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Your Directors have pleasure in presenting Twelfth Report on the operations of the Company together with the Audited Statement of Accounts for the financial year ended 31st March, 2014.
2. OPERATING PERFORMANCE & ONGOING PROJECTS:
Despite the challenging environment of the global as well as the Indian economy, the Company demonstrated the resilience of its business model. The highlights of the Company's performance are as under:
The Company achieved a turnover (net of VAT) of Rs. 26,712.81 Lakhs (on consolidated basis Rs. 39,728.13 Lakhs) during the year as against previous year's turnover (net of VAT) of Rs. 37,041.25 Lakhs (on consolidated basis Rs. 44,706.37 Lakhs) and has earned a Profit after Tax (PAT) of Rs. 2,854.86 Lakhs (on consolidated basis Rs. 2,890.35 Lakhs) as against previous year's Profit of Rs. 4,357.81 Lakhs (on consolidated basis Rs. 4,812.84 Lakhs).
The Company has been gradually moving from pure EPC to a mix of EPC & Asset Ownership. The Company's subsidiary, namely Manaj Tollway Pvt. Ltd. is executing a Road project at Hadpsar, Pune on DBFOT (Design–Build–Finance–Operate–Transfer) basis for Maharashtra PWD. The Company has also been gradually increasing its focus on real estate segment. The Company intends to develop real estate projects through joint development model by partnering with other established players. The Company is expecting to launch its mega real estate projects in Mulund, Mumbai in this financial year. Man Realtors and Holdings Private Limited, a wholly owned subsidiary of the Company is also executing development/ redevelopment projects in Mumbai.
Considering the performance of the Company in the current market scenario, your Directors have recommended a Final Dividend of Rs. 1.35 per share (i.e. 13.5 %) on the Equity Shares of Rs. 10/– each for the financial year ended 31st March, 2014. The dividend payout including dividend distribution tax for the year under review will be Rs. 711.12 Lakhs.
Further your Company has declared and paid an interim Dividend of Rs. 1.35 per share (i.e. 13.5 %) on the Equity Shares of Rs. 10/– each for the financial year 2014–15.
The Company's dividend policy is based on the need to balance the twin objectives of appropriately rewarding the shareholders with dividend and conserving the resources to meet the Company's growth.
A) MAN PROJECTS LIMITED (MPL):
MPL achieved a turnover (net of VAT) of Rs. 227.62 Lakhs as against previous year's turnover of Rs. 2,623.55 Lakhs and has suffered a net loss of Rs. 347.20 Lakhs as against previous year's Profit after Tax of Rs. 110.65 Lakhs.
B) MANAJ INFRACONSTRUCTION LIMITED (MAIL):
MAIL achieved a turnover (net of VAT) of Rs. 12,331.01 Lakhs as against previous year's turnover of Rs. 5,890.90 Lakhs and earned a Profit after Tax (PAT) of Rs. 863.07 Lakhs as against previous year's Profit after Tax of Rs. 143.75 Lakhs.
C) MAN AARADHYA INFRACONSTRUCTION LIMITED
On 2nd December 2013, the name of the Company was changed from Man Nirmal Infraconstruction Limited to Man Aaradhya Infraconstruction Limited. Man Aaradhya achieved income of Rs. 0.71 Lakhs as against previous year's income of Rs. 1.02 Lakhs and suffered a net loss of Rs. 0.44 Lakhs as against previous year's loss of Rs. 0.75 Lakhs.
The Company transferred 1000 shares (2%) of Man Aaradhya on 5th June, 2014; resulting in reduction in its shareholding to 98%. Man Aaradhya has now ceased to be a wholly owned subsidiary of the Company.
D) MAN REALTORS AND HOLDINGS PRIVATE LIMITED (MRHPL):
MRHPL achieved income of Rs. 32.22 Lakhs as against previous year's total income of Rs. 15.90 Lakhs and earned a Profit after Tax (PAT) of Rs. 17.87 Lakh as against previous year's Profit after Tax of Rs. 0.71 Lakhs.
E) MANAJ TOLLWAY PRIVATE LIMITED (MTPL):
MTPL achieved income of Rs. 65.80 Lakhs as against previous year's income of Rs. 2.05 Lakhs and suffered a loss of Rs. 26.29 Lakhs as against previous year's loss of Rs. 4.32 Lakhs.
F) MAN GLOBAL HOLDINGS LIMITED (MGHL):
The Company had incorporated MGHL as a Wholly–owned Subsidiary with Jebel Ali Free Zone Authority, UAE in order to look for growth opportunities in global arena. During the financial year under review, MGHL was voluntarily wound up pursuant to De–registration certificate dated 4th March, 2014 issued by the Jebel Ali Free Zone Authority.
G) AM REALTORS PRIVATE LIMITED (ARPL):
ARPL achieved income of Rs. 0.33 Lakh as against previous year's income of Rs. 0.36 Lakh and suffered a net loss of Rs. 0.07 Lakh as against previous year's Profit after Tax of Rs. 0.07 Lakh.
