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NCC Ltd.

BSE: 500294 Sector: Infrastructure
NSE: NCC ISIN Code: INE868B01028
BSE 00:00 | 14 Feb 46.95 -0.95
(-1.98%)
OPEN

48.10

HIGH

48.65

LOW

46.45

NSE 00:00 | 14 Feb 46.95 -0.95
(-1.98%)
OPEN

48.10

HIGH

48.70

LOW

46.40

OPEN 48.10
PREVIOUS CLOSE 47.90
VOLUME 699337
52-Week high 119.15
52-Week low 46.15
P/E 5.88
Mkt Cap.(Rs cr) 2,863
Buy Price 46.50
Buy Qty 200.00
Sell Price 46.95
Sell Qty 1700.00
OPEN 48.10
CLOSE 47.90
VOLUME 699337
52-Week high 119.15
52-Week low 46.15
P/E 5.88
Mkt Cap.(Rs cr) 2,863
Buy Price 46.50
Buy Qty 200.00
Sell Price 46.95
Sell Qty 1700.00

NCC Ltd. (NCC) - Director Report

Company director report

To the Members

Your Directors take pleasure in presenting the 28th Annual Report togetherwith the Audited Statement of Accounts for the Financial Year ended March 31 2018.

Standalone Financial Results

` in Million

2017-18 2016-17
Revenue from Operations 75593.23 78920.73
Other Income 1158.33 1400.76
Total Income 76751.56 80321.49
Profit before Interest Depreciation 9707.16 8252.52
Exceptional Items and Tax
Less: Finance Costs 3789.40 3956.99
Profit before Depreciation Exceptional 5917.76 4295.53
Items and Tax
Less: Depreciation and Amortisation 1174.71 1120.63
Expenses
Profit before exceptional item & tax 4743.05 3174.90
Exceptional item (1065.64) (503.37)
Profit before tax 3677.41 2671.53
Provision for Tax(Including earlier Year 809.37 416.52
Taxation)
Profit after Tax 2868.04 2255.01
Other comprehensive income / (loss) (19.70) (38.85)
for the year
Total comprehensive income for the 2848.34 2216.16
year
Retained earnings- Opening Balance 4103.64 2250.09
Add: Profit for the Year 2868.04 2255.01
Less: Dividend paid during the year 267.65 401.46
(Including Dividend Tax)
Retained earnings - Closing Balance 6704.03 4103.64
Paid up Capital 1201.29 1111.86

Operational performance A. Standalone

You will note that your Company posted a turnover of ` 76751.56 million for the yearended 31st March 2018 as against ` 80321.49 million in FY-2016-17 and earned a PBIDT of `9707.16million for the F.Y 2017-18 as against ` 8252.52 million for the F.Y 2016-17. Afterdeducting financial charges of ` 3789.40 million providing a sum of

` 1174.71 million towards depreciation ` 809.37 million for income tax and afterexceptional items of ` 1065.64 million the operations resulted in a net profit of `2868.04 million as against ` 2255.01 million in FY-2016-17.

B. Consolidated

During the year under review your Company achieved a consolidated turnover of `84919.98 million as against ` 92044.73 million in the previous fiscal. Your Company hasearned a PBIDT of ` 9807.49 million as against ` 8736.21 million in the previous year. Theoperations resulted in a net profit attributable to the shareholders of the Company of `1686.34 million as against ` 316.84 million in the previous year. During the year theCompany on consolidated basis bagged new orders valued around ` 238750.00 million (netof GST) and the order Book of the company as on March 31 2018 stood at ` 325320.00million.

QIP ISSUE

The QIP Issue made by the Company in January 2018 received very good response from theInstitutional Investors and the Company had successfully raised an amount of ` 5500million. Post the QIP Issue the Paid-Up Capital of the Company had increased from `1111.86 million to ` 1201.29 million.

Proposed Dividend

Your Board takes pleasure in recommending Dividend of ` 1/- per Equity Share of ` 2/-each (50%) as against ` 0.40 (20%) per Equity Share in the Previous Year for theconsideration and approval of the members of the Company at the forthcoming Annual GeneralMeeting.

Transfer to Reserves

The Directors have decided to retain the entire amount of ` 6704.03 million in theretained earnings.

Management Discussion and Analysis

Business Overview and Outlook and the state of the affairs of the Company and theIndustry in which it operates is discussed in detail in the section relating toManagement Discussion & Analysis.

Change in nature of business:

There is no change in the nature of business carried on by the Company during the yearunder review.

Material Changes and Commitments affecting the financial position of the Company

There are no Material Changes and Commitments affecting the financial position of theCompany which occurred between the end of the financial year to which the financialstatements relate and the date of this Report.

