To the Members of
Surana Telecom and Power Limited
The Directors have pleasure in presenting the 29th Annual Report of yourCompany together with the Audited Balance Sheet as at 31st March 2018 andStatement of Profit and Loss for the year ended 31st March 2018.
The performance of the Company during the year has been as under:
|Particulars || |
| ||2017-18 ||2016-17 ||2017-18 ||2016-17 |
|Sales and other Income ||255927521 ||275122174 ||357401412 ||344522335 |
|Profit before Depreciation and Interest ||140637163 ||135944838 ||232689430 ||193840864 |
|LESS : || || || || |
|Depreciation & Amortization ||71867146 ||74127977 ||138390864 ||105124324 |
|Interest ||39287415 ||39379813 ||69485997 ||63128885 |
|Profit for the year ||29482602 ||22437048 ||24812569 ||25587655 |
|Prior period Adjustments || ||-- || ||-- |
|Profit before Taxation ||29482602 ||22437048 ||24812569 ||25587655 |
|Provision for Taxation : Current Tax ||6015000 ||4370000 ||6630000 ||4449068 |
|Deferred Tax ||408000 ||453000 ||(585480) ||246862 |
|Income Tax in respect of earlier years ||-- ||-- || ||-- |
|Profit after Tax ||23059602 ||17614048 ||18768049 ||20891725 |
|Add: Other Comprehensive Income ||32048459 ||(3308032) ||32048459 ||(3308032) |
|Total Comprehensive Income for the year ||55108061 ||14306016 ||50816508 ||17583693 |
|Less: Minority Interest (Current year's Profit/(loss) ||-- ||-- ||(3865795) ||1550948 |
|Add: Share in Net Profit of Associate Company || || ||24707141 ||24251053 |
|Surplus brought forward from previous year ||218868588 ||204562572 ||242157525 ||201873727 |
|Balance carried forward to Balance Sheet ||273976649 ||218868588 ||321546969 ||242157525 |
Note: The previous years' figures regrouped and rearranged wherever necessary in orderto make them comparable as per Ind-AS.
During the year under review the Income from Operations is ' 235345624 as against '266532956 for the corresponding previous year. The Profit Before Tax stood at '29482602 as against ' 22437048 for the previous year. The Profit After Tax stood at' 23059602 as against ' 17614048 for the corresponding period. The Basic EarningsPer Share for the year ended 31.03.2018 is ' 0.17 as against ' 0.13 for the correspondingprevious year ended 31.03.2017.
The Company's 5 MW Solar Power Project is situated at Gujarat Solar Park CharankaVillage Santalpur Taluq Patan District is generating steady income.
M/s.Surana Solar Systems Pvt. Ltd. a subsidiary company is successfully operating its5 MW Solar Power Plant situated at Shankapur Village Shankarampet Mandal Medak DistrictTelangana.
M/s.Aryavaan Renewable Energy Pvt. Ltd. a subsidiary of the Company has successfullycommissioned its grid connected 5 MW Solar Power Plant at Barhara Village Sarila TehsilHamirpur District Uttar Pradesh on 08.02.2017 and since then successfully injecting powerto the grid. For sale of power the Company has entered into long term Power PurchaseAgreement with Uttar Pradesh Power Corporation Ltd.
Pursuant to the Scheme of Arrangement the 5 MW Solar Power Project located atMunipally Village Sadashivpet Medak District of M/s Bhagyanagar India Limited hastransferred to the Company. The project is running successfully. The power is being soldto M/s.Tata Communications Ltd. through Open Access route.
M/s.Tejas India Solar Energy Pvt. Ltd. a Subsidiary Company has completed erection of3 MW grid connected Solar Power Plant at Gajwel Mandal Medak District Telangana. Thepower will be sold under Open Access to third party. The Company is awaiting approvalsfrom the authorities for synchronization of the plant with the grid which is expected bythe end of July 2018.
Your company has 4 subsidiary companies as on 31.03.2018 as mentioned below. Furtherthere has been no material change in the nature of business of the subsidiaries.
|Name of the Subsidiary ||Percentage of Shareholding |
|1. Globecom Infotech Private Limited ||100% |
|2. Surana Solar Systems Private Limited ||51% |
|3. Tejas India Solar Energy Private Limited ||51% |
|4. Aryavaan Renewable Energy Private Limited ||51% |
During the year under review your company has divested 51% equity stake held inCelestial Solar Solutions Private Limited which has set up 10 MW solar power project inthe State of Karnataka to NVR infrastructure and Services Pvt Ltd since the outlineinvestment for executing 10 MW solar power project was done by NVR infrastructure andServices Pvt Ltd which was holding 49% stake in the said company.