H) MANMANTRA INFRACON LLP (MANMANTRA):
On 1st April, 2014, the Company entered into a Limited Liability Partnership namely Manmantra Infracon LLP and became 63% partner along with the then existing partners. On 2nd April, 2014, the Company acquired further 10% share in Manmantra and became 73% partner. Thereafter pursuant to admission of new partners on 29th April, 2014, the Company's share was diluted to 60%. Manmantra is engaged in the business of real estate development.
The Company has availed exemption pursuant to the General Circular No. 2/2011 dated 8th February, 2011 issued by the Ministry of Corporate Affairs; from attaching the Annual Accounts of its subsidiaries vide its Board's approval on 29th May, 2014.
The Company undertakes that the annual accounts of the subsidiary companies and the related detailed information shall be made available to the shareholders of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies are available for inspection by the shareholders at the Registered Office of the Company and its Subsidiaries.
5. CONSOLIDATED FINANCIAL STATEMENTS:
The audited consolidated financial statements comprising of the audited financial statements received from subsidiary companies as well as audited financial statements of MICL, as approved by their respective Board of Directors, have been prepared in accordance with the Accounting Standard (AS–21– Consolidated Financial Statements) read with Accounting Standard (AS–27 – Financial Reporting of interest in Joint Ventures). As on 31st March, 2014, the Profit after tax and minority interest as per consolidated accounts is Rs. 2,890.35 Lakhs.
6. SUB–DIVISION OF EQUITY SHARES AND AMENDMENT TO MEMORANDUM OF ASSOCIATION:
With a view to broad base the investor base by encouraging the participation of the small investors and also to increase the liquidity of Equity Shares of the Company, the Board of Directors at their Meeting held on 25th June, 2014 had approved the sub–division of each Equity Share of face value of Rs. 10/– (Rupees Ten Only) of the Company into 5 (Five) Equity Shares of face value of Rs. 2/– (Rupees Two Only) each subject to approval of members. The Members of the Company have approved the said sub–division vide Postal Ballot, the results of which were declared on 12th August, 2014.
Further pursuant to sub–division of Equity Share of the Company, Clause V(A) of the Memorandum of Association of the Company was amended in order to refl ect the alteration in the Authorised Share Capital of the Company as aforesaid.
7. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
Your directors have constituted the Corporate Social Responsibility Committee (CSR Committee) comprising Mr. Berjis Desai as the Chairman and Mr. Parag Shah and Mr. Dharmesh Shah as other members. The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities.
During FY 2013–14, Mr. Rahul Raisurana resigned from the Board w.e.f. November 14, 2013 as joint nominee of Standard Chartered Private Equity (Mauritius) II Limited and Standard Chartered Private Equity (Mauritius) III Limited (hereinafter collectively referred to the "SCPE"). The Board of Directors places on record its deep sense of appreciation of the valuable contributions made by Mr. Rahul Raisurana as Director. Mr. Namit Arora was appointed as nominee of SCPE w.e.f. 10.02.2014.
Pursuant to provisions of Section 161(1) of the Companies Act, 2013 Mr. Manan Shah was appointed as a Whole–time Director of the Company w.e.f. 29th May, 2014 subject to the approval of shareholders at the ensuing Annual General Meeting. Mr. Dinesh Lal was appointed as an Additional Director designated as Independent Director w.e.f. 29th May, 2014 and Mrs. Shruti Udeshi was appointed as an Additional Director designated as Non–executive Director w.e.f. 13th August, 2014. Both, Mr. Dinesh Lal and Mrs. Shruti Udeshi shall hold office up to date of ensuing Annual General Meeting of the Company. The Company has received requisite notices in writing from members proposing the candidature of Mr. Manan Shah as a Whole–time Director and of Mr. Dinesh Lal and Mrs. Shruti Udeshi as Independent Director and Non–executive Director respectively.
The Company has received declarations from all the Independent Directors (IDs) of the Company confirming that they meet with the criteria of independence as prescribed both under sub–section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. The Board of Directors at the meeting held on May 29, 2014 has taken the same on record. The relevant provisions of the Companies Act, 2013 also provide that the IDs shall be appointed as such within a period of 12 months from April 1, 2014. Your Board has deemed it prudent and recommended to the Shareholders their appointment as ID for a period up to 5 years at the ensuing Annual General Meeting (AGM) and the Company has received requisite notices in writing from members proposing Mr. Berjis Desai, Mr. Sivaramakrishnan Iyer, Mr. Kamlesh Vikamsey, Mr. Dinesh Lal and Mr. Dharmesh Shah for appointment as Independent Directors. All IDs shall not be liable to retire by rotation. A brief resume relating to the Directors proposed to be appointed as Independent Directors is furnished in the Notice convening the Annual General Meeting. None of the above mentioned persons is disqualified from being appointed as a Director as specified in terms of Section 164 of the Companies Act, 2013.
