenue from Delhi Entry Point project. The profit before tax was ` 4697.23 Lakhs and theprofit after tax was ` 3007.64 Lakhs for the financial year under review as against `6383.60 Lakhs and ` 4016.29 Lakhs respectively for the previous financial year.
On consolidated basis revenue from operations and other income forthe financial year under review were ` 293682.42 Lakhs as against ` 244236.82 Lakhsfor the previous financial year registering increase of ` 49445.60 Lakhs. Theprofit before tax was ` 9236.74 Lakhs and the profit after tax was ` 5334.44Lakhs for the financial year under review as against ` 10455.92 Lakhs and `6625.36 Lakhs respectively for the previous financial year.
Your Directors recommend payment of dividend @ 3% i.e. ` 0.30 perequity share on face value of ` 10/- each on 183446051 equity shares aggregating to `550 Lakhs (previous financial year: ` 550 Lakhs).
TRANSFER TO RESERVES
Your Directors do not propose to transfer any amount to Reserve.
During the year under review the Company had successfully raised
` 16179.57 Lakhs via issue of equity shares through QualifiedInstitutional Placement (QIP). Your Company has allotted 20876860 equity shares to thenew shareholders on 4th April 2018 and the trading on new shares wascommenced with effect from 6th April 2018. The Paid-up Equity ShareCapital accordingly as on 31st March 2019 was ` 1834460510/- (divided into183446051 equity shares of ` 10/- each.).
MATERIAL CHANGES AFFECTING THE COMPANY
There were no material changes and commitments affecting the financialposition of the Company between the end of the financial year and the date of the report.
OPERATIONS v HYBRID ANNUITY MODE (HAM) PROJECTS
During the year under review your Company has received the AppointedDate from the National Highways Authority of India for the 4 (Four) Projects underthe Hybrid Annuity Mode (HAM) as detailed below:
During the year under review and as on the date of this report yourCompany has achieved the following Projects Milestones:
Nagpur Ring Road-Package I [Four Laning standalone Ring
Road/Bypass (km. 0.5 km. 34.0) for Nagpur city].
The Authority has paid the second Milestone payment for 40% of thephysical progress for the project on 25th May 2018.
Nagpur Ring Road-Package II [Four Laning standalone Ring
Road/Bypass (km. 34.5 km. 62.035) for Nagpur city]. TheAuthority has paid the second Milestone payment for 40% of the physical progress for theproject on 19th July 2018.
Talaja Mahuva [Four Laning of Talaja Mahuva Section of NH8E (fromkm. 53.585 to km. 100.100) (design chainage from km. 54.990 to km.100.450) (Package II)].
The Authority has paid the first Milestone payment for 20% ofthe physical progress for the project on 5th October 2018.
v TOLLING PROJECTS
During the year under review and as on the date of this report yourCompany has successfully won the following tolling projects:
Collection of toll at Athur Toll Plaza at km. 103.500 on Tambaram toTindivanam Section from km. 74.500 to km. 121.000 of NH-45 in the State of Tamil Nadu fora period of 1 (One) year.
a Collection of user fee at Paranur Fee Plaza at km. 52.820 for thesection from km. 28.000 to km. 74.500 (Tambaram - Tindivanam Section) of NH45 in theState of Tamil Nadu for a period of 1 (One) year.
During the year under review your Company has successfully completed124 projects including 228 toll plazas and 1459 lanes across India.
Detailed information on the operations of the Company and details onthe state of affairs of the Company are covered in the Management Discussion and AnalysisReport.
Your Company has not accepted any deposits during the year.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis forms an integral part of thisreport and is presented separately. It gives details of the overall industry structureeconomic developments performance and state of affairs of your Company and theiradequacy risk management systems and other material developments during the FinancialYear 2018-19.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mrs. Sudha D. Mhaiskar (DIN: 00707501) who was appointed as anAdditional Director of the Company on 12th February 2018 was confirmed asDirector of the Company by the Members at the 16th Annual General Meeting("AGM") of the Company held on 2nd August 2018.