Particulars of Contracts or Arrangements with Related Parties

All related party transactions entered during the financial year were in the ordinarycourse of the business of the Company and were on an arm's length basis. There were nomaterially significant related party transactions entered by the Company during the yearwith the Promoters Directors Key Managerial Personnel or other persons which may have apotential conflict with the interest of the Company. The policy on Related PartyTransactions as approved by the Audit Committee and the Board of Directors is hosted onthe website of the Company and the link for the same is (http:// ncclimited.com/Policies.html).

Since all related party transactions entered into by the Company were in the ordinarycourse of business and were on an arm's length basis the requirement of furnishing therequisite details in Form AOC-2 is not applicable to the Company.

Directors' responsibility statement

Pursuant to the provisions of Section 134(5) of the Companies Act 2013 your Directorsto the best of their knowledge and ability confirm as under: (a) In the preparation of theannual accounts the applicable accounting standards had been followed along with properexplanation relating to material departures; (b) We have selected such accounting policiesand applied them consistently and made judgments and estimates that are reasonable andprudent so as to give a true and fair view of the state of affairs of the Company at theend of the financial year and of the profit of the Company for that period; (c) We havetaken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguarding the assets of the Company andfor preventing and detecting fraud and other irregularities; (d) The annual accounts havebeen prepared on a going concern basis; and (e) The Company had laid down internalfinancial controls to be followed by the Company and that such internal financial controlsare adequate and were operating effectively.

(f) We have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively

Subsidiary Companies/ Joint venture Companies / Associate Companies:

The Company has 51 subsidiaries (including step down subsidiaries) as of March 312018. There was no material change in the nature of the business carried on by thesubsidiaries. During the year under review the Company has floated a new subsidiary viz.Talaipalli Coal Mining Private Ltd under a Joint Venture with another Company. As per theprovisions of Section 129 of the Companies Act 2013 read with the Companies (Accounts)Rules 2014 a separate statement containing the salient features of the financialstatements of the subsidiary Companies/ Associate Companies/Joint Ventures is prepared inForm AOC-1 and is attached to the Financial Statements of the Company.

In accordance with the provisions of the Companies Act 2013 and the Rules framedthereunder the Balance Sheet Statement of Profit and Loss and other documents of thesubsidiary companies are being made available on the website of the Company and are notattached with the Annual Accounts of the Company. The Company will make available theAnnual Accounts of the subsidiary companies and the related information to any member ofthe Company who may be interested in obtaining the same. The annual accounts of thesubsidiary companies will also be kept open for inspection by any member at the Registeredoffice of the Company and that of the respective subsidiary companies.

In compliance with Section 134 of the Companies Act 2013 read with the rules framedthere under and Provisions of SEBI (Listing Obligations and Disclosure Requirement)Regulations 2015 as amended from time to time the Financial Statements for the F.Y2017-18 have been prepared in compliance with the applicable Indian Accounting Standards.

Consolidated financial statements

In compliance with Regulation 34 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and in compliance with the provisions of Section 129(3)and other applicable provisions of the Companies Act 2013 and the Indian AccountingStandards Ind AS-110 and other applicable Accounting Standards your Directors havepleasure in attaching the consolidated financial statements for the financial year endedMarch 31 2018 which forms part of the Annual Report.

Preferential Issue of Warrants to Promoters

The Board of Directors of the Company at its meeting held on 24th May 2018 subject tothe approval of the members of the Company and other requisite approvals had accorded inprinciple approval for raising an amount upto ` 1100 million by issue of convertiblewarrants to M/s. AVSR Holdings Private Limited one of the promoters of the Company.

Disclosures : Deposits

During the year the Company has not accepted any public deposits.

Conservation of energy technology absorption and foreign exchange earnings and outgo

A. Conservation of energy

The Company's core activity is civil construction which is not power intensive. TheCompany is making every effort to conserve the usage of power.

B. R&D and technology absorption: Not applicable

C. Foreign exchange earnings and outgo during the F.Y 2017-18 Foreign exchange earnings- Nil Foreign exchange outgo i. Towards travel ` 1.12 million ii. Towards import ofcapital goods & material supplies ` 887.11 million iii. Others ` 1.04 million

During the year under review no significant and material orders were passed by theregulators or courts or tribunals impacting the going concern status and the Company'soperations in future.

