Sunteck Realty Limited
Your Directors have the pleasure in presenting the 36th Annual Report of theCompany on the business and operations of the Company together with the Audited Statementof Accounts for the year ended 31st March 2019.
The Company's performance during the financial year ended 31st March 2019as compared to the previous financial year is summarised below:
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For the year ended on 31.03.2019
|For the year ended on 31.03.2018 || |
For the year ended on 31.03.2019
|For the year ended on 31.03.2018 |
|Revenue from Operations ||23793.45 ||17572.67 ||85679.21 ||88828.63 |
|Other Income ||6107.98 ||2249.14 ||3432.55 ||908.97 |
|Total Income ||29901.43 ||19821.81 ||89111.76 ||89737.60 |
|Total Expenditure ||11192.62 ||6824.09 ||52181.40 ||55985.87 |
|Profit for the period before tax and share of profit/ (loss) of Associates/ Joint ventures ||18708.81 ||12997.72 ||36930.36 ||33751.73 |
|Share of profit/(loss) of ||- ||- ||25.05 ||(568.16) |
|Associate/ Joint Ventures || || || || |
|Profit Before Tax ||18708.81 ||12997.72 ||36955.41 ||33183.57 |
|Current Tax ||202.21 ||237.62 ||12646.72 ||10002.45 |
|Taxation of Earlier Years ||- ||(5.08) ||97.22 ||23.37 |
|Deferred Tax ||51.65 ||405.96 ||102.75 ||759.86 |
|MAT Credit ||- ||- ||(3.76) ||(0.75) |
|Profit After Tax ||18454.95 ||12359.22 ||24112.48 ||22398.64 |
|Other Comprehensive Income ||(8.85) ||14.27 ||(92.68) ||(65.87) |
|Total Comprehensive Income ||18446.10 ||12373.49 ||24019.80 ||22332.77 |
Note: Your Company has adopted Indian Accounting Standards (referred to as Ind AS)with effect from 1st April 2016 and accordingly these financial statementsalong with the comparatives have been prepared in accordance with the recognition andmeasurement principles stated therein prescribed under Section 133 of the Companies Act2013 read with relevant rules framed thereunder and other accounting principles generallyaccepted in India.
REVIEW OF OPERATIONS
During the year under review the consolidated revenue for the current year amounted toर 89111.76/- Lakhs against र 89737.60/- Lakhs compared to the previous year.The profit before tax on consolidated basis stands at as र 36955.41/- Lakhs comparedto र 33183.57/- Lakhs during the previous year.
The total revenue earned is र 29901.43/- Lakhs compared to previous year'srevenue of र 19821.81/- Lakhs on standalone basis. The profit before tax onstandalone basis stands at र 18708.81/- as compared to profit before tax of र12997.72/- Lakhs during the previous year.
NATURE OF BUSINESS
The Company is engaged in the activities of real estate development of residential andcommercial projects. During the year under review there was no change in the nature ofbusiness of the Company.
Your Directors are pleased to recommend a dividend of 150 % i.e. र 1.5/- perEquity share on 146344861 Equity Shares of face value Re. 1.00/- each out of theprofits of the Company for the financial year 2018-19 subject to approval of shareholdersat the ensuing Annual General Meeting. Total outflow on account of dividend shall amountto र 219517292/- (Rupees Twenty One Crores Ninety Five Lakhs Seventeen ThousandTwo Hundred Ninety Two Only) excluding dividend distribution tax.
TRANSFER TO RESERVES
Your Directors do not propose to transfer any amount to reserves out of the profitsearned during financial year 2018-19.
During the year under the review your Company allotted 2414 (Two Thousand FourHundred and Fourteen) and 19198 (Nineteen Thousand One Hundred Ninety Eight) EquityShares of face value of Re. 1/- (Rupee One Only) per share to option grantees on 28thNovember 2018 pursuant to exercise of options under Company's Employee Stock OptionScheme 2013 (ESOP 2013) and Company's Employee Stock Option Scheme 2017 (ESOS 2017)respectively. All issued shares rank pari-passu to the existing shares of the Company inall respects.