The Board of Directors at their Meeting held on 14thFebruary 2019 on the recommendation of Nomination & Remuneration Committee hasre-appointed Mr. Jayant D. Mhaiskar as the Managing Director designated as Chairman& Managing Director' of the Company with effect from 1st July 2019subject to approval of Members at the ensuing AGM. The suitable resolution seekingMembers' approval for the said re-appointment forms part of the Notice convening theensuing AGM.
Mrs. Anuya J. Mhaiskar is liable to retire by rotation at the ensuingAGM and being eligible offers herself for re-appointment. Your Board of Directorsrecommend her re-appointment. The Board of Directors at their meeting held on 14thFebruary 2019 had approved the appointment of Mr. Subodh R. Garud as Chief ExecutiveOfficer Toll Operations of the Company from immediate effect. All IndependentDirectors have given declarations that they meet the criteria of independence as laid downunder Section 149(6) of the Companies Act 2013 and Regulation 16(b) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
As required under clause (c) of sub-section (3) of Section 134 of theCompanies Act 2013 Directors to the best of their knowledge and belief state that(i) in the preparation of the annual accounts the applicable Accounting Standardshad been followed along with proper explanation relating to material departures;
(ii) the Directors had selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit for the year; (iii) the Directors had taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act 2013 for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities; (iv) the Directors had preparedthe annual accounts on concern basis; (v) the Directors had laid down internal financialcontrols to be followed by the Company and that such internal financial controls areadequate and were operating effectively; and (vi) the Directors had devised proper systemsto ensure compliance with the provisions of all applicable laws and that such systems wereadequate and operating effectively.
DISCLOSURE ON COMPLIANCE WITH SECRETARIAL STANDARDS
Your Directors confirm that the Secretarial Standards issued by theInstitute of Company Secretaries of India have been complied with.
INDIAN ACCOUNTING STANDARDS (IND AS) IFRS CONVERGED
The Company has prepared the Financial Statements (both Standalone andConsolidated) for the year ended 31st March 2019 as per Indian AccountingStandards (Ind AS') notified vide G.S.R. 111(E) dated 16thFebruary 2015 as amended from time to time.
PERFORMANCE EVALUATION OF THE DIRECTORS
Pursuant to the provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 as amended from timeto time the Board has carried out an annual performance evaluation of its own performanceas well as of its Committees thereof and of the Directors individually. The manner inwhich the evaluation has been carried out has been covered in the Corporate GovernanceReport.
The Board has on the recommendation of the Nomination and RemunerationCommittee framed a policy for selection appointment and remuneration of Directors andKMP. The Remuneration Policy is stated in the Corporate Governance Report.
EXTRACT OF ANNUAL RETURN
The extract of annual return as provided under sub-section (3) ofSection 92 of the Companies Act 2013 in the prescribed Form MGT-9 is annexed to thisReport.
NUMBER OF MEETINGS OF THE BOARD
There were 4 (Four) meetings of the Board held during the year.Detailed information is given in the Corporate Governance Report.
The Audit Committee comprises of 3 (Three) Independent Directors and anExecutive Director. Detailed information is given in the Corporate Governance Report. Allthe recommendations made by the Audit Committee were accepted by the Board.
a going CORPORATE GOVERNANCE
A separate section on Corporate Governance forms a part of our Report.A certificate has been received from the Secretarial Auditor of the Company regardingcompliance of requirements of Corporate Governance as stipulated under the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as amended from time to time.