In terms of proviso to sub section (3) of Section 129 of the Act the salient featuresof the financial statement of the subsidiaries is set out in the prescribed Form AOC-1which forms part of the annual report. Pursuant to the provisions of section 136 of theAct the financial statements of the Company consolidated financial statements along withrelevant documents and separate audited accounts in respect of subsidiaries are availableon the website of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements prepared and annexed in accordance with theAccounting Standards 21 and 23 as prescribed under Section 133 of the Companies Act 2013read with Rule 7 of Companies (Accounts) Rules 2014 and Guidelines issued by Securitiesand Exchange Board of India (SEBI) also forms part of this Annual Report.
As per the provisions of Section 136 of the Companies Act 2013 the Company has placedseparate audited accounts of its subsidiaries on its website www.suranatele.com and copyof separate audited financial statements of its subsidiaries will be provided to theshareholders at their request.
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2relating to Meetings of the Board of Directors' and General Meetings'respectively have been duly followed by the Company.
The paid-up Share Capital of the Company as on 31st March 2018 is '135759963 divided into 135759963 equity shares of Re.1/- each.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review as stipulated underListing Regulations is presented in a separate section forms part of the Annual Report asAnnexure-II.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto the Directors' Responsibility Statement the Board of Directors of the Company herebyconfirms:
(a) That the preparation of the annual accounts for the financial year ended 31stMarch 2018 the applicable accounting standards have been followed along with properexplanation relating to material departures;
(b) That the directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year 31st March 2018 and of the profit and loss of the company forthat period;
(c) That the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;
(d) That the directors have prepared the annual accounts for the financial year 31stMarch 2018 on a going concern basis; and
(e) That the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS
The Independent Directors have submitted the declaration of independence as requiredpursuant to sub-section (7) of section 149 of the Companies Act 2013 stating that theymeet the criteria of independence as provided in sub- section(6) of Section 149.
NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy which lays down a framework in relation to selection appointment andremuneration to Directors Key Managerial Personnel
and Senior Management of the Company. The details of Nomination and RemunerationCommittee and Policy are stated in the Corporate Governance Report.
PARTICULARS OF LOANS GUARANTEES OR SECURITIES OR INVESTMENTS
The details of Loans Guarantees Securities and Investments made during the financialyear ended 31st March 2018 are given in the notes to the Financial Statementsin compliance with the provisions of Section 186 of the Companies Act 2013 read withCompanies (Meetings of Board and its Powers) Rules 2014.
RELATED PARTY TRANSACTIONS
All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business. There are no materially significantrelated party transactions made by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons which may have a potential conflict with theinterest of the Company at large. All Related Party Transactions are placed before theAudit Committee and also the Board for approval where ever required. Prior omnibusapproval of the Audit Committee is obtained for the transactions which are of aforeseeable and repetitive nature. A statement giving details of all related partytransactions entered into pursuant to the omnibus approval so granted are placed beforethe Audit Committee and the Board of Directors on a quarterly basis. The Company hasdeveloped a Policy on Related Party Transactions for the purpose of identification andmonitoring of such transactions. The policy on Related Party Transactions as approved bythe Board is uploaded on the Company's website.
The particulars of contracts or arrangements with related parties referred to insub-section (1) of section 188 is prepared in Form AOC-2 pursuant to clause (h) of theCompanies (Accounts) Rules 2014 and the same is annexed herewith asAnnexure-IN to this Report.
The Board of Directors have not recommended the dividend for the financial year 2017-18due to low profitability and to retain maximum possible cash in the system to meet thefinancial commitments.
EXTRACT OF ANNUAL RETURN
The Extracts of Annual Return as per the provisions of Section 92 of the Companies Act2013 and Rule 12 of Companies (Management and Administration) Rules 2014 in Form MGT-9are enclosed as Annexure - IV to this Report.