Pursuant to the above allotments the paid up capital of the Company increased to146336639 (Fourteen Crores Sixty Three Lakhs Thirty Six Thousand Six Hundred and ThirtyNine) Equity shares of Re. 1/- each aggregating to र 146336639 (RupeesFourteen Crores Sixty Three Lakhs Thirty Six Thousand Six Hundred and Thirty Nine) as on31st March 2019.
REDEMPTION OF NON-CONVERTIBLE DEBENTURES DURING THE YEAR
The Company has made timely interest and redemption amount payment to theDebentureholders of 1000 11.75% Secured Redeemable Non-Convertible Debentures (NCD)Series C. The Company has made timely interest amount payment to the Debentureholders of2000 11.75 % Secured Redeemable Non-Convertible Debentures Series D.
The balance NCDs are shown in its books as per the details provided below:
|Sr. No. ||Particulars || |
|1 ||11.75 % Secured Redeemable Non-Convertible Debentures Series D ||2000 ||INE805D07049 |
| ||TOTAL ||2000 || |
In terms of Sections 73 and 74 of the Companies Act 2013 read with the Companies(Acceptance of Deposit) Rules 2014 during the year financial year 2018-19 your Companyhas not accepted any deposits from public and as such no amount on account of principalor interest on public deposits was outstanding as on the date of the Balance Sheet.
SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES
During the year under review the Company had 20 subsidiaries including step downsubsidiaries 2 LLPs where Company exercises significant control and 2 Associates/JointVentures of which 1 Company is Joint Venture entity in UAE.
As per Section 129(3) of the Companies Act 2013 the Company has prepared consolidatedfinancial statements of the Company and its subsidiaries its associates and Joint Venturein accordance with applicable Accounting Standards issued by The Institute of CharteredAccountants of India forms part of this Annual Report. The performance and financialposition of each of the subsidiaries associates and Joint Venture companies for the yearended 31st March 2019 is attached to the financial statements hereto in FormAOC 1.
In terms of Section 136 of the Companies Act 2013 Financial statements of thesubsidiaries are not required to be sent to the members of the Company. The Company willprovide a copy of separate annual accounts in respect of each of its subsidiary to anyshareholder of the Company if so desired and said annual accounts will also be kept openfor inspection at the Registered Office of the Company.
The Company has formulated a policy for determining material' subsidiaries andsuch policy is disclosed on Company's website.
During the year pursuant to the approval by the Board of Directors the Company hadfiled an petition with National Company Law Tribunal (NCLT) regarding the Scheme ofMerger by Absorption of Amenity Software Private Limited Magenta Computer SoftwarePrivate Limited and Sunteck Fashions and Lifestyle Private Limited being the wholly ownedsubsidiaries of the Company with itself.
MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL
In compliance with provisions of Section 152 of the Companies Act 2013 Mr. AtulPoopal Director of the Company retires by rotation at the ensuing Annual General Meetingand being eligible offers for re-appointment. Appropriate resolution for aforesaidre-appointment is being placed for approval of the members at the ensuing AGM.
In terms of the Regulation 17(1A) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended (Listing Regulations) with effectfrom 1st April 2019 the listed entity shall pass special resolution forappointment or continuance of the directorship of any person as a non-executive directorwho has attained the age of seventy five years. Accordingly approval of members is soughtby way of special resolution in the ensuing AGM for continuance of directorship of Mr.Ramakant Nayak and Mr. Kishore Vussonji for their remaining tenure.
The members of the Company at the AGM held on 27th September 2018 approvedthe re-appointment of Mr. Kamal Khetan to hold office as Managing Director of theCompany for a period of five years with effect from 30th May 2018 upto 29thMay 2023.
During the year under review Mr. Sumesh Mishra ceased to act as Chief Operating Officeof the Company with effect from 30th June 2018.
During the year under review there was an untimely and sad demise of Mr. MahadevanKalahasthi Independent Director of the Company on 9th February 2019. TheBoard placed on record its gratitude for the contribution made by Mr. Kalahasthi to theCompany during his tenure as Independent Director. Mrs. Sandhya Malhotra was appointed asa woman Independent Director of the Company on 1st April 2019 who shall holdoffice upto the date of ensuing AGM of the Company for a term of up to 5 consecutiveyears from 1st April 2019 subject to the approval of members.