AUDITORS v STATUTORY AUDITORS
Y our Company had appointed M/s. G. D. Apte & Co. CharteredAccountants (Firm Registration No. 100515W) as the Statutory Auditors of the Company atthe 15th Annual General Meeting (AGM') held on 27th July2017 to hold office for period of
The Ministry of Corporate Affairs vide their Notification 7thMay 2018 have done away with the provisions relating to the ratification of the Auditorsat every AGM. However considering the resolution passed at the 15th AGM yourCompany as a good governance recommended the ratification of the appointment of StatutoryAuditor at the 16th AGM and also obtained the consent of the Members that noratification for the appointment of the Statutory Auditors would be required from next AGMand they shall continue to hold office of Statutory Auditors till the conclusion of the 20thAGM of the Company. Accordingly your Company would not require to ratify the Appointmentof Statutory Auditors at the ensuing AGM.
There is no audit qualification reservation or adverse remark for theyear under review. However the Statutory Auditors have made an observation in Point No.vii (b) in Annexure B of their Independent Auditors Report reply for which is mentionedbelow: Our Company has generally been regular in depositing statutory dues. These amountshave subsequently been paid and the management has taken steps to avoid delay in future.
v COST AUDITORS
Your Company has been carrying out audit of cost records relating toroad maintenance activity every year in line with the provisions of Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) AmendmentRules 2014 as amended from time to time.
Your Board of Directors on the recommendation of the Audit Committeehas appointed M/s. Nawal Barde Devdhe Associates Cost Accountants (Firm Registration No.001711) as the Cost Auditors to audit the cost accounts of the Company for the FinancialYear 2019-20. As required under the Companies Act 2013 a resolution seekingmember's approval for ratification and consideration of the remuneration payable tothe Cost Auditor forms part of the Notice convening the AGM.
The Cost Audit Reports for the Financial Year ended 31stMarch 2018 were filed on 6th December 2018.
The Cost Audit Reports for the Financial Year ended 31stMarch 2019 are required to be submitted by the Cost Auditor to the Board ofDirectors on or before 29th September 2019 and same are required to befiled by the Company with the Central Government within 30 days from the receipt of thereports.
v SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Rules made thereunder the Company has appointed CS Dinesh Joshi KANJ & Co.LLP (Membership No. 3752) (Formerly KANJ & Associates) Company Secretaries inPractice to undertake the secretarial audit of the Company for the FinancialYear 2019-20. Secretarial Audit Report as issued by him in the prescribed Form MR-3is annexed to this Report. The said Secretarial Audit Report does not contain anyqualification reservation or adverse remark for the year under review.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
Pursuant to the requirements of Section 22 of the Sexual Harassment ofWomen at Workplace (Prevention Prohibition & Redressal) Act 2013 read with the Rulesthereunder the Company had formulated and adopted a Policy on Prevention of SexualHarassment at Workplace. The Company has not received any complaint of sexual harassmentduring the year under review.
RISK MANAGEMENT POLICY
Your Company has implemented mechanism to identify assess monitor andmitigate various risks and has formulated a Risk Management Policy. The Audit Committeeand the Board of Directors are informed of the Risk assessment and minimizationprocedures.
CORPORATE SOCIAL RESPONSIBILITY
Detailed information on Corporate Social Responsibility Policydeveloped and implemented by the Company on CSR initiatives taken during the year pursuantto Section 135 of the Companies Act 2013 as Report on CSR activities is annexed to thisReport.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Information regarding loans guarantees or investments as requiredunder the provisions of Section 186 of the Companies Act 2013 is not applicable to theCompany as the Company is exempted under the category of "the companies providinginfrastructure facilities".
RELATED PARTY TRANSACTIONS
All related party transactions during the year were on arm'slength basis and not in conflict with the interest of the Company. The particulars of thesaid transactions alongwith other contracts/arrangements are also briefed in theNote/Schedule 39 to the financial statement which sets out related party disclosures. AStatement containing particulars of contracts/arrangements entered into by the Companywith related parties referred to in sub-section (1) of Section 188 of the Companies Act2013 including certain arm's length transactions in prescribed form AOC-2 is annexed.The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed through the following portal link:http://www.mepinfra.com.
CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which isapplicable to the Members of the Board and specified employees in the course of day to daybusiness operations of the Company. The Company believes in "ZeroTolerance" against bribery corruption and unethical dealings/behavior in any formand the Board has laid down certain directives to counter such acts. Such code ofconduct has also been placed on the Company's website. The Code lays down thestandard procedure of business conduct which is expected to be followed by theDirectors and the designated employees in their business dealings and in particular onmatters relating to integrity in the work place in business practices and in dealing withstakeholders. The Code gives guidance through examples on the expected behavior from anemployee in a given situation and the reporting structure. All the Board Members and theSenior Management personnel have confirmed compliance with the Code. A declarationto this effect signed by the Chairman & Managing Director of the Company appearselsewhere in this Annual Report.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of employees of the Company is annexed. The information about Top TenEmployees in terms of remuneration will be available for inspection by the Members at theRegistered Office of the Company during business hours on working days of the Company upto the date of the ensuing AGM. If any Member is interested in obtaining a copy thereofsuch Member may write to the Company Secretary in this regard.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company has established a Vigil Mechanism Policy/Whistle BlowerPolicy to deal with instances of fraud and mismanagement if any. Staying true to our corevalues of Strength Performance and Passion and in line with our vision of beingone of the most respected companies in India the Company is committed to the highstandards of Corporate Governance and Stakeholders Responsibility. The said Policy ensuresthat strict confidentiality is maintained in respect of whistle blowers whilst dealingwith concerns and also specified that no discrimination will be meted out to any personfor a genuinely raised concern. The Policy on Vigil Mechanism/Whistle Blower Mechanism maybe accessed through website of the Company viz. http://www.mepinfra.com.
Following are the companies which are Subsidiary Companies of theCompany:
A statement containing salient features of the financial statement ofthe subsidiaries and associates in the prescribed Form AOC-1 is annexed to this Report.The audited financial statements of the said companies will be kept for inspection by anymember of the Company at its Registered Office of the Company during business hours and asper the provisions of Section 136(1) of the Companies Act 2013 a copy of the same willbe made available to any shareholder on request. A Cash Flow Statement for the year2018-19 is attached to the Balance Sheet.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
The Company primarily being an Infrastructure Company and not involvedin any industrial or manufacturing activities the Company has no particulars to reportregarding conservation of energy and technology absorption as required under Section 134of the Companies Act 2013 and the Rules made thereunder. During the year under reviewthe Company did not have any foreign exchange earnings whereas the foreign exchange outgoamounted to ` 95.72 Lakhs towards Business promotion Advertisement expenses Legalconsultancy and Professional fees.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
Your Company has an effective internal financial control andrisk-mitigation system which are constantly assessed and strengthened with new/revisedstandard operating procedure. The Company's internal financial control system iscommensurate with its size scale and complexities of its operations.
SIGNIFICANT AND MATERIAL ORDER PASSED BY REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND OPERATIONS OF THE COMPANY
During the year under review there were no significant or materialorders passed by any Regulator Court or Tribunal against the Company which could impactits going concern status or operations.
Statements in this Directors' Report and Management Discussion andAnalysis describing the Company's objectives projections estimates expectations orpredictions may be "forward-looking statements" within the meaning of applicablesecurities laws and regulations. Actual results could differ materially from thoseexpressed or implied. Important factors that could make difference to the Company'soperations include changes in the government regulations developments in theinfrastructure segment tax regimes and economic developments within India.
ACKNOWLEDGEMENT & APPRECIATION
Your Directors wish to place on record their sincere appreciation forthe contribution made by the employees at all levels for their hard work and support yourCompany's achievements would not have been possible without their efforts. YourDirectors also wish to thank all Shareholders Clients Government and RegulatoryAuthorities and Stock Exchanges Joint Bidding Partners Financial Authorities CustomersDealers Agents Suppliers Investors Lenders and Bankers for their continued support andfaith reposed in the Company. Your Directors also thank the Ministry of Corporate Affairsstakeholders advocates solicitors and business associates for their continuous support.