Particulars of Loans Guarantees or Investments under Section 186;

In compliance with the provisions of Section 186 of the Companies Act 2013 read withCompanies (Meetings of Board and its Powers) Rules 2014 the details of LoansGuarantees Investments given / made during the Financial Year ended 31st March 2018 aregiven in Annexure- 1

Directors :

In pursuance of Section 152 of the Companies Act 2013 and the Rules framed thereunderSri A G K Raju (DIN-00019100) Executive Director and Sri A S N Raju (DIN-00017416)Whole-time Director are liable to retire by rotation at the ensuing Annual GeneralMeeting and being eligible have offered themselves for reappointment. During the periodunder review Sri N R Alluri and Sri Amit Dixit Directors have resigned from the Board dueto pre-occupation. Sri Neeraj Mohan Director had resigned from the Board on 7th May 2018due to pre-occupation. Your Board places on record the valuable services rendered by Sri NR Alluri Sri Amit Dixit and Sri Neeraj Mohan during their tenure as Directors of theCompany. The Independent Directors have submitted the declaration of independencepursuant to Section 149(7) of the Companies Act 2013 stating that they meet the criteriaof independence as provided in sub-section(6) of Section 149 of the Companies Act 2013.

Key Managerial Personnel

Sri A A V Ranga Raju Managing Director Sri A G K Raju Executive Director Sri A S NRaju Sri J V Ranga Raju and Sri A V N Raju Wholetime Director(s) Sri R S RajuAssociate Director (F&A) & CFO and Sri M V Srinivasa Murthy Company Secretary& EVP (Legal) are Key Managerial Personnel of the Company in accordance with theprovisions of Section(s) 2(51) and 203 of the Companies Act 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014. There has been nochange in the Key Managerial Personnel during the Financial Year under review.

Policy on Directors' Appointment and remuneration and other details

The Company's policy on Directors' appointment and remuneration and other mattersprovided in Section 178(3) o the Companies Act 2013 is hosted on the Company's websiteand the weblink thereto is (http://ncclimited.com/Policies.html).

Meetings of Board of Directors

During the Financial Year seven (7) meetings of the Board of Directors were held . Thedetails of the meetings of the Board are given under the Section Corporate GovernanceReport which forms part of this Report. The details of the familiarization programmeformulated for Independent Directors is hosted on the Company's website and the web linkthereto is http://ncclimited.com/corporate_ governance. html.

Audit Committee

The Company has in place an Audit Committee in terms of the requirements of theCompanies Act 2013 read with the Rules made thereunder and Regulation 18 of the SEBI(LODR) Regulations 2015. The details relating to the Audit Committee are given in thesection relating to Corporate Governance forming part of the Board Report. During the yearunder review Sri Amit Dixit Non-executive Director ceased to be a member of the AuditCommittee consequent to his resignation as a Director of the Company.

Whistle Blower Policy/Vigil Mechanism

Pursuant to Section 177 of the Companies Act 2013 and the Rules framed there under andpursuant to the provisions of SEBI

(Listing Obligations and Disclosure Requirements) Regulations2015 the Company hasestablished a mechanism through which all the stakeholders can report the suspected fraudsand genuine grievances to the appropriate authority. The Whistle Blower Policy which hasbeen approved by the Board of Directors of the Company has been hosted on the website ofthe Company (http://ncclimited. com/ Policies.html). During the year under review theCompany has not received any complaint(s) under the said policy.

Risk Management

The Company has established Enterprise Risk Management process to manage risks with theobjective of maximizing shareholders value.

Internal Financial Controls and their adequacy

The Company has in place adequate internal financial controls commensurate with thesize scale and complexity of its operations. The Company has policies and procedures inplace for ensuring proper and efficient conduct of its business the safeguarding of itsassets the prevention and detection of frauds the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information.

Compliance with Secretarial Standards

The Company has complied with applicable provisions of the Secretarial Standards issuedby the Institute of Company Secretaries of India and approved by the Government of Indiaunder Section 118(10) of the Companies Act 2013.

Extract of Annual Return

The extract of the Annual Return of the Company in Form MGT-9 for the Financial Yearended 31st March 2018 is given in Annexure- 2 and forms part of the Directors' Report.

Statutory Auditors and their report

M/s. S R Batliboi & Associates LLP(Firm Registration No 101049W / E300004)Chartered Accountants who were appointed as Statutory Auditors of the Company for a termof Five years from the conclusion of the 27th Annual General Meeting till conclusion of32nd Annual General Meeting conducted the Statutory Audit for the FY-2017-18.TheIndependent Auditors' Report(s) to the Members of the Company in respect of the Standalone Financial Statements and the Consolidated Financial Statements for the FinancialYear ended March 31 2018 form part of this Annual Report and do not contain anyqualification(s) or adverse observations.