PARTICULARS IN RESPECT OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGNEXCHANGE EARNINGS AND OUTGO
The information on Conservation of Energy Technology Absorption Foreign ExchangeEarnings and outgo required to be disclosed under Section 134(3)(m) of the Companies Act2013 read with Rule 8 of the Companies (Accounts) Rules 2014 are provided in theAnnexure-I forming part of this Report.
RISK MANAGEMENT POLICY
In terms of the requirement Section 134(3)(n) and Regulation 21 of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 read with relevant provisions of the Companies Act 2013 the Company has developed andimplemented the Risk Management Policy. The Audit Committee has additional oversight inthe area of financial risks and controls. Major risks identified by the businesses andfunctions are systematically addressed through mitigating actions on a continuing basis.The development and implementation of risk management policy has been covered in themanagement discussion and analysis which forms part of this report. At present theCompany has not identified any element of risk which may threaten the existence of thecompany.
During the year under review pursuant to the provisions of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the evaluation ofperformance of all Directors is undertaken annually. The company has implemented a systemof evaluating performance of the Board of Directors and of its Committees and individualDirectors on the basis of a structured questionnaire which comprise evaluation criteriataking into consideration various performance related aspects.
The Board of Directors has expressed their satisfaction with the valuation process.
Ms. Vinita Surana Director of the Company will retire by rotation at the ensuingAnnual General Meeting and being eligible offers herself for re-appointment.
Shri D.Venkata Subbaiah and Dr.R.N.Sreenath Independent Directors of the Company whoattained the age above 75 years are being appointed as Non-Executive Independent Directorsthrough Special Resolution by shareholders at this Annual General Meeting pursuant to SEBI(Listing Obligations and Disclosure Requirements) (Amendment) Regulations 2018.
The brief particulars of the Directors seeking appointment/ re-appointment at thisAnnual General Meeting are being annexed to the Corporate Governance Report.
Pursuant to the provisions of Section 203 of the Act the appointment of Shri NarenderSurana Managing Director and Shri Devendra Surana Director and Ms.Vinita SuranaWhole-time Director and Shri Baunkara Shekarnath Wholetime Director and Shri. SrinivasDudam Company Secretary were formalized as the Key Managerial Personnel of the Company.
During the financial year under review 5 (Five) Board Meetings were convened and held.The details of which are given in the Corporate Governance Report. The intervening gapbetween the meetings was within the period of 120 days as prescribed under the CompaniesAct 2013 and Regulation 17 of SEBI Listing Regulations 2015.
The Company has not accepted any deposits from public in terms of Section 73 of theCompanies Act 2013 and as such no amount on account of principal or interest on publicdeposits was outstanding as on the date of the balance sheet.
M/s. Luharuka & Associates Chartered Accountants were appointed as StatutoryAuditors of your Company at the Annual General Meeting held on 26th September2017 for a term of five consecutive years. As per the provisions of Section 139 of theCompanies Act 2013 the appointment of Auditors is required to be ratified by Members atevery Annual General Meeting.
In accordance with the Companies Amendment Act 2017 enforced on 7th May2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors is notrequired to be ratified at every Annual General Meeting. M/s. Luharuka & AssociatesChartered Accountants have confirmed that they are not disqualified from continuing asAuditors of the Company.
There are no qualifications reservations or adverse remarks made by M/s. Luharuka& Associates Chartered Accountants Statutory Auditors in their report for theFinancial Year ended 31st March 2018.
The Statutory Auditors have not reported any incident of fraud to the Audit Committeeof the Company in the year under review.
The Board of Directors of the Company have appointed M/s Sekhar & Co. CharteredAccountants as Internal Auditors to conduct Internal Audit of the Company for theFinancial Year ended 31st March 2019.
The Board of Directors subject to the approval of the Central Government re-appointedM/s BVR & Associates Cost Accountants holding certificate of practice No.16851 as aCost Auditor for conducting the Cost Audit for the financial year 2018-19. Subject tosection 148 of the Companies Act
2013 read with Companies (Cost Records and Audit) Rules
2014 issued by the MCA the Audit Committee recommended their re-appointment. TheCompany has also received a letter from the Cost Auditor stating that the appointment ifmade will be within the limits prescribed pursuant to the section 141 of Companies Act2013.
The Company has implemented the procedures and adopted practices in conformity with theCode of Corporate Governance as per the requirements of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
A separate report on corporate governance practices followed by the Company togetherwith a Certificate from the Company's Auditors confirming compliances forms an integralpart of this Report.