The Board has received declarations from the Independent Directors as per therequirement of Section 149(7) of the Companies Act 2013 and the Board is satisfied thatthe Independent Directors meet the criteria of independence as mentioned in Section 149(6)of the Companies Act 2013. The certificate under Regulation 34(3) of Listing Regulationsforms part to this report .
DISCLOSURES RELATED TO BOARD COMMITTEES AND POLICIES
The Board of Directors met 5 times during the financial year ended 31stMarch 2019 in accordance with the provisions of the Companies Act 2013 and rules madethereunder. The Directors actively participated in the meetings and contributed valuableinputs on the matters brought before the Board of Directors from time to time.
The Independent Directors held a separate meeting in compliance with the requirementsof Schedule IV of the Companies Act 2013 and Regulation 25(3) of the Listing Regulations.For further details of the meetings of the Board please refer to the Corporate GovernanceReport which forms part of this Annual Report.
Directors' 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 2019 theBoard of Directors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to 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 on 31st March2019 and of the profits of the Company for the year ended on that date;
c. pr oper and sufficient care was taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company 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. pr oper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Committees of the Board
a) Audit Committee
An Audit Committee is in existence in accordance with the provisions of Section 177 ofthe Companies Act 2013. Kindly refer to the section on Corporate Governance under thehead Audit Committee' for matters relating to constitution meetings and functionsof the Committee.
b) Nomination and Remuneration Committee
A Nomination and Remuneration Committee is in existence in accordance with theprovisions of subsection
(3) of Section 178 of the Companies Act 2013. Kindly refer to the section on CorporateGovernance under the head Nomination and Remuneration Committee' for mattersrelating to constitution meetings functions of the Committee and the remuneration policyformulated by this Committee.
c) C orporate Social Responsibility Committee
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company during the year are set out in Annexure I ofthis report as per the format prescribed in Companies (Corporate Social ResponsibilityPolicy) Rules 2014.
The CSR Policy may be accessed on the Company's website at the linkhttp://www.sunteckindia .com/codes-policies.php.
The Company has undertaken projects in the areas of Health Education and EnvironmentSustainability as part of its initiatives under Corporate Social Responsibility (CSR).These projects are largely in accordance with Schedule VII of the Companies Act 2013.
d) Other Board Committees
F or details of other Board Committees' viz. Stakeholders Relationship Committee andothers kindly refer to the section Committees of the Board of Directors' whichforms part of the Corporate Governance Report.
Vigil Mechanism for the Directors and Employees
In compliance with provisions of section 177(9) and (10) of the Companies Act 2013read with Regulation 22 of the Listing Regulations your Company has adopted whistleblower policy for Directors and employees to report genuine concerns to the management ofthe Company. The whistle blower policy of the Company is posted on the website of theCompany and may be accessed at http://www.sunteckindia .com/codes-policies.php.
The Company's management systems organisational structures processes standards codeof conduct and behaviors together form the system that governs how the Group conducts thebusiness of the Company and manages associated risks.
The approach is based on identification evaluation and mitigation of operationalstrategic and environmental risks disciplined risk monitoring and measurement andcontinuous risk assessment and mitigation measures.
Annual Evaluation of Directors Committee and Board
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theBoard has carried out an annual evaluation of its own performance performance of itsdirectors individually and the committees of the Board.
Particulars of Remuneration
The information as required under the provisions of Section 197(12) of the CompaniesAct 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are set out in Annexure V attached hereto.
The information required pursuant to Section 197 of the Companies Act 2013 read withRule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of employees of the Company is available for inspection by themembers at registered office of the Company during business hours on working days up tothe date of the ensuing Annual General Meeting. If any member is interested in obtaining acopy thereof such member may write to the Company Secretary whereupon a copy would besent.
DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEMES
In compliance with the SEBI (Share Based Employee Benefits) Regulations 2014 asamended thereto the details of Employees Stock Option Schemes of the Company as on 31stMarch 2019 are furnished in Annexure II attached herewith and forms part of this Reportand is also available on the website of the Company https://www.sunteckindia.com/financials.php.The ESOS Schemes of the Company are in compliance with the provisions of SEBI (Share BasedEmployee Benefits) Regulations 2014.