Except Mr. Parag Shah and Mr. Manan Shah, none of the Directors are related to each other per se. Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Parag Shah will retire by rotation at the ensuing Annual General Meeting of the Company. Mr. Parag Shah, being eligible, has offered himself for re–appointment. The Board recommends his reappointment.
9. DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, your Directors confirm:
(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures;
(ii) that the Directors have approved such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March, 2014 and of the Profit of the Company for that year;
(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) that the Directors have prepared the annual accounts on a going concern basis.
10. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT:
The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements as set out by SEBI. A Report on Corporate Governance together with a certificate from M/s. Rathi & Associates, Practising Company Secretaries, Mumbai, regarding compliance of requirements of Corporate Governance pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges is annexed hereto and forms part of this Report. The Management Discussion and Analysis Report on the operations of the Company as required under the Listing Agreement with the Stock Exchanges is also annexed hereto and forms part of this Report.
11. INTERNAL AUDIT AND CONTROL:
M/s Aneja Associates, Chartered Accountants, Internal Auditors of the Company have carried out audit on various expense heads of the Company and site and inventory management. The findings of the Internal Auditors are discussed on an on–going basis in the meetings of the Audit Committee and corrective actions are taken as per the directions of the Audit Committee.
The Statutory Auditors of the Company, M/s G. M. Kapadia & Co., Chartered Accountants, Mumbai having Firm Registration Number 104767W shall hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re–appointment. M/s G.M. Kapadia & Co., Chartered Accountants have expressed their willingness to act as the Statutory Auditors of the Company, and furnished to the Company a certificate that their appointment, if made, would be in conformity with the provisions of Section 139 of Companies Act, 2013.
As per the recommendation of the Audit Committee, the Board proposes the re–appointment of M/s G. M. Kapadia & Co. Chartered Accountants as Statutory Auditor of the Company from the conclusion of ensuing AGM till the conclusion of the AGM to be held in the year 2017; subject to ratification by shareholders at each subsequent Annual General Meeting.
13. AUDITORS' REPORT:
The observations made by the Auditors in their Report read with the relevant notes as given in the Notes to Accounts for the year ended 31st March, 2014, are self–explanatory and therefore do not call for any further comments under Section 139 of the Companies Act, 2013.
14. COST AUDITORS:
In pursuance of Section 148 of the Companies Act, 2013 and Rule 14 of the Companies (Audit and Auditors) Rules, 2014, read with Companies (Cost Records and Audit) Rules, 2014, the Board of Directors of the Company, on recommendation of the Audit Committee, has approved the appointment of M/s Joshi Apte & Associates (Firm Registration Number 240) as Cost Auditors to conduct the audit of cost records of the Company for the financial year ending on March 31, 2015.
15. CODE OF CONDUCT:
Pursuant to Clause 49 of the Listing Agreement, the declaration signed by the Managing Director affirming the compliance of Code of Conduct by the Directors and senior management personnel for the year under review is annexed to and forms part of the Corporate Governance Report.
16. DEPOSITORY SYSTEM:
Your Company's Equity Shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As on 31st March, 2014, 4,94,78,603 Equity Shares of Rs. 10/–each constituting 99.96% of the total paid up capital of the Company were in dematerialized form.
17. FIXED DEPOSITS:
During the year under review, your Company has not accepted any deposits in terms of Section 58A of the Companies Act, 1956 read with the Companies (Acceptance of Deposit) Rules, 1975 and also no amount was outstanding on account of principal or interest thereon, as of the date of the Balance Sheet.
18. PARTICULARS OF EMPLOYEES:
In terms of provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, and the notification issued by the Ministry of Corporate Affairs dated 31st March, 2011, the names and other particulars of the employees are set out in the annexure to the Directors' Report.
19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE EARNINGS AND OUTGO: Conservation of Energy:
Conservation of energy is an ongoing process in the activities of the Company. The core activity of the Company is civil construction which is not an energy intensive activity. Your Directors have nothing to report as regards the disclosure of particulars of conservation of energy under section 217 (1) (e) of the Companies Act, 1956.
The Company has been efficiently using aluminum form work, shuttering materials, hi–tech vertical transport systems at various construction sites of the Company.
Information about Foreign Exchange Earnings and outgo
(i) Foreign Exchange outgo Rs. 0.06 Lakh as against Rs. 0.72 Lakhs in previous year on Revenue Account and Rs. 88.69 Lakhs as against ^ NIL in previous year on Capital Account.
(ii) Foreign Exchange Inflow Rs. NIL.
Your Board wishes to thank all shareholders for the confidence and trust they have reposed in the Company. Your Board similarly expresses gratitude for the co–operation extended by SEBI, BSE, NSE, NSDL, CDSL and other statutory bodies.
Your Board acknowledges with appreciation, the invaluable support provided by the Company's auditors, business partners and investors. Your Board records with sincere appreciation the valuable contribution made by employees at all levels and looks forward to their continued commitment to achieve further growth and take up more challenges that the Company has set for the future.
For and on behalf of the Board of Directors