The Company has adopted a Whistle Blower Policy establishing vigil mechanism toprovide a formal mechanism to the Directors and employees to report concerns aboutunethical behavior actual or suspected fraud or violation of Code of Conduct and Ethics.It also provides for adequate safeguards against the victimization of employees who availof the mechanism and provides direct access to the Chairperson of the Audit Committee inexceptional cases. It is affirmed that no personnel of the Company has been denied accessto the Audit Committee. The policy of vigil mechanism is available on the Company'swebsite. The Whistle Blower Policy aims for conducting the affairs in a fair andtransparent manner by adopting highest standards of professionalism honesty integrityand ethical behavior.
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 the Company hasappointed Ms. Rakhi Agarwal Company Secretary in Practice as Secretarial Auditors toconduct Secretarial audit of the company for the financial year ended March 31 2018.
The Secretarial Audit Report issued by Ms. Rakhi Agarwal Company Secretary in Practicein Form MR-3 is enclosed as Annexure - V to this Annual Report.
The Secretarial Audit Report does not contain any qualifications reservation oradverse remarks.
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.
PARTICULARS OF REMUNERATION
The remuneration and perquisites provided to the employees and Management are at parwith the industry levels. The remunerations paid to the Managing Director and seniorexecutives are reviewed and recommended by the Nomination and Remuneration Committee.
(i) The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year;
|Name of the Director ||Ratio to Median Remuneration |
|Shri Narender Surana Managing Director ||46.67 |
|Shri Devendra Surana Director ||0 |
|Ms.Vinita Surana WTD ||16.33 |
|Shri Baunakar Shekarnath WTD ||0 |
(ii) The percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year;
|Name of Person ||% increase in remuneration |
|Shri Narender Surana Managing Director ||0 |
|Shri Devendra Surana Director ||0 |
|Ms.Vinita Surana WTD ||0 |
|Shri Baunakar Shekarnath WTD ||0 |
|Shri. Srinivas Dudam CS ||5.53 |
(iii) The percentage increase in the median remuneration of employees in the financialyear - (24.04%)
(iv) The number of permanent employees on the rolls of company - 19.
(v) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration;
The average increase in salaries of employees other than managerial personnel in2017-18 was 6.23%. Percentage increase in the managerial remuneration for the year wasNil.
(vi) Affirmation that the remuneration is as per the remuneration policy of the company- Yes.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal audit function process owners undertake corrective action in theirrespective areas and thereby strengthen the controls. Significant audit observations andcorrective actions thereon are presented to the Audit Committee of the Board.
CHANGE IN NATURE OF BUSINESS
There is no change in nature of business of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT:
There are no significant and material orders passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
MATERIAL CHANGES AND COMMITMENTS
There are no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year 31st March 2018to which the financial statements relates and the date of signing of this report.
The industrial relations of the Company continued to be harmonious during the yearunder review.
ISO 9001-2008 CERTIFICATION
Your Company continues to hold ISO 9001-2008 Certification by meeting all therequirements of Certification from time to time.
POLICY ON SEXUAL HARRASSEMENT
The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplacein accordance with The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.
The Internal Complaints Committee(ICC) has been setup to redress Complaints receivedregarding sexual Harassment. During the period under the review no complaints werereceived by ICC.
Your Directors wish to place on record their appreciation to employees at all levelsfor their hard work dedication and commitment. The enthusiasm and unstinting efforts ofthe employees have enabled the Company to remain at the forefront of the industry despiteincreased competition from several existing and new players.
Statements in the Board's Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward-lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include global and domestic demand and supplyconditions affecting selling prices of finished goods input availability and priceschanges in government regulations tax laws economic developments within the country andother factors such as litigation and industrial relations.
The Directors take this opportunity to place on record their sincere thanks to thesuppliers customers strategic partners Banks and Financial Institutions InsuranceCompanies Central and State Government Departments and the shareholders for their supportand co-operation extended to the Company from time to time. Directors are pleased torecord their appreciation of the sincere and dedicated services of the employees andworkmen at all levels.
|For and on behalf of the Board of Directors |
|NARENDER SURANA ||DEVENDRA SURANA |
|MANAGING DIRECTOR ||DIRECTOR |
|(DIN-00075086) ||(DIN-00077296) |
|Place: Secunderabad || |
|Date: 06.08.2018 || |