PARTICULARS OF LOANS ADVANCES GUARANTEES AND INVESTMENTS
Pursuant to Section 186 of the Companies Act 2013 and Schedule V of the ListingRegulations details of Loans guarantees and investments given/made during the financialyear under review are part of the financial statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
All the transactions/contracts/arrangements of the nature as specified in Section188(1) of the Companies Act 2013 entered by the Company during the year under review withrelated party (ies) are in the ordinary course of business and on arm's length basis.There are no material significant related party transactions made by the Company withPromoters Directors or Key Managerial Personnel which may have a potential conflict withthe interest of the Company at large. In view of the above the requirement of givingparticulars of contracts / arrangements / transactions made with related parties in FormAOC-2 are not applicable for the year under review.
The Policy on related party transactions and procedures dealing with related partytransactions as approved by the Board may be accessed on the Company's website athttp://www.sunteckindia .com/codes-policies.php.
Disclosure on related party transactions is provided in notes to financial statements.
DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT 2013
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company and the date of this report.
INTERNAL FINANCIAL CONTROLS
The Company has adequate Internal Financial Controls in place with reference tofinancial statements and is operating effectively. The Company's IFC frameworkcommensurate with its size scale and complexity of operations. The controls based on theprevailing Business conditions and processes have been reviewed by the Company tostrengthen the same wherever required. In compliance with the provisions of section 138 ofthe Companies Act 2013 read with Rule 13 of Companies (Accounts) Rules 2014 theinternal control systems are supplemented by Internal Audit carried out by independentfirm of Chartered Accountants M/s. Price Waterhouse & Co. Bangalore LLP forperiodical review by management. The Audit committee reviews the reports submitted by theInternal Auditors in its meeting.
DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL
There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.
STATUTORY AUDIT AND AUDITORS' REPORT
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the Companies(Audit and Auditors) Rules 2014 M/s. Lodha & Co. (Firm Registration No. 301051E)Chartered Accountants were appointed as Statutory Auditors of the Company to hold officefrom the conclusion of the 32nd Annual General Meeting (AGM) held on 29thSeptember 2015 till the conclusion of the AGM to be held in 2020.
During the financial year 2018-19 total consolidated fees of र43.60/- Lakhs waspaid to the M/s. Lodha & Co. Statutory Auditors and all entities in the networkfirm/network entity of which the Statutory Auditors are a part of for all the servicesrendered to the Company its associates and its subsidiaries.
The Company has received a certificate from the said Auditors that they are eligible tohold office as the Auditors of the Company and are not disqualified for being soappointed.
Observations of statutory auditors on accounts for the year ended 31stMarch 2019:
There are no qualifications reservations or adverse remarks made by M/s. Lodha &Co. Chartered Accountants Statutory Auditors of the Company in their report for thefinancial year ended 31st March 2019.
Pursuant to provisions of section 143(12) of the Companies Act 2013 the StatutoryAuditors have not reported any incident of fraud to the Audit Committee during the yearunder review.
As required under provisions of Section 204 of the Companies Act 2013 and theCompanies (Appointment & Remuneration of Managerial Personnel) Rules 2014 the reportin respect of the Secretarial Audit carried out by Mr. Veeraraghavan N. Company Secretaryin practice in Form MR-3 for the financial year 2018-19 forms part to this report. Inrespect of the observation made by the Secretarial Auditor in the report your Directorswould like to state that the Company is in process of appointing Chief Financial Officerof the Company. Except as aforesaid the said Secretarial Audit Report does not containany qualification reservation or adverse remark or disclaimer made by the SecretarialAuditor.
Pursuant to Section 148 of the Companies Act 2013 and the rules made thereunder theBoard of Directors had on the recommendation of the Audit Committee re-appointed M/s.Kejriwal & Associates Cost Accountants (Firm Registration No. 101363) to audit thecost accounts of the Company for the Financial year ending on 31stMarch 2019. As per the provisions of the Companies Act 2013 the remuneration payable tothe Cost Auditor is required to be placed before the Shareholders in a General Meeting fortheir ratification. Accordingly a resolution seeking members' ratification for theremuneration payable to the Cost Auditor is included in the Notice convening the AnnualGeneral Meeting.