Secretarial Audit Report

As per the provisions of Section 204(1) of the Companies Act 2013 the Company hasappointed M/s. BS & Company Company Secretaries LLP Practicing Company Secretariesto conduct Secretarial Audit of the records and documents of the Company for the FinancialYear 2017-18. The Secretarial Audit Report for the Financial Year ended 31st March 2018in Form MR-3 is annexed to the Directors Report - Annexure - 3 and forms part of thisReport. The Secretarial Auditors' Report to the Members of the Company for the FinancialYear ended March 31 2018 does not contain any qualification(s) or adverse observations

Cost Audit

In compliance with the provisions of Section 148 of the Companies Act 2013 the Boardof Directors of the Company at its meeting held on May 23 2017 had appointed M/s.Vajralingam & Co. Cost Accountants (Firm Registration No.101059) as the Cost Auditorsof the Company for the FY 2017-18. In terms of the provisions of Section 148(3) of theCompanies Act 2013 read with Rule 14(a)(ii) of the Companies (Audit and Auditors) Rules2014 the remuneration of the Cost Auditors has to be ratified by the members.Accordingly necessary resolution is proposed at the ensuing AGM for ratification of theremuneration payable to the Cost Auditors for FY 2017-18.

Corporate Governance

Pursuant to the provisions of Chapter IV read with Schedule V of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a separate section onCorporate Governance has been incorporated in the Annual Report for the information of theshareholders. A certificate from the Statutory Auditors of the Company regardingcompliance with the conditions of Corporate Governance as stipulated under the saidSchedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015also forms part of this Annual Report.

Business Responsibility Report

As stipulated under Regulation 34 of the SEBI (LODR) Regulation 2015 BusinessResponsibility Report is attached and forms part of the Annual Report.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act 2013 read with IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 (‘the Rules') allunpaid or unclaimed dividend are required to be transferred by the Company to the IEPFestablished by the Government of India after the completion of seven (7) years. Furtheraccording to the Rules the shares on which dividend has not been paid or claimed by theshareholders for seven consecutive years or more shall also be transferred to the demataccount of the IEPF Authority. In compliance with the aforesaid provisions the Company hastransferred the unclaimed and unpaid dividends and corresponding shares to IEPF. Thedetails of the unclaimed / un paid dividend during the last seven (7) years and also thedetails of the unclaimed shares transferred to IEPF are given in the Report on CorporateGovernance forming part of the Annual Report.

Reporting of Frauds

There have been no instances of fraud reported by the Auditors including the Statutoryof the Company under Section 143(12) of the Companies Act2013 and the Rules framed thereunder either to the Company or to the Central Government

Corporate Social Responsibility

The brief outline of the Corporate Social Responsibility (CSR)Policy of the Company andthe initiatives undertaken by the Company on CSR activities during the year are set out inAnnexure-4 of this Report in the format prescribed in the Companies(Corporate SocialResponsibility Policy)Rules 2014.The policy is available on the website of the Company.(http://ncclimited.com/Policies.html)

Particulars of Employees

Details in respect of remuneration paid to employees as required under Section 197 (12)of the Companies Act 2013 read with Rule 5(2) & (3) of the Companies (Appointmentand Remuneration of

Managerial Personnel) Rules 2014 as amended from time to time forms part of thisreport. In terms of Section 136 of the Companies Act 2013 the same is open for inspectionat the Registered Office of the Company. Copies of this statement may be obtained by themembers by writing to the Company Secretary at the Registered Office of the Company.

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 2014is given in Annexure – 5 and forms part of this Report.

Evaluation of performance of the Board Members of the Board and the Committees of theBoard of Directors.

The Nomination and Remuneration Committee has laid down criteria for performanceevaluation of Directors Chairperson Board Level Committees and the Board as a whole andalso the evaluation process for the same. The Nomination and Remuneration Committee hasreviewed the performance evaluation of the Directors Chairperson Nomination andRemuneration Committee Audit Committee and Stakeholders Relationship Committee and theBoard as a whole. The statement indicating the manner in which formal annual evaluation ofthe Directors the Board and the Board level Committees are given in the report onCorporate Governance which forms part of this Annual Report.

Protection of Women at Work Place

The Company has formulated a policy on Prevention of Sexual Harassment of Women atWorkplace in accordance with The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. During the financial year ended 31st March 2018the Company has not received any complaints pertaining to Sexual Harassment.

Acknowledgements

Your Directors place on record their sincere appreciation and thanks for the valuablecooperation and support received from the employees of the Company at all levelsCompany's Bankers Financial Institutions Central and State Government AuthoritiesAssociates JV partners clients consultants sub-contractors suppliers and Members ofthe Company and look forward for the same in equal measure in the coming years.

For and on behalf of the Board Hemant M Nerurkar

Chairman (DIN No. 00265887) Place: Hyderabad Date: 24th May 2018