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 2019 madeunder the provisions of Section 92(3) of the Act is attached as Form MGT 9 asAnnexure III which forms part of this Report and is also available on website at https://www.sunteckindia.com/financials.php.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company adopts good practices by using rainwater harvesting thereby lowering freshwater intake and reducing run-offs. The Company uses Dual Fitting Tanks and LED lightswhich reduces the burden on energy usage in the construction area. The Company uses steelproducts for rolling mills which saves considerable amount of natural resources and energyrequired to convert steel from ores. Fly ash and GGBS are the waste generated from thethermal power plant and steel plants respectively used in concrete which consumes wastegenerated by other industries and also produce more durable concrete. Sites are coveredwith G1 sheets which reduces the equipment noise and prevents dust getting blown up in airin windy days. The use of STP water for flushing and gardening reduces the burden onnatural water resources.
The details of foreign exchange earnings and outgo during the year under review is asbelow:
|i) Foreign Exchange Earned: ||` ||91741945 (P.Y. र11191983) |
|ii) Foreign Exchange Outflow: ||` ||154095427 (P.Y. र11976134) |
INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2014
During the year under review no case was filed pursuant to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013. Your Company has apolicy and framework for employees to report sexual harassment cases at workplace and theProcess ensures complete anonymity and confidentiality of information. The Company hascomplied with provisions relating to the constitution of Internal Complaints Committeeunder the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013.
COMPLIANCE WITH SECRETARIAL STANDARDS
Pursuant to the provisions of the Companies Act 2013 the Company has complied withthe Secretarial Standard on the Meetings of the Board of Directors (SS-1) and SecretarialStandard on General Meetings (SS-2) issued by the Institute of Company Secretaries ofIndia (ICSI) and approved by the Central Government under Section 118(10) of the CompaniesAct 2013.
The report on Corporate Governance and the certificate from the Statutory Auditorsregarding compliance with the conditions of Corporate Governance have been furnished inthe Annual Report and forms a part of the Annual Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis report has been separately furnished in theAnnual Report and forms a part of the Annual Report.
Business Responsibility Report
Pursuant to Regulation 34(2) (f) of Listing Regulations the Business ResponsibilityReport of the Company for the financial year ended 31st March 2019 is attachedas Annexure IV which forms part of this Report.
Investor Education and Protection Fund (IEPF')
Pursuant to the provisions of Sections 124 and 125 of the Act read with the IEPF(Accounting Audit Transfer and Refund) Rules 2016 dividend / interest / refund ofapplications which remains unclaimed / unpaid for a period of 7 years is required to betransferred to IEPF. Further the IEPF Rules mandate the companies to transfer all shareson which dividend remains unclaimed / unpaid for a period of 7 consecutive years to thedemat account of the IEPF Authority. Hence the Company urges all the shareholders toencash/claim their respective dividend during the prescribed period.
Accordingly during the financial year 2019-20 the dividend remaining unpaid andunclaimed for 7 years and shares pertaining to which dividend remains unpaid / unclaimedfor 7 consecutive years shall be transferred by the Company to IEPF. The Members /claimants whose shares or unclaimed dividends get transferred to IEPF may claim the sharesor apply for refund from the IEPF Authority by following the refund procedure as detailedon the website of IEPF Authority at http://www.iepf .gov.in /IEPF/refund.html.
The details of the unclaimed dividend along with the names and addresses of theshareholders are mentioned on the website of the Company www.sunteckindia .com.
ACKNOWLEDGEMENT AND APPRECIATION
Your Directors would like to express their sincere appreciation and gratitude for theco-operation and assistance from its shareholders bankers regulatory bodies and otherbusiness constituents during the year under review.
Your Directors also wish to place on record their deep sense of appreciation for thecontribution and commitment made by every member of the Sunteck Family.
| ||For and on behalf of Board of Directors |
| ||Kamal Khetan |
| ||Chairman and Managing Director |
|Mumbai 2rd May 2019 ||DIN: 00017527 |